SHOULD I OPEN A FRANCHISE COFFEE SHOP? 

Coffee is one of the most popular drinks in the world, especially in Vietnam. According to statistics of the Vietnam Coffee Association, in 2020, Vietnam consumed about 3 million tons of coffee, accounting for about 15% of global coffee production. With increasing demand, the coffee business becomes an attractive field with great potential.

However, opening a successful coffee shop is not easy. You have to face many difficulties and risks, from branding, store design, employee management, to attracting and retaining customers. A solution that many people choose to reduce these risks is to open a franchise coffee shop.

Franchising is a form of business in which you will be able to use the name, logo, products, technology and support of a brand. already have a reputation in the market to do business according to their model. Along with that, investors will have to pay a franchise fee or share a percentage of profits depending on the requirements of each brand. 

So should you open a franchise coffee shop or not? To answer this question, we need to consider both the benefits and risks of doing business in this form. Here are some points everyone should know:

I. Benefits of franchising coffee business

1. Save time, costs and effort in building a brand

When running a franchised coffee business, partners will not need to spend a lot of time, money and effort to build a new brand from scratch. You just need to follow the regulations and standards of the franchise brand and will be given the right to use the brand including many resources such as logo, menu, recipe, ingredients, etc. This saves a lot of costs on market research, brand identity design, copyright registration... and also does not require a lot of time and effort to build customer reputation and trust. trademark.

2. Own an existing customer base

When consuming and using products, customers will choose familiar, long-standing and reputable brands in the market. So instead of building a completely new brand that few people know about, running a franchise coffee shop will help you benefit from the brand's existing customer base. 

The pressure to find new customers or retain old customers will be reduced. Instead, as long as you maintain the quality of products and services according to brand standards, customers will automatically come to the shop. Investors can fully take advantage of the brand's spread to attract potential customers from other regions.

3. Simplify store design

Each brand when doing franchise business has a shop design concept according to that brand's identity standards including: design, floor format and shop interior. Investors do not need to worry about store design but just need to follow the general regulations of the brand. This helps save a lot of time and costs for hiring designers, construction, decoration...

4. Helps store operations become faster and more efficient

The franchise coffee business model will also help store owners shorten the time to learn, experiment and minimize unnecessary risks. A strict management process will help your shop quickly adapt to business stages, maintain stability in the face of market trends, changes, and customer needs, and minimize greatly affects revenue.

Operating the store is also much easier when franchised coffee shops are supported by the brand in the entire opening and operating process as well as in-depth training on bartending, updating trends and Solutions to help businesses grow. At the same time, concerns about raw material sources will also be resolved, quality exclusive products and preferential benefits only for franchise partners will also be applied. All types of machinery, equipment, tools... are equipped to help investors quickly start business.

5. Support for advertising and marketing activities

When running a franchised coffee business, investors will benefit from the brand's advertising and marketing activities. Stores in the chain will also be able to participate in advertising campaigns, promotions, events and take advantage of the power of the brand's communication channels and social networks. 

When a brand creates a good reputation in the market and communication campaigns resonate with the public, the business of all stores in the same chain benefits. 

Along with that, the development and investment in image communication, consistent product quality, and large coverage of franchised coffee shop chains will also help penetrate into customers' minds more easily. leading to the development of the "mother" brand in general and your coffee shop in particular.

II. Risks when running a franchised coffee business

1. Bear the general risks of the brand

When running a franchised coffee business, the shop owner will have to follow the regulations and standards of the parent brand regarding product quality, service, space arrangement, price, promotion, and marketing. 

This can ensure consistency and professionalism in business, but can also make it difficult for restaurant owners to adjust to the needs and preferences of local customers or new market trends. .

Besides, it will also be affected by the general risks of the parent brand, for example when there are incidents in product or service quality or the brand's reputation is damaged due to legal issues, moral or social. This will more or less affect the revenue and business operations of the entire system.

2. Personal color cannot be expressed

When running a franchise coffee business, the owner will not have much creativity and freedom in designing the space, decoration, menu or other activities of the coffee shop. You will have to follow the requirements and instructions of the parent brand, while also ensuring there is no confusion or conflict with other franchised cafes of the same brand.

This can make the coffee shop lack uniqueness and difference, unable to create its own mark and attract loyal customers.

3. Subject to internal competition

Because there will be many stores also operating under the franchise model of the same brand, competition between stores in the same area is inevitable.

Because some franchisors often set sales and revenue targets, if not achieved, it will affect the franchise contract. This leads to internal competition between stores no less than competition with other brands. 

III. Franchise Milano Coffee

1. A few words about the brand

Milano Coffee is a famous coffee brand in Vietnam, established in 2011 and now has more than 12 years of business and development experience in the market. 

Till now MILANO COFFEE There are more than 1865 stores nationwide stretching from North to South and are continuing to expand the market. Milano Highly appreciated by customers because of the product's relatively cheap price and extremely excellent quality. Customer segments are workers, students and office workers. With reasonable prices helps coffee Milano Coffee has the added bonus of becoming a favorite daily drink. 

Read more: "Formula 1.000" of the coffee boss Milano

2. Benefits of cooperation

Form of coffee franchise Milano Currently chosen by many people. Because, this form has many advantages and brings many benefits to business people. Compared to other forms of business, franchising Milano Coffee There will be many benefits for investors as follows: 

– Franchise criteria 3 No: No profit percentage – No additional costs – No sales targets

– Approve the premises before cooperation, ensuring the distance between points Milano Coffee The other is to preserve the system, standardize and limit internal competition. 

– During operation, franchise partners receive incentives from programs, commodity strategies, and large-scale supply chains of the company. Milano Coffee such as promotions, incentives when buying raw materials, accumulating points for gift exchange, etc. are held regularly and continuously. 

– Testing and new product deployment (R&D) activities are okay Milano Coffee share and notify in detail each period with the Franchisee. 

– Franchise partners are supported and updated on issues in business operations, maintenance, store upgrades, relocation support, premises conversion,...

– Franchise partners are supported and accompanied by local communication and marketing programs that not only increase competitive advantage and brand recognition coverage but also bring new breezes and attract customers. compared to other competitors in the region.

Read more: What helped? Milano Coffee Maintaining its reputation after more than a decade

With the information about coffee franchising above, we hope to help you answer the question: "Should I open a franchise coffee shop?" There will be benefits and limitations, so future shop owners should weigh, compare and make the most suitable choice for themselves. Good luck!