If you are running a cafe, would it be good news to you if you no longer have to recruit, pay, train, insure and even fire your baristas? It seems impossible until Cafe X's existence. Cafe X serves your coffee without anyone at the kiosk. All you see is an arm, a robotic arm that maneuvers around to prepare you freshly brewed coffee, ordered in advance via its mobile application.
Participants from Malaysia's Technology, Ecosystem and Culture (TEC) Immersion Program experienced their first Cafe X cup of coffee and interacted with Cafe X's CEO Henry thanks to UC Berkeley's program organizer Mark Coopersmith. A short chat with Henry revealed that Cafe X is a "super local" company focused on delivering a fun coffee experience. Given the extremely high cost of real estate and labour in the San Francisco area, this business model aims to overcome the two major challenges most coffee shops are facing.
Cups of latte, cappuccino and mocha were seen placed on the cup holder before the cup holder moves down to an opening for patrons to collect their coffee. However, before this, an order must be placed ahead of time. Upon arriving at the kiosk, a 3 digit code is entered and your cup of coffee will be delivered within minutes.
Note of caution, don't you make the same mistake like me. Placing an order more than 7 minutes ahead of your arrival time means you will not get your coffee. Luckily the first cup was free so I did not feel the loss. This system is able to prevent wastage as coffee is brewed only upon you entering your code. With the use of robots, coffee is made much faster and more consistent.
Henry shared Cafe X's marketing tactics include getting friends to refer a friend to enjoy a $5 coupon. Prices of coffee now is between $3-$5. Henry explained that Cafe X's investors saw high potential given its high potential of going viral. The company has all production and processes done in-house after learning from past mistakes. Cafe X's engineering had been outsourced before and it was a good mistake to be discovered at early stage of this start-up. No wonder they could even adjust the coffee temperature! If you are not a coffee lover, you could also serve beer and nitro cold brew just by changing its case. Milk is already available.
Once warmed up some of us went into more intimate questions. We were told to break even, 50-200 cups needs to be sold. This boils down to the rental rate, the highest investment for this business. Currently there are three outlets in San Francisco, Metron, 135 4th St, One Bush, 1 Bush St and 578 Market St. Remember to select the right outlet when placing your order. When asked about margins, we were politely answered with "It's confidential". Cafe X has received funding in millions based on my understanding, wow!
Interested in this robotic coffee business? You can do so by being one of its licensees. That is if you are lucky as Cafe X have already been receiving numerous requests from different countries. Yah, this arm could be a great crowd puller to your retail or food and beverage stores as first timers like me couldn't stop taking photos, videos and even writing a blog post despite not a coffee lover.