Starting and Owning a Mobile Coffee Van Business
Starting and owning a mobile coffee van business might be a great alternative to a coffee shop. But, what is involved, what is it really like, and would you enjoy running a coffee truck?
A beginners guide for starting a mobile coffee van business including plenty of handy tips. The guide is complete with a podcast interview with the owner of a new coffee business. It has been written by business mentors, in a simple way to help boost your business knowledge quickly.
Why would you buy a coffee van business and not a Cafe?
There are always cafes or coffee shops for sale, sometimes at attractive prices. Often you would be buying “a going concern” that rents premises and not buying any real estate. The price of some coffee shops is therefore, similar to buying a mobile coffee van, so which is best?
A cafe will have a commercial lease and is in a fixed location.
Tip: A lower lease amount usually equates to lower foot traffic and may explain why the previous owner is selling.
It’s always worth investigating why a previous cafe has not worked in the location. Do not rely on the reason a commercial real estate agent tells you and do your own investigation.
A poor location will probably always be a poor location. Customers are lazy and often will not walk down side streets or out of the way places.
A cafe must have enough passing traffic to succeed.
Commercial leases tend to be for several years with options to renew and maybe a significant legal and financial risk.
Mobile coffee vans give more flexibility with no long-term commercial lease. However, suppose you finance your coffee van with a loan or purchase a franchise. In that case, you will have a longer-term financial and legal commitment to consider.
Coffee vans may be more attractive to those seeking a more “lifestyle” business rather than a bricks and mortar shop.
Operating a coffee van business may have service and licensing costs that coffee shops do not have, so these need taking into account.
Coffee vans can go to different locations such as sporting events, markets, and tourist attractions, providing an advantage over a cafe in a fixed location. In addition, mobile coffee shops can “follow the customers” and change locations whereas shop is fixed.
Visit shows, sporting events or a busy metropolitan area, and you will spot a huge variety of mobile coffee van businesses.
What is a coffee van?
A coffee van can be a light commercial van, truck, cart, trailer, or caravan converted into a mobile cafe.
There is no standard definition of a van, but generally, it is an enclosed motorised vehicle for carrying goods. For some people or in certain countries, the term van can include box-type trailers.
Here in Australia and the UK, the word “van” can also be shortened version of the word caravan to confuse matters! Some cute caravans also get reborn as mobile coffee shops too.
In some countries, like the USA, they may be called coffee trucks, coffee trailers or coffee carts.
In essence, think of a van as primarily a box shape suitable for hauling commercial cargo.
The medium sized vans such as the Volkswagen Transporter, Ford Transit, Toyota Hiace, Renault Traffic or Hyundai iLoad are common platforms.
Often these vans will be diesel-engined. The bodies come in various lengths and heights. Some van configurations are tall enough to stand up inside the cargo area.
Some franchise coffee vehicles are branded and have a standardised setup. Other independent van owners are more creative and artisan-inspired.
How is a coffee van different to a food van?
There are some subtle but significant differences to the design and fit out of a food truck or coffee van.
The main difference is that coffee vans carry coffee making equipment rather than cooking equipment.
A food van is more of a mobile kitchen and is generally considered a higher food safety risk.
In some jurisdictions, the sale of food or drinks is regulated for food safety. For example, operating a coffee van may require a different licence than food preparation.
Coffee vans, therefore, usually carry a more limited range of pre-prepared or packaged food items.
You must check any laws or regulations in your area before operating a mobile coffee or food business. Regulations can be at the state and local council levels.
You will need to have certified training to prepare food, and a food van may need to meet compliance standards as a mobile kitchen.
It is also important to display your certification, which is often a legal requirement.
How to choose the right coffee van?
The first question to start with is whether you want a van or a trailer?
Whichever you choose, you need a secure parking arrangement, convenient for cleaning and restocking. You will need a daily routine to clean, sanitise and stock your van. You may also need to do some periodic maintenance too.
Your home base needs access to power, food storage, refrigerated stock, hot water and cleaning materials to make life much easier.
Some fit-outs allow for the barista(s) to be inside the van, while other layouts mean the barista stands at the rear of the van to prepare coffee.
So check if its height will be an issue for your parking at home base? After all, it probably won’t fit in normal garages if you can stand up in it.
On the other hand, a trailer may need reversing in or out, which needs some practice to master. Trailer heights may also be taller than residential garages.
A dedicated motor van may be a bigger investment as you are essentially buying a roadworthy vehicle plus its conversion cost.
A trailer may have lower costs as you are not paying for the engine and running gear etc. Its ongoing maintenance costs will also be lower as it doesn’t require as much servicing, and it may only have two tyres to look after.
A trailer purchase assumes that you have a suitable vehicle to tow it.
Some people find towing a reversing a trailer challenging so take this into account.
Your accountant can give you specific advice on what costs you can claim for both options.
Should you buy a new or used coffee van?
Another consideration is whether you want to buy a new or used coffee cart?
If you are buying new, considering the vehicle warranty, servicing costs, weight capacity, size, and driver safety features is important.
Adding the cost of its fit-out to the on-road cost will help you get a more accurate estimate of the total cost. The resale value of the base vehicle is also a factor as some brands will cost more initially but will hold their value much better. Don’t forget to include signwriting in your costs.
You may need to budget for new signwriting or van wrapping unless you buy a going concern with a used van.
A used van could save a substantial amount. Remember to assess a used van against two criteria. Firstly the condition and value of the base vehicle. Secondly, the condition and suitability of the fit-out for your needs.
Having the van checked by a mechanic and the coffee machine distributor will be a good precaution.
Your van is an essential business tool that must be reliable and efficient.
Your accountant will give you advice on the merits of used versus new.
What skills do you need to run a coffee van business?
It goes with saying that your barista skills need to be very high. Coffee customers have become increasingly sophisticated in their taste over the last ten years. So providing an ordinary coffee experience will get you nowhere. In the podcast, Ben explains more about his training and how his taste matured.
You will need other skills to operate your business, such as confident driving and parking skills. In addition, manoeuvring a van or trailer takes practice.
Physical work includes lifting supplies in your home base storage and van, as well as cleaning tasks.
Having a friendly, positive customer manner will also help.
Great attention to detail will ensure your van looks immaculate and your customers get a high standard of service.
There are other hidden skills that you need that are not obvious:
- finding new or better locations to grow your business
- being very organised to keep track of upcoming venues and the stock you need
- doing maintenance to keep everything working at its best
- keeping track of your bookkeeping
- making sure your income and expenditure are balanced
- marketing your business to find great set up locations
- staying up to date with compliance and insurances
Should you start or buy a coffee van business?
Buying an existing coffee business can have benefits. Everything should be ready for you to take over and make money.
Starting any business seems simple, but it all takes time and cash-far more than most be people imagine.
The asking price of the business will include the van, equipment and stock. These can be relatively easy to value based on internet searching of used equipment.
The asking price will also most likely include an amount of “goodwill” for the value of the established business. For example, the brand name, website, introduction to customers or venues. Goodwill values can be tricky to calculate. However, the seller has built up many customers and venues, which may give you a good start. Remember, though, that there is no guarantee that those customers will be loyal when you take over.
Negotiating a good handover where you work with the seller and meet your customers may help cement the relationship.
When buying a coffee van business, it is best to get good advice from your accountant and lawyer.
Get specific advice if you consider entering a franchise as a contractual agreement will bind you, irrespective of how well your business does.
Coffee van fit-out and costs
Fitting out a coffee van is specialised work. A reputable fitter will have plan layouts for the more common commercial vehicles. Their plans will help you decide on the best layout for ergonomics and maximise space inside the van.
A professional outfitter will ensure the weight of the equipment is evenly balanced to avoid bad handling or road safety problems.
Here’s a link to a van fitter with indicative prices–Coffee Van Fit-out
Choosing the right coffee equipment is crucial, but the power supply, storage, and how easy the van is to clean are also important.
After a long day serving customers, you don’t want a van that takes ages to clean.
Once your van is parked and ready to work, you will need access to electrical power, which can come through hooking to a mains supply or a generator. If you are carrying a generator, then have a dedicated storage locker will be safer.
Your van conversion may need to be certified by an engineer for compliance and insurance purposes. Check this out before your purchase a van. Your council may also need to certify the van before use.
How many coffee vans are there?
There are no meaningful statistics about the number of coffee trucks, but the number seems to be growing.
Perhaps it’s the drive for people to own a lifestyle or part-time business.
Several franchises are also actively fighting for a market share of coffee lovers.
What is a drive-through mobile coffee van?
In Melbourne, some side streets are designated for drive-through where customers can queue. For example, the coffee van operator takes orders and cash from a line of customers who wait in their vehicle for their coffee.
How much should you charge for coffee?
Working out how to charge means you have to take several things into account:
- the cost of the ingredients
- the cost of the labour
- your indirect costs
- the number of coffees you expect to sell
- the market price
You can calculate the cost of ingredients and labour directly used to make a coffee by some arithmetic. Include the coffee, milk, sugar, cup and lid because they sell as a unit.
The cost of small, medium and large will be different.
Remember that your coffee and packaging prices will be wholesale, and your need to add GST into your selling price.
The fixed costs are a little more tricky. Fixed costs are such as insurance, maintenance, electricity at home base, cleaning products etc.
Add these all together and divide them by the number of weeks you plan to work.
You must sell enough coffee every week to cover all your costs and make a profit.
The market price limits how much you can sell a coffee for.
Your accountant will help you determine how many coffees or kgs you need to sell to break even. This means you have covered all your costs.
What you sell beyond the break-even becomes profit.
Where does coffee come from?
We think of coffee as the end product or a cup of hot delicious flavours arriving just when needed. But, what is coffee, where does coffee come from and how does it get to you? Having superior product knowledge will help you engage with your customers. Hopefully, this helps them to remember your coffee van business and come back again.
Coffee comes from the pips inside the cherry-like fruit of the tropical coffee plant. The flavour of the soft, green harvested pips has no resemblance to roasted beans. Incidentally, they are called a bean because they look like a bean.
Coffee plantations are around the globe between the Tropics of Cancer and Capricorn. Brazil accounts for nearly half of the world’s supply.
There are two major commercial varieties called Arabica and Robusta.
Arabica accounts for about 60% of the market and Robusta the balance.
Interesting Robusta typically has higher caffeine content.
Coffee beans are a natural product that can vary from different soils, climates and trees.
Why are coffee beans roasted?
Coffee beans are picked and stored green, at which stage their flavours bear no resemblance to those imparted by the roasting process.
Heating green beans initially drives off the water they contain, making the beans harder and yellow. Continued heating causes chemical changes in the starches, sugars and fats that create flavours, and caramelisation makes the beans brown.
Depending upon the heating oven, temperature profile and time, different flavours emerge. This is why you will find light, medium and dark roasts as more heating causes more caramelisation.
Why are coffee beans blended?
Coffee beans are a natural product, and blending different beans can produce a unique blend flavour.
Customers love consistency and will stick to a blend they like. Therefore, blending beans enables a coffee roastery to produce its unique brand range. Blending also enables master blenders to cope with the natural variation from different bean sources by adjusting the blend, so the overall result is consistent.
Why are coffee grinders crucial for a good cup?
The roasted bean contains exquisite flavours, but how do we get to taste them? The chemicals that reach our tastes buds are soluble in water.
Grinding the beans increases the surface area of the beans and allows the hot water to extract the flavours as it passes through the grind. Thus, grinders are an essential part of the coffee experience.
The fineness of the grind is another part of the puzzle for the ultimate coffee.
High-quality grinders cope with a variety of fineness, but most importantly, they perform consistently. Poorer quality grinders may give varying results, particularly as they wear through use. Also, if the grind size fluctuates, so will your finished coffee. Therefore, when selecting a grinder for your coffee van business, try to get the best you can afford.
Which coffee brand should I buy?
Customers know good coffee and will not tolerate poor standards.
Buying high-quality beans from reputable roasters is the way to go.
The best coffee beans come from countries such as Ethiopia, Brazil, Colombia and India.
Wholesalers will buy beans, blend and roast them to achieve particular flavours. Additionally, the roasters may have access to excellent quality single source beans for more unique and distinctive flavours.
It is vital to buy the best quality coffee you can as that is your core product. In addition, coffee drinkers have a sophisticated palate and will detect poor beans or roasting.
A consistent supply of high quality roasted beans is a must.
You may wish to consider whether your supply chain offers organic and fair trade options.
Finding a good supply and sticking with it helps establish a consistent brand offering to your customers.
The roaster may be able to advise you on brew recipes that help you provide a consistent high standard of coffee to the end customer.
What is a coffee brew recipe?
It is essential that you can reliably and consistently produce high quality coffees. To achieve this following a recipe is required. A brew recipe is the roasters guide recipe on where to start. Typically the brew recipe will give you a target dry weight of ground coffee, a basket size and a target wet of the extracted coffee.
By doing some trial and error experiments You can fine tune the brew recipe to Your particular equipment.Each time you produce a trail cup, keep detailed records so you can track your results. Here’s a an example table to record your test brew recipes.
|Coffee Bean||Grinder Setting||Basket (g)||Dry Dose (g)||Extract Time (sec)||Wet Weight (g)||
You can trial various grinder settings and use accurate scales to weigh the ground weight you produce. Using a timer for the time it takes to extract the coffee is recorded along with the weight of the extracted coffee. The tamp pressure must also be consistent to ensure the ground coffee always offers the same resistance to the hot water.
Tasting the extract will indicate whether you have a well balanced flavour or if the settings procude an over or under extracted coffee. This is great method to learn how your equipment behaves.
What else can you sell with coffee?
You can increase your sales income by “upselling”. You do this by adding items that customers might buy in addition to coffee. This could be, for example, snacks, cakes, confectionery or cold drinks. Upselling is a tactic to increase your sales income through very little effort as you already have a customer. You entice the customer to spend more.
Remember to check what you are permitted to sell under your licence.
Will a loyalty card increase your coffee sales?
A loyalty card can be a simple business card with room on the back for you to make multiple stamps of your logo. A bunch of business cards and a small self-inking stamp can increase your sales. Customers love a discount, and a loyalty card might entitle them to a free coffee once they have visited you enough times to fill the card.
Encouraging repeat customers is good business sense as it helps build your brand recognition. In addition, building rapport with customers makes them feel more valued and comfortable.
How many hours do you have to work in a coffee van?
How long is a piece of string? The more coffee you sell, the more income you make. In general, you need to budget and work out how much you plan to sell and how many hours you need to work.
As in all businesses, many activities are going on behind the scenes.
Being in your van and serving customers is the obvious activity, but some hidden ones are:
- driving to and from your selling site
- setting up and packing up from your selling point
- working out your stock and maintaining your inventory.
- ordering or getting your stock from suppliers
- doing equipment maintenance
- disposing of waste
- cleaning and sanitising the van and equipment
- marketing to promote your business
- business administration and bookkeeping
So when working out how many hours you need to work, factor in these hidden tasks. Again in the podcast, Ben gives some good tips on approaching the business admin.
You also have to work out when it is worth your while to be at a location to avoid wasting time. For example, if your serving commuters the peak hour are busy and in between is not. If you serve a sports event being there too early may also be a waste.
Is a coffee van business a steady income?
Establishing what you need to earn from your business and the frequency you need income is important.
Many businesses are subject to seasonal peaks and troughs. Therefore, achieving the same sale every week or month may be challenging, depending on your season. That doesn’t mean that you couldn’t achieve a predictable income by some basic planning. Having a realistic understanding of the seasonality and building that into your business plan will avoid you having a nasty surprise.
Here are some examples of things that cause seasonal peaks and troughs:
- summer/winter habits that increase or reduce hot drink consumption
- holiday times such as Christmas
- school holiday periods
- public holidays
- sports seasons
- weather events, e.g. a wet season or snow season
Putting a detailed monthly sales plan together will help you plan your cash flow and earnings.
Another important factor in achieving a steady income is consistently showing up. If your van doesn’t show up at its regular spots, then your customers will go elsewhere.
Where do I find customers?
There are some general guidelines for finding new customers. Ideally, you are looking for large groups who don’t have easy access to coffee shops.
People love convenience! Find locations that are convenient for consumers, and your success will be higher. For example, you could target commuters, shoppers, tourists, sports fans, parents or music lovers.
Booking early at events and markets gets you into the best spots before your competitors and gives you time to prepare.
Developing a regular weekly schedule will minimise your driving and allow you to build rapport with regular loyal customers.
Minimising driving and maximise your selling time is key.
Is a coffee van a good part-time business or lifestyle business?
A coffee van is a good lifestyle business for some people. Some owners focus on weekends or events and have free time or part-time jobs in the week. Servicing commuters or industrial areas means early starts and weekday working.
Whichever market sector you choose to focus on, develop a flexible routine for all the tasks that don’t involve serving customers. Adjust your business plan accordingly, so you predict your income and cash flow.
How many coffee types should I offer?
Coffee consumers have become more sophisticated and demanding.
As a result, there are many coffee styles and milk options to offer.
- Flat white
- Espresso or Short Black
- Long black
- De-caffeinated Coffee
These coffee alternatives derive from the short black with varying amounts of milk and steam milk froth. Here’s a good explanation of the differences in the coffee menu.
Different varieties may demand slightly more time to make, but don’t essentially change the stock you need.
The increase of food intolerance means a wider choice of kinds of milk is needed.
De-caffeinated coffee is also a useful addition for customers who love coffee but wish to avoid caffeine. The Swiss water treatment method uses water and not any organic solvents.
- Full cream milk
- Low-fat milk
- Soy milk
- Almond milk
Carrying a variety of milk does increase the stock you need to hold and carry. Longlife varieties of soy and almond may assist.
Adding flavours such as amaretto can also be used as an upsell technique.
Keeping track of your sales and customer requests will help you focus.
Avoid wasting stock by trying to cater for every possible eventuality.
Why are there long queues at coffee trailers?
Your coffee production is limited by the speed of the barista, the coffee machine and the ergonomics. Once you reach the output limit, you operate at your vans maximum capacity, and queues start to form.
Suppose you have two people available, one being the barista and one taking orders and payment. In that case, it is probably the best you can do. The critical thing is to ensure the barista has all the stock at hand and not waste any time.
Having an order point and a different collection point will help keep the flow of customers moving and not clog the working space you have.
Suppose some items in an order are ready before others. In that case, it might be better to get the whole order ready before calling the customer forward. This may help avoid confusion and keeps the flow going.
Can competitors smell your coffee van business success?
Your competitors are mobile cafes too, and no doubt they are hunting for sales. If competitors encroach, your customer loyalty and brand can help.
Building any business is about building a brand that customers recognise and value.
Consistent high quality of product and service supported by a friendly staff is important.
Using the same quality coffee and branding means your customers know what they get. On the other hand, customers may not be loyal if you constantly shop around and change your supply chain for the lowest price.
Competition is always present, and keeping a cool head and customer focus is the best defence.
Should you buy a franchise or go independent?
Coffee van franchises can look attractive. You get a ready-designed and sign written van and an out of the box business ready to run. Trading under a brand name and having a team to support you should help.
Franchises have slick presentations to sell franchises to people like you. They are masters at highlighting all the positives of buying into their franchise.
But what about the negatives of buying a franchise?
There are some major negatives such as:
- whether your personality and mindset are suited to being a franchisee
- high fees that you may have to pay
- franchises generally do brand marketing and you still have to do your local marketing
- the cost of materials that must be bought through the franchise might be higher than you can buy direct from a supplier
- some franchises set territorial limits on where you can trade (eg. a postcode)
- franchises are often inflexible
- your agreement may be for a limited duration
Franchises don’t like mavericks. They want followers who don’t question too much and pay their fees. If your personality and mindset do not fit this follower persona, perhaps a franchise is not for you.
Beware of franchise fees and additional costs.
Franchise fees are paid in various ways but result in a higher cost base than an independent business. Therefore, it only makes sense to pay fees if they give you a significant return; otherwise, they eat your hard-earned profit.
Often franchises charge an additional marketing fee to promote the brand. You may still need to find your customers and spend time and money doing that. Unless a franchise gives you detailed information on how they spend the marketing fund, keep away from them.
If a franchise agreement requires you to buy materials from them, be careful. You may end up paying more than buying direct from wholesalers, which can further eat your profits.
Often when you purchase a franchise, you will have a territory. For example, it might be a state, a postcode or bounded by specific roads in a city.
An independent business has no territory and can search out the best locations.
Franchising is essentially leasing a business for a defined period. At the end of that period, you may have to pay to renew the lease again.
Joining a franchise means you are paying fees and reducing your flexibility. Signing a legally binding agreement means there is an external influence in your business. Only do this if there is a compelling business reason.
Do not believe that franchises are less likely to fail than independents. Franchise chains might not fail very often, but their independent franchisees can fail like any other business.
A franchisor put its shareholders first, not its franchisees.
It is essential to get legal advice before buying into a franchise so that you understand your obligations.
Why are ergonomics and lean efficiency so important in a coffee van?
What on earth has lean manufacturing got to do with coffee vans? The answer is everything.
Your income is directly linked to the number of coffees and upsells that you can make.
Let’s assume you had a constant line of customers over 4 hours and you could make and sell a coffee every 2 minutes. So you could make 4 hours x 30 cups per hour = 120 cups.
Supposing you increased your efficiency to make a cup every 1 minute, you would double your income!
The skill and speed of the barista is core to maximising your profit.
While each barista has achieved their level of output, several external factors influence their performance.
The ergonomics of the van so that they don’t waste time or energy by looking for things, reaching or moving about unnecessarily.
Having the right amount of coffee, milk, sugars, and extras also means they never decline a sale because they have run out of something.
If the barista has to waste time taking orders, taking payment, replenishing stock, and hunting for items, efficiency plummets.
Designing a van properly for lean operation makes perfect sense.
The lean thinking extends to all aspects of the van and your home base.
For example, the speed and ease of cleaning and replenishing the van is important as these tasks soak up your time at the end of the day.
How do you kanban storage to never run out of coffee stock?
One of the simplest and most effective stock systems is to combine visual management and kanban.
You can apply this in your home base and in your van too.
Firstly, only stock items you need as everything else is considered a waste. This is because stocking things you don’t use is a waste of time, cash and space.
Arrange the things you need in neat rows so that all your stock is visible.
You place the oldest item closest to you, which means you naturally will rotate your stock, avoiding wasting any stock that goes out of date.
Open shelves are great for this, but you can also do it in cupboards and drawers.
Why does simple visual stock management work best?
This visual approach means you can see your stock level at a glance without hunting through cupboards or boxes. Instead, you can visually see which items are getting low and need reordering.
Visual management means not wasting time entering stock into a computer system and keeping the computer stock accurate.
The kanban aspect is also beautifully simple.
For every item, decide how many you want to have in stock at any one time. Then, check how many items you have to order and how long it takes to get them delivered.
Do this for every item such as cups, lids, stirrers, napkins, sugar sachets.
You use one carton of coffee per week.
It takes one week to get a new carton delivered.
You decide to have a kanban trigger point of three cartons on the shelf.
Whenever you get down to 3 cartons on the shelf, place an order for a new carton. When the carton arrives, you should still have two unopened cases.
When there is a special on coffee, you might buy extra cartons to take advantage of a good deal.
As You quickly get through the stock, you might increase the stock to 5 cartons in busy periods.
Again, a simple list of all your items and their kanban trigger point will help you:
- minimise your cash tied up in stock
- avoid waste by items going out of date
- ensure you don’t run out of critical items when you need them
- save time and stress by overthinking
How do you cope with coffee van maintenance?
Maintenance of some sort is inevitable, and how do you cope with it?
Firstly let’s split maintenance up into different sorts.
- Vehicle or trailer servicing and roadworthy testing.
- Equipment maintenance.
- Compliance maintenance.
- Daily or weekly routines.
A motorised van will require periodic maintenance similar to any car. Lubricants, Oils, fluids and brakes are examples of what must be checked and periodically changed. The van manufacturer will have a schedule based on kilometres (or miles) travelled. Periodic roadworthy inspections of your van or trailer may also be needed.
Some of your equipment may also require regular servicing. For example, generators, water filters or the coffee press may need a service at a time interval or perhaps after a certain number of hours of use.
Other items might require daily or weekly checks to make sure they are working correctly, for example, any safety equipment or switches.
The easiest way to deal with maintenance is to have a plan and some basic records. The matrix (paper or digital) helps you choose the best time to do things to avoid any income loss. For example, you don’t want to be motor servicing in the middle of a peak season. It also helps you to budget the cost and cash flow of maintenance.
Whether in a book, a spreadsheet, or an app, some basic records will help you keep on top of everything.
Simple and effective maintenance avoids breakdowns and loss of income. It also means you don’t let your customers down.
Maintenance records will also help with getting a good resale value when you want to upgrade your setup. Records may also help you will any compliance checks.
What is waste in a coffee van business, and how can you avoid it?
Waste can be physical items such as milk or out of date pre-packaged food. “Lean thinking” also considers the waste of time, power, space, and cash resources.
Driving long distances adds fuel and wear and tear costs. In addition, you cannot make a sale while driving, so it is a wasteful activity.
Waste has a direct impact on your profit. Waste means you have increased your cost and not increased your sales. Wasted resources also mean you may have lost the opportunity to make more money because you were inefficient.
Waste has a negative environmental impact because the resources used to make something got thrown away.
Paying attention to waste makes good sense on every level.
Measuring and tracking a few things will give you some data.
- How many coffees or kg you actually sold versus what you could have made?
- How much milk have you thrown away?
- Which size of coffee cup is most popular?
- Which products are most popular and profitable?
Avoiding waste is a combination of two things:
Firstly, only ordering the minimum amount of perishable stock that you can sell.
Secondly, working accurately and efficiently minimises waste from making the wrong items, spills or using varying quantities of ingredients.
Both require some practice and good work routines.
Cleaning is essential for food hygiene compliance.
Good cleaning routines means that you will not have complaints or compliance issues. Customers will notice things that you don’t because they see things from a different perspective. While they are waiting for their order, they may gaze at your setup, and they have time to notice things you don’t. When you are busy, your focus is on serving customers.
Develop your coffee van cleaning plan in three tiers:
1 Clean as you go.
These are the simple tasks you do as part of your coffee making routine. For example, placing empty milk containers in a convenient bin avoids clutter and keeps your workspace tidy, hygienic and safe.
2 Daily Clean
Daily tasks might be done when you return to home base and include emptying bins, liquid waste bottles, sanitising the fridge shelves, surfaces and the floor.
3 Periodic Clean
You set periods (weekly or monthly) when you carry out a deep clean, which might mean moving equipment to reach the more hidden areas.
A simple cleaning record reminds you or your team of “what and when” is a good idea. In addition, cleaning records help you train staff and can demonstrate compliance if needed.
Signage, branding and vehicle wrapping
Creating a distinctive brand, logo, and signage can pay dividends.
Choose clear and colourful signage that stands out. Unfortunately, passing motorists have not got time to study intricate designs for cursive fonts.
Get noticed and keep it simple. Vehicle wrapping can be very cost-effective for marketing and advertising.
A consistent design for signwriting or wrapping your van and portable A-frames is simple and effective advertising.
Cash and cashless payments for coffee
Taking cashless and cash payments means you are covered for either eventuality. Cashless payment options are now common and accessible for small businesses. It is worth comparing a few providers are their fees vary. Some options use dedicated terminals like EFTPOS, whereas Square uses readers linked to phones or tablets.
At markets and events, cash may be more common than in a business park. A small cash float will also mean you don’t lose any sales for those that still find cash best.
Keeping your bookkeeping simple
Keeping on top of your bookkeeping is the best way to stay in control of your business. There are free or paid options that you can use. Here’s a comparison of some common free bookkeeping software and apps in Australia.
Setting up a separate bank account and credit card (or debit card) for your business will keep business money segregated. Avoid spending personal money from your business account and vice versa.
A simple spreadsheet can get you going, although some good online software/apps can simplify life. Some are affordable and allow things like scanning receipts.
It’s important to record all the money that comes into your business or gets spent by your business.
Placing clear written purchase orders with your suppliers is a good business practice. Emails are great for this and provide a record if any goes wrong with a delivery.
Which coffee making equipment is best?
Your mobile cafe income relies on it working efficiently and consistently.
Stick to reputable and long-established coffee equipment suppliers such as:
- Mazzer grinders and dosers
- Wega Coffee Machines
- Synesso hand-built espresso machines
- La Marzocco handmade coffee machines
- Anfim grinders
- Mahkoenig grinders
Good quality brands will have spare parts and service agents should you need them.
In a van, space and power are limited so its better to consider the 10 amp single head machines which also have a smaller footprint than their full-size siblings. The La Marzocco Linea Mini is a good example.
What equipment might I need to buy for my coffee cart?
Apart from the coffee making equipment, You may choose additional equipment. For example You may choose to offer Ice Coffees or Smoothies in summer, which will require ice and a blender.
|Grinder||Blender||Fridge||Sandwich Press||Payment terminal (Eftpos)|
|Water pump||Food warmer||Lighting|
What size generator do I need for my coffee truck?
Having a van that can be connected to mains electricity or have its own generator power source gives you most flexibility for different venues. In case you are wondering, a solar generator is not a practical option given how power hungry the appliances are.
Generators can be petrol (gasoline) or diesel powered. They vary in size from small suitcase to giant industrial size. There are some basic factors to take into account:
- how much power you require when the equipment is running
- how much power you need when the appliances start up as they surge to get going
- the noise produced by the generator
- the dimensions and where the fuel will be stored
- the cost
To work out the size of generator start by making a list of all the appliances you will have. For each one check it’s specification for the wattage it uses for start up and running.
TIP – if possible listen to a generator running. The noise output in decibel dB is a logarithmic scale so a small difference in number can be a big difference in noise. Cheaper units are more likely to be noisy.
TIP- get help choosing a generator as they have optimal loadings so getting the correct size for the job is important.
TIP – using 10 Amp appliance options will help keep the cost of the generator lower.
How big should my water tanks be on a coffee trailer?
Having your van set up to use either mains water or an on board tank gives you most flexibility.
Food safety regulations will require that you use potable water. Some quick arithmetic will give you an idea how much water you will need for coffee production. You may need some extra for other drinks or cleaning too.
A grey water tank is also a requirement. A ratio of 3:2 (potable water : grey water) is a good rule of thumb. Hopefully most of the water is sold via the coffee machine!
So, a 90 litre potable tank and a 60 litre grey water tank would be an example of 3:2.
What insurances do I need for my mobile cafe?
You will need the necessary insurances for your vehicle or trailer, such as CTP. You can also add comprehensive insurance and contents insurance for additional cover for damage, fire and theft.
As your business is serving the public, a public liability insurance policy will be required.
In Australia, workers compensation is needed to protect you or your workers.
An insurance broker will help you choose the best policies and quotes.
How do I choose cups for my coffee van?
Cups come in espresso, small, medium and large and a plethora of options.
Espresso 4oz or 112ml
Small 8oz or 245ml
Medium 12oz or 340ml
Large 16oz or 450ml
The cup options include fluted or plain walls and a variety of colours.
Branded cups can be printed for an additional cost. Lids also can be ordered with closeable openings or push buttons.
Choosing cups is not just about price but also your brand essence.
If you serve organic, fair-trade coffee, then the choice of cup and lid materials should complement your offering. But, again, recyclable and sustainable options are available.
Recycled and paperboard tray options are available too. Again, Biopak has a large range to choose from.
What is the best business structure for your coffee business?
Your accountant or lawyer will help you determine which is the best option for your circumstances.
Operating as a company may incur more costs but may also provide you with more personal asset protection.
Your accountant will also be able to advise you on the tax deductions you can claim through your business.
If your sales are more than $75,000 per annum, you must register for GST and make returns. Again, your accountant can help with this.
It’s important to get professional advice before entering any contractual, franchise or loan agreements.
Suggestions to make running a coffee van business easier
A simple cleaning schedule.
- A matrix of tasks and daily/weekly/monthly can act as a reminder and a record that tasks are done.
Stocklist and Kanban trigger.
- A list of every item you need, the supplier price and how long it takes will save you from stock-outs.
- Arranging your stock for visual management saves time.
- A matrix of everything that needs servicing and when will keep you operating.
- Cashless payment system.
- Cash box and float for the van.
- Simple tracking of your sales and costs
- What items are selling well?
Running a mobile coffee van business- key questions and answers interview.
Starting and owning a mobile coffee van business might be a great way for you to own a business. But, what is it really like, and would you enjoy running a coffee truck?
To help answer that question, we interviewed Ben, a mobile coffee van business owner in Melbourne, Australia.
Ben takes us through his journey from the initial idea of starting his mobile cafe to juggling a thriving “side hustle” with a full-time job.
Ben shares some of the challenges he has faced and the most and least rewarding facets of owning a coffee cart business.
Why did you choose to start a mobile coffee business?
I have always been an employee working in office jobs. So owning a business was not on my radar, but the idea rather came out of the blue.
It happened on a normal Saturday morning in June at a swimming pool.
While watching my kids at a swimming lesson, I thought, “Hey, I could really do with a coffee now.” I wondered if the other 40-50 parents might be thinking the same. Swimming lessons started every 15 minutes, which brought a new group of parents!
There was nowhere nearby to buy a coffee, and I thought, “Oh, this is a pretty good opportunity for a coffee van.”
Have you always wanted to be your own boss?
Oh, look, I always have had that that pie in the sky thought that I’d love to be my own boss.
While there were moments at work sitting at a desk, grinding away and thinking, ” I’d really like to be doing an outside job.”
And then in winter, “Man, I’m glad I’ve got an inside job.” But it wasn’t a real desire until at the pool.
It was when I saw ” a good opportunity.”
What previous business experience did you have?
I never owned a business before and had always been an employee.
However, I am familiar with the business owner mindset as my parents owned a busy berry farm.
As a youngster, I helped on the farm, including packing berries for the markets. So I knew the work ethic required, but I had no experience of the economics of my coffee cart idea.
What steps were there to get your mobile coffee van making money?
So the process went fairly quickly. In about six months, we spent a lot of money, bought a mobile coffee van, and learned to make coffees.
I did a one-day barista course, and I loved it. I’ve never done any cafe work before. Although I’d worked in bars when I was just out of high school, I had no hospitality experience in cafes.
And it was fun. I just loved doing it.
Next, we did some basic research looking into how saturated the market was around our area. Also, we checked our competitors out to see if they were franchises or not? By checking websites or visiting mobile coffee shops we saw what they offered and their prices.
I started writing a business plan template that I found on the internet.
The business plan was a way of getting all my thoughts in one place.
You can imagine it was quite involved at that stage, and there was a fair amount of effort and excitement involved.
We weren’t looking to get into the business straight away but Hyundai had a van sale on, so we looked at the vehicles on offer.
Because the van was a bargain that we bought it, and the business was born. The van sale was the trigger!
How did you choose the best coffee van and equipment?
The next part of the research was how to fit out the van and choose the best coffee equipment to put in it.
There were a couple of different places that do coffee van fit-outs here in Melbourne.
But they’re more for food trucks, not mobile coffee vans. Food truck fit-out is quite different, so we chose a specialised coffee van fitter instead.
There were a couple of dedicated coffee van converters we liked, with one in Sydney and one in Queensland.
So I made a road trip to Sydney, and it took about two weeks for the van to be finished. I then drove the van back in January.
That’s when the business was up and running. But, amazingly, it was only about 6 months after the idea came into my head.
It’s fair to say I was still learning the craft of making coffee.
I experimented with different coffee, milk and products. My neighbours loved me because I made lots of free coffee.
How did you train to be a barista in your coffee business?
Before getting into this, I’m a little ashamed to say I didn’t have much exposure to the purest coffee.
I liked sugary moccas, vanilla lattes, that sort of stuff. But with the access to a coffee machine, unlimited coffee, and time I tried heaps of coffees. As a result, my palate for coffee has now expanded along with my expertise.
My training was the one day course and then heaps of practice. The experimenting also helped me learn quickly.
Want to know what’s going on globally in Coffee? Check out the International Coffee Organization.
What is it like running a mobile coffee van?
I still work Monday to Friday in an office job. So our coffee business focus is on functions and events.
And it’s probably going to stay that way for the foreseeable future. So my business plan has been to build up slowly on the weekends to get a solid client base. Our season is mostly April through until October-ish.
Summer hits us a bit hard since there’s not so much sport like netball and football over summer.
And so, a successful business for us is using the adage “to make hay when the sun shines.” Well, we make coffee when it’s cold.
So through winter, I work seven days a week because I’m working in my normal job and then making coffee every weekend- Saturdays, Sundays, and Friday nights.
And I take any coffee job that I can get. I have a booking calendar that goes out several months in advance to have events lined up.
There may be a point in the future where, as my children get older, I start to look at it as a job opportunity for them.
It could provide an opportunity for them to have their own business in five years.
We’re getting pretty close to that as we’ve been running now for three years.
This year I’ve already got all of the football season booked for Sundays and Saturdays for one club.
And I’ve just gained another club as well. My alternate days so are now full. I go to Auskick games on Friday nights. So it’s a nice robust calendar already packed out.
What surprises did you have starting a coffee van business?
Nothing appeared that was super out of the ordinary. There were food, health safety requirements, and council inspections.
And from a food handling perspective, the council has a system called Street Trader, where you log all your jobs ahead of time.
It’s a little frustrating because you’re interacting with councils. So councils want things done in certain ways, and they want it done seven days in advance.
The mobile coffee van business is a lot more fluid than that. You get a phone call at five o’clock for a job the following day. Street Trader wants you to put it in seven days in advance, which is just not possible.
I enter the details at the booking time. That way, if there’s a council inspection, I have done the bare minimum by logging the jobs.
What else can you sell to increase your sales?
We are also restricted on what we are allowed to sell.
There are a few things about food handling to note. As a coffee business, we can do pre-packaged milk drinks and stuff like that.
We can sell coffee and milkshakes without using ice or frozen berries. Otherwise, we need to change our food handling classification, which requires another course and more record-keeping.
So it’s not feasible for us at the moment. We tried confectionery and soft drinks without much success.
Because sports clubs or schools usually have their canteen, they don’t want us to compete.
And that’s fair enough, where when we’re not here to rub customers up the wrong way. So ultimately, what ends up happening is that I eat lots of Mars bars, and the stock control is me!
And at the moment, my biggest issue is stock management.
How do you find customers to buy coffee?
I did sell coffee at the original swimming pool where the whole idea started. And it was a good lesson in business!
So I suggested to the owners that I provide a coffee service to stop the parents from leaving the premises. My business would help promote their business and it would be symbiotic.
These guys ran a fairly successful business and they wanted to charge me rent.
While I’m on their premises, I am a fully self-sufficient unit that doesn’t take power or use water.
Furthermore, I wasn’t taking up a car space in their car park. So we tried the first swimming term as a rent-free trial, which was good. We built some business and some return clientele.
Customers were happy that there was a coffee van there, but the owners introduced the rental charge in the second swimming term. While it doesn’t sound like much, but it’s $25 for the day, more for the morning.
That’s five coffees before you even start the day. And at the time, we were doing maybe 35 coffees.
So, it’s not much, but it does add up. It becomes a fixed cost. So we moved on from there and built some local football teams, some school functions, and events.
Running a mobile coffee shop has a hidden cost, such as a contribution per cup or a percentage or a flat fee back to the club.
Probably the most significant and steepest learning curve I’ve had to learn is how to pitch the right amount to get the job. The balance is not burning myself by working for free or overprice a job and not get it.
I look for sporting events, perhaps markets or car launches where there are crowds of people who might want coffee-hence the business name.
What is in a typical week owning a coffee van business
I spend some time from Monday to Friday and at lunchtime lining up jobs. That’s usually the start or early in the sports season.
During the week, there’s preparation work and calendar management. I ensure I have venues lined up for the weekend by knowing what’s on?
And then, I do calculations about the milk required. While I don’t want to run out, we err on the side of caution and always get more as needed. And again, my neighbours love it because I end up then delivering free milk to them.
It’s that whole stock management over the weekend issue again.
But generally, we’ve worked at a ratio of full to skinny to soy milk and the volumes to cater for most events. On the weekends with football, the main thing is calendar management during the week, prep work, so we buy the milk on a Friday and put it in the van to be ready.
On Fridays, I’ll finish office work early and go straight from finishing work to Auskick. And then there’ll be a little bit of clean up afterwards; it’s not a massive job.
Saturdays, it’s usually from six o’clock in the morning onwards until probably two or three depending on when the last game is.
Then you travel time home and then spend about 40 minutes of wipe down, cleaning, restock, reorder, purchase more milk for the following day.
Ready to go again.
What is behind the scenes of running a coffee van business?
So it’s not just pouring coffees; there is a lot more to it!
For example, balancing the coffee’s made with the spreadsheet.
And then that doesn’t take into the accounting side of it.
Because we are weekend business, our systems are still a little bit manual. We don’t have any computer processes and no point of sale software or tracking software.
We use Xero for accounting, and we use Square for credit card purchases. I plan to explore the electronic processes and make things easy because it will save another 40 minutes.
If we have a big day, we make between 150 and 200 coffees for the day. That creates a lot of paperwork to track, balancing the tills and the electronic payments-all that admin. Larger cafes that work full time and probably have more efficient processes in place.
But for us, simple works. So, for example, we take orders on Post It Notes with texters. We collect them on a spike and count them. But we could be doing it a little bit more efficiently.
What do you find rewarding about serving coffee?
I just really love making a good coffee including the process and the aromas, the customer service interaction. Hopefully, customers generally come to me less happy than when they leave.
I’m providing a cup of happiness and making people smile. I like the fact that when I give someone a coffee, it’s a happy purchase rather than a grudge purchase.
There are all spectrums of people you’re serving- adults, parents, grandparents, and kids-it’s just fun.
What do you find challenging about owning a coffee van business?
And the biggest thing that I find is the level of cleaning which is not challenging, but it’s tedious.
As a food handling business, there is a lot of cleaning. I’m very particular with the cleaning because, ultimately, it’s a cornerstone of a hygienic van.
The stock management was a challenge for us, however since we’ve shrunk our menu, it’s become a lot more manageable.
If we went full-time Monday to Friday and did a run or had a fixed van position or a drive-thru, then stock control would become a challenge.
But then that comes down to routine and processes which we could improve pretty quickly.
What advice would you give to a new coffee van owner?
We probably didn’t do enough initial market research.
Off the top, my head, there are six competitors that I know of, in less than three Km’s from where I live, and that’s the vans that are parked and then go into their run.
That’s not including franchises or fixed drive through open all day.
We probably should have done a little more research into that, although I don’t think it would have changed our decision.
I’m always glad that I started the coffee business.
But more market research would have opened my eyes to the competition as there are more than I expected.
If I was also working Monday to Friday through the industrial estates, that would be tough because many coffee franchises do it.
Try to think outside the box on options that don’t clash with existing coffee businesses.
I’m also not about to go out to eat someone else’s lunch and take clients from them.
Ultimately, we’re all out there as small business people paying for kids dancing lessons, mortgages and bills.
It’s about being fair and respectful to other people as well. But, you know, understand that you’re still going to run a business to make money.
So the moral of the story is research, research, and when you think you’ve done enough, do some more research.
We hope our chat with Ben has provided some insight into the realities of owning a part-time business in the mobile coffee van niche.
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Disclaimer: The information contained in this podcast is general in nature and does not take into account your personal situation. The content does not constitute legal or financial advice and should not be used as such. You should consider whether the information is appropriate to your needs, and where applicable, seek professional advice from a financial adviser or lawyer in your own jurisdiction. To find out more, please go to ShouldIOwnABusiness.com