The entrepreneurial spirit is certainly alive and kicking on UK forecourts nationwide, and none more so than in the north east in Darlington to be precise where independent retailer Nick Baker of NJB Services has been working hard launching his own brand of coffee.
In the past year he has learnt an awful lot about the stuff literally from bean to cup and now is the moment of truth as he launches a trial to see how customers react to the removal of the ubiquitous but very popular Costa Coffee machine, and sup from its replacement wait for it Cheeky Coffee.
"So far it’s going really well," says an enthusiastic Nick, who seems to be as full of beans as the new coffee machine he has acquired in preparation for his latest venture. Fair to say at this point that Nick is a very energetic, lively fellow who will regale you with tales of cycling, skiing and general he-man adventures. He clearly puts that same amount of creativity and drive into his business.
"Coffee sales have not altered so far they’re still around 50 cups a day and I’ve had a good reception from customers," he gushes. "But it’s early days we’re only a week into it. It’s week three and four that will count. Success would be holding its own, but even if it dropped 20% in sales, I’d still be better off financially, because it’s all mine.
"If you’re asking why I’m doing this, it’s because I want the whole pie. The pie is only so big and if Costa is taking 65%, it doesn’t leave a lot left. Also, there are other costs, such as if a customer hits the wrong button and gets the wrong drink which happens quite a lot. They put it to one side, press the right one, but the retailer is charged for the discarded drink, because it’s all automated through a telephone system. Or the night staff use it. They don’t realise that 65% of the value of that cup goes on my invoice. Costa does allow a shrinkage (of 5%) in there, but it’s never enough. So you can see how this has developed."
Nick went to great lengths to create a mild blend of coffee mirroring the broad appeal of Costa to satisfy a range of palettes, but with the option to add extra shots for those that prefer a stronger flavour. His customers are getting their coffee cheaper at the moment £2 and £2.20, for the standard and large respectively, compared to £2.10 and £2.40 previously.
"Our flavour shots are cheaper as well, and we’ve also got loyalty cards for every 10 cups you get one free which we couldn’t do before."
Nick is determined to see if he can bring extra value into his operation by not giving up such a considerable margin to a major brand: "I’m already pulling people in because of the Subway, the Spar shop and the Jet-branded fuel. Does Costa pull people in over and above these brands? On my other sites there’s no doubt Costa is a pulling power.
"But because of the location of this site, people can’t see the Costa branding until they arrive at the corner of the forecourt. I believe people are buying the coffee because it’s here, rather than a destination. But this is a trial the proof of the pudding will be in what happens over the next few weeks."
Nick has a good relationship with Costa, which has worked well for the business on all his five sites "it drags people in and it has been very successful". But he says this is more about what he’s doing generally in his business; the coffee comes under the umbrella of another major project his recently launched Cheeky Café.
The Cheeky Café came about because Nick was looking for an offer such as Greggs, "who weren’t interested".
"I had Costa and Subway, and wanted to bring another branded concession in, but I was struggling to do the bakery offer. I thought I’d got somewhere with a local bakery, but in the end it all went cold. It left me in a position where I was going to have to design and create my own offer. I went through various names and ideas as to what the brand was going to be called. In the meantime I’m constantly mulling things over I’d already been thinking about my coffee.
"The ’Cheeky’ name came from a lot of head banging. Because of the link with Africa the coffee beans come from Ethiopia we decided on Cheeky Cheetah, but it was rejected when we tried to register the name. We had to apply again another £400! and as I’d already spent quite a bit on the artwork we kept the Cheetah image and just used the ’Cheeky’. I like the name, as in, you have a ’cheeky’ beer and so on, and it became the favourite with everyone."
It’s also easy to add it to other things such as ’Cheeky Char’ for the tea machine and ’Cheeky Charging Zone’.
In the past six months Nick has put his plans into action on his site near the A1 motorway in Darlington a site which at one time had been losing its previous owners £40k a year. Nick took over running it eight years ago on a lease/rental basis, turned the business round, and was very fortunate in managing to buy it two and a half years ago (it’s a long story!). It came with a lorry park for 26 trucks; a pallet sales business which also operates in the lorry park and pays rental; and a mobile café unit.
He has gutted the building, spending £240,000 knocking all the internal walls down, rebuilding toilets, showers and offices, and creating a 3,000 sq ft Spar store. He moved the Subway from the front to the back of the store, and in its place put tables and chairs. He also built a proper kitchen and serve-over area and persuaded the man running the mobile café in his lorry park to come inside and work for him.
You can have anything you want in the Cheeky Cafe ranging from full breakfast down to a sausage sandwich, bacon sarnie and so on, in whatever format you want care of a menu of ’extras’. In the evening the truckers can come in and get meals for £5.49 including such delights as toad-in-the-hole; other options include meat pies, pizzas and jacket potatoes.
"It’s been very popular and is giving people more reasons to come back," says Nick. "The store has gone from £14-£15k to £18-19k a week since I’ve had the Spar; and the Subway is up £2k a week since relocating it."
Fuel sales are also looking good 70,000 litres a week, plus 140,000 litres a week on bunkering.
Further plans include increasing the car park and clearing trees to increase visibility to motorists. He is also hoping to attract the attention of drivers on the motorway. How will he do that? A totem pole of course cheeky idea!