Retail Focus: Compound Surf & Espresso

Compound Surf & Espresso is located in Coolum on the Sunshine Coast (QLD), Australia.  The store is run by two passionate surfers, Abe Andrews and Aaron Bradley and together they have created a formula that many of us would be shaking our heads at, pondering why we didn’t come up with the concept ourselves.

Surf and Drink Coffee.  It’s what we do down under – the coffee culture runs deep in Australia, and very obviously, so does surf – and when the two are married together, a little bit of magic happens.  Whether it’s pre-surf coffee raids (they open at 5:30am) or post surf latte’s and breakfast, one doesn’t really need an excuse to surf and drink coffee.  But the story goes a little deeper here; Compound is not just another cafe with a surf vibe, it’s a surf store too… and a very unique one at that, one that serves a bigger purpose than just retail.

On the retail side, it started out as a second hand surf store, and the word very quickly spread across the Sunshine Coast community it serves, with bag loads of decent quality clothes being dropped off at the door. The “op shop” style retail gained traction and gave the boys confidence to dip their toes into the full price, branded retail category.  The retail formula has since evolved and the store now trades with multiple streams of product lines, which aside from apparel includes branded merchandise of their own with a very catchy tagline, yep you guessed it – Surf & Drink Coffee, coffee beans and surfboards.

The store also operates with a higher purpose in mind, set up as a non-profit, it always has it’s eye on opportunities to help others and serve the community with a particular passion towards youth projects.

It wasn’t very long ago that surf retail had become rather stale amidst a sea of slatwall and vertically merchandised product.  Then the multi revenue trend started out of Southern California and a few surf traditionalists frowned on the idea, arguing the point around identity – are you a surf shop or a coffee shop? Fast forward a few years and the retail trend is growing, not only in surf but also by big box retail and national chains. Think Cotton On and their in-store cafe concept and others who are focussing heavily on creating consumer experiences in store.

In Australia we have seen the concept work, FinBox in Thirroul, The Shop Next Door in Manly (RIP… that was due to a landlord issue 😉 ) and Saltwater Wine in Port Macquarie come to mind as other examples.  But for the humble duo on the Sunshine Coast it’s just about following a passion – Surfing, drinking coffee and making a difference in their community, and for them it’s working.

Co-Founders Aaron Bradley (L) and Abe Andrews (R)

The Business of Surf caught up with Abe Andrews to find out a little more about the store, what makes them tick and the secrets to making a good coffee.

Enjoy.

How would you describe the retail concept that you have?

We are a Community Focused Specialty Coffee Shop which sells new, secondhand surf apparel and boards.

How long have you been trading for?

3.5 Years

Who else is involved in the business and how are you structured?

We are a non-for profit which is owned by Christian Surfers Australia.

We focus purely on creating a space for community to come together around coffee and their love of the ocean.

When people shop here they in turn benefit the wider surf community by their small purchase, supporting community engagement through CSA events, youth mentoring and other youth focused programs.

Tell us about the movements you support with Compound?

We have been able to support the local community by sponsoring local boardrider events, Lions Club auctions, school fates and other global charities fighting against sex trafficking and Nepalese First Aid. We have also done our own charity fundraisers with a community centered focus for youth here on the sunshine coast.

How does the op shop part of the business go commercially?

It is an interesting balance, the community really do get behind it by donating their “better apparel” (the stuff which is too good to donate to vinnies) to us. We don’t advertise that we take donations and it is more a word of mouth thing. This helps us keep a pretty exclusive collection process, so we get quality brands to sell to the public. We also focus a lot on upcycling and have customers incentives; like trade in your old wetsuit or wetty top and get 15% off on a new Vissla Wetty/Top.

You also have first price product in store. Tell us about your brand mix and what categories you are doing well with out of store?

We try to focus on brands that are about preserving the culture of surfing.

We have stuck with Salty Crew from the start, SALTY (Salvaging A Lifestyle for Tomorrows Youth) We could see that some surf brands were losing the essence of why those brands started in the fisrt place.

Unfortunately some brands became too corporate and lost there identity trying to please shareholders.

We noticed with brands like Salty Crew, Vissla and Shapers they still held onto being core surf brands with a huge focus on not diluting the value of their product and investing in the lifestyle and culture of surfing and the ocean. They also are focused on manufacturing quality goods and hardware which looks good and is functional. This is a big focus for us as a shop because we want to sell with confidence, the brands that we believe in.

What are the sales split (%) between coffee and retail?

We sell a lot of coffee! We are prominently a coffee shop, but coffee only tends to pay wages and overheads, we find the foot traffic we do get daily does help us sell a lot of apparel when other shops might struggle on quiet/rainy days. Today it’s raining as I write and we were busier today then a nice sunny day.

We always hear there are good margins in coffee. Is this truly the case?

The margin is good as far as COGS vs Gross Profit. However, it’s the wages that eat these margins up… you have to sell a ton of coffee with barebones staff to make a healthy profit.

What is key to running an excellent coffee shop?

Good Coffee, Good Milk, Good Clean Equipment, Well Trained Barista’s and Exceptional Service.

Its not rocket science but it requires a lot of focus and attention to detail to make good consistent coffee.

Tell us about the beans you use and what do you look for when choosing a bean supplier?

Slide Coffee Roasters are a great specialty coffee roaster here on the coast. They have a huge focus on quality and service. The branding suits our market and target audience which in turn helps us cross promote. We have our own signature blend Dawn Patrol which is exclusive to Compound and its customers.

You also do your own product with a great tagline that’s gaining a lot of traction. Can you tell us a little more?

All credit goes to Ben Adams a very talented graphic designer who I had known for years and he originally came up with the name Compound.

Compound by definition means “ to combine or bring together two or more elements” which we felt worked since we were merging the two, Coffee and Surf.  We had an initial T-shirt design with SURF & DRINK COFFEE splayed across the back in grungy lettering and loved it.

The slogan stuck and the Fin Cup Tee was born not long after that. We also put the slogan on decal stickers and its rare these days for me to drive down the beach or highway without seeing one smeared across someone’s rear window.

Any plans for additional product or category extensions?

We have quite an array of products; ceramic keep cups, water bottles, hats and tees have become our staples. Along with baby onsies that are a play on the initial slogan with Surf & Drink Baby Chinos. The future might incorporate something a little more ambitious but we will keep that close to our chest for now.

Biggest lessons learned during your first 3 years?

Don’t be afraid to try something new. But if something isn’t working don’t force it.

A wise friend of mine said we need to focus on, organic sustainable growth. Sounds like farming terminology but it applies to any business.

Would you ever look at opening more doors at key surf locations?

It’s definitely on our radar but it has to be the right fit!

We know where you get your coffee… but where do you get your surfing fix?

The Sunshine Coast isn’t known for good waves but we have our moments. You have to get creative up here, fun boards and logs can turn a crap surf into a good one.

And to finish, what does the world need more of?

I had a mate go to a busy specialty coffee shop. He waited at the counter for a while before he was greeted because the 4 staff that were on were too busy talking to eachother about the coffee that they were making, then serving.

When finally served, the cool hipster barista rolled his eyes when he ordered a Cappuccino, the Barista then informed him that don’t do cappuccinos, so he asked for a Latte instead. My mate wasn’t impressed and said despite the good coffee he wouldn’t go back because the overall experience was negative.

It was like they were too cool for their own good and so focused on what they were doing that they had forgotten why they are doing it.

At Compound we make excellent coffee, but I always say to my staff its because we care just as much about the person drinking the coffee than the actual coffee itself. Don’t forget the why!

 

 

 

 

 

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