Collective Espresso

Pallavi GuptaMatthew Guenther

Eric NeviusNidal Khaznadar

History

• Dustin Miller and David Hart began discussing venture options in High School• First Collective Espresso shop opened August 2012• Second shop opened in December 2014• CAC Café scheduled to open March 2015• Founding Principles• Respecting the craft and ritual of beverages• Honoring all who make it possible• Curating spaces that enrich the community

Industry/Market Overview

• Coffee/Snack Shop industry $30.2 billion annually• Starbucks and Dunkin Donuts are dominant firms within segment• Barriers to entry very low• Many Independents exist

• Second Wave vs. Third Wave• Product• Place• People

Organizational Overview

• 2 Founders (owners/operators)• 10 employees for espresso shops• 1 front of house manager/1 back of house manager for Café• 20 employees for Cafe

Financial Overview

• Year 1• Sales - $ 137,000• Net - $52,000

• Year 2• Sales - $180,000• Net $52,000

• COG (Coffee and Dairy) and Labor are largest expenses• Year 3 projections• Sales - $725,000• Net - Loss

SWOT Analysis

Strengths

• Owners equipped with broad range of skills and knowledge about coffee.

• Low operation cost and full control over the business.

• Build customer loyalty through focus specifically on quality of coffee.

Weaknesses

• Coffee prices are not competitive

• Lack of defined business plan.

• The menu is limited and it provides no special offers.

• Marketing only through word of mouth and limited social media use.

Opportunities

• Focusing on the quality of the coffee attracts more coffee customers

• Opportunity of contracting with other suppliers to provide cheaper beans

• The coffee market is a very growing market (industry)- they may broaden

their target market

• Adding food to the menu will increase net profits

Threats

• Increased competition from local cafes and other coffeehouse chains.

• Rising prices of coffee beans and dairy products.

• Changing market tastes.

• New coffee machines encourage people to prepare their coffee by themselves

at home or at work.

Suggestions?

• A long-term vision• SMART objectives• More control on cost (as they cannot control the price)

• More online presence• Finally, they need someone who understands business

Passion + Business acumen

Questions?