According to Technavio, the global cold brew market is projected to increase by nearly $440 million by 2027, highlighting the immense potential for entrepreneurs like you. With its smooth taste and growing popularity, cold brew has become a go-to beverage for coffee lovers around the globe.
But what does this mean for your cold-brew coffee business? Offering high-quality cold brew and unique flavours is essential if you want to attract a diverse customer base.
Customers increasingly seek speciality cold coffee drinks made from single-origin beans that create memorable sensory experiences. However, crafting exceptional cold brew isn’t just about flavour; it’s also about ensuring profitability.
We’ll explore everything you need to know about how to start a cold brew coffee business, from initial planning to marketing strategies and profitability management.
What Is Cold Brew Coffee?
Cold-brew coffee differs from ordinary coffee because it does not require heat to create the perfect cup. Instead, cold water is allowed to soak into the coffee beans over time, allowing the greatest of the beans' flavours to shine through in the coffee.
Cold-brew coffee is substantially lower in acidity than heat-brewed coffee. Acid levels are lowered by up to 70%, producing less bitter coffee. People with stomach sensitivity or acid reflux concerns may enjoy a cup of cold brew without experiencing the normal adverse effects.
Many coffee connoisseurs also point to the superior flavour of cold-brewed coffee. As the acid sting is removed, more of the coffee's inherent flavours can shine.
The chemistry of cold-brew coffee remains unchanged because it is made without heat. While the coffee may take some time to brew, the result will taste different from leftover coffee.
Different types of coffee beans produce distinct flavours. Cold-brew coffee provides numerous alternatives for developing profitable beverage items.
The Rise of Cold Brew: Why It's So Popular
Cold brew coffee has overtaken the world, becoming a staple in many coffee shops & homes. Its popularity can come on to many factors:
1. Smooth Taste and Reduced Acidity:
Less Bitter: The cold brewing process extracts flavours differently than hot brewing, resulting in a smoother, less bitter taste.
Lower Acidity: Cold brew has a lower acidity level, making it easier on the stomach for those sensitive to traditional coffee.
2. Versatility:
Concentrate: Cold brew is often made as a concentrate, allowing for customisation with water, milk, or other additives to suit individual preferences.
Multiple Applications: It can be enjoyed iced or hot or used as a base for cocktails or desserts.
3. Convenience:
Pre-Made: Many coffee shops offer ready-to-drink cold brew, eliminating the need for brewing at home.
Shelf Stability: Cold brew can be stored in the fridge for several weeks, making it a convenient option for busy lifestyles.
4. Health Benefits:
Antioxidants: Cold brew contains antioxidants that may help protect against cell damage.
Caffeine Content: While it contains caffeine, it's often perceived as a gentler alternative to hot brew due to its lower acidity.
5. Trendiness:
Social Media: Cold brew has gained significant popularity on social media platforms, driving consumer interest.
Health-Conscious Lifestyle: The trend towards healthier, natural products has increased demand for cold brew.
6. Environmental Factors:
Sustainability: Some cold brew methods, like reusable filters, are more environmentally friendly than traditional coffee brewing.
Cold brew's popularity stems from its unique taste profile, versatility, convenience, potential health benefits, and alignment with current trends.
A Hit with Younger Generations
Cold brew coffee has grown in popularity, particularly among younger demographics like millennials and Gen Z.
A 2018 study revealed that Gen Z's most frequently purchased beverages were cold brew and ready-to-drink (RTD) coffee products.
Dale Harris, the COO UK of Ozone Coffee Roasters and the 2017 World Barista Champion believes that cold brew's appeal extends beyond traditional coffee drinkers.
"Cold brew offers a wider range of accessibility," he explains. "It's a great option for newer and younger coffee enthusiasts seeking something more exciting than the standard vanilla latte, which might not be as appealing as it once was."
Harris further emphasises the growth of the cold brew segment. "It's one of the fastest-growing areas in the coffee industry," he notes.
"During warmer months, cold brew is a staple in many coffee shops, helping to balance the decline in hot coffee sales. However, I believe cold brew should be enjoyed year-round."
Brewing Your Cold Brew Coffee: A Step-by-Step Guide
Cold brew coffee is a smooth, less acidic alternative to traditional hot-brewed coffee. It's made by steeping coffee grounds in cold water for an extended period. Here's a simple guide to brewing your cold brew:
Equipment Needed:
Coffee grinder: To grind your beans to a coarse grind.
Cold brew maker or mason jar: For steeping the coffee.
Filter: To separate the grounds from the coffee.
Refrigerator: To store the brewed coffee.
Ingredients:
Coffee beans: Choose a high-quality coffee with a bold flavour.
Cold water: Filtered water is ideal.
Instructions:
Grind your beans: Grind the beans to a coarse grind. A coarser grind will allow for better extraction.
Steep the coffee: Add the ground coffee to your cold brew maker or mason jar. Pour cold water onto the grounds, ensuring they are fully saturated.
Refrigerate: Cover the container & place it in the refrigerator. Let the coffee steep for 12-24 hours. The longer you steep, the stronger the flavour.
Filter: Strain the coffee through a filter to remove the grounds.
Serve: Enjoy your cold brew immediately, or store it in the refrigerator for later.
Tips for Perfect Cold Brew:
Experiment with ratios: The proper ratio of coffee grounds to water depends on your preferred strength. Start with a 1:4 ratio (1 part coffee grounds to 4 parts water) and adjust to your taste.
Use a good quality filter: A fine-mesh filter will help prevent sediment from getting into your coffee.
Dilute if needed: If you find the cold brew too strong, dilute it with cold water or milk.
Add flavourings: For a unique twist, experiment with different flavourings like vanilla, chocolate, or caramel.
How to Start Your Own Cold Brew Coffee Business
Cold brew coffee, with its smooth flavor and lower acidity, has gained immense popularity. If you're considering venturing into this booming market, here's a guide to help you start your own cold brew coffee business.
1. Conduct Market Research
Analyse demand: Understand the local market's preference for cold brew coffee.
Identify competitors: Assess their strengths, weaknesses, and pricing strategies.
Research trends: Stay updated on emerging trends and consumer preferences.
2. Develop a Business Plan
Define your goals: Clearly outline your business objectives, such as revenue targets and market share.
Create a marketing strategy: Plan how to reach your target audience and promote your brand.
Estimate costs: Calculate your startup expenses, including equipment, ingredients, and marketing.
Project revenue: Forecast your potential income based on sales projections.
Sole proprietorship: Easy to set up but offers limited liability protection.
Partnership: Shared ownership and responsibilities.
Limited Liability Company (LLC): Combines the benefits of a sole proprietorship and a corporation.
Corporation: More complex to establish but provides maximum liability protection.
If you're new to the food service sector, a franchise like Kouzina may provide you with the framework and assistance you need to operate a successful business.
4. Secure Funding
Personal savings: Use your funds to start the business.
Loans: Consider obtaining a business loan from a bank or credit union.
Investors: Seek funding from individuals or venture capitalists.
Crowdfunding: Raise funds through online platforms.
5. Choose a Location
Foot traffic: Consider areas with high foot traffic, such as shopping malls or business districts.
Accessibility: Ensure easy access for customers, including parking and public transportation.
Rent: Evaluate the cost of rent and the potential for future growth.
6. Obtain Necessary Permits and Licenses
Business license: Register your business with local authorities.
Food handling permits: Obtain permits required for preparing and serving food.
Health inspections: Ensure compliance with health and safety regulations.
7. Source High-Quality Ingredients
Coffee beans: Select high-quality beans that match your desired flavour profile.
Water: Use filtered or purified water for optimal taste.
Additional ingredients: Consider adding syrups, milk, or other flavourings.
8. Invest in Equipment
Cold brew maker: Choose a suitable machine based on your production volume.
Grinder: Ensure precise grinding for optimal flavour extraction.
Refrigerator: Store your cold brew for freshness.
Bottling equipment: If you plan to sell pre-bottled cold brew.
9. Develop Your Brand
Create a logo: Design a memorable and visually appealing logo.
Choose a name: Select a name that resembles your brand's personality and values.
Develop a tagline: Create a catchy tagline summarising your brand's unique selling proposition.
10. Market Your Business
Social media: Utilize platforms like Instagram, Facebook, and TikTok to reach your target audience.
Local partnerships: Collaborate with cafes, restaurants, and grocery stores.
Events and festivals: Participate in local events to promote your brand.
Online sales: Consider selling your cold brew online through your website or platforms like Etsy.
11. Provide Exceptional Customer Service
Friendly staff: Train your staff to provide excellent customer service.
Quality products: Ensure the consistency and freshness of your cold brew.
Feedback: Actively ask feedback from clients to improve your offerings.
Kouzina sets itself up to help franchise partners use the cloud kitchen concept to grow their companies. Franchisees at Kouzina Food Tech receive excellent training support to provide them with the know-how and abilities to run their cloud kitchen efficiently.
Making Cold Brew More Profitable: Strategies for Coffee Shops
Cold brew coffee has surged in popularity, offering a smoother, less acidic alternative to traditional hot-brewed coffee. For coffee shops looking to capitalise on this trend, here are some strategies to enhance profitability:
1. Premium Pricing
Unique Blends: Offer exclusive, speciality cold brew blends that justify a higher price point.
Seasonal Variations: Introduce limited-time, seasonal cold brew flavours to create a sense of urgency and a premium value.
Add-Ons: Upsell cold brew with premium add-ons like syrups, milk alternatives, or cold brew concentrate.
2. Efficient Production
Batch Brewing: Optimize production by brewing larger batches in advance and storing them properly.
Cold Brew Concentrate: You can produce cold brew concentrate in bulk and dilute it to order, reducing waste and improving efficiency.
Automation: Invest in automated cold brew equipment to streamline the brewing process and reduce labour costs.
3. Creative Merchandising
Eye-Catching Displays: Showcase cold brew prominently with visually appealing displays and signage.
Seasonal Themes: Decorate the shop with seasonal themes to attract customers & create a festive atmosphere.
Cold Brew-Focused Menu: Create a dedicated menu section for cold brew, highlighting unique offerings and enticing customers.
Local Businesses: Partner with bakeries or ice cream shops to offer complementary products and cross-promote.
Food Trucks and Events: Collaborate with food trucks and local events to expand your reach and introduce cold brew to new customers.
Subscription Services: Offer a subscription service for regular cold brew deliveries, which will provide a steady stream of revenue and build customer loyalty.
5. Customer Loyalty Programs
Rewards and Discounts: Implement a loyalty program that rewards repeat customers with discounts, free drinks, or exclusive offers.
Personalised Recommendations: Use customer data to offer recommendations and tailor promotions to individual preferences.
Social Media Engagement: Motivate customers to share their cold brew experiences on social media, using contests and giveaways to drive engagement.
6. Waste Reduction and Sustainability
Compostable Packaging: Use eco-friendly and compostable packaging to appeal to environmentally conscious customers.
Leftover Coffee: Find creative ways to repurpose leftover coffee grounds, such as selling them for gardening or creating coffee-infused products.
Energy Efficiency: Implement energy-efficient practices in your shop, such as using LED lighting and optimising refrigeration.
Concluding Thoughts
Establishing a cold-brew coffee company presents a special chance to fuse your entrepreneurial aspirations with your love of coffee.
You may create a profitable business in this booming sector by comprehending the rising need for cold brew, carefully budgeting for your startup expenses, and implementing good marketing plans.
To maintain growth and cultivate customer loyalty, prioritise quality, customer involvement, and continual development.
It's time to start your adventure and introduce the world to your passion for cold brew coffee!
Make an appointment with Kouzina right now to learn more about franchising options and how you can use the support of a well-known brand to convert your love of coffee into a profitable business!
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