A cybercafe is a business just like any other business, but due to the novelty of the whole industry (10 years young, as of September 1st, 2004), the basic business models are still very much in the development phase.
There have been many failures, but many successes in the cybercafe industry as well.
The most important thing is to learn from the existing cybercafes and those that failed before you open your own Internet cafe.
The name of the game is planning ahead. To organize your thoughts on how to approach opening a cybercafe, you should make a business plan.
Start Internet Cafe Business - Business Plans
Business plans serve multiple purposes. Business plans are great for:
- Organizing your thoughts on starting an Internet cafe
- Checking the viability of the business (as business plans normally include projections of profitability)
- Giving investors, prospective investors, and other related parties an idea of how the business will be run and how you are going to make money with it
There are many ways in which you can organize your business plan to start Internet cafe business, and you can use some of the available ready-made plans as the framework for your own business plan.Generalized, the items in the Internet cafe business plan usually include:
- Stating your business goals
- Strategies you'll use to meet your business goals
- Potential problems that may confront at your Internet cafe and ways to solve them
- The organizational structure of your cafe
- The amount of financial capital required until the business becomes self-financing/profitable
Start Internet Cafe Business - Franchises
Franchises in general are businesses with pre-made business plans. You simply take the business plan along with the brand name, and start your own branch.
The benefits of using someone elses business plans and brand is that the brand may have gained recognition and the business plan may have been proved in real life.
The downside of entering a franchise to start Internet cafe business is that you may have to have significant amount of capital to enter the franchise agreement. Also, you have to follow the franchise rules in order to continue using the franchise brand.
How to Start an Internet Cafe - Business Models
When building your plan for business, one of the most important things to consider is the overall business model.
There are three main business models for Internet cafe businesses, but naturally you can use any variation or innovation within imagination to start Internet cafe business.
In fact, giving a unique selling proposition (distinguishing your cybercafe from the competition) should be one of your objectives.
The first business model, and the oldest, emphasizes giving basic Internet connection. You may even decide to forgo the cafe side of business altogether and start an automated Internet kiosk instead.
This type of business is typically volume based, so you need to get a lot of traffic to your location in order to make money.
The second basic model expands from the first model and includes offering a lot of extra services, such as a full cafeteria and basic office services, which is one way of to start Internet cafe business.
Under this model, your customers may come to the cafe for a variety of reasons, some for the coffee, some for the Internet connection, some for the other services.
Under the second business model, some have even expanded into Internet cafes from other business areas.
For example, some computer repair shops have opened cybercafes, so that customers can get a favorite place for both repairing their computer and surfing the web on a cafeteria.
In fact, under the expanded Internet cafe business model, you can upsell other services, such as home broadband connections, or computer accessories, to your customers.
This may bring additional revenues, but can also make it less clear to customers just what your cafe is all about.
Under the third major business model, Internet cafes offer specialized services to their customers. For example, some cybercafes have specialized in serving PC gamers.
Another popular specialization area is to offer business center-like services, where you offer an "office away from office" to your (business) customers.
Specialized Internet cafes typically need to charge a bit more in fees from their clients, due to the fact that the potential number of customers is simply fewer than with more generic business models.
However, the upselling opportunities may be as good or better in the third business model than in the second (Internet game cafes can sell computer games, business center cafes can sell other business services, for example).
