As I write, I’m sitting in Costa Coffee and pondering at their very clever business model. You may be mistaken in thinking that Costa are in the coffee business. The clue is certainly in the name. But it strikes me that Costa are actually in the money business first. You see, every single person who comes into Costa, whether in person or by way of the drive thru, gives them money before they get the delivery of any goods or service. In some cases, the customer has their money taken within under a minute of arriving, but delivery can take place as much as ten to fifteen minutes later.
In McDonalds, it’s the same. And Starbucks. Yet they all claim to be in the “restaurant” business.
But the traditional restaurant or cafe let’s you sit down first, get settled, order, and eat before they ever think of asking you to pay – and only then after they’ve asked if everything was alright with your meal. Can’t think of a time someone asked me in Costa if everything was alright with my coffee.
So what difference does it make? I guess not much in the scheme of things, perhaps. But imagine what a difference it might make to your business to take the money up front and make your customers wait for the delivery of their goods and services. Imagine the impact on your cash flow. Imagine the difference in customer satisfaction.
Sure, delivery in Costa or Starbucks is nearly instantaneous. But not always. Ask yourself this: how many times have you ordered, paid and then had to wait so long you had to run off because you might have missed your train? Or waited so long that your fast food was no longer the “fast” it promised to be, and therefore cost you the entirety of your lunch hour. If you hadn’t paid up front in these situations, would you have behaved differently? Walked out? Complained? Felt less aggrieved at having to wait?
Either way, these businesses seem to all be doing well. McDonald’s was always said to actually be in the real estate business, not the burger business. Perhaps a different business model would revolutionise how you operate, worth thinking about.
Tricia Fox is the founder of Volpa. A Fellow of the Chartered Institute of Marketing, an Accredited PR Practitioner and an entrepreneur, she has over 18 years under her belt running her own business. Visit her profile