Expanding a cafe into a new location is a challenging but rewarding process. Creating a consistent brand experience that’s relevant to your new local audience is as important as getting your finances sorted for scaling. Min Chai and Eddie Stewart, owners of Tokyo Lamington, have first-hand experience doing just that. They’ve built on their cult following in Sydney by opening a standalone shop in Melbourne. After chatting to the duo about their learnings, we’ve pulled together five tips for business owners looking to introduce their cafe to a new location.
Maintain consistency in product and branding
When planning to open more doors for your cafe, remember the key selling point that sets you apart from competitors. During their time together at N2 Brunch Club in Tokyo, dessert chefs Min Chai and Eddie Stewart were inspired to create a new twist on the traditional Aussie Lamington. Bringing the concept to a Sydney audience, Min and Eddie describe why it’s so popular.
“It’s a niche product. If you grew up with lamingtons, they’re always terrible. They’re a dry sponge covered in chocolate and coconut. You grew up eating that as a kid. No one has taken it to the next level. We thought it’s such a good medium, a good template, for us to be creative,” says Min.
When asked about the best seller, Eddie says, “It’d have to be the ‘OG’, the original. A jam and cream centre with a vanilla sponge dipped in chocolate then in coconut. It’s our version of what an OG lamington should be. It’s my memory of when I’d be baking with my grandparents. It brings back a lot of nostalgia for people.”
As the idea gained traction and fans, the pair decided to open a store in Melbourne. With interest from other brands wanting to embark on collaborations, it’s important to remember your own values, says Min, which includes “learning to say no. Aligning with people who share the same values is important to us now. We’re big on sustainability and inclusivity, and we only work with brands that speak the same.
We love collaborations because it’s a chance for us to do what we love. It also pushes us out of our comfort zone. We do lamingtons, but working with other brands, we can be outside the mold.”
Create a welcoming environment for customers
Opening during COVID lockdowns led Tokyo Lamington to focus on creating a warm and safe space for their customers. Min says, “We want to create a cozy environment. When we built the shop, there was a lot of light, comfortable seating, soft lighting, soft furnishings, and lots of plants. We put up a Pride flag to let our customers know it’s a safe space.”
As well as factors like lighting, seating, signage, and decor to make your customers feel physically comfortable, also consider how your team can help to establish your brand values and create a welcoming experience.
“We have a very diverse team from Indonesia, Nepal, Thailand, Korea, Taiwan, and Japan. They bring their experience, nostalgia, and flavours, and we incorporate them. When we do that, it speaks to a broader community, you’re not just a Japanese concept. People are noticing those things,” says Min.
Prepare to scale your operations
More cafe locations mean a lot more cake! Consider how you can utilise economies of scale to serve more customers more efficiently. Min and Eddie describe how purchasing a cake-cutting machine reduced labor and improved efficiency – and staff satisfaction.
“Our staff were spending half an hour [on cutting] every cake — they get 70 pieces of cake out of each slab. We bought a machine that cuts cake precisely. In about a minute, it cuts a whole slab of cake,” says Eddie.
Min adds, “The machine was about $30,000 – it was a stretch for us financially. But after implementing the machine, our productivity increased by 20% overnight. That was one of the best decisions we’ve made.”
“It brought so much joy to everyone that they don’t have to cut with a knife by hand and measure it. Now every single cut is perfect and square, and it takes half the time. They can actually do fun stuff in the kitchen, like designing menus and playing with flavours,” says Eddie.
Navigate financial challenges as a team
Expanding your cafe can come with financial challenges, from rising costs to cash flow management. Tokyo Lamington’s owners have faced these challenges head-on, being cautious not to overspend and to live within their means.
Min says he and Eddie have complementary skills that they leverage when it comes to finances. “When it comes to money, we both take it very seriously. We usually go, ‘let’s put our heads down, and see what we can do. Let’s work through this together.’ We’re lucky we share the same values when it comes to managing finances. I’m more the finance guy and Eddie, he’s more the spender. He’ll understand and we’ll work things through together.”
Business owners across the board are also adjusting to the rising cost of living. Min explains the benefit of keeping the whole team across where the business is at financially.
“Recently it was egg yolks and egg whites – we use a lot of them and we’ve been buying commercial, not by the pallet. We’re at a point where, now that we have two shops, we have to scale our production. The staff came to us and let us know how we can save money. I really appreciate that.”
Build a sense of community
Building a sense of community around your business makes you more resilient as well as authentic and attractive to customers. Tokyo Lamington’s owners have built camaraderie with other local businesses and rely on the support of their loyal customers.
Min says, “We’ve gone through a lot during COVID, trying to stay in business. We work together to help promote each other. That’s what defined us when we started to grow – that needed to be a key part of what we do.
We have a network of people that support us along the journey. In Sydney, our neighbour is a nursery. When we built our Melbourne shop, the nursery drove 10 hours to set up plants for us. That’s what sets us apart from those million-dollar shops – we’re very proud of that.”
To expand their cafe to Melbourne, Eddie and Min used a Square Loan. By aggregating and analysing your Square sales, payment frequency, and new and regular customers, among other criteria, we can see when you might be ready to grow with a loan. Pay a set fee rather than interest rates, and repayment amounts and timing work in step with your business activity. Learn more about how it works here.
All loans are issued by Square AU Pty Ltd. (ABN 38 167 106 176). Valid Australian bank account is required. Actual fee depends upon payment card processing history, loan amount and other eligibility factors. A minimum payment of 1/18th of the initial loan balance is required every 60 days and full loan repayment is required within 18 months. Loan eligibility is not guaranteed. Eligibility criteria include consistent and continuous payment card processing through Square. All loans are subject to credit approval. Terms and conditions apply.