How Can Digital Labels Enhance A Coffee Shop Business?
Coffee shops can be a sanctuary for patrons, but they need to be able to face today’s challenges. Find out how digital labels can help coffee shop operations.
Owning a coffee shop business can be fun and satisfying. Not only do cafes get to provide a cozy sanctuary for patrons, but they get to provide delicious and nutritious beverages and meals for people as well.
However, as a business owner, you also have to think about keeping operations running smoothly and providing the best products and services. A coffee shop business can be downright challenging, especially nowadays. And it’s up to owners to assess their challenges and apply the best possible solution.
The coffee shop business industry
The coffee shop or cafe business is a billion-dollar industry. Still, like many industries, it has recently faced monumental challenges of its own. During the pandemic, coffee shops had a few setbacks. Since coffee shops are a customer-facing business and part of the food service industry, they had to adapt to the various lockdowns, restrictions, guidelines, consumer shifts, staff shortages, and more.
Right now, one thing is for sure: the coffee shop industry is recuperating.
In the United States, coffee chain sales grew by 10% in June 2022, which was almost close to pre-pandemic numbers. By the end of 2022, the market value of the coffee shop market in the U.S. surpassed 45.8 billion USD. Statista also reported that there were an estimated 38,4000 coffee shops in the United States alone, an increase compared to the number of stores in 2020 and 2021. Big coffee shop chains like Starbucks, Dunkin’ Donuts, and Panera Bread dominate the U.S. coffee market with over 28,000 combined stores across the country. Smaller, independent cafe businesses, on the other hand, still thrive within communities.
Besides the United States, major global cities also boast numerous coffee shops. London, Shanghai, and Tokyo are just a few examples, with over 3000-7000 coffee shops just within city limits. The global coffee market reached 165.7 billion USD in revenue in 2022 and is expected to reach 182.63 billion USD by 2030.
When it comes to the demographics of the coffee shop business industry, the main market includes Millennials, Gen Z, young adults, and college-educated individuals. Still, seniors and older individuals drink more coffee than their younger counterparts in general. For example, Americans over 70 are known to drink an average of 2.18 cups of coffee a day, compared to younger individuals aged 18-24, who drink only 1.87 cups of coffee per day.
In conclusion, the coffee shop industry is very much alive today as it recovers from the pandemic years. What cafe owners need to do now is face the new onslaught of challenges to survive post-pandemic.
Challenges coffee shops face
Operating post-pandemic is giving way to a lot of unique challenges for a coffee shop business. Right now, it’s not just the smaller coffee chains or independent shops that need to adapt. Well-known coffee shop brands are also being impacted by several obstacles in this day and age.
Coffee shop owners and managers need to be aware of the exact challenges they are facing. Here are some examples:
- Stiff competition: The coffee shop industry is highly competitive, with many established brands and independent cafes. Standing out and attracting and retaining customers can be a significant challenge for a cafe business.
- Poor-quality coffee and products: The quality of products and offerings also poses a challenge for coffee shops. Anything less than the consumer’s preferences and quality standards will lead to unsatisfied customers.
- Changing consumer preferences: Consumer tastes and preferences can change rapidly, especially with the turbulent pandemic shift across the world. Staying updated with trends and adjusting offerings to meet evolving demands can be a challenge.
- Food safety regulations: Compliance with health and safety regulations, food safety standards, and other local laws will always be a challenge and a requirement for coffee shops. Adapting to changing regulations may require additional time and resources.
- Supply chain issues: Dependence on a consistent supply of quality coffee beans and other ingredients is critical. Any disruptions in the supply chain can affect product quality, product availability, and service. Coffee shop owners might need to work better with suppliers, growers, wholesalers, and their inventory management to solve any supply chain issues.
- Labor costs and staffing issues: Managing labor costs while maintaining service quality is a common challenge among coffee shops. This is even more inevitable post-pandemic, with reduced labor costs and staff shortages. High turnover rates in the service industry can also be a concern.
- Marketing and branding challenges: Effectively promoting a coffee shop and building a strong brand are essential to stand out and attract a loyal customer base. This also includes online reviews and social media. The influence of online reviews and social media can significantly impact a coffee shop's reputation nowadays.
- Technology and automation: Having the right technologies and automation is also important for customer satisfaction, expansion, and scalability. Coffee shops will most likely need to stay updated with technology trends, implement efficient POS (point-of-sale) systems, or even incorporate online ordering and delivery options to stay competitive.
- Environmental concerns: With growing environmental awareness among younger generations, consumers may prefer a coffee shop business that emphasizes sustainability. Managing waste, using eco-friendly packaging, and sourcing ethically can be extra challenging.
- Customer Retention: Building a loyal customer base is vital, especially for smaller or independent coffee shops. Offering consistent quality, excellent customer service and loyalty programs can help retain customers and grow the business.
How can digital labels enhance a coffee shop business?
While coffee shops continue to assess their operations and adjust their strategies, certain technological solutions can solve multiple problems at once and enhance a coffee shop business. A digital label is one of these.
SOLUM’s Newton LITE is an ideal example of a digital label solution for various coffee shops and cafes. Newton LITE is SOLUM’s line of compact and superior digital labels. Equipped with Newton technology, faster update speed, 7-color LED, built-in protection cover, near-field communication capability, sticker bezels, and more. Coffee shops can use these digital labels to display product prices, menu boards and product information, ingredient inventory, marketing promotions, and more.
Here’s how digital labels like Newton LITE can enhance coffee shop operations:
1. Safer for food offerings
Using chalkboards and chalk as aesthetic price signs for the pastry shelf displays or the menu can compromise food safety. Chalk can be hazardous when large amounts get into food and are ingested. Digital labels offer a safer alternative for coffee shops without sacrificing the aesthetic or branding of the place.
2. Enhanced customer experience
Staff are usually busy during rush hour and cannot answer every customer's question about the food. This is even more challenging with a limited staff or staff shortage. Digital labels like Newton LITE can enhance the customer experience for the coffee shop. Since they are known to have a multi-page capacity, more information about the food can be displayed, which reduces waiting times and the need to ask any staff. This includes details like calories, ingredients that may cause allergic reactions, brewing methods, coffee origins, flavor profiles, and more.
3. More convenient retail operation
Scalability and expansion are also some of the challenges among coffee shops. Regular menu updates or an expansion can be a complicated adjustment for a coffee shop. Fortunately, digital labels and digital signage can lessen the stress of coffee shop employees. There’s no need to regularly reprint and throw away obsolete paper labels or menu boards, as pricing and label updates can be done digitally.
4. Energy and time efficiency
Many digital labels are designed to be energy-efficient, with low-power displays that contribute to environmental sustainability. They are also time-efficient, as updating traditional paper or chalkboard labels can be time-consuming for the staff in a fast-paced coffee shop environment. Digital labels streamline coffee shop operations, allowing staff to focus on other important tasks.
5. Reduced labor costs
With Newton LITE’s automated price updates, dynamic menu changes, and fewer customer inquiries, the need for manual labor and customer assistance is minimized. This can lead to more time savings and a reduction in overall labor costs.
6. Inventory management
Inventory management is also one of the frequent challenges among coffee shops. Integrating digital labels with inventory management systems helps in real-time tracking of stock levels. This can help optimize ordering processes, enhance supply chain management, and even prevent out-of-stock situations for customers. This ensures that popular items are always available.
7. Marketing and branding within the coffee shop
Digital labels like Newton LITE, as well as additional digital signage, make it easy to manage and display promotions. Coffee shops can run time-sensitive promotions, happy hour specials, or discounts, and the information can be updated centrally across all labels. This ensures consistency in marketing strategies. Newton LITE bezels can also be customized, contributing to the branding of a coffee shop business.
8. Overall consistency and accuracy
And, of course, digital labels eliminate the risk of human error in pricing or menu displays. This ensures that customers receive accurate information every time they order a coffee or a pastry. This reduces confusion and potential disputes at the point of sale, which in turn strengthens loyalty and customer retention.
Ready to spruce up your coffee shop and improve the service you provide to your patrons? Talk to SOLUM experts now to learn more about Newton LITE and how it can enhance your coffee shop business.