Business ideas for 2015: Quirky cafes

Quirky, unique cafes are all the rage. Visit Shoreditch and within a five minute stretch you’ll find Lady Dinah’s Cat Emporium – the capital’s first ever cat cafe– and the aptly-named Cereal Killer Café (pictured) which offers visitors a range of breakfast cereals from around the world.

But it’s not just Tech City hipsters getting in on the trend. Just this month, Simply Crispy; the world’s first crisp sandwich cafe, launched to the public in Belfast and a Newcastle rival to Lady Dinah’s; the Pretty Pussy Parlour, announced plans to launch in a secret location later this May.

National media attention, popular consumer responses and social hype have helped to put innovative cafes on the map and with more people looking to coffee shops as a social venue rather than a place to simply purchase a latte, 2015 is a great year to start your very own niche cafe.

Starting a quirky cafe: Why it’s a good business idea

If the surge in cult cafés doesn’t convince you of the market opportunity then recent research should. According to Allegra Strategies Project Café 13 UK report, published last year, the total UK coffee shop market was worth £6.2bn in 2013 with 6.4% sales growth on 2012. The report claimed that “after 15 years of growth, the sector continues to be one of the most successful in the UK economy”.

This statement was echoed in Euromonitor’s September 2014 study into the cafe and bar industry where it concluded that specialist coffee shops “were amongst some of the best performing within the whole food service market” and were the most “significant growth story”. Drawing on these statistics and Allegra’s other findings that consumers now see cafes as more of a “social setting” with consumption levels of coffee actually decreasing, by starting a niche cafe you’re entering a stable market and one that looks set to grow in demand over the next year.

Starting a quirky cafe also benefits from being relatively noncompetitive. Although there are now over 16,000 cafes and coffee shops across the country, a quirky cafe doesn’t have to compete at the same level as its USP focuses on turning the traditional coffee shop concept on its head.

The diverse array of opportunities available also makes launching a quirky cafe an exciting prospect as it’s not just cats, cereal, and crisp-centric venues that appeal to the public. In the last couple of years there’s been a steady influx of cycling cafes, including Brighton’s Velo Cafe which offers a “community” for cyclists, and other interest-driven cafes such as Newcastle’s Geek Retreat; a cafe for comic book fans, and Notting Hill’s Biscuiteers Boutique – which, as the name suggests, concentrates on biscuits. Consumers increasingly want added extras so if you can draw on the success of these cafe start-ups and find your niche, then a quirky cafe could be a good money spinner.

In addition, a quirky cafe is a business opportunity which has no real barriers to entry so anyone of any age or background can enter the market. Take London’s Nana for instance – a “comfort food” cafe which is staffed wholly by “hip” nans and grandma’s serving up drinks, soups and more.

Quirky cafe business opportunities

In terms of launching a quirky cafe, the best advice is to think regionally. London’s quirky cafe market is increasingly becoming saturated – there’s even an alcoholic milkshake cafe in Hoxton – so while you could strike lucky by starting a unique cafe in the capital, long-term success is more likely in other areas of the country.

Thinking long-term is also essential when it comes to your business strategy. Quirky cafes have drummed up a lot of media coverage for the very fact that they’re gimmiky and offer a twist to the usual. However gimmicks will only last for so long so you should think about ensuring your cafe attracts regular custom. Lauren Pears’ Lady Dinah’s is a good example of how to go about launching your quirky cafe.

Opened in March 2014, Pears charges between £5-£6 per guest for visitors to meet the array of cats and Pears says the business is set for long-term growth as it focuses on return custom “over novelty seeking ones”. Despite the start-up being less than a year old, Pears made the business model more sustainable by engaging and attracting a community of followers; she ran a successful crowdfunding campaign on Indiegogo which raised £109,000 and Lady Dinah’s fan base now extends to over 70,000 members. These are all points to keep in mind.

Several quirky cafes also maintain growth by supplementing added services into their offering such as retailing relevant products (Lady Dinah’s sells cat-related gifts) and the Geek Retreat sells comic books, so a quirky cafe is as much a food and drink opportunity as it a retail opportunity.

Despite the growing popularity of quirky cafes, some critics have questioned their appeal and argued that by having such a narrow focus on one area, niche cafes can actually put off the average consumer who may be looking for a choice and range of options. Yet there’s nothing to say that this issue couldn’t be overcome. Mel’s in Earlsfield is a good example of how to maintain a niche focus while catering to a range of audiences as it operates as breakfast cafe in the morning, turns into a lunch and snack bar in the afternoon and then at night serves cocktails and plays “vintage beats” for evening visitors.

Who else has started a quirky cafe business?

Aside from the weird and wonderful cafe start-ups already listed, in the last few months there’s also been other interesting quirky cafe launches such as Hurwendeki, London’s only cafe to offer hairdressing alongside South Korean food and there’s even a cafe dedicated to board games, Draughts, which opened in Hackney last November.

Quirky cafes don’t necessarily have to be quirky because of the products or service they offer either, and can be unique simply in the way they run. Take Ziferblat for example. It’s a Shoreditch cafe which, rather than charge for food and refreshments, charges customers on the amount of time they spend in the store on a pay-per-minute basis.

Insider opinion

Sean Mallon, co-founder of Bizdaq, a new platform which lists businesses to buy and sell, claims the market is ripe for cafes and catering businesses:

“During the 12 months of 2014, catering businesses including cafes were not only the most in demand business type across any small business sector, but for those who successfully sold, the timescales from listing a business for sale to completion was under six months on average”.

“The feedback we have from those looking to enter this market is that many see the ability to develop an existing passion alongside earning a comfortable and often significant income as a key driver.”

The founders of Cafe Afloat, a quirky cafe ran on a wide beam boat in the Diglis Basin Marina, add:

“We believe that people are looking for unique selling points, something different than the usual with a personal touch to tell their friends about. We think people are now looking to find hidden gems in the local community, and want to support smaller local business rather than non-personal large corporations.”

Published Jan 2015

Sparked your interest? Read our startup guide on how to open a cafe