Starting A Charitable Business When Resources Are Scarce

What happened to the slow and steady approach to developing and growing a business?

Has it been replaced with short termism and a preference for ‘low hanging fruit’ (through panic mostly)?

If I don’t get an hourly hit of dopamine, then I’m not committing?

Then there’s the attitude which says I’m not starting unless it can be big and shiny.

This has come up a few times in recent conversation for me and in these challenging times, with recession looming and more of our budgets going on our energy bills, it’s important to remain excited about what can still happen (as opposed to bemoaning what can’t).

Start now, with whatever you have

I was talking with a contact recently where they initially thought they needed a new car to start a new business. 

They didn’t think their existing car was ‘good enough’.

I am absolutely with them that the car they were looking at will be better, but I’m also of the opinion of starting small, making sure the business model works, then upgrading when the profits allow.  He thankfully saw this without any further input from me.

Start small and simple, with a picture of what you want the end result to look like, approaching this from a mindset of stepping stones.

When it gets busier (and the profits allow) more equipment can be brought to improve the profitability and take a step towards that end goal.

It never has to be as expensive as you think

Another friend has recently taken over a heritage building with a not insignificant number of annual visitors. The site has lots of potential but needs to become financially sustainable.  For this to happen it needs to attract even more people.

This is his dilemma; with a limited budget does he attract more visitors by:

Spending money restoring the building to make it more appealing

or

Spending money on facilities so when people are there, they have a better experience (despite the ropey décor)

He’d done the sums and saw that a café would cost too much (espresso machines, hot water boilers, ovens, dishwashers, furniture etc). His most optimistic budget had project costs of nearly £50k, even before factoring in staff needed to run the place.

It’s a tricky one for sure.

Do you want to show off a pristine and beautifully restored building or serve tea and cake in a room with tired walls?

I suggested that instead of starting with a brand new, fully fitted café, we could use some of the existing furniture – long wooden tables and benches (all in keeping with the historic building too), with some great coffee, ground fresh and served in a French press (cafetiere), and a selection of loose-leaf tea.  No need for a fully operational kitchen (or indeed, any kitchen at all), we’ll start with bought in cakes from a local business with a first-class reputation.  This also requires fewer people required for the operation to run smoothly.

The cost of this set up was less than £5k.

In my opinion, our painfully cliched English nature means we don’t naturally desire sharing a table with strangers, but when we’re ‘forced’ to, we kind of like it.

We (hopefully) know the difference between good and bad coffee, so what’s important is that we have good quality beans being freshly ground.  What’s less important is whether it’s a made in a £6k espresso machine or a £20 French press.

Why any business is still putting a teabag in a pot when we can have access to loose-leaf tea is bewildering to me.  

Simply tea and cake – the National Trust has been making millions from this every year and I don’t think they have the intellectual rights on it.

Not everything needs to be perfect

The Hot Drink Hub (not their real name) is a café near to us and has long queues forming before they open most mornings.  The tea and coffee is horrible (think long life milk, instant coffee) and the cakes sweat away in polythene wrappers.  The roughness of the food doesn’t matter though.  They’re popular because they occupy a stunning stretch of coastline, they have ample seating and you can park right next to it (and it’s a short walk from the city centre).

To put it bluntly, they’d never get away with serving such shite if they didn’t have such a wildly perfect location (and luckily for them, the competition isn’t up to much, another reason as to why they’re able to get away with it).

Likewise, if they did reconsider their menu, they could increase their turnover (and profit margin) even further.

I’m not suggesting that you compromise on quality – far from it, but not everything has to be perfect in order for you to be profitable.

Remember those stepping stones, picture the end result, and share the journey with your customers, one step at a time.

Customer service always wins out

How we’re made to feel in a space will always trump the product.  If I was to ask you what your favourite café or restaurant is, would it be purely down to the food?

For me one of my favourite restaurants routinely overseason the food.  But the staff are amazing and despite the slightly salty pasta, it’s hard to not feel great when you’re seeing the staff bringing a smile to every single table in this ever so slightly out of date, family run business.

It’s just joyful. The fact that it’s Italian is not even remotely a factor. Put any other cuisine in there and it would still be my favourite.

Too many businesses get into the mindset of believing that it’s the bells and whistles which bring people in. Or it’s a reflection on them if it’s not ‘perfect’.

My mantra has always been “look after people so they want to come back”.  Great customer service is more memorable than most things and is not likely to cost as much as a top of the range coffee machine.