The Coffee Business Opportunity in Mexico
Coffee is an integral part of daily life for Mexicans, present in 97% of households and consumed by 50% in the mornings, according to a study by Worldpanel by Numerator. The average annual consumption per household in Mexico is 2.1 kilograms, with frequent consumers drinking five cups a week.
Despite this, there’s a significant market opportunity, especially in locations near offices. In celebration of the International Coffee Day on October 1st, here are key considerations before starting a coffee shop.
Eight Crucial Steps to Opening a Coffee Shop
With 15,932 coffee shop units in Mexico, as per the National Directory of Economic Units (DENUE), a strategic approach is needed to differentiate and grow amidst fierce competition.
Alfonso Nava, a consultant and founder of Sukhafe, asserts that starting a coffee shop can be profitable, with an initial investment of around 350,000 pesos. However, selecting the right location and self-education are crucial beforehand.
Alfonso Nava’s Advice
“Don’t buy the coffee machine first; first, conduct a demand analysis to understand what type of machine is needed. Otherwise, you might end up with excess capacity.”
Key Considerations for Success
- Passion for Coffee: Your love for coffee will drive your business. Be a genuine coffee enthusiast.
- Strategic Location: Choose a spot with high foot traffic, preferably near offices or schools. In Mexico City, areas like Reforma, Condesa, Plaza Satélite, and Santa Fe show promising growth for coffee shops.
- Training: Acquire knowledge about the coffee business before starting. This could involve working in a coffee shop or learning from certified suppliers and experts.
- Hire the Right Team: Your staff will represent your brand and convey its values. Seek individuals who share your vision and values.
- Unique Selling Proposition: With numerous coffee shops, finding a unique selling point is essential. This could be a specific drink, serving style, or shop concept—like pink-themed cafes.
- Standardize Processes: Measure portion sizes and standardize procedures for easier pricing, profit, and loss tracking.
- Social Responsibility: Consumers increasingly favor businesses with social responsibility. Consider strategies to serve vulnerable populations or create an eco-friendly business model.
3. Patience for Profitability: Understand that the first two years may not yield profits, requiring reinvestment. Realistically, profitability might be achieved by the third year.
Emerging Trends in Coffee Shops
Alfonso Nava highlights the growing trend of coworking coffee shops that offer food services and stay options for a fixed price, appealing to young professionals seeking alternatives to traditional offices and home environments.
