Australasia, as Australia, New Zealand and New Guinea is known, attracts millions of tourists each year and the growth of the Pacific Rim as the world’s foremost economic area means that major cities in the region, such as Sydney and Auckland, are likely to become important links in world trade and commerce. One Mihaylo grad talks about her experience starting a business Down Under.
Mihaylo entrepreneurship alumna Annie Nguyen ’14 moved to Australia out of her motivation to travel the world. She established Annee’s CaPhe a Vietnamese coffee sales business, which began as a stand that she operated for three days each week at Rusty’s Farmer’s Market in Cairns, Queensland, on the country’s northeast coast. “I spent less than $200 to buy coffee and materials and started pouring coffee out of a pitcher,” she says. “After a trial and error process, the concept worked. The initial cost was $20 per day for a table rental. Eight months later, I moved into a shop space which is located in the market as well, with a rent of $270 a week.” Today, the business has expanded to a permanent shop location and Nguyen has hired three employees.
She discusses her business concept, the Australian business climate and the impact of her Mihaylo education.
Q. What is your business model?
A: Annee’s CaPhe is a specialty coffee bar that provides alternative beverages. We use both modern and traditional brewing techniques to filter our coffee, which includes cold brewing and a slow-drip method. Our signature drink is iced coffee served with condensed milks and shaken like a cocktail. Providing customers with a wide range of milks and toppings for their coffee allows them to personalize their drinks.
We have positioned ourselves in the city center within the largest farmer’s market in town. Because Cairns is in the Great Barrier Reef region of Australia, 20% of our customers are tourists and 80% are local residents. We are the only Vietnamese coffee bar that specializes in cold drinks in the tropics, where the weather is warm all year round.
Our daily sale is about over 250 cups per day, 300 on a good day. Our goal is to make over 300 cups sale per day at an average of $6 a cup. All profits are put directly back into the business from the beginning.
Our profit margin is large enough to charge a lower price on our drinks compared to the local standard iced coffees. In addition to being the only alternative coffee shop in town, our business model focuses on excellent customer service. Knowing as many customers by name as possible, giving each customer a genuine personal touch and going “above and beyond” is our strategy.
Q: What motivated you to relocate from Southern California to Australia?
A: I always had the desire to travel, but I also wanted to indulge in a country long enough to truly understand the people and their culture. My partner had a job offer in Australia, and we wanted to take the opportunity to live somewhere new. Australia is a vast country with breathtaking landscapes. Its small population offers a high standard of living and great business opportunities.
Q: What are the greatest similarities and differences between California and Australia?
A: One of the greatest differences between business in California and Australia is the lack of good customer service in Australia. Most businesses here focus on the quality of the product rather than providing a good experience. In America, by contrast, it is our culture to be service-driven and meet customers’ needs. Both countries greatly encourage innovation and support new business ventures for entrepreneurs. If anything is big in California, Australia won’t be too far behind.
Q: What has been your advertising and marketing strategy?
A: Because Cairns is still a small town compared to Sydney and Melbourne, social media is not yet widely used by business owners around here. Yet it is already popular enough to our younger customer base to give us one of the biggest advantages in advertising in a small town. We do not pay for any ads. We focus mainly on Instagram and Facebook, which allows for the customer to give us free advertising exposure. The majority of our leads come from word of mouth, a large percentage comes from Instagram and Facebook and the rest are from visitors who see our business when walking through town.
Q: How did your Mihaylo education impact your business venture?
A: The business program provided me with a strong network of like-minded entrepreneurs whom I am still in touch with today. With these connections, I was able to seek advice and resources when needed. On the curriculum side, core classes in computer science, accounting and management provided me essential skills such as Microsoft Excel, bookkeeping and employee management.
Australia’s Immigration Boom
Nguyen is part of a growing number of people from around the world to relocate to Australia. While largely inhabited by descendants of arrivals from the British Isles, by 2010, 26.8% of the population was born overseas, one of the highest percentages of any nation. These immigrants come from such diverse regions as the Balkans, Middle East, East Asia and the United States.
What About New Zealand?
Yet Australia isn’t the only economy Down Under. Some 1,000 miles east of Australia, New Zealand is among the most unspoiled countries on earth. While Australia may have cultural and geographic similarities to Southern California, New Zealand is more akin to Northern California and the Pacific Northwest.
Made up of two islands – the North Island and the South Island – the country of 4.5 million has more sheep than people, though the ratio has narrowed in recent years.
Agriculture remains the major industry, with meat, dairy, timber and fruit predominating. New Zealand is a leader in agricultural innovation. Yet other industries are also growing, among them tourism, which employs 6.9% of the population. Overseas tourism increased 7.1% in 2014 alone.
In contrast to Australia, which is known for a moderately-conservative political climate, New Zealand is a very progressive nation. In 1893, it became the first country to give women the right to vote and a free health-care system has been in effect since 1938. The country declared a non-nuclear stance in the 1980s, in spite of opposition from allies such as the United States and Britain.
Unlike Australia, which has been inhabited for thousands of years, New Zealand, like many islands in the Pacific, which are some of the farthest places geographically from the earliest civilizations of the Middle East, were also among the last places on earth to be settled. The first known inhabitants arrived within the past 2,000 years.
In the 2013 census, 74% of Kiwis (as New Zealanders are often called) listed their ancestry as European, while 14.9% were Polynesian Maori, the first inhabitants of the islands, who arrived about 800 years ago.
New Zealand’s major cities are Auckland, the largest city, and Wellington, the capital, on the North Island. Auckland has the largest Polynesian population in the world. On the South Island, Christchurch is the largest city, while Dunedin is a major university town.