BEYOND THE BEAN

It was late June 2012, and David Greig was completing the details of his business plan to launch a board
games café called "Beyond the Bean" in London, Ontario. He had been working on the idea for over a
year, and he wanted to complete a marketing plan for his proposed venture that would include the chosen
target market, product pricing, a promotion plan and the final product offering. Greig wanted to have the
plan ready by the end of the month so he could review it with his partner, Angela Peck. If Peck agreed
with the plan, the partners would try to launch the new venture within the next year.
BACKGROUND
The Idea
Greig and Peck's plan was to launch a café that specialized in gourmet coffees and related beverages
(espressos, lattes, cappuccinos, teas, etc.) where customers could also rent tables and play board games.
The partners came up with the idea after visiting the Snakes and Lattes Café in Toronto, Ontario. This
business combined a traditional coffee shop with table rentals for groups to play board games. The café
had a selection of more than 2,500 different games from classics such as Monopoly and Risk to more
recent games such as Angry Birds1, the Settlers of Catan,2 and Game of Thrones.3 Snakes and Lattes had
opened in 2010 and had become so popular that reservations were often required, and the café had already
undergone a significant expansion.
1
Originally released in 2009 on the Apple App Store as an iPhone game, Angry Birds' success led to versions for other
mobile platforms, personal computers and game consoles. Board game versions were released soon after.
2
An immensely popular German game released in 1995. Settlers of Catan has sold approximately 15 million copies
worldwide and has been translated into 30 languages.
3
An epic fantasy game based on George R.R. Martin's "A Song of Ice and Fire" series. The first novel in the series, "A
Game of Thrones," was published in 1991. A television version of the book was shown on HBO in 2011.
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The Venture
Greig and Peck had enjoyed their visit to the Toronto café so much that they decided a similar business in
London could also be very successful. Some quick research showed that there was no similar business in
the area, so the partners began looking into the feasibility of launching a board games café in the city
where friends could get together, have fun, socialize, enjoy gourmet coffee drinks and play games.
The partners had $60,000 in start-up capital4 and decided to locate their café along or near the Richmond
Row5 area of London. Revenue would be generated from sales of snacks, drinks, and rental fees charged
to customers for the use of a table to play games. The staff would be knowledgeable about a large
selection of games and would be able to provide expertise to help patrons understand the rules. Greig had
prepared a list of board, card, and role-playing games he wanted to have available, and he had already
purchased many of these. To save money, he obtained many of the games at garage sales, used but in good
condition (see Exhibit 1). Greig wanted the café to deliver a great social experience. Consequently, he
planned not to provide free Internet Wi-Fi, which, he believed, discouraged social interaction.
In addition to games, the partners wanted the café to be known for its excellent coffees and snacks (see
Exhibit 2). Greig also pondered the idea of offering a limited selection of alcoholic beverages, primarily
beer and wine. The business would have to obtain a liquor licence from the Alcohol and Gaming
Commission of Ontario (AGCO) at an application cost of $1,055. Obtaining a liquor licence came with a
number of stringent requirements, including staff training and AGCO or police inspections. Serving
alcohol would also expose the business to potential liabilities in tort6 if, for example, customers left the
café intoxicated. Serving alcohol increased a business's liability, resulting in higher annual insurance
premiums. (See Exhibit 3 and 4 for a list of AGCO requirements.)
The café would be open from 11 a.m. until 11 p.m. weekdays and until midnight on weekends. To
minimize expenses, the partners planned to operate the café without hiring additional staff for the first few
months of operation. Greig would be available to work full time, but Peck's availability would be limited
by her considerable time commitment needed to complete her doctorate. After three months in operation,
the pair hoped to be financially able to hire a part-time employee. Although no location had yet been
selected, Greig anticipated that the café would have a maximum capacity of 50 customers.
The Partners
David Greig had earned a bachelor degree in mechanical engineering in 2009 and a master's degree in
2011 at Western University in London, Ontario. His partner, Angela Peck, had graduated from Western
University with undergraduate and graduate degrees in civil and environmental engineering, and she was
currently pursuing a doctorate at Western. Although the partners had limited formal business training, they
had taken a full-year university course called "Business for Engineers" offered by the Richard Ivey School
of Business at Western. This course provided an introduction to basic concepts in business and introduced
the partners to the fundamentals of marketing.
Greig had also attended several seminars at the London Small Business Centre (SBC). At these seminars,
Greig had received expert advice on how to get a new business started, including the preparation of
4
The partners planned to invest $20,000 each and obtain a family loan for another $20,000.
Richmond Row, a shopping district located in northwest London near Western University, was home to several bars and
restaurants frequented by university students.
6
The area of law that deals with the duty of care owed to others and remedies for victims' of negligence.
5
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projected financial statements, creation of a cash budget, financing, and the development of a marketing
and business plan. Neither partner had worked in a café before, but Greig had received barista7 training,
and he felt confident that his research and careful planning would produce a successful new venture.
The Industry
London's economy was hit hard by the worldwide recession triggered in 2008 and was still recovering.
Unemployment in the city was 8.8 per cent, higher than any other major city in Ontario, other than
Windsor.8 High unemployment generally led to reduced spending on discretionary expenses, including
entertainment. In spite of this economic climate, the partners believed their venture could provide a
relatively inexpensive form of recreation, especially since specialty coffee was a $5-billion industry in the
United States (hit with the same worldwide recession), yet it had a growth rate of 20 per cent annually
during the last decade. The partners believed that the growth rate was similar in Canada and that it would
continue. Additionally, board games had experienced a resurgence in popularity since the early 2000s, and
their sales had increased 100 per cent in the last five years. Seventy-two new board games were expected
to be released in 2012.9 Although the concept of a board games café was relatively new in Canada, such
businesses had become popular recently in Europe and Asia.
COMPETITION
Direct
Greig believed Beyond the Bean would be competing directly with businesses that provided social and
recreational experiences among friends. These businesses included bowling alleys and billiards facilities
— in particular, the Palasad and Fleetway, due to their proximity to the new business's Richmond Row
location.
Fleetway
Fleetway, located in Northwest London, billed itself as the "new dimension in entertainment." The facility
(originally, solely a 40-lane, five-pin bowling operation) offered five and 10-pin bowling, glow-in-the-dark
miniature golf, rock climbing on a 40-foot-high wall, and billiards. Fleetway's operation opened directly
into a Dairy Queen restaurant that provided all food and drink for Fleetway's customers (the facility was
not licensed to provide alcohol). Fleetway's advertising and promotional materials targeted children,
teenagers and adults and offered kids camps and youth or adult bowling leagues. Selected pricing for
Fleetway's various activities is shown in Exhibit 5.
Palasad North
Palasad had two locations: one in south London (Palasad South) and another in the northeast quadrant of
the city, Palasad North. Facilities included: a 70-seat dining room; a 60-seat bar/lounge; an eight-ball
billiards lounge (20 to 30 seats); a private billiards room with two billiard tables, sofa seating, a fireplace
7
A barista is trained to make coffee and related beverages such as espresso, cappuccino and latte.
"More Jobless Throw in the Towel," London Free Press, http://lfpress.com, March 11, 2012.
9
"Business Plan — Beyond the Bean Board Games Café," Greig, D., Peck, A., June 2012.
8
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and dining table; a 1960s retro-designed lounge with three billiard tables; a bowling lounge with 10 vintage
bowling alleys; a large bar (80- to100-person capacity); and a video arcade amusement area for children.
This extensive activity area was fronted by a full-service restaurant. Palasad North specialized in group
events for corporations, families and sports teams. Its slogan was "Eat! — Drink! — Bowl!" although
many of its customers frequented only the restaurant, which was known for its wood-fired pizza, made-toorder pastas, fresh ingredients, and tomato sauces made from scratch. Pricing was similar to that at
Fleetway.
Indirect
The partners expected to compete only indirectly with coffee shops because these businesses did not offer
recreational activities. Local indirect competitors included:
Tim Hortons
Tim Hortons was an extremely popular Canadian franchise with dozens of locations in the London area.
The chain specialized in coffee and baked goods such as doughnuts, bagels and muffins. It also offered a
small selection of teas, as well as espresso, cappuccino and lattes. Its stores had a "fast-food" ambiance,
did not provide comfortable seating that might encourage customers to linger, and had only recently begun
offering Wi-Fi services. In 2011, the company earned revenues of $6 billion in Canada and the United
States and served approximately two billion cups of coffee annually.
Starbucks
Starbucks was an American-owned company with its head office in Seattle, Washington and almost 20,000
locations in 60 different countries. Each site was set up as a coffee house to reflect the mission statement
"to inspire and nurture the human spirit - one person, one cup, and one neighbourhood at a time." The
company focused on premium coffees and offered a wide selection of related drinks and high-end pastries,
including croissants and scones. Patrons were encouraged to relax on home-style furnishings and to spend
time in a comfortable atmosphere. Free Wi-Fi was available at each location. The company had revenues
of $11.7 billion worldwide in fiscal 2011.
Williams Coffee Pub
Williams Coffee Pub (Williams) entered the market in 1993 with the opening of its first location in
Stratford, Ontario (50 kilometres from London). The Canadian company had approximately 50 locations
in Ontario. The company's concept was to provide fast service while offering tasty, high-quality products
in a relaxed and affordable atmosphere. Williams offered a full selection of coffees and related drinks,
pastries and snacks. The stores had a restaurant look with a heavy focus on the breakfast menu. Starbucks
offered free Wi-Fi at each of its locations.
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Coffee Culture Café and Eatery
This franchise, established in 2006, promoted the slogan "Come for the taste, stay for a visit." The
company had approximately 40 locations throughout Ontario, two of which were located in London. Each
site resembled an old-world style coffee house and offered an extensive specialty coffee menu and baked
goods, ice cream and gourmet foods. Similar to Starbucks, customers were encouraged to relax, socialize,
enjoy the ambiance and take advantage of free Wi-Fi.
CUSTOMERS
The partners believed that Beyond the Bean would be of interest primarily to people between the ages of
15 and 34 years and that neither gender nor ethnicity would constitute a basis for segmentation. Greig was
considering four segments of this target market: Western University students, Fanshawe College students,
high school students and young professionals.
Western University Students
Western University (Western) and its three affiliate colleges (Brescia, Huron and Kings) were located in
northwest London. There were approximately 30,000 undergraduate and graduate students enrolled with
almost 4,500 first-year students enrolling each year. Students came to Western primarily from Ontario, but
a significant number of out-of-province and international students also attended. The partners believed that
they understood this group well because they had recently been students at Western themselves. Greig and
Peck thought university students enjoyed the opportunity to inexpensively socialize with friends and were
looking for an alternative to the bars frequented by most students. Most of Western's students did not own
cars and lived near the university; therefore, Beyond the Bean needed to be close enough to the university
for students to either walk to it or to be accessible with public transit. All full-time undergraduate students
at Western received a public transit pass for the school year. Although some classes were offered in the
spring and summer, the majority of students spent eight months (September through April) in London, and
returned home over the summer months.
Fanshawe College Students
Established in 1962 and located in northeast London, Fanshawe College (Fanshawe) enrolled over 15,000
full-time students at its London campus. The partners believed that Fanshawe students had characteristics
similar to those of Western students and also enjoyed a night out at a reasonable price that did not include
alcohol and bars. Fanshawe was approximately 10 kilometres away from Western's campus and the
proposed Richmond Row location of Beyond the Bean. The presence of Fanshawe students in the city was
also highly seasonal, with many of these students leaving London during the months of May through
August.
High School Students
The partners estimated that there were almost 20,000 high school students, between the ages of 14 and 19,
enrolled in secondary schools within the city. These students usually lived with their parents and often
worked part-time, which provided them with some spending money. The partners believed this group
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would be interested in social interaction while playing board games, but they were not sure how much
interest high school students would have with the coffee-focused menu offered at Beyond the Bean. The
members of this group would also be restricted in their ability to visit the café on school nights with the
requirements of homework, part-time jobs and parent-imposed curfews. This segment often relied on
public transit or parents to drive them around the city.
Young Professionals
The partners deemed young professionals to be between the ages of 25 to 35 years, generally well-educated
and with a higher disposable income relative to others their age. The partners' research revealed that
approximately 15,000 young professionals10 lived in London. Greig and Peck believed this group would
align well with their gourmet coffee shop offering but they were less clear on how much interest this group
would have in playing board games. Young professionals generally provided their own transportation and
lived year round in the city.
PROMOTION
Greig had budgeted $6,000 to be used for marketing during the business's first three months of operation,
but he was unsure how to promote Beyond the Bean. His promotional strategy had to get customers to try
the café. If it did not get enough customers to break even, the business would quickly run into cash flow
problems that would cause it to fail. Greig knew from his university course in business that he also needed
to decide on the content and message of his chosen promotional methods.
Web and Facebook Pages
Greig and Peck planned to develop both a website and a Facebook site for Beyond the Bean. To minimize
costs, Peck planned to do the development work herself since she had the technical abilities to take on this
task. The partners had not yet finalized what content should be on their webpage. They did not plan to use
any of Facebook's paid advertising. Instead, they intended to use Facebook primarily as a medium to
create free word-of-mouth publicity. One way to enact this plan was by adding a "Like" button to the
Beyond the Bean Facebook page. When a user visited the site and clicked "Like," a link was added to the
user's activity page for all the user's Facebook friends to see. If the user's friends clicked the link, they
would be directed to Beyond the Bean's Facebook page. This approach had the potential to create a lot of
free exposure.
The Western Gazette
The Western Gazette (Gazette) was Western University's student newspaper. It was published every
weekday except Monday. Approximately 11,000 copies of each edition were distributed free of charge
throughout Western's campus. Students could also view the Gazette on the paper's website. Many local
businesses targeting this student market advertised in this paper and often included discount coupons in the
publication. Rates for advertising are shown in Exhibit 6.
 

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