Square Champion AMA: Turn Customers into Community Featuring Kat from Quokka Coffee

[Tom]

Hello Seller Community!

As part of our focus on Seller Community's Small Business Month, we're excited to feature Quokka Coffee for our next Super Seller AMA-style conversation.

Square Champions AMAs are “Ask Me Anything” forum discussions where you can ask business owners and experts about their strategy and lived experiences. Each event showcases a different Square Champion and the business topics they've mastered.

This month we welcome Kat, founder of Quokka Coffee, to host a discussion about the tangible benefits of exceptional customer service at your business. We're fortunate to have her share her experience with hospitality and community strategies, online and in-store presence, and Google review management — have a look at their 5-star ratings!

Kat’s the proud owner and operator of Quokka Coffee in Perth, Australia (@QuokkaCoffee in the Seller Community). She and her team have been working since August of 2021 to revolutionize the hospitality industry one coffee at a time by being radically empathetic and ruthlessly kind — to their guests, their vendors, and most importantly to each other.

Ready to participate? Post your questions to this thread now. Kat will address your posts on Wednesday, May 31.

Not sure what to ask? Here are some example questions: 

• How do I ensure that my customers experience consistent standards of service even while I am not present in my business?

• What three things did you wish you knew before you created social media profiles for your business?

• What's the difference between customer service and hospitality — and why does it matter for my small business?
  
  

Please note that Kat Alarkon is not an employee or consultant of Square. The information she provides solely reflects her views and is not endorsed by Square. This Q&A is limited in scope and is only intended as a high-level overview of the topics discussed.

Click 'Reply' below to ask your question ahead of time, and we’ll answer every question on Wednesday, May 31. We're looking forward to hearing from you!

[Donnie-M]

What square services (i.e. Loyalty) do you use and how do they impact your mission to deliver the exceptional service?

And as a follow up, what do you think is unique to a coffee shop?

[QuokkaCoffee]

Honestly, as someone who’s had to navigate through a lot of crappy POS interfaces, I chose Square Register, Square Restaurants, and Square KDS because of how intuitive they are to pick up. I’ve trained a lot of people over the years and it’s the one system new employees struggle with the least. (And therefore costs an operator the least in comps and voids, and in customer goodwill when they’re low on patience.)

YMMV, but that’s what I want out of a POS system: something that’s designed to fade into the background as you foster genuine connection at the till or, if you’re in a restaurant, work expo.

Obviously there’s a fair amount of backend work to make the staff user experience seamless, but I think that’s what’s unique to our shop–that our POS isn’t something you’re trying to wrangle.

I have a lot of feelings about loyalty (the value, not Square’s product, although we use it too!), and a lot of them were reinforced when I read Colin Harmon’s What I know About Running Coffee Shops.

I hate coffee stamp cards and other cafe owners should think twice about implementing them.

Such a labor-intensive product (growers > pickers > sorters > processors > middle-men > importers > roasters > distribution > front of house > barista > customer; and that’s just the coffee side of it–there’s the dairy industry too!) shouldn’t be discounted especially if it’s a habitual purchase. We work really hard to make that cup the best it can be, and I’d be doing the business a disservice if I discount the thing we sell the most of and has the thinnest of margins.

So how do we make customers feel like they’re being rewarded for their continued patronage? Our Square Loyalty program is on a semi-invite basis, and the points guests collect for every visit can be used to claim a range of sweet and savory snacks. The margins on food are a bit more forgiving, and it’s a way to encourage new buying habits.

[Grainular]

How do you support your staff to avoid burnout? In what ways do you inspire them and motivate yourself to persevere and strive towards the kindness and compassion that your business provides? 

[QuokkaCoffee]

I’m guilty of taking on a lot more than I can handle in order to shield my staff from potential burnout. If anything, I’m literally kicking the team out of my shop (because they like hanging out after their shift ends) so they can live their lives. Of course I can’t speak for them, but no one’s approached me yet asking for less shifts because they’re struggling to achieve work-life balance.

But I can speak for myself. As I type out this response, I can tell you that I’m still recovering from the burnout that hit me really badly last August, and from additional incidents that made me want to quit this industry entirely less than two weeks ago.

I still think it’s possible for an entrepreneur to work a ‘normal’ 38-hour week. That’s definitely my goal; we’re trying, but the business isn’t quite there yet. What’s helped is actually being honest with the small team I have about what I struggle with as a leader, and by surrounding myself with as many people who are smarter and far more clever than me, who can revive me a little and make me believe once more in the ideals I set out when I first opened. 

Burnout’s a bummer. It’s something I like talking about, because apparently we don’t do it enough as a society and I think that needs to change.

[MizMakeup]

Hi Kat!

How do you get your team members on board with such lofty goals?

[QuokkaCoffee]

So many ways I could answer this question! 🙂 But I would probably narrow it down to a) practicing what I preach, and b) making absolutely sure the people on our team are the right cultural fit.

Making sure that new and existing staff spend time seeing and listening to how I interact with guests all the way from the point of sale to food and beverage handoff, but also encouraging them to be present in the moment and improvise if needed. I explain all the ‘touchpoints’ throughout the guest’s time with us (we’re talking anywhere from a minute and thirty seconds, through to longer stints in-store) and where we can insert ourselves into the experience without being overly intrusive.

It’s actually the most thrilling tightrope to walk because you want to be juuust the right amount of attentive without being overbearing!

[Flowerlady87]

What are some real life examples of ruthless kindness and radical empathy? And how do you balance that without bending over backwards or being walked all over? Especially for someone who’s naturally a people pleaser. 

[QuokkaCoffee]

Hello, fellow people-pleaser! 🙂

There’s some overlap with the answers I provided to @Bill_Auldbar's question–I hope you get to check it out!

Something I impress upon the team is to make sure people who order what other baristas might consider ‘outlandish’ are well taken care of. We go above and beyond to make these custom drinks to spec.

I’m talking folks who take five sugars in a 12oz cup, half-decaf/half-house blend combos, extra extra hot coffees, etc. We’re aware people like this have been shamed for their coffee preferences elsewhere and know that making it the best drink ever means they come back day after day, which means money in the bank over time.

Don’t get me wrong. Most of our team are coffee nerds with the technical expertise to boot. But we understand most peoples’ entries into coffee are tall, milky, and sugary drinks–and that’s perfectly okay!

(I honestly prefer serving these folks over those in the coffee community whose egos have swollen to the point where they’ve forgotten the meaning of the word ‘hospitality’.)

Our job is to meet these two extremes (noob and nerd) at their level, and our area reflects that variety in guest demographic; those who just want a consistently great cup get it anyway because it’s our default mode of operation.

Some other examples of our values being a two-way street:

• My team has almost exclusively consisted of women since we opened in 2021, and our brand of service often gets misconstrued as flirting. We’ve had to ‘fire’ a customer in the past for asking everyone out for non-platonic, one-on-one dinners. We’ve also flagged problematic guests internally, and created code-phrases in case staff can’t get out of uncomfortable situations with guests.

• We only accept BYO cups if they’re clean. Everyone’s trained to direct guests to a side sink where they can at least rinse things out, which means they have to step out of the line or if they’re in a rush, simply opt for a disposable; we are not ‘the help’ and refuse to be seen as such. Any serial offenders are escalated, and I deal with them.

If a mistake is made and discovered during order handoff, staff are trained to fix that mistake straightaway. All other food and bev orders are deprioritized until we can deliver the correct product to the right customer. Said ‘mistake’ is then pressed upon the customer (and later comped/voided in Square as necessary) as we smile and say, ‘You can keep that for yourself/bribe your supervisor/make a new friend [at your workplace]!’ It’s a win-win situation: my guest walks away happy, and I potentially gain a new one. Our advertising budget is zero dollars, and we push guerilla tactics like these.

[FrothyM]

How long did it take for you to become profitable? And how do you balance scaling to be profitable with 'one coffee at a time'?

[QuokkaCoffee]

A money question! I love these. 🙂 But I can only speak about my experiences running this particular cafe.

I hesitate to give a timeline because every business is different, and there are a million and one factors that could make or break you, that you can plan for but get thrown a different curveball anyway. 

What I can say is that we’re on track to double gross revenue before we hit our second year anniversary, and are actively pushing to double it again before Year Three is over.

We’re predicting that year-on-year growth after that will happen on a much smaller scale, anywhere from 5% to 10%.

People get a bit cagey about numbers, but I think just having realistic expectations (one should never enter the hospitality industry hoping to make a fortune, and you should be suspicious of people who seem to have done exactly that) and a willingness to pivot if things aren’t working go a long way.

Our north star is not to do more with less (I can’t deliver 5-star service if I cut my staff’s shifts to keep labor costs down), but to maximize our earnings given the limitations unique to our business (i.e. we’ve leaned into third-party delivery because we don’t have a lot of foot traffic, and people in the area only have limited lunch breaks.)

We have technically broken even, the taxes I pay reflect a business that is making a profit, and my accountant is satisfied with our profit and loss, balance sheet, and cashflow reports; to anyone who doesn’t already know, you need all three of these to properly assess the health of a business.

I think what helps too is that I still do my own bookkeeping to keep my finger on the pulse of a living, breathing behemoth. I can pull certain levers operationally and see the direct effect on our bottom line. 

The caveat I don’t talk about nearly as much: I don’t pay myself a conventional ‘living’ wage because of certain privileges unique to my situation (i.e. I still live at home with my nuclear family, and I’m lucky we’re a relatively harmonious household!); I can draw on a pool of company funds without increasing our tax liability, but I’m forced to live a pretty minimal lifestyle due to the type of business I decided to open. I also owe both my personal savings account and my parents a five-figure amount each (documented in a legally binding agreement to dispel any ambiguity), plus interest, which I will only likely recoup if I sell the business–a thing that can only happen once it’s more mature.

I did not approach any bank for a loan. I don’t recommend anyone starting a hospitality venue do so. Start small, scale up, and always pay your staff and suppliers on time.

As to your second question… I’m really tired all of the time now and, more than money, I want my time and energy and zest for life back.

So I guess what I’m saying is that I personally haven’t found that balance yet. But the business and my identity are so intertwined that it’s difficult to navigate even on my best days. We’re about to scale to the point where I can take an extended leave of absence to recover from burnout, and so I’m profiting in my most valuable non-renewable resource: time.

What helps is having systems and procedures in place that allow the team to be consistent even when I’m not on-shift, because the ultimate goal is for the cafe to be a passive source of income.

Or as ‘passive’ and ‘income-generating’ as a hospitality venue can be.

There’s a reason they’ve a reputation for being money pits.

[mksavage]

Oh my goodness, these are all such good questions -- I want to hear @QuokkaCoffee 's answers to all of them! This is maybe a silly question -- but is the event live, or are the questions answered here in writing? 

[QuokkaCoffee]

And it's a lot of pressure to have equally good answers! I'm already in the process of drafting them, and they'll go live on the day--at least, that's my understanding. 🙂

[mksavage]

I bet it is! You have so much to share and offer though -- I always really appreciate your perspective and insight. We can all learn a lot from you and your experience! (Just don't forget to give yourself some grace and permission to rest too -- I imagine drafting the answers takes a lot of time on top of an already very busy schedule!)

Looking forward to it! Thanks for the clarification!

[FrankRefillery]

I tend to guide customers to less expensive options when talking to them. I find upselling really difficult and feel like it will make them think that I'm only pushing expensive items. How can I be more comfortable talking about expensive products with customers and potential customers?

[QuokkaCoffee]

Gives you the ‘ick’, huh? Me too. 🙂

Are you Frank’s Market and Refillery? I have so many questions for you. But to answer yours first…

Some low-hanging fruit: what we do for our retail area and food cabinet is regular merchandising and letting the products speak for themselves. Stock is always abundant, samples are readily available (who doesn’t like free food?), and there’s not a single price tag in sight. Staff are always a few meters away ready with lines like ‘Oh, we can grind that coffee for you for home if you like’ or ‘We really love our house blend/single origin–did you want to sample a batch brew/espresso/small flat white?’

We actively shift conversations away from price and towards value, honing in on a customer’s problem and offering solutions in the form of a product or service.

Our business relies on recurring trade; to me anyway, yours seems more challenging because you have more one-off/infrequent purchases. Perhaps getting folks locked onto your perishables and lifestyle goods first might make it easier for them to buy into the rest of merchandise?

Like, I’m already picturing your market stall with food samples (unsure what your limitations are when it comes to food prepared offsite vs opening a jam jar), containers with the spices for people to pick up and smell, maybe some cheesy demos of the absorption power of your reusable towels.

I’d be curious to hear if you’ve modeled your business on one that has multiple outlets. I look at your stuff and think your ideal demographic has some overlap with Trader Joe’s, and borrowing their sales strategies should be fairly low-risk.

Looking at much bigger companies always becomes a rabbit hole for me. 🙂 I think a lot about how Costco’s rotisserie chickens are loss leaders, and how free samples guarantee a sale.

I’d maybe point you in the direction of Paco Underhill’s Why We Buy, because spending money can be irrational and emotional, and it’s good to know how to maximize that.

Here’s an example of a customer’s journey with us:

If a new guest walks up and I’m on register, I already know I’m making a sale, so I might as well get some fun banter going. I’ll compliment someone’s sunnies, someone’s shoes, someone’s super fresh fade–literally anything to break the ice, anything to get them to trust me because at that point all I am is someone trying to make a dent in their wallet.

I’m a risk, and I need to make it clear there’s a reward. So the banter’s cooking, and I ask them how they take their coffee. Not a coffee drinker? No problem, we got bomb hot choccies that come with marshmallows by default–at this point I’ll probably remind them that it’s a bit chilly outside, so would they like that hot bevvy extra hot? three marshmallows? sure!–and the whole while I’m watching their eyes drift to the display fridge.

Bingo. ‘Can I get some breakfast going for you? A lot of folks get the bacon and egg toastie. We can throw in some free barbeque or tomato sauce–did you want either of those?’

If it’s a no, well, then at least they’re primed to buy on the next visit, which is all you can really do.

Honestly… it’s kind of just boring, tried-and-tested, ‘assume the sale’ and ‘aim for incremental yes-es’ sales techniques. I want my guest walking away feeling pumped about their workday, ideally with a hot beverage or snack in hand, and I feel good because I firmly but gently pushed them in the direction I wanted them to go. 

What’s extra rewarding is hearing my team achieve the same results because they’ve listened to me use this script hundreds of times. They’re taught the script, then taught to break the rules and improvise (we also have flowcharts to help navigate the often confusing specialty coffee menu), but most importantly they’re taught to listen to the guest and pay attention to body language or cues one would otherwise miss.

I could talk about buyer personas but might just leave it to the professionals.

[shibli]

What three things I wish I knew before creating the social media profiles for my business?

[QuokkaCoffee]

1) That if I could choose the one plate to drop amongst the dozen or so I have to keep spinning at all times, Instagram/Facebook are perfectly reasonable–you may even find the sound they make while breaking cathartic! The business will survive if you treat guests well and offer consistently great products.

2) It doesn’t matter what your feed looks like or how much hype you build or how much money you pour into ads if you don’t have the team to execute your vision–staff shortages are still a thing people have to contend with–because guests can be quite fickle where both products and service are perceived as having failed. I think organic growth will forever be the least exhausting, albeit longer, path to building a sustainable business.

3) Listen to the new people who walk through your door. Why have they decided to take a gamble at that specific time, on that specific day, during that specific season? Leverage their customer journey and try to scale, or at the very least replicate, it.

I’m also gonna direct you to the answers I provided for @MikeKnight and @TheTurtleTribe above regarding social media management. 🙂

[Stacelyn24]

Do you use Square Loyalty and if so, what perks and features have you added into your loyalty program?

[QuokkaCoffee]

We do indeed! I’m gonna direct you to my answers to a similar question posed by @Donnie-M, but also add a few things I’ve been trying to get off the ground with our Loyalty program:

• BOGO coffee for referrals/a way to track which members are recommending us to friends, family, and colleagues, and whether these new people are doing any further proselytizing. We know we’re getting a lot of word-of-mouth advertising (we ask a lot of questions whenever we get new faces in-store), but I’d like to find a way to systematize it and create a bigger incentive for people to keep doing it. It’s so much more reliable than paid advertising, but I haven’t quite cracked it yet…

• Expanding our rewards system to include retail items. We’re quite proud of the retail section we’ve built, and have made decent sales by simply merchandising our bar consumables–beans, plant-based milks, sugars, syrups, etc.–instead of keeping things in storage. But I know there’s so much more potential to make us everyone’s one-stop-shop for coffee beans and equipment. This is a conversation I’ll need to have with my roaster, who can offer specialty brewing equipment on consignment, because cashflow can get tight pretty quickly if we’re not careful.

• Having more beta testers of rewards and features I’d like to experiment with. I keep a mental tally of our core customers, and those amongst that group who fall into the ‘early adopter’ category when it comes to playing around with new concepts. 

That’s all I can think of so far, hopefully you’ve found it useful! 🙂