Opening a coffee shop is challenging without research and planning. Focus on these core pieces when developing your business plan:
- Understand your target customers, their needs and motivations.
- Observe neighboring businesses.
- Make your shop special.
- Consultant Matt Milletto estimates $150,000 to $500,000 to open.
- Rent, buildout, equipment, and inventory are key costs.
Choose a location with heavy foot traffic, visibility, accessibility, and near other shops. Study coffee itself and consider food offerings to differentiate yourself.
The first step in opening or taking over an existing coffee shop is to conduct market research.
- Analyse the coffee shop sector evolution.
- Learn as much as possible about your industry.
To understand coffee shop operations, focus on:
- Cafe operations
- Customer interactions
- Bathroom cleaning protocol
Is a coffee shop profitable? According to the National Coffee Association, the average coffee shop makes $40,000 in monthly sales.
On average, it costs $31,000 to $40,000 per month to run a coffee shop. Coffee shops fail for reasons including poor management, lack of sales to cover costs, bad employees and service, and too much debt.
The Coffee Shop business is expected to see growth at a CAGR of over 11% by 2021. A coffee shop’s profit margin is typically 12% of all the coffee products on sale.
How much does it cost to open a coffee shop?
Choose a location with heavy foot traffic, visibility, accessibility, and near other shops. Identify your unique value proposition to stand out in the market. What experience will you provide customers? Study coffee itself and consider food offerings to differentiate yourself.
It’s hard work starting any small business, but following these steps sets you up for coffee shop success. With passion and commitment, you can turn your dream into a thriving community hub.