Canadian joe | A conversation with Nick Northcott, founder of North Cottage Coffee in Damariscotta
Founded: February 2008
Employees: One in winter; four in summer
Startup costs: $185,000
Projected revenue, year one: $150,000
Projected revenue, year two: $200,000
Contact: 563-7779
77 Main St., Damariscotta 04543
www.northcottagecoffee.com
Tell me about your business. What makes it unique?
It’s a coffee shop that is, in many ways, standard. One unique feature is that we also make our own Italian ice cream. And another unique feature would be that we offer as much organic and fair trade ingredients as we can. For example all of our coffee is organic and fair trade. We get our coffee from Wicked Joe, which is a roaster in Brunswick.
Why did you decide to open North Cottage Coffee?
Well, it went hand in hand with [my wife and my] decision to move to this small town, in that I basically told my wife that if I was going to live here, I needed to get good coffee. And she said, “Well, why don’t you open a coffee shop?” And I said, “OK, I’ll do it.”
We moved here from Vancouver, British Columbia, which is about a three-hour drive from Seattle, and it really experienced the same specialty coffee revolution that Seattle went under with Starbucks and so on. To me it seems like that phenomenon of what they’d call “fancy coffee” here in Maine has been a West Coast phenomenon that has moved east.
What did you learn from running your previous business in Canada? How is running a business in Maine different?
My previous business was a vending machine business and applicable knowledge mostly came from the nuts and bolts of how to manage finances and keep costs in line. The actual business is not very similar at all, but it helped me in organizing a new startup from a money point of view. The tax laws and employment laws are all different here and for incorporation I had to undergo a different process.
How did you finance the launch of your business?
From the sale of my previous business.
How do you market your business?
We market primarily through press releases in our local paper. Our other main source of marketing comes from our customer base having a point-of-sale system that has customer cards attached to it — in return for a customer card [which gives customers a free coffee after they buy 10], they give us their personal information and we market directly to them via email. We also do non-press release-type ads, so newspapers and direct-to-customer advertising are our two main sources.
What has been your greatest challenge running this business?
I’d say keeping costs down, managing employee hours — in this part of the world you’re really busy for the summer months and then the rest of the year you’re not, so being aware of how much of this and that you’ve got to order and how many people you’ve got on staff and how quickly it changes is pretty crucial in terms of not overspending on the cost of running the business. So our first year here I made a point of being overstaffed while we worked out the kinks of how to keep it down to the bare minimum in the winter.
What were some of the things you learned about running a business during your first year?
I’ve been learning a lot about having employees because my previous business was just a one-man show. So to me the steepest learning curve has been how to have employees. How to have a successful boss-to-worker relationship is definitely challenging. Also, in terms of biggest challenge, anticipating what customers are looking for on a season-to-season basis in terms of what we offer for specials or the type of baked goods we have, making sure that we’re ahead of their expectations, that’s a challenge. And marketing is a big challenge, especially in-store marketing. I’ve noticed that in the successful coffee shops I’d like to emulate, there’s a lot of visual marketing that goes on. What people see they often buy and I need to expand that here. The challenge is to do that without being tacky.
What are your goals for the future of your business?
Our goal is to eventually have a few more North Cottage Coffees in Maine ... having maybe four or five locations by year 10.
Interview by Mercedes Grandin
New Ventures profiles young businesses, 6-18 months old. Send your suggestions and contact information to editorial@mainebiz.biz.
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