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Take a bite out of food costs: think that adding food items to your coffee house menu will bring in more revenue? Not necessarily. Discounting or adding sandwiches may not be the answer to dwindling sales; in fact, it might set you back even more.

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There's no getting around it: coffee houses are feeling the pinch point between soft sales and higher costs. The impact of declining home values, adjustable rate mortgage resets and higher gasoline prices are causing everyone to think twice about their morning coffee house visit. Coupled with the increase in dairy costs and paper products, operators are also feeling it in their bottom lines.

At no time in the recent evolution of the U.S. coffee house business have operators felt an economic climate like the one they face right now. Even the big players are searching for answers. Coffee house operators are scrambling to find a strategy that stems the decline in sales and profits.

Searching for an Answer to Declining Sales

When customer visit frequency declines, it is common to see classic mistakes made. Operators panic and often go to places where they have never gone before. Instead of taking what they know and doing it better, they sometimes take on unproven business propositions and untested products because they make sense intuitively.

Why wouldn't a coffee house owner try to build his or her lunch day part with soups, sandwiches, salads, or even hot dogs, pizza, hoagies or burritos? Selling just a few of these items a day will increase sales. Right?

The store is already open and it's so easy to sell these products, so why not? What could it hurt? Sounds logical. Right? Wrong!

In The Beginning ...

When a coffee house owner first opens...

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