August’s Caffè Case Study was conducted with Hugo Hercod of Relish in Wadebridge.
Relish Food & Drink
Location: Wadebride, Cornwall
On the high street: No, tucked away off the beaten track – deliberately so!
Annual turnover: £250k
Who owns the business: Sarah and Hugo Hercod
No. of staff: 9 (including Hugo and Sarah)
Opened: December 2006
Business model: Café with delicatessen
Length of lease: 15 years
Opening hours: Tuesday to Saturday 9am – 5pm
Average number of coffees served weekly: 1,000
What made you decide to open your own café bar business?
I did a degree in hotel and catering and Sarah and I have both worked in the hospitality sector all our adult lives. The plan was always for us to run our own business; we just had to decide what part of the industry we wanted to work in. Eventually we decided that this would be a good business, allowing us to keep control over what we offered, but that could also operate within sociable hours. We have taken the decision to only open five days a week to ensure that we still maintain some kind of life outside of work.
How did you get started?
We spent a long time finding the right premises and definitely started with a clear idea of what we wanted to be. We had done a lot of research and really understood who our customers were going to be and what kind of products we were going to serve. We had our eyes wide open having come from catering backgrounds, and would have been completely lost without that knowledge. We definitely came into this business knowing it was going to be the most challenging thing we had ever done, knowing it was going to be exceptionally hard work and that it would be a rollercoaster. Even so, nothing prepared us for just HOW tough it was going to be.
Being based in Cornwall means that it is very easy to create a business that is reliant on the tourist trade, the problem is, that usually means reducing the quality of what you offer to be able to cope with the quantity of customers you get – but only for a five to six week period over the summer.
Many of the businesses around here seem to operate on a model of selling poor quality food and drink as expensively as possible to as many people as possible for the shortest period possible – and then sit back for the rest of the year doing very little. We care passionately about what we do and definitely did not want to run a business in that way. So we deliberately found premises off the high street meaning that we have to focus on delivering high quality food and coffee to a local audience all year round.
We took over the lease just five weeks before we opened and got to work completely gutting and renovating the place. We did all the work ourselves and didn’t hang around waiting for the right time to open (there is never a perfect time to start a business and I am baffled by people who sign their lease and then sit back and take an age to get ready to open, waiting for the perfect time to announce their existence to the world – time is money!). We opened as soon as we were physically able even though it was just a couple of weeks before Christmas.
Despite being where we are, we still attract a reasonable number of tourists throughout the summer months and I have to confess it always upsets me when our loyal local customers can’t get a seat during busy summer days when they are the ones that support us all year. I guess I shouldn’t be ungrateful for any trade that we get, but I know that the sustainability of our business model is definitely based on our local following. We never set out to be a mass-market business and we wouldn’t want to be.
Did winning the UK Barista Championships help put the business on the map?
To be honest I have a very competitive nature and always want to be the very best I can be at anything I turn my hand to – and that includes making coffee. I met James Hoffman and he showed me stuff that just blew me away, it really woke me up to the possibilities of coffee and made me want to serve the very best coffee I could.
The only reason I entered the championships was to help the business, and it certainly has ensured that we have a good reputation within the trade and media. However, the most important thing is that it means I serve very good coffee – and that is what I am passionate about. I want to know that our customers are getting the best.
My passion for coffee does mean that I have a tendency to try and persuade customers to drink espressos rather than lattes or cappuccinos – even though we could make more on the latter, I would rather they came back time and time again and enjoyed a better quality coffee experience. I am slowly winning that battle and can now judge a good day by how many small or large cups I have left on top of my coffee machine at the end of the day. But I am not there yet, like most café bars, latte is latte is still the most popular drink we sell.
What are the highs you’ve experienced since launching the business?
After I won the championships it was great to come back to the regulars at Relish and know that they appreciate what we are trying to do. It was a huge buzz and made all the hard work seem completely worthwhile. It is great being told that you have just made someone the best coffee or hot chocolate that they have ever tasted. I guess it is that pride in what we do that keeps us going.
What are the lows?
If I am completely honest, there have been far more lows than highs since we launched. Running a café bar business is exceptionally hard work and generally for very little return. So much money is taken back off you through taxes, rent, PPL and PRS licenses and so on. The idea that this government is trying to help small businesses in the UK is an absolute joke. They constantly talk about how small businesses are the backbone of the country, but don’t actually do anything to support us. The VAT rise has wiped an additional five per cent off the bottom line in a year.
It is a constant stream of outgoings and a battle to make sure that you can make a reasonable living from it, without killing yourself. People look at how busy we are and the turnover and assume that we must be a fantastically successful business. We are certainly a success in many ways, but this is never going to make us rich. It is sometimes hard to keep going when you know you could be earning a lot more for a lot less effort doing something else.
Staffing is also constant battle – and probably the hardest thing we have to deal with. We are required to provide huge amounts of training for our staff, we have to demonstrate commitment to them and do all we can to support them. However, there is nothing in place to protect you as an employer. People let you down all the time, calling in sick, leaving without notice, not maintaining the levels of service you have worked hard to achieve. It is a real challenge and one that we are finally overcoming by being exceptionally careful about whom we employ. Now one of our best members of staff is a granny from Liverpool who completely gets what we are trying to deliver and works like a real trooper.
What would you say to anyone thinking of launching a café bar business?
In honesty, I would say don’t do it! Not unless you really know what you are doing. We would have been completely lost without our background in catering, and even then it has been a struggle. We have seen so many people’s ‘dream businesses’ fail within the first 18 months because people haven’t done the proper research and have no idea how to run a hospitality based business.
You’d be amazed by how many people start a coffee shop and don’t know how to make a good cup of coffee. If you can’t get that bit right (or don’t care enough to get it right) what hope has the rest of the business got? If you are determined to do it, ensure it is the best possible business you can run, anything else is just not worth it.
What’s next for Relish?
Relish is becoming more and more popular and we are finally making a reasonable living from it. Ideally we would like to be in a position to employ a reliable general manager, allowing us to take a bit of a step back from the day-to-day running of the business. It would be good to be able to free up a bit more time to allow us to explore ways in which to grow the business and also look at other ways to create additional income streams
It will always be a question of whether our sanity lasts that long though!