Winning formula at Hudsons Coffee

The founders of Hudsons Coffee have fine-tuned their franchising formula to create a strongly growing business. By Andrea Toal.

INTERNATIONAL TRAVEL can not only broaden the mind; it can also help identify a good business opportunity. It was while researching potential businesses in North America and Europe that the co-founders of Hudsons Coffee, Mark Hawthorne and Ros Turner, realised that Australia was lacking the type of dedicated coffee outlets that were catering for the needs of coffee lovers elsewhere in the western world.

Hawthorne and Turner had set out on their business-spotting trek after working successfully for more than 20 years for fast-food giant McDonalds – Mark on the corporate side, and Ros as a multi-store franchisee.

“We both went travelling, me to Europe and Ros to North America, looking for an opportunity where we could use some of the transferable skills we’d picked up at McDonalds,” explains Mark. “We both identified coffee as an emerging opportunity. At that time there were a lot of cafes here in Australia, but no one specialising in coffee.”

The two drew up a business plan, identifying their target market as being time-poor city professionals who wanted quality coffee. They opened their first Hudsons Coffee outlet on the corner of Collins and Elizabeth Street in Melbourne’s CBD in 1998.

They decided to stake their reputation squarely on their ability to deliver quality product in an efficient manner. “The quality of the coffee was important because the market we were after is quite discerning,” said Hawthorne.

“We had to get a blend of the best quality and the most efficient service system, because our target market was usually in a hurry to get to work. Also in a location like that, you have to have the ability to do high volumes to get the dollars.”

The first few weeks were a little sobering. ”To be honest, the first week left us scratching our heads wondering what the hell we’d done. It was a fairly visionary concept at the time; we were only serving coffee in three different sized paper cups and no one was doing that yet. In that first week I think we served all our friends and relatives about 85 times each, trying to make the place look busy.”

But it wasn’t long before word of mouth took off and within a month Mark recalls people coming into the city specifically to buy one of their coffees. He attributes part of the store’s success to its branding.

“We presented ourselves in a very international way,” he explains. “Even though we are an Australian company, we wanted to give the impression that we may be from overseas, to make us look bigger than we were.”

The company’s structure and procedures had been set up with the idea of growing a much bigger business than one outlet. “In terms of our IT platform and the systems we put in place, we set it up to grow. Everything we did was with the mind set of we’re going to grow this thing.”

The decision to franchise was made only after they were completely convinced of the success of their business concept.
“After five years, we had 25 stores and we realised that franchising was probably the best direction to head in if we wanted to keep growing,” said Mark.

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