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It feels like they own it: Coffix founder on $2.50 coffee and branching out

With coffee prices making New Zealand's love for the drink an expensive one, Coffix has a solution with $2.50 beverages. We talk to founder and franchise manager Natan Yehezkely about making that dream a reality, expanding it into franchises and maintaining the brand.

As a passionate coffee drinker with an ambition to practice ethical business, Natan Yehezkely decided three years ago to take the cost out of the daily coffee fix by creating Coffix.

The franchise's 11, soon to be 13, cafés have a standardised $2.50 price for a cup of barista made coffee, no matter the type, milk used or flavour included. This is in an effort to reduce the money spent on satisfying the 3.7 kilograms of coffee beans each New Zealander drinks in a year on average, according to Traveller.

Yehezkely knows first-hand how the amount can add up, having worked in retail for 25 years and buying takeaway coffees which only had the coffee and paper cup to show for the $4 he parted ways with—or $4.50 if he added cold milk.

“There was no real reason for the coffee to be that expensive,” he says, giving the example of Europe where a takeaway coffee can be picked up for as low as one Euro.

He's also seen a shift in consumers’ attitudes towards coffee and the activity of going to a café, with many popping in every day to get a takeaway coffee and reducing the significance of visiting a café to sit down and enjoy the experience.

“I think coffee has moved from being something that is in the entertainment budget to something that is like a need, something you do daily,” he says.

Despite his motivation to drop the price of coffee, he set about doing eight months of research before opening Coffix to learn about the industry and who the key players were, completing a barista course and establishing what the key components were that made overheads really high. His thinking was that if you take those away and leave only the coffee, the price can afford to be low.

Included in those unnecessary additions that contributed to high overheads were crockery, waiters and menus, which you won’t find in Coffix's cafés across Auckland, Hamilton, Tauranga and Wellington.

And for those who aren’t convinced that dropping the price below the usual $4-plus is sustainable, Yehezkely is confident about the quality of the coffee, which he says causes it to sell enough to make it a profitable model.

The first two café's on K’ Road and Elliott Street opened in 2014 within weeks of each other and at the time, it wasn’t Yehezkely's intention to start franchising. However, with such a bold business strategy, people were eager to find out what it was all about and how they could get into it for themselves, so the evolution to a franchise began.

In doing that, Yehezkely took on the role of franchise manager, while Amit Zamirly took up the role of CEO. Amit Zamirly took up the role of CEO. Yehezkely says at some stage in the past three years, he's worked on all aspects of the business. But he’s been privileged to step away from things like accounting and stock-taking to focus more on what he enjoys doing.

“I like to talk about coffee, I like to tell people about what we’re doing, I like to meet new people and I like to help people set up their new businesses.”

He says there’s a satisfaction in seeing franchisees grow and make a happy living and recalls watching as his first franchisees, Daniel and Rhonda Danin, achieved enough success with their first shop that they opened a second.

Daniel says he was drawn to Coffix’s people-centric model and bought the K’ Road café off Yehezkely in September 2015 after six months of leasing it and learning the management ropes. With the café going from strength to strength, the pair opened a branch in Hohipere Street in February this year.It’s been quite the learning curve for Daniel and Rhonda, with administration, sourcing and retaining staff to be done, but they say the security that the franchise brings cannot be underestimated.

Natan and Amit have supported us every step of the way and are always happy to help and share their knowledge,” says Daniel.

And that’s not to say Yehezkely and Zamirly hold control over all aspects of the franchise's cafés. While there are infrastructures in place in terms of operating systems, Yehezkely doesn’t want that to come through in the customers’ experiences.

He says some other franchise cafés are all computerised and hold no differentiation from branch to branch, whereas each of the Coffix branches has a sense of character. Some Coffix cafés have paintings on the walls, others have photos or plants, and some have seating while others don’t.

“We know that we’re never going to be a full standard like other franchise systems, which is a bit of a risk but we’re happy. I think it gives character and it allows that coffee branch to be a local place and [the franchisee] feels like they own it, they have more sense of ownership over it,” he says.

Despite the personalisation, Yehezkely is confident the Coffix brand remains clear. One of the things that remains visibly common across all the cafés is the use of certified organic, fair trade coffee beans as it’s always been Coffix’s goal to do good and support the bean growers.

The beans are sourced from reputable, certified fair trade organic cooperatives in the Pacific region and South America. And when made, the coffee is served in biodegradable takeaway cups or reusable glass cups to further that commitment to ethical practices.

Moving into the future, Yehezkely is working to make the systems even more streamlined and therefore easier for franchisees. He wants them to spend less time on administrative work and more time on quality coffee and customer experiences, because from all his years working in retail, he knows the customer always comes first.

This story first appeared at StopPress.