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Cuppy’s Coffee, Smoothies & More serves fresh coffee in under a minute. Janice Gable Bashman tells the story of how a one-year-old coffee franchise is successfully taking on Starbucks and its other competitors.

Best Coffee in town or it’s free.” That’s a brazen statement to make, but that’s what Cuppy’s Coffee, Smoothies & More is promising, says company President Doug Hibbing. So how does Cuppy’s Coffee set itself apart from the competition? By hand-pulling each espresso shot, getting the coffee or smoothie beverage to the customer in under a minute, and using award-winning products.
Cuppy’s Coffee features Caffe D’Arte coffee, an award-winning coffee known all over America and in parts of the Far East. In addition to coffee, lattes, and espresso, Cuppy’s features 100 percent natural fruit smoothies. The smoothies contain no artificial colors, sugar or preservatives and provide three servings of fruit in each 16-ounce container. “Our franchisees currently offer at least four flavors on the menu,” says Hibbing of the smoothies, “but we are in the process of doubling this selection for 2008.” In addition to the smoothies, there is always one seasonal beverage, such as Mint Julep, Pumpkin Patch Mocha or Candy Corn Latte for customers to choose from. Juice bars, muffins, bagels, sandwiches, wraps, soups, salads, cookies and chips are just some of the interesting food items that Cuppy’s offers in addition to gourmet coffee and smoothies.

ITS OWN CONCEPT

Cuppy’s Coffee, Smoothies & More, a one-year-old franchise based in Fort Walton Beach, Fla., began when a holding company purchased the assets of a coffee licensing company and attempted to perfect the existing brand. This led to the development of a new company and the decision to go with a franchise model, explains Hibbing. “Cuppy’s invited licensees of the prior company to become franchisees, which gave us a good running start on our growth and development.”

Today, Cuppy’s has big plans for growth. Currently there are 70 open Cuppy’s throughout 25 states. Cuppy’s has 84 leases signed with franchisees that expect to open within the next six months, approximately 250 signed franchise agreements, and a projection of 1500-2000 units in the next five years. Cuppy’s is leading the industry with the number of stand alone dual drive-thru units open throughout the United States. The Cuppy’s franchise also offers Cuppy’s Cafés, kiosks, mobile units, and carts. Cuppy’s Coffee, Smoothies & More is also expanding internationally with franchisees in Canada, Puerto Rico and South Africa.

Cuppy’s measures its position as a leader in the coffee market, and its percentage of growth, in relation to its competition. “We are experiencing unheralded growth both as a franchise and a player in the coffee and smoothie industries. We will open a minimum of 250 franchisees in the next year or so—positioning the company as a force to be reckoned with on a global scale,” says Hibbing.

Helping to achieve this goal is the fact that Cuppy’s was awarded the highest score ever achieved (99.5 percent in compliance) for fair franchise standards by the American Association of Franchisees & Dealers (AAFD), “whose philosophy is near our own,” says Public Relations Director Andi Davidson. “We

observe the golden rule in our franchise contract. This is a collaboration or partnership, not a dictatorship. We value our franchisees’ suggestions.”

Although the coffee and smoothie markets are competitive, Cuppy’s is not concerned. “There are a lot of coffee concepts out there that have as many stores open as we do, but most of them have been open for 15 years or so,” says Davidson.

“We are really growing tremendously and hope to be within the top five by 2009. We don’t want to be number two—we are truly our own concept.”

CALL IT “FUNKY-MODERN”

Right now, Cuppy’s Cafés have a traditional look and feel, similar to the competition. The Cuppy’s Cafés are “fun, fresh and really colorful, but we want to create an ambiance that can only be found at Cuppy’s,” says Davidson. “We are adding to the café interior design selections available to our franchisees – everything from the lighting fixtures, to the colors of the bulbs, the flooring and the countertops. We are adding funky couches, artwork and unique Wi-Fi stations.” This image revamp will enhance the “look and feel to more of a modern lounge type atmosphere geared toward Generation Y,” says Hibbing. He is quick to point out, however, that Cuppy’s will still appeal to all age groups. “It won’t be so outlandish that it will drive away those in the baby-boomer years, but it will definitely have a wow factor with younger people.”

A SENSE OF COMMUNITY

Cuppy’s franchises are locally owned and operated, so each location gives customers a sense of community and the franchisees benefit from a loyal customer base. “Customers and franchisees are members of the same churches and other organizations, so there is a personal relationship between the customers and the store owners,” says Davidson, “and that is a huge factor” in the success of the business.

Cuppy’s prides itself on “working like a family. We give our franchisees the best service we can because we care about them and we’re looking out for their best interests,” says Davidson.

BUILDING SUCCESSFUL FRANCHISES

How does Cuppy’s make franchisees successful? With a proven business format franchise that is relatively rare in the industry. Cuppy’s provides franchisees full customer care in-house instead of outsourcing it. “We guide our franchisees through the opening process, and then we support them afterwards to make certain the store is running at its optimal potential.” Cuppy’s also monitors store sales and responds promptly to “anomalies outside the normal fluctuation of business,” says Hibbing. “Cuppy’s has a Business Development Department dedicated to mentoring our franchisees in all of their business endeavors and helping them achieve their goals.”

Before opening, Cuppy’s franchisees attend Coffee College, which consists of a week of training at the corporate headquarters in Fort Walton Beach. In addition, franchisees receive four days of on-site training at their own location during their opening to help them get up and running. “We want to ensure our franchisees are well prepared to open their own business. Our success as a franchisor depends on the success of each one of our franchisees, and we take every precaution to make that happen,” says Davidson.

That is why Cuppy’s in-house marketing department creates an ongoing variety of promotions and campaigns to help motivate franchisees’ sales. The in-house real estate department works with franchisees to obtain premier locations and maintains a book of such locations that are looking for franchisees. “It is not out of the realm of possibilities for someone who lives close to one of these sites to come in and sign a contract, have their lease negotiated in 30 days or less, and be open within six months, depending on the type of location,” says Hibbing. Cuppy’s Web-based ordering system allows franchisees to purchase everything they need from an espresso machine to smoothie mix to cup sleeves at wholesale pricing. Additionally, Cuppy’s is in the process of expanding its distributor network to help lower shipping costs and time. The in-house finance department provides loan assistance and guidance to franchisees throughout the financing process as well. It’s a successful business model that lowers cost, maximizes potential and creates success for Cuppy’s franchisees.

Ultimately, Cuppy’s Coffee, Smoothies & More’s success boils down to its proprietary systems, products and service. “It’s the quality of our drinks and the attention to detail that creates an authentic experience for our customers and sets us apart from our competitors,” says Davidson. “That’s why we have customers and that’s why they keep coming back.”

Volume:
4
Issue:
4
Year:
2008


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