Building A Matcha Tea Shop Case Study
Nestled in the heart of Marylebone, a unique transformation was underway. This is the story of “How Matcha,” a vibrant project helmed by two enterprising souls – Deepak from the UK and Axel from sunny Southern France.
Unlike the typical startup, this venture involved a takeover, a revamp, and a whole lot of passion. At the outset, Deepak was already busy building the Pearl Lemon Café, a haven for coffee lovers and outdoor enthusiasts alike. His daily ritual involved seeking out new cafes, ordering his favorite brew, and setting up shop with his trusty laptop.
The acquisition of “How Matcha” was a natural extension of this love for outdoor workspaces. It made perfect sense. Deepak wasn’t just an advocate for great coffee; he was also the mastermind behind “Plant Sumo,” a successful vegan food subscription business. Given his commitment to promoting healthy food choices, adding a menu of healthy matcha drinks was a logical step forward.
Inspired by insightful restaurant marketing strategies and armed with unyielding determination, Deepak decided to seize the opportunity. Matcha was on the rise, captivating the UK market with its powdered green magic. Its popularity was growing, and the trend showed no signs of slowing down, pandemic or not.
“How Matcha” seamlessly fit into this narrative. It wasn’t just a café; it was a haven for matcha enthusiasts. Located strategically in an area teeming with business potential, it was a year-old establishment that had already proven itself. Deepak recognized its untapped potential and was determined to elevate it even further.
The Initial Purchase
Well, due to the previous owner’s personal reasons, he decided to let go of How Matcha and focus on his family and what he wanted to do the most. Running a cafe and doing marketing was not his thing, so he decided it was time to sell it to someone who could make it thrive more. The cafe needed some in-store and online work that he just didn’t have the time to work on.
How Matcha had work that had to be done regarding remodelling and supplier set-up. The previous owner had gotten it going, but much work had to be done. Delivery platforms were neglected, there were poor supplier relationships and much more.
Deepak was someone that came at the perfect time. And when he fully acquired the business, rather than operating it immediately, he first needed to review the transition thoroughly.
He studied the shop’s daily operations, met the staff, visited regularly, met the suppliers, talked with the landlords, and communicated with some potential customers passing by the shop.
Our founder saw room for growth in physical and digital marketing, so he maximised that. Deepak went to local gyms, hotels, businesses around, and residences to talk to people and drop off flyers if needed. He also tasked the Pearl Lemon team to amplify its online presence across the internet.
The Scope of Work
With a budget of £57,000, the How Matcha project had to be executed perfectly, ensuring every aspect of the acquisition and revamp aligned with Deepak’s vision for the establishment. This cost would include necessary expenses and investments – from purchasing the cafe itself to acquiring necessary equipment, supplies, and ensuring a smooth transition of agreements and contracts.
This budget would be allocated to about ⅛ of marketing and improving their reputation due to online reviews about the quality of the product. Deepak understood the significance of positive customer experiences in shaping the success of How Matcha. Investing in strategic marketing campaigns and initiatives will allow him to build a loyal customer base eager to explore the delights of matcha.
Half of the budget would be for replacing and fixing the interior of the building, upgrading the furniture, and procuring necessary large equipment.
The final ⅛ of the budget was allocated to sampling and sourcing new suppliers to replace any that may have fallen short of the desired standards. Deepak’s commitment to quality and excellence led him to explore alternative options, seeking partners who shared his passion for superior ingredients and ethical practices.
The remaining fraction would be spent to cover any legal fees and filing expenses during the process to change over contracts and licenses into the new ownership’s name.
By diligently allocating the budget across various critical aspects of the project, Deepak ensured that every pound was used wisely to maximize the potential of How Matcha. The careful planning and strategic distribution of funds allowed for a comprehensive transformation that would position the cafe for sustained growth in the competitive matcha market.
The fundamental idea is that it reflects the Pearl Lemon company ethos >
Young, vibrant, energetic and full of energy and life.
How Matcha already embodied this with its bright pink and green decor, so already a step in the right direction.
This project included the following:
- Negotiating rental price
- Getting the team their level 3 and level 2 food safety & hygiene certifications (we weren’t sure who had what in terms of existing staff)
- Taking over agreements we could
- Getting insurance
- Getting various licenses and relationships built (waste, internet, etc.)
- Setting up supplier relationships
- Placing initial orders
- Equipment research and ordering
- Finding contractors to paint and make small repairs
- Getting pavement licenses (the table and chairs license was a part of this)
- Getting alcohol licenses
- Marketing
- Delivery platform set-up (we had to get the accounts signed over to us, banks changed and then some platforms made us do a full re-do)
- And more…
Costing the Ingredients and Equipment
Surprisingly enough, while this took the most time on our previous projects, costing turned out to be the fastest part of the How Matcha build.
The previous owner shared existing relationships and contracts. However, Lydia and Axel took a virtual deep dive into the details. Their objective was to assess whether it would be more advantageous to stick with the current suppliers or forge new partnerships with suppliers already associated with Pearl Lemon Cafe.
Coffee was one of those things- changing this providor made it easily over 50GBP cheaper per order.
The Design
The previous owner already had a headstart on the pink and green design of How Matcha, so we decided to run with that and improve it. This meant finding nice green chairs to go with tables outside, neon signage for more photo opportunities inside and a fresh coat of paint to make the space well…more fresh.
With this, we also replaced the upholstery on the furniture and implemented new cleaning rules with the existing team because we found that it was a bit too dirty for our liking.
We also went “full steam ahead” with the pink as well. We purchased pink signage, soap dispensers, tip jars and more to really get the colour spread to every nook and cranny of the cafe.
Matcha Testing
We wanted the best matcha we could find for the cafe. We spent a week reviewing different types of matcha, organising samples to be sent to us, and going to matcha events to elevate the cafe.
Upon taking over the cafe, we were confronted with several 1-star reviews that lamented the poor quality of the matcha previously served. Determined to turn the tide and restore the cafe’s reputation, so we HAD to change this.
After all the samples and testing, we found a supplier straight from Japan that got us Super Ceremonial Grade Matcha.
This is considered some of the best, with a vibrant natural green, no bitterness, and no need for added sweetener. It was such a huge success we also ordered it in tins for people to buy in-store or online.
Designing the Menu
Designing our menu was one of the most immersive parts of the setup.
We wanted something classic and familiar but a few unique offerings that would set us apart. We relied heavily upon Axel’s experience being from Southern France. He specialised in taking his experience and looking at what was missing from the local market to have us stand apart and above the crowd.
Menu design also included looking at local produce and shops to push affordability and sustainability and support local. We found an amazing local matcha bakery to get us cookies, crepe cakes, chocolates and more (all with matcha heavily featured).
First things first was our coffee drinks. We wanted to include all the classics (latte, cappuccino, hot chocolates, espresso, Americano etc.)
But this is a matcha cafe. So we spent a full week designing and developing a matcha-based menu with our team and our supplier. We developed over 15 unique matcha drinks and other caffeine-free options to give life to the cafe.
A peek at some of our items is as follows:
First things first was our coffee drinks. We wanted to include all the classics (latte, cappuccino, hot chocolates, espresso, Americano etc.)
But this is a matcha cafe. So we spent a full week designing and developing a matcha-based menu with our team and our supplier. We developed over 15 unique matcha drinks and other caffeine-free options to give life to the cafe.
A peek at some of our items is as follows:
Progress
First, while our Procurement Director was sourcing items for the cafe INSIDE, we got contractors to start on the design.
Because the previous owner got a head start on this, we could take over contracts and relationships and pick up where they left off. Some of the biggest things were fresh paint, new furniture, new cleaning procedures, replacing neon and ensuring new rules were followed.
Meanwhile, back on the operations side of set-up was hiring and buying.
Hiring and Training
From a hiring standpoint, ads went out for HR to monitor and send people directly to Dee and Axel. We needed a skilled and bubbly team to great customers – bubbly was non-negotiable.
We had some struggles keeping people at first – some people with two jobs would end up not showing up after a few days and not being interested in the job. We had some of the original team stay for a while, but as we tightened down on the space needing to be properly cleaned and locked up at the end of the day- they left.
We had an amazing challenge of training 100% from scratch. Our team attended external training events to learn more about the industry. We built an online training course, a training packet, and more for the team. This all had to be matcha focused, and we ended up with 5 massive pdf documents of recipes, procedures, instructions and allergen statements.
These included online courses on how to open/close, manage the shop, customer service and more.
Other supporting documents matched the video training, recipes, and ingredient cards to help support the staff should they get questions.
We ended up with a great team.
Part of this setup was also finding what we felt the best POS system would be. After checking out close to 10 suppliers and sitting on various calls, we chose to partner with Square.
Their platform is secure, easy to use and edit, and had reasonably priced equipment bundles we needed.
Initially, the previous owner left us with a Zelle system, but we opted to switch to Square to manage all 3 locations from one palace. This also simplified our accounting system to have one less system to get information from.
The Legal Stuff
Legal “stuff” was a long, detailed process. It was mission-critical not to miss anything to avoid delays in our grand opening or risking the potential of being shut down.
The first was applying for a food license. This meant:
- At least one person needed a level 3 food hygiene certification (this took 5 hours per person). We were lucky to have this already, so this transferred to the new location.
- We needed to have public liability insurance (this meant hunting and getting quotes). We had a tough time with this as we also did catering, so we needed close to 1 million in coverage for public liability due to serving food. Again back to the agent, we went to add on another location.
- We had to build a fire safety analysis (to prove we were safe). This was a surprisingly tough document to build as we had to show everything was up to code and everything was fully mapped out. An old floorplan was shared with us, but we had to redo it fully.
4. We had to build a HACCP (this over 50-page document was built to show we can handle any issue or potential hazard from mould to spoilage to fire or flood). This took close to a week to build fully, with a template guiding us. If there could be a contaminant, we had to list what it was, how it could happen and how to prevent and handle the situation- from chemicals to glass to illness and everything in between. We were gladly able to use the same document and do a rebrand because it was the same as our first.
5. Prove we have a waste and rubbish contract. This was simple and most of the time was spent finding the best price for the best service. We did end up keeping the existing contract for ease.
Other legal items that came next were registering our logo as a trademark so no one could pretend to be us, going through alcohol license courses and tests (this one was another two-week process) and getting a premises license to serve alcohol. The owner at least gladly signed over the rights to the trademark, so we owned it.
Delivery Platforms
Setting up How Matcha on delivery platforms was a key part of our marketing strategy. As a new business, we couldn’t solely rely on foot traffic to bring people in. This meant relying on delivery platforms to get us visibility online.
How Matcha was on Deliveroo and Uber Eats.
How Matcha had the unique challenge of already existing. So it took a few weeks for their support teams to sign over the existing accounts to us and change the bank information to our bank.
Once this was done, Lydia went to work.
Delivery platforms maintained an ongoing project through year one- experimenting with ads and offers, changing descriptions and photos, and making bundle deals. We invested much time and energy into this portion of the project to gain as many new and recurring customers as possible.
We found there was a very particular formula for having the perfect restaurant listing on these platforms. We spent 80 hours per platform after going live fine-tuning and developing our “secret sauce”.
Descriptions must be a particular way; pricing has to be set just right, images are factored in, reviews and more. It was a true challenge.
Inventory and Stock Management
To give you a feel for what we had to purchase:
- Chairs
- Cleaning supplies
- Mop
- Square Terminal
- Tablet for square
- A-board for outside (we needed to get those views from the street)
- Sandwich press (because we needed a new one)
- And more…way more
Then there were the consumables:
- Startin with supplier relationships
- Milk suppliers
- Pastries
- Toasty supplies (mostly avocado toasts)
- To go supplies for sandwiches
- Juices
- Matcha
- Coffee
- Coffee Syrups
- And more
Once we established everything we needed and had. We built a purchasing spreadsheet to start while we honed in on who was best.
Choco was an absolute life saver, making ordering for us way easier as it put everything in one place- no logins, no spreadsheets…no nonsense.
Prior to the app, Lydia and Axel worked in one giant shared sheet with a check box system. It seemed to be the best way to be cohesive with a 5-hour time gap. Lydia would include all information needed in the sheet. Such as product name, a description, where it was for, where it was from, the cost and the URL. Axel would then check the sheet when things needed to be ordered, check off a little box and write in how many packs.
Lydia would check the sheet at her EOD and order for the next day or within 48 hours. As we got busier and expanded, this became hard to manage, and other team members requesting items wouldn’t use the sheet. So choco was a definite lifesaver- it is on our
The internal team was quick to establish purchasing protocol with Lydia. After a few weeks of watching inventory, a rhythm was built so that when there was a week left of an item, Lydia would order it to be delivered in about 72 hours, and then there wouldn’t be an excess of stock.
Marketing Efforts
Marketing cannot be forgotten in our cafe’s setup.
We made offline and online efforts to ensure we hit the ground running. Marketing work began before a physical location was found.
This meant building the website, social media accounts and directory listings. Once these were built, we began SEO work to get greater visibility on Google and have an active online presence.
As soon as discussions of purchasing How Matcha began, we started to work on the above and below.
Parallel to our online efforts, we engaged in offline marketing initiatives to boost local visibility. We initiated a comprehensive flyering campaign around the Marylebone area, strategically placing flyers in key locations frequented by our target demographic.
Additionally, we actively encouraged customers to write reviews and refer friends, offering incentives such as discounts for their participation. This resulted in an overwhelming response and an unprecedented demand for our loyalty program, where we had to order over 5,000 loyalty cards in year one.
We also had QR codes at the register to further streamline the customer experience and incentivise engagement. Customers could easily scan these codes to avail themselves of exclusive discounts and leave reviews.
The health & fitness opportunity
Matcha is considered a superfood as it is packed with antioxidants. It serves as a great alternative to caffeinated drinks.
By offering an array of matcha-themed drinks or decaf matcha-free drinks, we were able to appeal to those trying to stay on the lighter side of the caffeine spectrum.
How Matcha is also in a vastly different space than Pearl Lemon Cafe, so it had to grab people’s attention on the go quickly. Healthy highlights were our A-board’s focus to pull people in.
The Product Opportunity
We found plenty of people loved matcha and couldn’t get enough of it. Lattes, pastries and boba. But also wanted to take this love home and gift it to others.
We will talk more about the online sales aspect later on, but having a matcha theme cafe allowed us to take social media and Shopify by storm with unique user-generated content and get a piece of How Matcha at home.
Ranking Locally
We greatly benefited from developing a local marketing matrix to outrank all of our competitors.
Some of these strategies we employed was having a beautiful A-board out on the sidewalk for people passing to see on the street and across the street should they not look up at our sign.
We extensively researched local businesses and schools and partnered with them for special events. We also launched ourselves on numerous loyalty platforms as well. Having virtual loyalty programs and physical cards allowed us to extend our reach well beyond what anyone else could.
We greatly benefited from developing a local marketing matrix to outrank all of our competitors.
Some of these strategies we employed was having a beautiful A-board out on the sidewalk for people passing to see on the street and across the street should they not look up at our sign.
We extensively researched local businesses and schools and partnered with them for special events. We also launched ourselves on numerous loyalty platforms as well. Having virtual loyalty programs and physical cards allowed us to extend our reach well beyond what anyone else could.
Part of ranking locally was also getting in on associations and clubs because then our name ended up far and wide.
Places like Glassdoor, next door, yell, yelp and more allowed for us to gain an amazing level of visibility, and we quickly garnered a loyal following.
Local PR was also a huge part of this section of our launch. We wanted to be as visible as possible. We ended up being published in local newspapers and prints; we also ended up being published in numerous online publications as well.
This location also presented a lot of unique marketing opportunities as well.
It has 3 hotels within 3 minutes’ walking distance:
It sits below a residential block:
The average income for this postcode is:
Next door to it is a laser clinic, nail salon and luxury clothing store
The adjacent street has several other eateries suggesting a strong local market:
The local ‘hip’ cafe supports £4+ pricing for Matcha drinks
And has a strong local business based on it’s Google reviews:
In general, in the area – according to 192.com there are 200 active businesses just in this postcode
Of these businesses, there are 5+ gyms within a minute’s walking distance.
All in all – this represents a significant local marketing opportunity for the business.
Reviews, Reviews, Reviews
Reviews are mission critical in any industry, but especially the food and beverage space. Many sub-markets for restaurants are over saturated…everyone has a dream of having a food cart, a cafe, or a bakery.
This means you have to be seen as the best of the best.
The way to solve this problem is, of course, getting reviews. People spend hours researching before visits, purchases, etc.
In relation to the previous section, we got listed on directories for local visibility when people looked for our competitors in London and Fulham. Then from here we started getting reviews.
We made purposeful efforts to get reviews on Facebook, Google My Business, Yell/Yelp, Trust Pilot, and more. We ended up with hundreds of 5-star reviews spread over multiple platforms.
Part of our online marking efforts included more than just getting reviews. We developed a specific strategy to replying to reviews as well. With taking this “industry secret” approach, we were able to help boost our ranking within local searches as well.
Shopify and E-commerce
Something unique we started to develop early on was our Shopify store. Shop.pearllemoncafe.com was developed to sell our matcha and ship it to customers plus other retail items we sold in store.
There was more than this, though. We got our design team heavily involved with Lydia on this project. So while she spent a week building the website and ensuring the checkout worked and it was functional, the design team started working on various merchandise.
Shopify and E-commerce
This merchandise was to include t-shirts, tote bags and mugs. Each “section” we decided would have up to 10 different designs or slogans that would be repeated across all item types. This way if someone really liked “So Little Time, So Matcha To Do”, they could get a mug, tote and matching t-shirt to express their support of all things matcha fully.
After a month of designing and a week of website building, the store was ready for orders and was added to our various sites to buy directly from.
We also enjoyed ordering samples and having a fun photo shoot to document the project.
Hurdles and Obstacles
Suppliers and equipment:
Most initial suppliers were surprisingly expensive to work with. We HAD to cut costs to allow this location to turn a profit. It took a solid week of calls and negotiating to ensure all aspects of the menu would be covered and cut costs by close to 40%.
Cleaning:
The team that came with the cafe was a bit subpar in terms of cleaning. Once we got in, we found various equipment and furniture were never moved- thus, there was a build-up of crumbs, spills and sticky residues. Heavy training and cleaning were needed. As a direct result of poor cleaning we had a fly and ant problem to take care of soon after ordering.
Reviews:
While Deliveroo and Uber Eats had some great reviews of the existing shop. Google was another story. It was riddled with 1-star reviews about poor service or matcha. This gave us a huge push to answer all reviews and change matcha suppliers to something better.
Internet:
The Internet remained a big issue for this location. For some reason, it liked to disconnect or go on the fritz. We had to try different providers as this would cause delivery tablets to disconnect, and we would lose out on sales.
The Outcome
How Matcha turned out to be both lovely to look at and successful. As the business became established, we have easily seen 13% minimum growth month after month. Growth was even higher month after month on Deliveroo.
How Matcha continues to grow and remain a profitable business. We look forward to the various catering events and businesses that the cafe brings in. And seeing how often visitors tag us on their social media profiles and the joy the pink and green brings them.
