Things like atmosphere, décor, service and product are standard success factors in the coffee house business, but one British Columbia-based owner will tell you that, more than anything, location is key.
Michael Manhas raised eyebrows back in 2007 when he decided to transform an old laundromat in the run-down commercial area of Oaklands/Fernwood in Victoria, BC, into the stylish, family-friendly Koffi House (1441 Haultain St.). “As we were building, there was a lot of curiosity. When they found out what I was doing they were openly pessimistic,” remembers Manhas. “Most thought we didn’t stand a chance.”
It’s not that the 43-year old coffee enthusiast had run out of options. He’d seen plenty of empty spaces in more affluent neighborhoods that would have required less work and less upfront investment. But none of those spaces offered Manhas what he was looking for as precisely as Oaklands/Fernwood did. “It was one of the only affordable neighborhoods to buy a home, so a lot of mid-20 to mid-30 families started coming in and buying homes,” he says. “This was my target demographic, a little older than the core demographic you find downtown, a little more stable.”
The gentrification of the Oaklands/Fernwood residential area continued over the course of the laundromat’s extensive, three-month conversion into a coffee house, one that included the removal of over 4 tons (4000 kg) of metal. Manhas, who co-owns a real estate business, took on much of the renovation work himself and completed it for a fraction of the cost. “I took classes at Home Depot – electrical, flooring, tiling plumbing,” he says. “I saved between $20,000-$25,000 doing much of the high-cost ‘trade work’ myself or through my network of friends.”
When Koffi finally opened its doors, in October 2007, it was an instant hit. “Although the neighborhood was pessimistic, there was a lot of advance build-up which gave us a really strong core customer base. The same person comes in 2-3 times per day,” says Manhas. “Once we started operating as a business, the cash flow was always positive. Second year sales skyrocketed. I paid off my initial $90,000 investment within five years.”
Manhas credits well-positioned, reasonably-priced products; friendly, everybody-knows-your-name service; unique, Mid-Century modern-inspired styling; and strategic partnerships with local businesses like Pagliacci’s, Canterbury Coffee, Planet Foods, Simply Sweet Bakery, and Lekker Foods, for converting one-time neighborhood cynics into loyal customers.
As new business ventures into Oaklands/Fernwood, Koffi finds itself in a new role: neighborhood anchor. It’s a role that Manhas doesn’t take lightly. “We have a large community involvement,” says Manhas. “ We have raised money for neighborhood improvements – new benches and flower pots – as well as for families. Recently , we helped raise over $20,000 neighborhood family who had a very sick baby.”