how to open a cafe business plan

How to Open a Café Business

How to Open a Café Business – Ultimate Beginner's Guide PDF

Successfully Opening a Café Business

Opening a café business can be an exciting opportunity for aspiring entrepreneurs. The sound of steaming espresso machines, delicious food being served, and the lively chattering of customers can pique the interest of any new business owner.

A café is one of many different coffee shop concepts that could work in your community. Finding the right concept for the right location to serve the appropriate target market will be a significant part of your café planning.

In today's post, we'll deep dive into the steps you'll want to take to open a café successfully.

How much does a café business cost?

Several main factors impact the cost of a café, which requires two specific budget breakdowns .

The first budget would be your café startup budget . The second cost breakdown would be your operational budget .

Your coffee shop startup budget will be the money you need to get from Square One to your grand opening. This budget includes your research, planning, legal, and administrative costs. Additionally, your startup budget includes your initial space lease, café buildout, equipment costs, furniture and fixtures, and training.

Your operational costs are centered on the day-to-day or monthly cost of operating your café. This includes your lease, insurance, labor, inventory, taxes, and other expenses.

Since a café often has a more extensive menu and offers indoor seating, the costs of a traditional café are often higher than that of a conventional coffee shop.

These costs will fluctuate depending on the location, size of the kitchen, menu offerings, real-estate, and buildout costs.

For more information, read our post, How Much Does it Cost to Start a Coffee Shop?

Beginner's Guide

Opening a Café Business (Easy Steps)

• pick a cafe concept
• choose a cafe menu
• determine what will make you stand out
• define your branding
• determine your cafe budget
• understand who your cafe customers will be
• setup your business structure
• choose your cafe location
• pick your cafe equipment
• write a cafe business plan
• determine your cafe funding
• choose your cafe roaster
• build out your cafe
• get a cafe license and permits
• develop a coffee brand and marketing strategy
• hire amazing baristas
• always deliver excellence

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Steps Open a Café Business

Pick a café concept..

Cafés come in all shapes, sizes, and themes. Even café concepts can vary among other cafés.

What type of café do you wish to have? Perhaps, more clearly, what kind of experience would you want your café customers to have?

Choosing the right café concept to fit your customers in a specific location will be vital to driving sales and keeping your business humming strong.

You will want to settle on a specific niche in the marketplace that offers a unique experience and a different menu. This will help side-step competitors and appeal to customers. 

Choose your café menu.

Cafés are often more than just traditional coffee shops and differ in various ways. For example, cafes often have a more extensive menu than traditional drive-thru coffee stands or coffee shops. Some cafes even can have a full kitchen, a large bakery operation, and a coffee roastery. Of course, many cafes also serve alcohol as well. Serving alcohol at your café may require additional permits and licenses, so check with your state's alcohol board.

These are significant undertakings, cost additional money, and require a greater startup budget and operational budget to maintain. But, of course, the benefits of having these operations in-house can improve your sales and increase your profit margin.

Choosing your café menu will play a big part in other big decisions you'll be making. Everything from your space needs, permit requirements, employee wages, and cafe equipment needs will be determined by your café's menu.

Deciding on your menu requires you to grasp what your customers want at the price they are willing to pay.

Determine what's going to make you stand out

Now that you are honing in on a concept and menu, this might be an excellent time to determine how your café will stand out from the competition.

The “special thing” that makes you different will often give you a competitive advantage in the marketplace and separate you from the rest of the choices available.

Perhaps it will be your special soup your rotating business lunches, or your in-house roasted organic coffee. It could be your decadent pastries or special cakes made by your award-winning baker. It might be the collection of art on your walls, your panoramic view, or the music you offer every night. All these elements and more have the potential to be a unique feature that only your café offers.

We often refer to this particular thing as your Unique Sales Proposition or USP.

Coming up with a winning USP will better position you among competitors and provide you with a solid foothold to make other decisions. This will include your branding, messaging, and marketing efforts. It will also help improve your sales and training and give you a competitive edge. 

Define your cafe branding.

As you begin to outline what type of café you will be in, you will also want to develop your café brand and messaging behind it.

Your café branding will include, among other things, your logo, name of business, your use of colors, menu choices, uniforms, etc.

Your branding may be reinforced by your décor, design, and layout, among other things.

Additionally, your messaging – the use of language, slogans, and energy that you communicate via all of your channels (website, social media, signage) – plays a role in what type of café you have chosen.

Your messaging has to appeal and trigger action among your target market to maximize your success and drive sales. So, as you move forward with your business planning, start crafting and refining your logo and overall messaging. If you need help, there are affordable branding experts online who can help design your logo, signs, and other items.

Yet, there are plenty of things you can do yourself before hiring an expert, so keep reading!

Determine your cafe budget.

In the early stages of your planning, you will want to sketch out your café startup budget . Of course, the easiest way is to start listing the things you need to get your café up and running.

Your cafe budget will be central to answering the question: How much will your café cost?

This final estimate and budget will take a little planning, realistic estimates, and adjusting.

As you plan out your café business, your budget may naturally increase. Keep a running list and include this budgeting effort in your cafe business plan .

You will also need to create an operational budget. This operational budget will itemize the costs of being open and running your café daily. These two estimated budgets (your startup budget and operational budget) will be essential to understand before you launch your business.

My recommendation is that you don't create and act on your budget in “real-time” or as you go. Instead, determine your café budget first – analyze it against your business plan, then move forward with securing the funds needed to get your café operational – and then spend the money.

Opening a café business

Understand who your café customers will be.

There is no secret that your customers play a significant role in your café's success. From generating sales and repeat business to being your most prominent marketers – your customers are the foundation of your profit and continued success.

Start with determining who your customers are. It should be among the first necessary steps you'll need to take. Afterward, you can start molding your entire business to serve them.

Your target market is the general market to which your café will appeal, often based on your geographic convenience, accessibility, and business concept.

If you dig a little deeper – you will also know who your target customers are – or those customers that are most likely willing to buy from you.

Set up your business structure.

To operate your café legally, you will have to set up an appropriate business structure. Often, your business structure is created in the state in which you plan on operating your business. This is done through your specific state's secretary of state office.

Keep in mind that you can still operate your business in other states and regions as long as you have the appropriate business licenses and health permits and complete other requirements for those areas. For example, you might decide to open a coffee business in New York but decide to operate a second coffee shop located in Los Angeles .

Your business structure is an essential part of your café startup process. You'll have several business structures to choose from – such as a sole proprietorship, corporation, limited liability company (LLC) , etc.

Choose your cafe location.

Choosing the best location for your café will be the cornerstone of your success. The perfect location can determine your sales strengths and position you to maximize exposure.

There are a few essential elements that revolve around your café's location. Your location should be easily accessible to your target market, and have parking and lighting, among others.

You will have to factor in neighboring businesses, competition, and other essential elements in your prospective location. These include neighboring points of interest, parks, farmers' markets, theaters, etc.

Additionally, your location's lease will be critical in moving forward with the location. A poor lease or a lease that makes business difficult may hamper your progress and sales.

For more information, read our post, How to Choose the Best Location for Your Café .

Pick your cafe equipment.

Now that you've picked out the concept and your menu and you're settling on a location, you'll want to start choosing the café equipment pieces you'll need.

Detail items such as ovens, stoves, and refrigerators. You will also need an espresso machine, commercial coffee grinders, and brewing devices.

Your café equipment will be a significant part of your budget and requires some thoughtful budgeting and comparison shopping. You may also want to include your café displays, menu boards, furniture, and fixtures in your calculations here as well.

For more information on choosing your coffee shop, please read   The Coffee Shop Equipment You Need

Write a café business plan

Writing a café business plan will help get all your thoughts, ideas, and plans on paper. In addition, your business plan will play a key role in helping you organize your thoughts and ensure that all elements of your business are addressed.

A café business plan is written for a small and significant audience. First, your business plan will be read by your potential investors, partners, and bank lenders. Next, your café business plan will also be read by property managers. Most property managers will expect to see a business plan which allows them to understand the nature of your business and operations thoroughly.

For help getting started, please read   How to Start and Write Your Cafe Business Plan.

Determine your café funding.

After you've developed your business plan, you will want to secure your funding. Before getting the financing, you will need to establish a café funding mix. Your mix will detail the pools of capital you will utilize to get the money to fund your café startup fully. It will also provide a guidepost to strategize accessing funds from each pool.

Your funding mix will help you prioritize your efforts to secure the funds you need to get your business self-sustaining. 

For a more detailed look at developing your café funding mix, please read our post, Developing Your Café Funding Mix.

Choose your café roaster and vendors.

If you decide not to roast your beans, you will need to work with a wholesale coffee roaster .

Choosing a coffee roaster is a big decision. After all, you are banking on their expertise, quality, reliability, and their ability to provide you with as much roasted coffee as needed. Some cafes run through hundreds of pounds of coffee in a week, so your wholesale roaster will need to be able to fulfill those orders.

You may decide to roast your coffee beans yourself, but this decision comes with added costs and other considerations.

In addition to your coffee roaster, you should consider looking at any vendors you might need to work with to fulfill your menu items.

For further reading, please read   How to Choose a Wholesale Coffee Roaster .

Build Out Your Café.

After securing your café location and signing your lease, you will probably need to remodel or build out your café. This may require some permitting, and it certainly requires some research to understand what codes and regulations you'll need to adhere to.

My recommendation is that you start early in the cafe design and layout process. Even though you may not have a location yet, you can still understand what is required for you to pass the inevitable health and building inspections. Establish contacts with your various departments. Never start working on your café without first checking with the agencies that will need to approve your design and layout.

Get your cafe license and permits.

You will need to get your health department permit, building permit, and business license to serve your first customer. Additionally, you may also need to have a fire department permit.

Each of these permits requires you to work with different governmental agencies before opening your café. The good news is that most of these agencies have worked with many café businesses in the past, so they would help you answer any questions you have.

Some agencies, like the building department, might be at the state level. In comparison, other agencies like the health department will be at the county or city level.

Develop a coffee brand & marketing strategy.

Setting your café apart from the rest of the field, in most cases, will be what allows your café to grow into the business you want it to.

You will want to create a brand – everything from your name, logo, slogan, and colors you use.

Your brand will be your banner symbol with which you, your employees, and your customers understand and develop a connection.

As you develop your café brand, you will also want to market your café business. Never believe that your café will succeed on its own simply with the fact that it exists.

Successful cafés figure out ways to effectively market to their target market. By understanding your target market and what you intend to do well, you can craft an effective marketing strategy.

Hire amazing baristas.

One of the best things you can do as a café owner is to hire amazing baristas and staff.

Reliable, honest, and skilled staff are hard to come by, so start looking for them early.

Once you hire your staff, do whatever it takes to keep morale high, pay fair wages, offer the opportunity for gratuity sharing, and provide regular barista training. Regular coffee education and barista training will improve your turnover rates.

Deliver excellence every time

Consistently deliver your best. If you have come this far to open your café, you will want to exceed your customers' expectations every time. I acknowledge that delivery consistency every time is hard, but it is necessary when your competitors are hoping you fail.

As a café owner and manager, you will want to offer high-quality products and services by constantly improving, continuously training, adapting, and listening to your customers. Treat your employees well, take steps to show how valuable they are to your business, and go the extra mile for your customers.

Further Reading : How to Start a Coffee Shop Successfully

Opening a Café Business

Additional Questions:

Is it hard to open a café.

Starting a café is not necessarily hard. Instead, it requires devotion and tenacity. There are several steps to owning and operating a café, and they all need to be completed before you can open your doors.

It will be challenging to have the patience, knowledge, and money to get you to the Grand opening. However, many successful café owners who started with less skill, less money, and less understanding than you, have succeeded because they had the motivation and devotion to follow through. Following through is the hardest part about starting a cafe.

How much money do café owners make?

Café revenue and income vary across the board. However, factors that determine café income and revenue aren't different from those of other retail businesses and restaurants.

To determine income, you'll need to determine how many sales you have per day, week, or month. Additionally, the number of sales needs to be multiplied by the average cost per ticket.

For example, let's take a tiny café open from 7 am to 7 pm, which sells 120 coffees per day, averaging $5 per receipt. That comes out to $600 per day or $4200 per week for coffee. So, this would come out to $16,800 per month.

Of course, this includes coffee alone and not muffins, pastries, soups, or other menu items. Additionally, you will want to subtract the operational costs to give you your café's net income and profits.

We take a deeper dive into the revenue and income that is generated by a coffee shop in our article, How Much Does a Coffee Shop Owner Make?

What is the difference between a cafe and a coffee shop?

A cafe is typically larger and offers indoor (and possibly outdoor) seating. Cafes may also offer waiting services and have a deeper menu. The menu may offer full-kitchen options for breakfast, lunch, and dinner. There are often different hybrid cafes that also offer walk-up or drive-thru options, but typically, you'll find a place for customers to sit, look at a menu, order from their items, and wait for their plates to be brought to them. A cafe may often be open later into the evening, serve alcohol , and offer live music.

Should I open up a low-cost coffee business instead?

If you would like to open a café but aren't sure you can manage the cost or secure funding, there may be a variety of other low-cost café options for you to consider.

Options include starting a mobile coffee business, an espresso catering business, or a drive-thru coffee stand . Additionally, you may also consider selling coffee online. Selling coffee online can help you establish your brand, help you target your customers, and provide you with the experience and funding you need to get your café started.

For more information, read Low-cost Ideas for Starting a Coffee Shop with No Money.

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How To Start A Coffee Shop (2024 Guide)

Updated: May 1, 2024, 5:13pm

Table of Contents

How to prepare, 12 key steps to open a coffee shop, tips for success after opening a coffee shop, independent coffee shop vs. starting a franchise, frequently asked questions.

It’s no wonder you want to start a coffee shop. Coffee is one of the most popular and profitable beverages in the world. It is robust and delicate, flavorful and aromatic, stimulating and relaxing. It’s conversational, it brings people together and it jumpstarts the day. The coffee industry can be a lot of fun. If you want to know how to start a coffee shop, look no further—we’ve compiled the ultimate guide to get you on your way.

Before you truly launch into the process of starting a coffee shop, you should lay a solid foundation to build on.

Create a Business Plan

Having a business plan is important. It’s similar to a map, helping you get from point A to point B.It’s also essential if you are seeking a loan or investment. You want your lender to see what you intend to achieve and how you plan for success.

Creating a business plan helps you connect your investments with goals, have a business model, show your target market, sales strategy and overall potential for growth. It also helps you uncover any weak spots, honing in on things that could potentially go wrong. Try to map out the whole picture for the entire business including business structure, customers, location, pricing, cost, products, staff and financials.

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Choose Your Business Structure

When it comes to choosing your type of business structure , it is important to decide what structure best supports you and your business. This is something you will need to do before you register your business with the state. It is best to choose your business structure carefully, as it directly affects you and your business from personal liability, taxes, legal protection, bankruptcy, selling or even transferring ownership.

You could run your business as a sole proprietor, partnership, limited liability company (LLC) or corporation. LLCs and corporations provide protection against personal liability, but require filing forms with your state. Take some time to consider which option works best for you.

Consider Costs: Funding and Finances

Unless you already have the finances to start your coffee shop, you’ll need to calculate your startup costs. After you determine your startup expenses, you’ll need to decide where to request funding. You may have self-funding or investors as financial resources or you may need to contact banks and credit unions to request a small business loan . Another popular option is crowdfunding, which allows other people to support and contribute to the success of the business. Whichever way you decide, you need to have a good idea of what your budget is going into it. Consider costs such as renovations, buildouts, construction, machines, water systems, coffee grinders—these can add up. It’s inevitable for unforeseen things to come up, so it is better to be as accurate as you can and avoid underestimating.

1. Have a Vision

Passion with a vision is the driving force you need to move into action and succeed. Your desire will be the fuel to your success, and your customers will sense your love and dedication to the business. This vision and passion not only fulfills your personal dreams and desires, but it delivers an exceptional outcome and experience to your customers. When the going gets tough, you’ll need that fuel to get you through and when you put your heart and soul into something you love, the payoff is even greater.

“People with passion can change the world” —Steve Jobs

2. Do Your Research

Knowledge is power and it is a major contribution to your success. In order to gain knowledge, you must do your research. Start by learning the ins and outs of what makes a successful coffee shop.

There are many ways to do this, from hands-on experience to networking, asking other coffee shop owners with experience and educational tools such as books, classes and online content. This will provide you with important tools and information to move forward with confidence. Write a list of questions to help you gather the information you need. Some examples include:

• How do you roast your own coffee beans?
• What makes a great cup of coffee?
• What are the best machines to use?
• What are the coffee shop essentials?
• What is the competition like in the area?
• What are the health codes for a coffee shop?
• What other sources can help the business grow?

The more knowledge you have, the better your business will be. You’ll have more insight on how to run it, and you’ll be able to make good decisions. Your staff will trust in you and your customers will enjoy buying from you.

3. Identify Startup Cost and Equipment

No matter what, starting a coffee shop will have expenses, and these are essential for your operation. If you are choosing a brand-new retail location, it will be more costly to build and renovate than it will be to rent an existing location. Depending on the size and location of your coffee shop, cost can vary from $100,000 to $600,000. Determine what your budget is and what your limit is to spend on the necessities including renovations, furnishings, products and equipment. Some common startup costs that you’ll have include:

• Rental space
• Licenses and permits
• Advertising
• Staff wages
• Furnishing and equipment

To gain a full picture, separate your one-time costs, such as licenses and permits, equipment and renovations, from your monthly costs, such as utilities, advertising and employee wages.It’s better to overestimate than underestimate, and it’s important to have additional funding to cover operating costs until the business becomes profitable. This can take anywhere from six to 12 months.

4. Develop a Branding Strategy

Branding is much more than a logo. It not only represents the overall identity of your business, but the quality of your product, allowing customers to recognize, become familiar and trust your services. Think of it as the face and personality of your coffee shop and what makes your café unique and stand out.

Ask yourself, “How can I leave a lasting impression on the consumer and how do I want my customers to feel when they arrive?” You want your brand to activate their senses so they will automatically anticipate the full experience before they even walk through the door. This leaves a lasting impression on the consumer, encouraging them to talk about their experience with others and visit again.

Here are some helpful questions to ask yourself when developing your brand:

• What makes your coffee shop unique? For example, the coffee beans, the atmosphere, the environment, the services, the ingredients, etc.
• What kind of experience do you want to provide, and what is your overall theme for the shop?
• How can you create a sense of community, and how does it serve others as a gathering hub?
• Is your brand logo appealing, and does it translate well on packaging, social media and merchandise?
• How will your logo create a sense of familiarity and trust for consumers?

Once you’ve found the perfect design, don’t forget to trademark your logo and protect your creative assets.

5. Find a Location and Commercial Space

When starting a coffee shop, it’s important to choose a location and space that provides a wonderful experience for your customers. With that in mind, you’ll also need to consider other factors that will determine the success of your business, returning true profitable potential.

Pick a location that targets your ideal customers. You want to make sure there will be enough foot traffic in the area to provide your coffee shop with high volume and avid coffee drinkers—keeping your business steady year round. Get an idea of population density in your area by contacting the city or visiting census.gov census data by zip code.

Research other coffee shops in the area. It’s a good idea to research other coffee shops in the area to see if they compete with the products and services you provide. Some coffee shops target specific audiences or have limited hours of operation. This could help you determine whether or not you want to target customers who are early birds or night owls. Maybe you want to serve breakfast sandwiches in the morning or dessert and coffee in the evening.

Either way, it’s a good idea to make sure you’re not in competition with your neighbor—try to complement them instead.

Find a location that is easily accessible. Customers are drawn to locations that are easily accessible whether on foot or driving. Customers love the convenience of hassle-free parking and street visibility for those walking from one destination to another.

Find a commercial space. Finding a cozy coffee space is just one necessary component to an exceptional café experience but, unfortunately, not all commercial spaces will be able to accommodate more than that. Coffee shops require a unique set of accommodations, such as sufficient space to move around, room for espresso machines, couches and tables, kitchen space, gas, drain and water lines just to name a few. Remember to take all of it into consideration.

Find a commercial space you can afford. This falls in line with your budget as an ongoing cost, making it a commitment for the long haul. Consider the length of the lease, rent increases, renovations, insurance requirements, security deposit, maintenance and repairs. This not only plays a role in your coffee prices, but can directly affect any business loans.

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6. File for Permits and Licenses

Before you start firing up the espresso machine and filling the display case with baked goods, you’ll need to get approved for state and local licenses and permits. Make sure you’re prepared ahead of time and be aware that these licenses and permits take time to secure. Permits and license requirements vary from state, city and county so be sure to check with your area of operation in order to fully operate in compliance with state laws and regulations.

Here are some licenses and permits you’ll likely need to open a coffee shop:

• EIN (Employee Identification Number)
• Business license
• “Doing Business As” License (DBA)
• Retail Food Service License
• Resale License for Sales Tax
• Sign Permit
• Food Handler’s Permit
• Building Health Permit
• Live Entertainment License

Once these important documents are set in place, you’ll be well on your way to opening your doors.

7. Choose the Right Coffee Supplier

A successful coffee shop is one that brews quality coffee time after time. A delicious cup of coffee keeps your customers coming back for more, making the experience enjoyable and worth every penny. When sourcing coffee, you’ll want to offer a product you’re proud of and to do that you must partner with the right supplier.

Here are a few key pointers to consider when choosing your coffee supplier:

Coffee lovers can be picky so be prepared to brew a high-quality cup of joe. When scouting the right supplier, there are many factors to take into consideration. Learn about the origin, how the coffee is roasted and where they source the coffee beans. If possible, visit the supplier and sample the coffee firsthand or request samples by mail. Inquire how the coffee is stored—as heat and humidity can damage the flavor and quality. Look for a coffee roaster that offers a wide variety of coffee bean options and falls in alignment with the vision of your café.

Find a supplier that can support low minimums to higher-volume capacity and has a fast and reliable turnaround. Once you find a supplier that suits your needs, you’ll want to make sure the supplier is able to grow with you. You may want to purchase a wide variety of coffee beans or a minimum quantity to start and a larger quantity as you grow. Either way, make sure you choose a supplier you can rely on. Your business will have fluctuating needs and you want to make sure the supplier is consistent and can provide a steady supply.

Customer Service

Think of your supplier as someone you are forming a long-term relationship with. You’ll want them to be just as committed to your success as you are. A good supplier will provide great customer service and walk you through each step—from roasting to packaging, sampling, creating blends and making small to large orders.

There are a few important things to consider when finding a price that works for you, including quality, customer prices and profit. First, determine if the supplier offers quality beans for the price, Second, decide if the price is fair for your customers and what your profit margin will look like. Lastly, will this price allow you to turn a profit? Great coffee does not come cheap, but it should not break the bank either. Most importantly, the taste and price should be worth a return visit.

8. Design Layout and Workflow

Your coffee shop layout and workflow will play a critical role in attracting customers to your café. Not only is ambiance and environment important, but so is the customer flow, food flow and coffee flow.

Here are a few things to consider when designing a layout:

Create a first impression. From a marketing perspective, your first impression determines who will become your customers. Determine what message you want to convey and what type of experience you want your customers to have when they walk through the door. Is it cozy and quaint? Is there music, study areas or areas for conversation? Not only is ambiance important, but so are the little details—such as where your customer will stand in line, wait for their coffee and move comfortably from place to place.

Create a good workflow design. Keep in mind, you’ll want to provide great service to your customers and with great service, you’ll need to move quickly and efficiently. Coffee shops can get busy, so it’s important the layout allows your baristas to move gracefully and swiftly when under pressure. Create a layout that allows the barista to be in a good flow from taking orders to brewing, grinding, steaming and frothing.

Long before you sign any contracts, make sure the building can accommodate a good workflow and area design. Consider how you will arrange and place the essentials:

• Coffee machines, grinders, milk frothers and kitchen equipment
• Storage and supplies
• Food display
• Menus and signs
• Outdoor and indoor seating
• Food assembly
• Coffee assembly
• Customer and employee flow

9. Order Equipment and Supplies

Quality equipment is necessary for a good cup of coffee but, unfortunately, equipment is not cheap. It’s best to do your research when making big purchases and remember quality equipment is a long-term investment, essential for the growth and success of your business.

Here is a list of equipment essentials you’ll likely need for your café:

• Espresso and coffee machine
• Coffee grinder
• Water filtration system
• Refrigeration and freezers
• Hot food equipment
• Point-of-sale (POS) system
• Dine-in and take-out coffee containers
• Ice machine
• Bakery display

This is just a starter list of your standard equipment and supplies. Remember to do your research because every detail counts. Get ready to stock your shelves with blenders, stirrers, syrups, varieties of milk, condiments, containers and thermometers and more. Inventory management software is also a great tool for tracking and identifying these items, making it easy to know what’s in stock and what needs to be reordered.

10. Hire and Train Your Team

A good barista goes a long way, from the very first interaction with the customer to their coffee-making skills. Remember, the people you hire are the face of your café and they have the ability to make a positive difference to your customers’ day. Customer service is everything so hire staff who know the importance of building relationships with people and have strong communication skills. Customers love genuine interaction and it will help create a bond between the customer and the café.

You also want to train your employees properly so they can make a great cup of coffee with confidence. Make sure the barista is ready to learn and is fully equipped with all the essential tools and knowledge to succeed—even a skilled barista will benefit from a refresher.

Here are a few must-haves to look for when hiring and training a barista:

• Great customer service
• Strong communication skills
• Attention to details
• Ability to multitask
• Ability to work under pressure
• Responsible and reliable
• Willingness to learn
• Cleanliness
• A positive attitude

Overall, a great barista will not only have a love for coffee, but they will care about the success and reputation of your business. Learn more in our guide about how to hire employees.

11. Market Your Brand

It can be frustrating to gain exposure when first starting out, so having a marketing plan for your brand should be top priority. It’s also important you tailor your ads and promotional products in a way that attracts the right people. There are many influential ways to promote your brand, so make sure to utilize all avenues of marketing—whether it be through online web content, social media, storefront advertising or involvement in the community.

Let’s take a look at a few ways you can promote your brand:

• Create a website
• Search engine optimization (SEO)
• Social media
• YouTube, Instagram and Facebook
• Influencer marketing
• Community gatherings and pop up shops
• Giveaways and raffles
• Paid advertising

12. Open House

Hard work pays off and once the paperwork is signed, decor is in place and staff is on the schedule, it’s time to open your café. To do so, you’ll need to get people to walk through your doors on opening day.

Now is the time to create a buzz through your social networks. Plan a ribbon-cutting event to promote your business or welcome a few people to a soft opening for an exclusive firsthand experience. Post about opening day on social media, letting your target audience know you’ll be open for business. You can even offer discounts or freebies as an incentive; this will help build curiosity and entice people to visit.

During the open house, it’s a good idea to show the face behind the brand. Mingle with your customers and take the time to know your community as this helps to build good lasting relationships.

There is no secret formula to success but here are a few additional ways you can increase your chances of success and grow the business.

Invest in a Strong Point-of-Sale System

You can greatly improve your business through a point-of-sale (POS) system . POS systems are made up of hardware and software, working together to process sales and payment transactions at the point of purchase. This system is digital with an intuitive touchscreen and interface, replacing the traditional cash register.

Having a point-of-sale system will benefit every area of your business. It allows customers to use different payment types, which in turn increases your revenue. It improves accuracy with a touchscreen, allowing you to keep a close eye on sales, profits and expenses.

It shows real-time inventory data from tracking inventory, making reordering simple. It also includes time clock functionality for employees to clock in and clock out. You can print reports, customize receipts and so much more. A point-of-sale solution is a great addition, furthering the success of your business and keeping your business organized and running smoothly.

Stay Ahead of the Game

In a saturated market of coffee shops, it’s important your café stands out. Find ways to take your coffee shop to a whole new level, giving your customers a good reason to visit your café and not your competitors. This brings money in the door and profits up.

Create consistency with your customers so they know what to expect, giving them a reason to come back, which helps form a long-term relationship. Think of something you can include with their experience that they wouldn’t get anywhere else such as a free biscuit with purchase, rewards or loyalty programs. Another way is to create an environment that is warm and inviting. Have relaxing music playing, comfortable lounge areas and offer free Wi-Fi, this will help your customers feel at home.

If you’re considering opening a coffee shop, you may be wondering if it is better to start a franchise or an independent business. There are many differences between the two business models and the choice will ultimately depend on your personal vision and set of goals. Let’s briefly take a look at both sides of the coin.

Opening an Independent Coffee Shop

Independent small business ownership is for those who have a personal vision and want to follow their own passions. You decide how the business will run. You are your own boss and you call the shots in every area of operation. If you decide on opening an independent coffee shop, you’ll have the freedom and independence to fully create and market your own product and brand name.

On the other hand, you’ll have less exposure, and you’ll need to develop your own customer base. You are fully responsible for developing and maintaining the success of the business.

Opening a Franchise Coffee Shop

When you franchise a coffee shop, you buy the rights from a company to operate and do business under their brand name. They provide the blueprint to replicate a proven formula. There are many controlled elements when opening a franchise, ranging from hours of operation and marketing strategies to the type of equipment and ingredients used.

They define how the business will operate in every way and you gain the reputation of a brand that most people already know and trust. If you decide you want to open a franchise, you’ll be responsible for signing contracts and following many rules and regulations. Startup costs can be high and you will have to pay a continuous fee to keep using their name.

In a nutshell, both have pros and cons, and both have the potential for success. It’s important to do your research and consider all factors before making a decision.

Bottom Line

We all know coffee will never go out of style. Coffee shops are continuing to grow and are becoming more popular every day, offering a variety of flavors and styles. You will likely succeed as a coffee shop owner if you have an ongoing love for your business and a solid business plan. Stay committed to the journey, express your creative edge and be open to learning. All in all, owning a coffee shop can be a gratifying and profitable experience.

How profitable is a coffee shop?

The profit margin will all depend on a few major factors, such as volume of sales, location, price point, startup costs, operational cost and more. Every coffee shop will vary from person to person, but it is estimated that a coffee shop owner can make between $50,000 and $175,000 yearly.

Do I need any qualifications to run my own café?

There are no specific requirements or qualifications to start a coffee shop, but it is a good idea to learn general business skills. Although you do not have to have a lot of experience, you must have the motivation to learn and grow.

How do I write a simple business plan?

When you’re working on a business plan, make sure you have as much information as possible so that you can simplify it to the most relevant information. A simple business plan still needs all of the parts included in this article, but you can be very clear and direct.

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Natalie Cusson is a small business owner with over 15 years experience in the creative arts. She's worked on ad campaigns for many trusted brands such as Nike, Subaru, Polaris, Red Bull and Progressive Insurance, just to name a few. Beyond her professional accomplishments, Natalie is driven by her love for writing and research, and is committed to maintaining a growth mindset. Not only is she passionate about learning and growing, she believes in embracing a healthy lifestyle.

Cassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of directors of two non-profit organizations seeking to revitalize her former railroad town. Prior to joining the team at Forbes Advisor, Cassie was a content operations manager and copywriting manager.

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How to Write a Cafe Business Plan (+ a Free Plan Outline)

July 12, 2024

Jul 12, 2024

17 min read.

If you’re thinking of starting a cafe or coffee shop, your first step is drafting a business plan. This may sound intimidating, but it doesn’t have to be. When you’re armed with the know-how you need, writing a business plan is actually pretty straightforward.

This article and detailed examples will show you how to create a cafe business plan step by step. We’ll also show you how Lark can help as you draft your business plan and optimize your cafe’s operations .

Explore how Lark has helped Journey Kaffe grow

What is a cafe business plan?

There are more than 38,400 coffee shops in the US, with a total market value of over $48 billion. But there’s room for even more — and each new one will need a business plan.

A cafe business plan is a strategic document that outlines your vision, goals, and roadmap for establishing and running a successful cafe. Its main purpose is to give you a structured approach to planning and decision-making.

Additionally, it serves as a guide for the business’s day-to-day operations and a reference point for measuring progress and making adjustments once you’re up and running.

Typically, a cafe business plan includes an executive summary, a market analysis, and detailed financial projections.

The executive summary offers a concise overview of your cafe concept, target market, and unique selling points (USPs).

The market analysis delves into industry trends, your competition, and customer demographics.

The financial projections include startup costs, revenue forecasts, and a break-even analysis.

If you’re seeking financing from investors or lenders, your business plan maps out the viability and potential profitability of your cafe business.

Discover how ZUS Coffee propelled growth with Lark

What should you include in your cafe business plan?

In this section, we’ll discuss the framework of a solid business plan.

Lark Docs is useful for creating your plan as well as any other important documents your restaurant will need to function. It gives you a central location to store everything securely. You can also easily share docs with stakeholders and collaborators.

Executive summary

Your plan document should start with an executive summary. Consider writing this last, when you’ve put all the other pieces in place.

In the executive summary, you’ll present a concise overview of your cafe business plan. It should provide key highlights and a snapshot of the business. Also, include the cafe's name, location, and mission statement.

Next, summarize your business concept, including its USPs and target market. Highlight important financial projections, such as expected revenue and profitability.

Briefly mention the cafe’s management team and their expertise, and outline the competition and your strategic advantages.

Conclude this section with a summary of your funding requirements and the purpose of the plan. This section should be informative and inspiring so that it encourages readers to delve deeper into the plan’s details.

Business description

Your business description should give readers a detailed overview of your business concept, mission, and USPs. This information is summarized in the executive summary, but it's laid out in detail in the business description.

To create an effective business description, start with a clear and concise mission statement that captures the essence of your cafe. Describe the type of cafe it’ll be, including the food and beverages you want to serve, the atmosphere you’re aiming for, and the target market.

Highlight what sets your cafe apart from its competitors, such as a unique menu, specialty coffees, exceptional customer service, or sustainable practices.

Here’s a helpful sequence for laying out your business description:

1. Mission statement: A brief and impactful statement that defines your cafe's purpose and values.

Example: “Our mission is to create a warm and inviting cafe space where customers can enjoy high-quality, ethically sourced coffee and freshly baked pastries while experiencing a sense of community and connection.”

2. Business concept: Describe the overall concept, including the cafe’s theme, design, and ambiance.

Example: “Urban Elegance Café offers a sophisticated yet cozy environment with a modern design, perfect for both business meetings and casual get-togethers.”

3. USPs: Highlight what makes your cafe unique, such as a focus on organic ingredients, locally sourced products, or innovative menu items.

Example: “We pride ourselves on using only organic, fair-trade coffee beans and locally sourced ingredients.”

4. Target market: Identify your primary customer base and explain why your cafe will appeal to them.

Example: “Our primary customers are young professionals and students who appreciate premium coffee and a comfortable space for working or socializing.”

5. Location: Mention the planned location and why you’ve chosen it to attract your target market.

Example: “Located in the heart of downtown, our cafe benefits from high foot traffic and accessibility. We’ll attract both office workers and local residents.”

6. Business objectives: Outline your short- and long-term business goals.

Example: “Our short-term goal is to establish a loyal customer base within the first six months, and our long-term goal is to expand to multiple locations within five years.”

A detailed business description like this provides a snapshot of your cafe's identity and strategic direction. It helps stakeholders quickly grasp what your business is about and why it’s worth investing in or supporting. Plus, it sets the stage for a logical and compelling narrative in the remainder of your business plan.

Demographics

The demographics section of a business plan includes an in-depth analysis of the target market or customer base.

In this section, include detailed information on the ages, genders, income levels, occupations, education, and lifestyle preferences of your potential customers.

Keeping these demographic factors in mind is important for tailoring your offerings, marketing strategies, and overall business approach to the needs and preferences of your target market.

To gather the right demographic information, start with market research. Use data from local government databases, industry reports, and market research firms. Websites like the US Census Bureau, Pew Research Center, and your local chamber of commerce can provide valuable insights.

Another way to collect demographic information is to conduct surveys, focus groups, and interviews with local residents. This will give you firsthand information about the location you’re looking at.

Here are some examples of how to use the information you collected:

1. Age and gender: If your target market is young professionals aged 25–35, you might find that this group frequents coffee shops for both work and socializing.

Fine-tune your menu to include trendy coffee drinks and offer amenities like free Wi-Fi and comfortable seating.

2. Income levels: Analyze the income levels of professionals at your planned location to set appropriate pricing. In a higher-income area, you might offer premium coffee blends and gourmet pastries. In a middle-income area, focus on affordability and value for money.

3. Occupation and lifestyle: If your cafe is near a business district, cater to office workers with quick-service options, lunch specials, and grab-and-go items.

If located near a university, offer student discounts, extended hours, and a study-friendly environment.

If your research shows a high percentage of health-conscious individuals in the area, incorporate healthier menu options, like vegan pastries and sugar-free creams and syrups.

4. Education: Higher education levels often correlate with a preference for specialty coffee and artisanal products. Use this information to create a menu that includes organic, fair-trade coffee and unique, high-quality baked goods.

If you thoroughly understand the demographics of your target market, you can make informed decisions that help you achieve customer satisfaction and drive business success.

SWOT analysis

A key element of any business plan is a SWOT analysis . This is a strategic planning tool for identifying and evaluating the strengths, weaknesses, opportunities, and threats related to a business. It’s used to assess the current situation of the business and develop strategies for growth and improvement.

More specifically, a SWOT analysis gives a comprehensive overview of the internal and external factors that can impact the business, which helps owners and managers make informed decisions.

A strength could be a particularly unique menu, and a weakness could be limited seating capacity.

Opportunities and threats are external factors, like market trends that favor a particular specialty coffee (an opportunity) or new competitors entering the market (a threat).

For example, a cafe might identify its prime downtown location as a strength but its limited parking as a weakness.

An opportunity could be changes in the coffee business, such as an increasing demand for organic coffee, while a threat might be the opening of a new coffee chain nearby.

By analyzing these factors, you’ll be prepared to play to the strengths of your cafe enterprise, address weaknesses, capitalize on opportunities, and find ways to lessen the impact of potential threats.

To visualize what a SWOT analysis looks like, here's a simple diagram of one for a cafe that caters to health-conscious customers:

Competition analysis

One of the most important considerations in opening a new business is whether it can hold its own against its competition and potentially outperform it. To figure this out, you need to do a competition analysis.

A competition analysis involves identifying and evaluating your potential competitors to understand their strengths, weaknesses, strategies, and market positioning. It’s critical if you plan to open a cafe since it provides insights into the competitive landscape and helps you develop strategies to differentiate your business and capture the market share you’re hoping for.

Specifically, conducting a competition analysis helps you:

Identify market gaps: Discover unmet needs or underserved niches that your cafe can target.

Benchmark performance : Understand industry standards and set realistic benchmarks for your business.

Refine your USPs: Clearly define what makes your cafe stand out from the competition.

Develop effective strategies: Craft marketing, pricing, and operational strategies that capitalize on your competitors' weaknesses and leverage your strengths.

How to conduct a competition analysis

Follow these steps for a solid competition analysis:

Identify your competitors: Start by pinpointing both direct competitors (other cafes) and indirect competitors (bakeries, food trucks) near your intended location. Use online searches, local directories, and social media to compile a comprehensive list.

Analyze key competitors: Visit your competitors’ locations, review their menus, and observe their customer service. Take note of their pricing info, promotional strategies, and customer reviews. Analyze their online presence, including their websites and social media profiles, to understand their brand positioning and customer engagement.

Do a SWOT analysis: Perform a SWOT analysis for each key competitor. Identify their strengths (e.g., strong brand loyalty or a prime location), weaknesses (e.g., a limited menu or poor customer service), opportunities (e.g., a growing demand for specialty coffee), and threats (e.g., new entrants or changing consumer preferences).

Evaluate market positioning: Determine where your competitors stand in terms of market positioning. Are they targeting budget-conscious customers or premium coffee lovers? Knowing this information will help you position your cafe appropriately.

Suppose you plan to open a cafe in a busy downtown area. Your primary competitors include a well-established chain with a strong brand presence and a local boutique cafe known for its artisan pastries.

Upon analyzing these competitors, you find that the chain offers quick service but lacks a cozy atmosphere, while the boutique cafe has a loyal following but higher prices.

Making use of these strengths and weaknesses, you could position your cafe to offer a comfortable, inviting space with competitive pricing and a focus on high-quality, locally sourced products to fill the gap between quick service and premium offerings.

So, by conducting a thorough competition analysis, you can strategically position your cafe to attract customers and thrive in a competitive market.

Costs and revenue forecasting

One of the first questions when opening a new business is: Will it generate a profit ?

Cost and revenue forecasting involves predicting future expenses and income to determine the financial viability of your cafe. This process is essential for financial planning, securing outside financing, allocating resources wisely, and managing cash flow effectively.

This detailed analysis provides potential investors with a clear picture of your cafe’s financial potential. It also identifies potential financial challenges and helps you identify proactive countermeasures.

How to conduct cost and revenue forecasting

Build this section around the following three points:

Identify costs: List all startup costs (e.g., equipment, renovations, and licenses) and ongoing operational expenses (e.g., rent, utilities, salaries, ingredients, and supplies). Group them into fixed and variable costs.

Estimate revenue: Project your monthly sales based on expected customer volume, average transaction value, and menu pricing. Consider peak and off-peak periods, as well.

Create projections: Use the identified costs and estimated revenue to create monthly and annual financial projections. Include best-case, worst-case, and most likely scenarios to account for uncertainties.

Suppose your estimated monthly costs are $15,000 (fixed costs: $11,000 for rent and salaries; variable costs: $4,000 for ingredients and utilities).

If you expect to serve 3,000 customers per month with an average transaction of $7, your projected monthly revenue would be $21,000.

Subtracting your costs from your revenue, you forecast a monthly profit of $6,000. This basic forecast helps you understand your break-even point and profitability.

By conducting cost and revenue forecasting, you ensure that your cafe is financially prepared for both challenges and growth opportunities.

To track inventory and sales details in your bookkeeping once your cafe is up and running, take a look at Lark Base . It easily connects with your POS system to give you insights into your cafe’s performance. You’ll see at a glance which drinks and foods sell and which don’t, helping you monitor the success of your menu.

If you’d like some help with staying on top of your inventory and revenue stream, also check out Lark’s helpful inventory and revenue tracking system.

If you’re selling online, too, software like Larksuite paired with a good POS like Shopify can help your ecommerce run very smoothly. Lark has a built-in Shopify integration, making it even easier to keep your data in sync.

Staff and management

Your cafe business plan should also detail the projected staffing structure and management roles in the organization.

Include a staffing plan that outlines the number of employees needed, their roles (e.g., baristas, kitchen staff, and waitstaff), and any required qualifications or experience.

Describe management structure and skills and highlight key positions such as general manager, head chef, and floor supervisor, as well as their responsibilities. Include recruitment and training plans for your future staff, too.

Finally, outline employee policies when it comes to compensation, benefits, and scheduling.

Legal information

Your cafe business plan should include a detailed overview of any necessary legal requirements as well. This includes business licenses and permits, such as a general business license, health department permits, food handler permits, and possibly a liquor license if you plan to serve alcohol.

Also, describe compliance with local zoning laws and building codes as needed.

Include information on any required inspections and safety regulations, as well as an overview of insurance coverage, such as liability and property insurance.

Clearly identifying these legal requirements ensures that your cafe operates within the law and you avoid potential legal issues.

Marketing plan

In addition to the above sections, you could add a summary of your marketing plan, which describes the avenues you will use to reach potential customers.

This could include a website, print ads, sidewalk advertising, online ads, social media, frequent visitor discounts or rewards, special promotions , or building a mailing list.

However, a marketing strategy is typically more comprehensive than what’s included in a business plan, so it's good practice to draft a detailed marketing plan as a supplement to your business plan.

Use Lark’s restaurant sales guide for smooth cafe operations

Coffee shop business plan example: Green Elephant Cafe

Still not sure how to get started with your plan? Take a look at our cafe business plan example for a hypothetical establishment called the Green Elephant Cafe.

Green Elephant Cafe - Business Plan

The Green Elephant Cafe, located in a bustling downtown area, will provide a vibrant, eco-friendly space for locals, office workers, and tourists.

Our mission is to offer high-quality, ethically sourced coffee and organic pastries while promoting sustainability.

With a prime location and exceptional customer service, we project a monthly revenue of $20,000 with a profit margin of 10%.

Our experienced management team will guarantee operational excellence. We seek $100,000 in funding for startup costs and initial operations.

The Green Elephant Cafe is a modern, eco-conscious cafe that combines a cozy atmosphere with a focus on sustainability. We offer a diverse menu featuring organic, fair-trade coffees, teas, and freshly baked pastries.

Our cafe provides a welcoming environment with free Wi-Fi, comfortable seating, and a commitment to reducing our ecological footprint through sustainable practices.

Our target market includes young professionals, office workers, and tourists.

The downtown location is home to numerous office buildings, so we will attract a steady flow of employees looking for quality coffee and a relaxing space.

The area is also a popular tourist destination, which will give us a diversified customer base.

Our focus on sustainability appeals to environmentally-conscious individuals and health-conscious consumers.

Strengths : Prime downtown location, unique eco-friendly concept, high-quality products, and experienced management team.

Weaknesses : Higher costs for sustainable products, reliance on foot traffic, and initial significant marketing expenses.

Opportunities : Growing demand for organic and fair-trade products, the potential to expand to new locations, and potential partnerships with local businesses.

Threats : Competition from established cafes, economic downturns that affect discretionary spending, and fluctuations in ingredient costs.

The Green Elephant Cafe faces competition from both large coffee chains and local boutique cafes.

Our key competitors include a well-known national chain located nearby and a local artisan cafe famous for its pastries. The national chain offers convenience and brand recognition, while the local cafe excels in specialty baked goods.

The Green Elephant Cafe differentiates itself through its strong commitment to sustainability, organic offerings, and unique, relaxing atmosphere.

Cost and revenue forecasting

Initial startup costs, including leasehold improvements, equipment, initial inventory, and marketing, are an estimated $100,000.

Monthly operating expenses covering rent, utilities, salaries, and supplies are projected at $15,000.

With an anticipated monthly revenue of $20,000, we forecast a monthly profit of $5,000, breaking even within the first six months.

The Green Elephant Cafe will employ a dedicated team of baristas, kitchen staff, and servers.

Our management team includes a general manager with over 10 years of experience in the cafe industry and a head barista with a strong background in specialty coffee. For the first three years of operation, we’ll outsource accounting to a local firm.

Staff training will focus on exceptional customer service and sustainability practices.

We will obtain all necessary business licenses and permits, including a general business license, a signage permit, health department permits, and food handler certifications.

Compliance with local zoning laws and health regulations will be strictly maintained. We will also secure comprehensive liability and property insurance to protect our business and our customers.

In addition to our website, we will market with local print ads and engage in extensive email marketing.

Check out Lark’s detailed restaurant opening checklist

Cafe business plan outline for your use

Now that you understand the key components of a cafe or coffee shop business plan, here’s a blank template you can use to compose your own:

Explore Lark’s detailed guide on restaurant marketing

Common cafe business plan FAQs

Let’s take a look at some common questions asked about cafe business plans:

How profitable is owning a cafe?

Owning a cafe can be profitable if you manage costs effectively and attract a steady stream of customers.

Profit margins in the cafe industry typically range from 5% to 15%, depending on factors such as location, menu pricing, and operational efficiency.

To maximize profitability, focus on high-margin items like specialty drinks and pastries, manage labor costs, and build a loyal customer base through excellent service and marketing.

What should be included in a business plan for a small cafe?

Your business plan should include an executive summary, a market analysis, and detailed financial projections.

Outline your cafe's concept, target market, and USPs.

Financial projections should include startup costs, revenue forecasts, and a break-even analysis.

Also, include an operational plan that details daily operations, staffing requirements, and supplier relationships.

What are some things I should know before opening a coffee shop?

Before opening a coffee shop:

Think about the importance of location since foot traffic and accessibility are crucial for success.

Familiarize yourself with local regulations and licensing requirements.

Develop a deep understanding of your target customers and their preferences.

Identify the USP that sets you apart from the competition.

Be prepared for the demanding nature of the business, including long hours and the need for consistent quality and customer service.

How do you calculate profits for a cafe business plan?

To calculate profits for your cafe business plan, subtract your total expenses from your total revenue.

Start by estimating your monthly revenue based on your expected sales volume and average transaction value. Then, calculate fixed costs, such as rent, utilities, and salaries, as well as variable costs, like ingredients and supplies.

Include other expenses, like marketing, maintenance, and equipment depreciation.

Your profit is the remaining amount after you’ve deducted all expenses from your total revenue.

Find out how Lark and Mama Lou’s created restaurant success

Let Lark help you run a profitable cafe or coffee shop

We hope our detailed business plan descriptions and examples have given you everything you need to get going on your cafe business plan.

When you’re getting ready to launch your new cafe, Lark can help.

At Lark, we have extensive experience helping food and beverage businesses flourish . Our state-of-the-art project and workflow management solutions, intuitive form builder , attendance management software, built-in communication apps, and food and beverage templates will make managing your establishment a breeze.

To learn more, try Lark for free .

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Dreaming of opening a coffee shop ? You’re not alone. The coffee industry is bustling with passionate business owners eager to make their mark. However, becoming successful coffee shop owners requires more than just a love for the brew. It demands a clear vision that differentiates your coffee house in a saturated market. A well-crafted business plan not only gives life to your idea but also sets your business on a path to thrive. Whether you’re a newbie or a seasoned entrepreneur, this guide, complete with a free template, will help you craft a business plan that markets and propels your coffee venture to success.

What is A Coffee Shop Business Plan?

A coffee shop business plan is a comprehensive document that explains what your business idea is, how you intend to penetrate the coffee market, and the strategies you’ll employ to run your coffee shop successfully. When opening a cafe, many aspiring cafe or coffee shop owners underestimate the value of a structured plan. However, this document does more than just outline the needs to open a coffee shop; it gives a detailed roadmap for your new business, offering clarity on every aspect of its operation.

More than that, presenting a well-structured business plan to potential investors is essential. It not only showcases your commitment but also your understanding of the industry, making it a vital tool for securing funding. While crafting a business plan can seem daunting initially, it’s the foundation that both clarifies your idea and sets your business on the trajectory for growth and success in the competitive world of cafes and coffee shops.

Why A Business Plan Is Important For A Successful Coffee Shop Business?

1. Clear Vision and Objectives

When you set up your coffee shop, having a business plan establishes a clear vision and defines your objectives. It is the backbone that steers every decision you’ll make. Without a clear outline, you may find yourself swaying from one idea to the next. With a detailed business plan, you can present a clear business proposal to stakeholders, ensuring them and yourself of the path you plan to tread.

2. Financial Planning

A comprehensive business plan is imperative for accurate financial planning. It will include information on how much capital is required to start, what your ongoing costs will be, and the revenues you plan to generate. If you’re seeking external funding, investors will want to see how you plan to use their money, and most importantly, how you plan to make a return on that investment. If you plan to sell specialty blends or unique treats, the financial section can also help you plan a strategy for pricing, promotion, and sales forecasts.

3. Operational Efficiency

Operational efficiency is the linchpin that holds all business operations together. A business plan will map out every detail, from supplier agreements to employee schedules. You may want to create special events or loyalty programs for regular customers, and this is where a business plan can help you plan a strategy for success. It becomes the reference point, ensuring that daily tasks align with the broader objectives, guaranteeing that resources, time, and efforts are used optimally.

Step-by-step Guide To Write A Coffee Shop Business Plan

1. Executive Summary

The Executive Summary is like the introduction of a novel – it provides a snapshot of what is to come. Typically, you write the executive summary last, even though it appears first in your business plan. It encapsulates the essence of your coffee shop’s mission, objectives, and financial overview, succinctly explaining what your business concept is about. This section is crucial because many coffee shops fail to engage potential investors right off the bat. Ideally, it should be concise – a page or two.

What should you cover in an Executive Summary?

• Introduce Your Coffee Shop or Cafe: Provide a company overview, giving readers insight into what makes your coffee shop unique from the myriad of coffee bars in the market.
• State Your Mission and Vision: Describe what drives your coffee business and where you see it in the future.
• Outline Your Objective: Define clear, measurable goals that you aim to achieve.
• Provide a Financial Overview: Highlight projected profit margins, a brief balance sheet, and other pertinent financial data.

2. Coffee Shop Business Description

This section paints a picture of your coffee shop. It’s where you elaborate on how you plan to infuse the local coffee market with your unique brews and pastries.

What should you cover in the Coffee Shop Description section?

• Coffee Shop Concept: Dive into the types of coffee drinks you plan to offer, whether it’s a rich espresso or a classic brewed coffee.
• Unique Selling Proposition: Discuss what makes your coffee shop stand out, be it a special blend of coffee beans, a unique roasting method using a specific coffee roaster, or artisanal pastry offerings.
• Operational Plan: Briefly touch upon how you’ll manage your coffee shop, from sourcing beans to serving cups of coffee.

3. Market Analysis

Before pouring your first espresso, performing market research before starting your coffee business is essential. This section dives deep into understanding your potential customer base and the coffee industry landscape in your area.

What should you cover in this section?

• Target Market: Describe your ideal customer. Are they local residents, office workers, or students?
• Location: Discuss the significance of your chosen location. Are there many coffee shops in the area? How does your location cater to your target market?
• Competition: Analyze existing coffee shops. What coffee and food products do they offer? What pricing strategy do they employ? How will your coffee shop compete or complement them?

4. Organization and Management

Behind every successful coffee shop is a robust organizational structure and a competent management team.

What should you cover in the Organization and Management Plan?

• Coffee Shop Ownership Information: Highlight the business’s legal structure.
• Profiles of Your Coffee Shop Management Team: Include details about your baristas, perhaps a part-time accountant, and someone to manage marketing. It can be helpful to create profiles for each role, detailing responsibilities and expertise.

5. Sample Menu

Your menu is the heart of your coffee shop. It’s more than just a list of coffee and tea; it’s an expression of your brand.

What should you consider when creating a Sample Menu?

• Menu Items: Detail the types of coffee, espresso drinks, and pastries you plan to offer. Maybe consider including non-coffee items like teas or specialty drinks.
• Unique Selling Proposition: Reiterate what makes your coffee or food items different from other coffee shops in the area.
• Menu Pricing : Discuss your pricing strategy, keeping in mind profit margin, competitors’ prices, and your target customer base.

6. Marketing Plan

To brew success, it’s not enough to have a fantastic coffee product; you must effectively market it.

What should you cover in a Marketing Strategy for your Coffee Shop Business?

• Define Your Brand: What voice, theme, or emotion do you want your coffee shop to evoke?
• Lay out your plans for social media campaigns, local partnerships, loyalty programs, SEO for website, and other promotional strategies.
• Considering using an  online food ordering system  in your food truck
• Create a  digital menu with QR code  to make your menu easy for your customers to access online

7. Operations Plan

Efficiency is key to the daily grind of running a cafe. The operations section provides a detailed look at the day-to-day operations of your coffee shop business.

What Operational Issues should you address in your Business Plan?

• Supply Chain: Where will you buy your coffee beans? Who will be your coffee roaster?
• Operating Hours: Consider the best times to cater to your target market.
• Staffing: Detail roles, such as barista, manager, and part-time support.
• Equipment: List down essential equipment, from espresso machines to ovens.

8. Financial Plan

In this crucial section of your business plan, delving into the financial specifics is paramount to lay out a concrete roadmap for the fiscal aspects of your coffee shop.

How Much Does It Cost to Start a Coffee Shop?

Starting a coffee shop is not just about brewing the perfect espresso; it’s also a substantial financial commitment. The cost for opening a coffee shop can range from $80,000 to $250,000. These costs can vary widely based on factors such as location, size of the establishment, equipment quality, and inventory requirements. Moreover, the process of opening a coffee shop might also involve unexpected expenditures, so it’s essential to account for some buffer in your budget.

How Many Ways to Fund Your Coffee Shop?

There are multiple avenues for funding your coffee venture. Traditional bank loans, personal savings, angel investors, crowdfunding campaigns, and partnerships are just a few options. It’s crucial to assess which option aligns best with your business vision and financial situation.

Important Questions to Consider When You Create Your Funding Request If you’re seeking funding, there are several questions you’ll need to answer in your business plan:

• How much money do you need to start and maintain your coffee shop until it becomes profitable?
• What will the funds be used for specifically?
• How do you plan to handle financial challenges that might arise?
• How do you plan to repay any loans or provide a return on investment?

9. Financial Projections

The financial projections section of your business plan forces you to translate your coffee shop vision into numbers, ensuring you’ve accounted for all key metrics that can make or break your venture.

Break-even analysis:

This is the point where your coffee shop’s total revenues equal its total costs. Simply put, it’s when you neither make a profit nor a loss from selling coffee.

Use this formula:  Fixed Costs / (Price – Variable Costs) = Break Even Point

Projected profit and loss statement:

This will provide a forecast of your expected income and expenses, giving a clear view of your venture’s profitability.

Cash flow analysis:

Essential for understanding the liquidity of your business, this tool is especially crucial for coffee shops, considering the fluctuating expenses and incomes coffee shops offer. When drafting this, consider who will read it, as stakeholders like investors or lenders might have specific expectations.

Coffee Shop Business Plan Template

• Mission: To offer the community high-quality coffee in a comfortable and vibrant environment.
• Vision: To become the go-to local coffee spot that fosters community connections and coffee appreciation.
• Coffee Shop Description: “Java Junction” will be a modern coffee hub that emphasizes direct-trade coffee beans and a relaxed, inclusive atmosphere.
• Costs: Estimated initial costs are $125,000.
• Profits: Projected annual profit by year two is $75,000.

2. Description of the Coffee Shop

• Coffee Shop Concept: A community-focused café emphasizing artisanal methods.
• Coffee Shop Name: Java Junction. (Consider using a coffee shop name generator for more ideas).
• Coffee Shop Type: Sit-down café with an adjacent mini-library.
• Location: Main Street, Downtown Area – chosen for its high foot traffic.
• Order Fulfillment: Orders taken at the counter with table service for food.
• Working Hours: Mon-Fri (7 am – 9 pm), Sat-Sun (8 am – 10 pm).

3. Menu Offer

• Type of Food and Drink: Coffee, teas, pastries, and sandwiches.
• Offer: From classic espresso shots to unique blends like “Lavender Latte”.
• Unique Selling Point: Every coffee product uses direct-trade beans, ensuring farmer fairness.

4. Market and Competition Analysis

• Market Analysis: The local population includes a mix of professionals, students, and tourists. Many search for quiet spots to work or relax.
• Target Customer: Professionals aged 25-40 and students.
• Size of the Target Customer: Approximately 15,000 individuals.
• Competition Analysis: Three established coffee shops within a mile.
• Size of the Competition: Ranging from small boutique coffee shops to a larger chain.
• Competitors’ Offer: Basic coffee drinks, with limited specialty items.
• Competitors’ Prices: Average of $4 for a coffee drink.

5. Investment Plan (Detailed Cost Analysis)

• Equipment: $30,000
• Renovations: $20,000
• Initial Stock: $10,000
• Licenses: $5,000
• Miscellaneous: $10,000
• Rent: $3,000
• Salaries: $10,000
• Utilities: $1,000
• Stock: $2,000
• Marketing: $1,000

6. Financial Forecast

Year one is projected to break even, with a profit of $50,000 expected in year two, and $75,000 in year three, considering growth and expanding customer base.

• Owner: Jamie Smith, a coffee enthusiast with a business degree.
• Manager: Alex Brown, previously managed a successful coffee chain for five years.
• Baristas: A team of 4 skilled individuals passionate about coffee.

8. Marketing Plan

Java Junction will use a mix of social media marketing, local print advertising, and loyalty programs to attract and retain customers. Regular events, such as “Buy Our Coffee Day” and collaboration with local businesses, will drive foot traffic and community engagement, integral components for starting your coffee shop and making it successful.

This coffee shop business plan sample is hypothetical and serves as a template. Tailoring specifics to your local market, vision, and unique aspects will be necessary. Every coffee shop has nuances that can make them successful, whether it be the coffee products they sell, the environment they cultivate, or the events they host. Focus on what will make your coffee shop stand out and be sure to engage your community.

Tips For Writing a Business Plan For a Coffee Shop

Your business plan becomes the blueprint of your vision. Here are essential tips to consider:

• Comprehensiveness is Key: Ensure your plan encompasses all sections you should include, such as marketing, financial projections, and operations. A well-rounded plan provides a holistic view of your business.
• Tailor to Your Audience: If you’re presenting to potential investors, focus on profitability and growth projections. For a landlord, emphasize the benefits your coffee shop will bring to their property.
• Specialize in Marketing: Given the competitiveness in the coffee industry, it’s crucial to have a solid marketing plan. If marketing isn’t your strength, consider hiring someone to do marketing for your venture. A strong online presence, loyalty programs, and community engagement can set you apart.
• Research Your Market: Understand what nearby coffee shops include in their offerings. Identify gaps in the market and strategize on how your shop can fill them.
• Stay Flexible: While a business plan provides direction, remain adaptable. The coffee industry is dynamic, and your ability to pivot can prove invaluable.
• Separate Sections for Clarity: If your plan becomes too dense, you might want to create a separate document for specific sections like a detailed marketing strategy or an in-depth market analysis. This makes your primary business plan concise and more readable.

Frequently Asked Questions

1. how profitable is owning a coffee shop.

Owning a coffee shop can be profitable, depending on factors like location, quality of products, and management. On average, after expenses, many coffee shops report a profit margin of around 3% to 5%, with some successful ones achieving even higher. However, it’s essential to factor in initial setup costs, ongoing expenses, and market competition.

2. How do I start a coffee shop business plan?

Starting a coffee shop business plan involves multiple steps. Begin by defining your coffee shop’s mission and vision. Conduct market research to understand your target audience and competitors. Then, detail out sections like your product offerings, pricing strategy, marketing plan, financial projections, and operational procedures. If you’re thinking of opening a coffee shop, a well-thought-out business plan is indispensable.

3. What is a business plan for a coffee shop?

A coffee shop business plan is a detailed document that outlines your coffee shop’s objectives, strategies, and operational procedures. It acts as a roadmap, guiding you from the startup phase to establishing a thriving business. Moreover, if you need a coffee shop business loan or investment, this plan becomes crucial in convincing stakeholders of your venture’s viability.

4. What are the 4Ps in a coffee shop business plan?

The 4Ps stand for Product, Price, Place, and Promotion. In the context of a coffee shop:

• Product: What type of coffee and related products will you offer?
• Price: How will you price your coffee? Will it be premium or competitive?
• Place: Where will your coffee shop be located? Is it accessible to your target audience?
• Promotion: How will you market your coffee shop? Will you offer promotions or loyalty programs?

These elements help in creating a marketing strategy tailored to your coffee shop’s unique needs and market position.

Related Coffee Shop Resources

• How to start a coffee shop with no money
• How much do coffee shop owners make
• Coffee shop names
• Coffee shop name generator

Launching a coffee shop is not just about brewing the perfect cup but weaving a narrative that resonates with your community, fostering an ambiance that people gravitate towards, and maintaining a seamless operation that drives profitability. The meticulous creation of a business plan is a pivotal step in this endeavor. It’s the beacon that guides budding entrepreneurs through the complexities of the coffee industry. In such a competitive marketplace, a well-structured, comprehensive business plan can make the difference between a fleeting venture and a thriving institution. To potential coffee shop owners, embrace the process, let your passion shine through in your plan, and remember that every great coffee shop started with a simple idea, much like a single coffee bean ready to brew greatness.

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It's been a few decades since Starbucks emerged from Seattle to take over the world and made a coffee shop on every corner the norm. As a result, the way Americans drink coffee has changed drastically.

This has also created a window for entrepreneurs looking to start a business. While the big coffee chains have expanded, so have specialty, independently run shops. According to an article in the New York Times , Americans drink less coffee today than we did in the 1930s, but we’re drinking higher quality, better-brewed cups. As such, many entrepreneurs today might wonder how to start a coffee shop to serve their own high-quality brews.

How to open a coffee shop in 7 steps

Wondering how to start a coffee shop of your own? These seven steps will take you through everything you need to know.

Step 1: Decide whether you want to open your own shop, a franchise, or buy an existing business.

When it comes to starting a business you usually have at least two ways to go about doing it, and with coffee shops, you've got three. When it comes to how to open a coffee shop you can do one of the following:

Completely start from scratch and open your own shop

Open a coffee shop franchise

Buy an existing coffee shop that's for sale

Each of the options has its pros and cons and varying degrees of work required by you. If you choose to open a franchise you'll be bound by many of the aspects of that franchise like the beans they use and the decor of the actual shop. If you buy another coffee shop you might have less construction to do to set up the space as a coffee shop. These options come with limitations as well.

Step 2: Create a business plan.

A well-thought-out business plan is key to creating any business, and a coffee shop is no exception. If you want to open a coffee shop, you probably already have a love of good coffee. To create a successful coffee shop you have to decide how you'll get other people to love coffee as much as you do. A business plan will help get your ideas focused and in one place. Besides the basics of what your coffee shop will be and the products you'll sell, a business plan also includes a marketing and sales plan, as well as financial projections.

An important consideration you'll need to take care of in the early stages, and that you'll include in your business plan, is to decide on the business structure you want your company to operate as. There are several business entity options you can choose, including a sole proprietorship, LLC, C-corp, and more—and the entity you choose will have both tax and legal implications for your business. It's always a good idea to seek the advice of a business attorney when making these big decisions as you start your coffee shop. if you choose to open a franchise, you might already have a business entity that you have to use.

While creating your business plan, you'll have to come up with a name for your business and an idea of where you want to open your coffee shop. Once you find the perfect location be sure to add it to your business plan, it might happen before or after you've written the plan.

You'll also want to outline the pricing of your products, what goods you want to offer, the type of coffee shop you want to have (sit-down, drive-through), and more. It's a lot to think about, but a business plan is where you can get all of these plans down in one place. Beyond that, if you'll need outside capital to make your coffee shop dreams a reality, you'll need to provide a business plan for funding consideration.

Luckily, there are several options for business loans for a cafe, and whether you're looking for funding to start your coffee shop or want to leave the option open for expansion down the road, having a solid business plan from the start will make the process easier.

Step 3: Find the right location.

This step can not be glossed over and you should take your time and consideration when completing it. The location of your coffee shop can make or break it in terms of success. There are some things to look for when looking for a coffee shop location. Coffee shop location considerations:

Size: You want to make sure enough people can fit in the space without feeling cramped. Coffee shops are relaxing areas where people tend to hang out with friends or colleagues and you want the space to be accommodating.

Accessibility: Make sure your cafe is accessible and anyone can enter.

Parking: Will you be dependent on foot traffic? If not you're going to want to make sure there's somewhere for your customers to park either a lot or street parking nearby. If biking is popular in your area, consider adding a bike rack.

Seating: Will customers be limited to seating indoors or is there some outdoor seating you could set up when the weather is right for it?

Rent: This should be one of your top considerations when deciding on a location. How much a business location will cost you is going to be a significant chunk of your budget and you should be sure to include this in your business plan.

Step 4: Register your business and get the proper licenses and permits.

The city or county where you plan to open your coffee shop will dictate the specifics of registering your business, what taxes you'll be responsible for, any necessary licenses and permits, and more. The details of registering a business vary from state to state, but you will need to apply for an employer identification number (EIN) and establish your business structure before you can start the registration process.

You also need to make sure that since you'll be serving coffee, and most likely some food, that you have the right business licenses and permits for that, as well. Usually, health licenses and permits are necessary for serving food. Other types of business licenses include building, zoning, and land-use permits. Be sure you consult with your local business resources so you have the proper documentation in place before you open your coffee shop.

Step 5: Find suppliers.

Customers are looking for a quality experience when they come into your coffee shop. That means quality ingredients and coffee, but also quality service and experience.

While it’s tough to produce the same quality every time, this is crucial in the coffee business, especially in a time when people are becoming more knowledgeable about specialty coffee. Having consistent and quality providers, from the beans to cups and everything else customers interact with can help keep your coffee shop running smoothly and customer experiences consistent.

When you're first starting your coffee business, don't be afraid to spend the necessary time finding the right coffee supplier for your business. Though if you're starting a franchise, they'll take care of this step for you by having their specific grounds. You may have to try a lot to find the right one that will work for the products you want to offer, at the right price, with the perfect taste.

The other way to create consistency is by training employees extensively. If you want patrons to walk past all the other coffee shops on the block and go into yours, you need to offer consistent quality.

Step 6: Create a warm, inviting environment.

A coffee shop is never just about a good cup of coffee. Many people frequent coffee shops as a place to do work, catch up with friends, or to take a break from the workday.

You want your coffee shop to have a warm and inviting atmosphere that's conducive to meetings, relaxing, and chit chat, but also one that's easy to keep clean and orderly. When choosing how to design the shop, be sure to take into account how many people you want the shop to fit and the kind of atmosphere you're looking to create for them all.

Remember when we were talking about the location of your shop? Here's where that comes in because the location can only do so much work for you. The work you do to design the cafe on the inside will also greatly matter. You're creating an entire atmosphere that also serves a purpose.

Step 7: Adopt a good inventory system.

Pay attention to your inventory. At first, you won't really know how much you need when it comes to things like beans and baked good, you probably won't even know how many cups you need a day. So track these things carefully at first so you can get a good handle on how much you're using.

There are a number of inventory management apps available to small business owners who need a way to manage their inventory and budget. Some point of sale systems also offer inventory management, which is something you might want to consider when choosing one. There are specific coffee shop POS systems out there to consider.

No matter what you choose, you want to make sure you have a way to manage what you need for your business so you don't run out of customer favorites or over-order on what you don't need.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

How much does it cost to open a coffee shop?

We've gone over many of the expenses you'll face when opening a coffee shop. The rent of the location, everything for the interior design, the machinery, the supplies like beans and cups, employees and more will all add up. Some of these things may cost far more than you're expecting them too, a good espresso machine along can run you up $20,000.

In all you can expect that opening a coffee shop will likely cost you upward of $200,000 when all is said and done. This goes for some franchises as well, Dunkin' for example, requires that you have $250,000 in liquid assets to start a franchise with them. You could consider starting smaller, with a coffee cart or a small pop-up location if you're unsure of the cost or if you don't want to dive in headfirst. But know that none of these options will be cheap or require no money up front.

LLC Formation

The bottom line

Running a small business is no easy feat, but for all of those coffee enthusiasts who have dreamed of opening a cafe of their own, now might be the time. Consumption and interest in the specialty coffee culture has increased steadily in recent years and doesn’t seem to be stopping any time soon.

While competition from bigger chains might have been a problem at one time, modern consumers prefer to support local neighborhood shops—especially if they’re offering what the big chains can’t. So if you've been wondering how to start a coffee shop, start thinking about the above steps to see if this is a feasible business venture for you.

This article originally appeared on JustBusiness, a subsidiary of NerdWallet.

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Opening a cafe? Here’s your checklist for a latte success

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Did you know cafes and coffee shops are the fastest growing segment in the food service industry? Americans are drinking more coffee than ever. 1

Of course, you already know that if you’ve spent anytime on Instagram browsing through a feed of latte art.

If you want to open a cafe, you need a plan. Here’s your step-by-step checklist to build the perfect blend, err… we mean, cafe!

Trust us; this part is more fun than it sounds. Sure, you’ll be taking lots of notes but you’ll get to test lots of coffee and pastries in the process.

As you visit cafes in your area, ask yourself the following questions:

• How many cafes are there? Are they mostly big chains or mom-and-pop shops?
• Which menu items seem to be most popular?
• Where do they source their coffee beans?

Pay special attention to how the coffee tastes. Your beans will be the bread and butter of your cafe. Research the price, location, and fair trade practices of any roasters you’re considering.

Your cafe concept is just a fancy way of saying the theme, vibe, or overall feel of your cafe. It’s never too early to start dreaming up your cafe name, menu, and decor.

To nail down your concept, think about the following:

• Who will your customers be? Do you want to serve coffee aficionados, Instagram foodies, or commuters? A little bit of everyone will trickle in, but your core customer will help you define your ideal location, pricing, menu offerings, and decor.
• How will you price your coffee? Do you envision your cafe as a fancy $7 matcha latte joint, or a place where anyone can get a decent cup of joe for a decent price?
• Will you serve food as well? Consider where you’ll source your pastries and food items, or if you want to prepare them in-house. You can also serve snacks and beverages to-go.
• What kind of atmosphere do you want to create? Do you want to encourage networking and community connection, or will you be a quiet haven for the remote-work crowd?

Now that you’ve gathered all your research, it’s time to formulate your thoughts into something a bit more official: your cafe business plan.

Your business plan is an important step of starting any business. It helps you finalize your vision, and work out the details of what you need to do to make it happen. Plus, if you decide to get funding for your cafe, your investors will expect to see a business plan. Here’s what to include.

• Executive summary
• Company description
• Market analysis
• Organizational structure and management
• Product or service explanation
• Marketing and sales strategy
• Financial plan and projections

There’s more than we can get into in this post, so be sure to check out our guide to writing a business plan .

Many people open their cafe with a low budget. Start by determining what finances you yourself can put into opening your cafe. Then, figure out how to get additional funding from:

• Family and friends
• Small business grants
• Business line of credit
• Equipment financing

Remember, it can take up to a year for a new business to be profitable. Your startup costs should cover not only everything you need to get started, but enough to cover your operating costs for twelve months as well.

During the research stage, you likely honed in on one or two areas of town that felt like a good fit for your cafe. Start looking for commercial space to rent in those areas.

Before you rush to sign a lease, however, take a moment to really think through whether this space will be a good fit for you, and for your customers.

For you, consider whether your staff will have sufficient room to work behind the counter. Are all the gas and water lines already installed? Is the location a reasonable distance from your suppliers? Does it have good visibility from the street? Finally, confirm that you won’t be next door to any competitors.

For your customers, you want a space that’s easy for them to access, whether that means there’s plenty of street parking or it’s on a busy downtown corner where everyone walks anyway. If you plan to have seating, consider how much space the front-of-house area affords. What is the crime rate in the area? Do your target customers live or work closeby?

If possible, work with a lawyer to help you make sure you’ll be on the right side of local zoning regulations.

Any new business requires a certain set of permits and licenses to open, and food businesses are under even more scrutiny. Work with your city government or small business administration to ensure you have all the required permits and licenses for your cafe.

These may include:

• Business license
• Seller’s permit
• Food service license
• Building health permit
• Certificate of occupancy
• Passed health & safety inspections

Pro Tip: It takes time for paperwork to go through the approval process, so start this process as soon as you can.

Most small businesses require at least four main types of insurance coverage. These include:

• General liability insurance. General liability insurance protects your cafe from liability caused by accidents, to your customers, their property, or other parties.
• Professional liability insurance. Also known as errors & omissions insurance, professional liability insurance protects you from the financial consequences of claims that your mistakes or negligence caused financial or personal damage to a third party.
• Business equipment protection. While general liability insurance protects you from liability costs when other people’s property gets damaged, Business Equipment Protection provides coverage for your equipment.
• Workers’ compensation. If you’re hiring staff, as most cafes do, you’ll need workers’ comp . This coverage is required in nearly every state, and provides benefits to your employees should they get injured during the course of their work.

Ready to bring your cafe to life? Here’s how to design a brew-tiful layout.

For back-of-house, your number one goal is order flow. You’ll need stations to take, prepare, and serve orders, and then a spot for cleanup. If you’ll be preparing food as well, consider how that works into your flow.

For front-of-house, let your cafe concept be your guide. The way you furnish and decorate your space, including the materials and color choices, will instantly communicate to people the vibe of your cafe. Get creative with your table and chair choices so you can maximize seating while still ensuring your customers’ comfort.

You already know you need a primo espresso machine and some mugs, but what else do you need? Here’s a list the basic equipment any cafe needs to open:

• Espresso machine
• Coffee grinders and brewers
• Frothing pitchers and thermometers
• Hot water dispenser
• Refrigerator
• Ice machine
• Display case for pastries and snacks
• Espresso cups and coffee mugs
• Additional dishware for dine-in
• Cup, lid, and straw organizers (and cups, lids, and straws)
• Condiments (sugar packets, stirrers, etc.)
• Three-compartment sink
• Point-of-sale (POS) system

Opening day is nearly here! You just need one more key ingredient: smiling and knowledgeable staff to serve your customers and wow them with their latte art. When hiring cafe staff, consider whether you want experienced baristas, or if you’re comfortable training novices in the art of coffee making.

Many customers will ask for recommendations when placing their order, so it’s good to bring your staff up to speed on the beans, flavor profiles, and appeal of different items of your menu.

You’re officially ready to open the doors and start brewing your coffee! As a reminder, here’s your opening a cafe checklist:

• Research, research, research.
• Craft your cafe concept.
• Draft a business plan.
• Calculate your budget.
• Find a space for your cafe.
• Secure all the necessary permits and licenses.
• Get insured ( Thimble can help with this part.)
• Design your afe layout
• Order cafe equipment.
• Hire your staff.

We wish you a latte success!

• Chron.com. Coffee Shop Sales and Growth.

Our editorial content is intended for informational purposes only and is not written by a licensed insurance agent. Terms and conditions for rate and coverage may vary by class of business and state.

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Cafe Business Plan Template

Written by Dave Lavinsky

Cafe Business Plan

Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their cafes. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a cafe business plan template step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Cafe Business Plan?

A business plan provides a snapshot of your cafe as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Cafe

If you’re looking to start a cafe or grow your existing cafe you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your cafe in order to improve your chances of success. Your cafe business plan is a living document that should be updated annually as your cafe grows and changes.

Sources of Funding for Cafes

With regards to funding, the main sources of funding for a cafe are bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.

The second most common form of funding for a cafe is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan.

Finish Your Business Plan Today!

Your cafe business plan should include 10 sections as follows:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of cafe business you are operating and the status; for example, are you a startup, do you have a cafe that you would like to grow, or are you operating a chain of cafes.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the cafe industry. Discuss the type of cafe you are operating. Detail your direct competitors. Give an overview of your target market. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.  

Company Analysis

In your company analysis, you will detail the type of cafe you are operating.

For example, you might operate one of the following types:

• Take-Out Cafe: this type of cafe doesn’t have seating (or has limited seating) and is mostly visited by customers looking to grab a coffee and/or bakery item on their way to work or elsewhere.
• Restaurant Cafe: this type of cafe is most similar to a restaurant and offers a full, sit-down menu in a nice atmosphere with a full wait staff.
• Casual cafe: also known as a corporate, student or co-working cafe, this type of cafe typically offers food and drinks from a counter with no waiters or waitresses. Patrons purchase items and consume them in the cafe, often while performing work on their laptops or conversing with friends or colleagues.
• Coffee Shop: This is a popular type of cafe. Coffee shops usually offer a selection of tea, coffee, pastries and other drinks

  In addition to explaining the type of cafe you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business? What is your business concept? What is your unique selling proposition?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new store openings, etc.
• Your business structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the cafe business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the cafe industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards cafes with ultra high speed internet connections, it would be helpful to ensure your location could offer such a service.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your cafe business plan:

• How big is the cafe business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key local suppliers in your market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your cafe. You can extrapolate such as figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The market analysis section of your cafe business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: local office workers, college students, sports enthusiasts, soccer moms, techies, teens, baby boomers, etc.

As you can imagine, the target audience you choose will have a great impact on the type of cafe you operate. Clearly baby boomers would want a different atmosphere, pricing and product options, and would respond to different marketing promotions than teens.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most cafes primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other cafes (and restaurants and/or bakeries depending on the type of cafe you operate).

Indirect competitors are other options that customers have to purchase from you that aren’t direct competitors. This includes restaurants, supermarkets and customers making coffee and bakery items themselves at home. You need to mention such competition to show you understand that not everyone in your target market will visit a cafe each day.

With regards to direct competition, you want to detail the other cafes or coffee shops with which you compete. Most likely, your direct competitors will be cafes located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What products do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

  With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to stand outside your competitors’ locations and ask customers as they leave what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide superior cafe products?
• Will you provide cafe products that your competitors don’t offer?
• Will you make it easier or faster for customers to acquire your products?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a cafe business plan, your marketing plan should include the following:

Product : in the product section you should reiterate the type of cafe that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, will you offer pastries, soups, items such as café latte, cappuccino, espresso or macchiato?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the menu items you offer and their prices.

Place : Place refers to the location of your cafe. Document your location and mention how the location will impact your success. For example, is your cafe located next to a heavily populated office building, or gym, etc. Discuss how your location might provide a steady stream of customers.

Promotions : the final part of your cafe marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your cafe’s front store extra appealing to attract passing customers
• Distributing samples outside the cafe
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites
• Partnerships with local organizations (e.g., gym members get a free cup of cafe with each pastry they purchase)
• Local radio advertising
• Banner ads at local venues

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your cafe such as serving customers, procuring supplies, keeping the cafe clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 10,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.  

Management Team

To demonstrate your cafe’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in the cafe, coffee shop and/or restaurant business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in cafes and/or successfully running retail and small businesses.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you serve 100 customers per day or 200? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your cafe, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. For example, let’s say a company approached you with a massive $100,000 catering contract, that would cost you $50,000 to fulfill. Well, in most cases, you would have to pay that $50,000 now for supplies, equipment rentals, employee salaries, etc. But let’s say the company didn’t pay you for 180 days. During that 180 day period, you could run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a cafe:

• Location build-out including design fees, construction, etc.
• Cost of fixtures like chairs, tables, signage and cafe decor
• Cost of equipment like grinders, espresso machines, blenders, refrigerators
• Cost of ingredients and maintaining an adequate amount of supplies
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Summary Putting together a business plan for your cafe is a worthwhile endeavor. If you follow the template above, you will be able to prepare a winning cafe business plan or a coffee shop business plan. You will really understand cafe business planning, business operations, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful cafe.

  OR, Let Us Develop Your Plan For You Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.

Click here to see how our professional business plan writers can create your business plan for you. Other Helpful Business Plan Articles & Templates

13 Tips to Open a Successful Coffee Shop

Candice Landau

12 min. read

Updated May 10, 2024

Free Download:  Sample Coffee Shop Business Plan Templates

Worldwide, experts estimate that people drink about 2.5 billion cups of coffee a day. Sales in the ready-to-drink market—which includes coffee shops—are forecast to grow by 67 percent between now and 2022.

Additionally, coffee and other ready-to-drink shops show incredible resilience in volatile markets, helping to eliminate some of the uncertainty associated with small business ownership.

If you’ve been thinking of combining your love of coffee with your entrepreneurial spirit, you may want to open a coffee shop.

• What You Need to Open a Coffee Shop

Aside from a love of that sweet java, you’ll want to get a few things in order to get your shop up and running. To help with this, Jack Wilson, owner of Radio Coffee and Beer in Austin, Texas, and Marc Renson, owner of Ambition Bistro in Schenectady, New York, stepped away from brewing and serving to offer 13 tips to prospective owners. Here’s what they recommend you consider when starting a coffee shop:

• Write a business plan
• Find the right location
• Develop a floor plan
• Hire an accountant
• Find local funding options
• Save money for your personal expenses
• Compare prices and quality on everything
• Network with lenders and other coffee makers
• Develop your marketing plan
• Focus on the Exterior
• Remain positive
• Hire slowly
• Set high standards

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• 1. Write a business plan for your coffee shop

One of the most vital steps you’ll take toward starting your coffee shop is to write a business plan. This document spells out:

• What your business is and who it serves
• How it will be profitable
• Your target market (primary customer demographics)
• Your competitors
• Sales and revenue projections
• Milestones and goals

Keep your business plan lean

Before you dive into creating a traditional, long-form business plan, we recommend creating a one-page pitch. This will allow you to quickly validate your business idea and get a good sense of who your market is, how you’re going to reach them, and find ways to differentiate yourself from your competitors. Will you serve pour-overs exclusively? Will you only use high-end coffee grinders and bean varieties? Will you include baked goods on your menu as well?

Similar to a thorough executive summary, this one-page pitch or plan  is a faster, more efficient way to plan your business.

Browse our free coffee shop sample business plans

Need help getting started? Check out our business plan templates for guidance. They’re free real-world examples for you to work from and are available to download and edit as Word documents. Whether you’re starting a little coffee and internet café or a coffee house bistro, there’s a business plan template—a sample business plan—to suit your coffee shop needs.

Coffee Kiosk Business Plan

Read how The Daily Perc opened drive-thru and mobile coffee stands, serving coffee drinks and other beverages to their target market: daily commuters and captive consumers.

Coffeehouse Business Plan

This sample business plan describes how Dark Roast Java attracted a diverse clientele with its Mediterranean art glass decor.

Internet Cafe Business Plan

The JavaNet Internet Cafe was a true visionary business sample plan when it was written, and with most coffee houses adopting some form of this plan, it’s obvious that it was an idea ahead of its time.

Cafe Bistro Coffeehouse Business Plan

The Watertower Cafe sample business plan describes how the cafe will establish itself as a “destination” of choice to the many residents of the greater Atlanta metropolitan area, as well as numerous out-of-town visitors by providing affordable high-quality food, coffee-based products, and entertainment.

Coffee Roaster Business Plan

Beanisimo Coffee is a startup coffee roaster in Salem, Oregon. Founder Frank Jones aims to bring old-world Italian traditions and recipes to meet the market need for premium coffees. His target market is coffee houses, restaurants, and grocery stores.

The key to making a sample business plan useful is to take the time to modify it so it’s right for your business. A lot of the benefit of creating a business plan is in the process of thinking through each part of the plan. Not sure if you need a plan? Check out this article on reasons why having a business plan is important.

• 2. Find the best location for your coffee shop

To be successful, you need the right location for your coffee shop. You want something that fits the following parameters:

• Centrally located and easy to access
• Highly visible and experiences consistent foot traffic
• A space that fits your vision

Jack Wilson, the owner of Radio Coffee and Beer, warns that finding this dream spot won’t happen overnight.

His team scoured city after city, scouting each location, even going so far as to count pedestrian traffic by hand. He was looking for a former restaurant space, so he didn’t have to remodel everything from scratch. Finally, one day when he dropped his keys on the sidewalk he noticed a tiny “for sale” sign in a former tavern window. After months of searching, he’d found his spot.

Keep in mind that effective restaurant spaces are highly sought after and difficult to find. It may take a while to find just the right spot, but for a business type that benefits from ease of access and casual traffic, it’s worth taking your time to find the right spot.

• 3. Create a floor plan

A solid and welcoming floor plan is vital for a coffee shop. You want customers to have space to form a line, employees to have the materials they need within reach for quick access and a comfortable seating area. As with finding a location, it will take some time to produce a good floor plan.

According to Wilson you should, “walk yourself through every scenario you can think of,” he says. “If you’re making coffee, what needs to be near you? If you’re a customer, what do you want in a seating area? Visualize everything you can and start putting those ideas down on paper.”

Design your cafe floor plan online

Here are a few free websites you can use to kickstart your planning process. Once you’ve drawn up an initial sketch on paper, get online and make it a reality.

Autodesk Homestyler (free): This is probably my favorite option. You can either start designing your floor from scratch or choose from a gallery of designs to personalize with your own look and feel. In fact, there’s even an option to experiment with real-world products and brands. When you’re done, you’ll be able to share the design as part of your planning process. It can even be used as part of your pitch to potential investors.

Floorplanner: This software is clean and simple to use, with plenty of drag-and-drop furniture and other items to fill out your design. It allows for both 2-D and 3-D visualization of your designs and can be easily printed out if needed.

Gliffy: While it may not be the go-to floor plan solution, I’ve included Gliffy on this list anyway, due to it being a well-known diagram and flowchart application. If you’ve used it before, you may want to give it a try to minimize the learning curve and jump right into designing. While you’re at it, you can even plot out your SWOT analysis.

• 4. Hire an accountant

One of the best pieces of advice Wilson says he can offer a new coffee shop owner is to turn your books over to an accountant. Aside from taking valuable time away from the business, having a numbers expert works in your favor.

“You won’t be as hard on yourself as you sometimes might need to be,” Wilson says. “Plus, you will make assumptions that an accountant wouldn’t make.”

In reality, your accountant is really your small business consultant. Make sure you find someone who believes in you and can help accomplish your business goals. If you’re unable to hire an accountant right away, you can also look to an online option like QuickBooks . The benefit of online accounting software is that you’ll have direct visibility into the day-to-day finances of your business.

Both are great options for managing your finances, and the decision fully depends on your situation and level of expertise.

• 5. Attain funding from local sources

Finding startup funds for a coffee shop can be difficult. Renson suggests talking with friends and family about investing in your coffee shop first. Present a solid business plan to them and ask them to invest in your business.

If funding via your family isn’t an option, or if you need more cash than your family can provide, Renson suggests looking into local loan options. In some cases, cities offer business assistance programs to offset costs. Consider an SBA-backed loan or see if a local bank or credit union is an option. Keep in mind that any bank loan will require you to show evidence that your business has some traction already. They want to know you’re a reasonable risk. So if you’re not up and running yet, there are other options for bootstrapping your business that you might consider.

• 6. Save money for your personal expenses

When identifying startup costs , don’t forget that you need to consider your own personal expenses alongside your business. All of your time and energy will be devoted to your new business, which potentially won’t be profitable for around six-months, even if you start bringing in revenue immediately.

So, plan ahead. Renson suggests making sure you set aside enough money to cover your personal expenses for at least six months if not longer. You’ll need to decide whether it’s possible to run your coffee shop while working another job or side gig or if you’ll be able to solely focus on your new business.

You will also want to understand the concept of cash flow . Considering that over half of the businesses that fail are profitable on paper when they fail, you’ll want to be sure you understand how much cash you’ll need on hand.

• 7. Shop around for everything

While you’re in the planning and funding stages and working through your finances,  keep a list or spreadsheet of all the startup expenses you’re looking at so you can compare prices.

Before you buy, try to get at least two price quotes for every item so you’re not losing money on basic necessities or recurring costs. Use the internet to your advantage and look for the best prices on everything from comfy chairs to espresso machines.

• 8. Network your heart out

Having a hot location and brewing superior coffee will only get you so far. You need to network to maintain a connection to the area and to attract more customers. Look into joining the local chamber of commerce, a business association, or partner with a local charity. Be visible in your local community and get dedicated partners long before you open your doors.

9. Develop your marketing plan — before you open

If you start marketing the day you open, you’re already behind. On opening day , you want people excited to come in. You’ll want to develop your marketing strategy and begin advertising to potential customers several months before opening.

Affordable marketing options to consider:

• Partner with other local businesses by providing free coffee in exchange for on-site advertising.
• Leverage social media as direct communication with your customers.
• Participate in local events, providing free specialty coffee samples leading up to your grand opening.
• Do a small direct mail or email campaign that sends coupons to local residents or businesses.
• Call everyone, including the media, to tell them about your plans to open the shop.

10. Don’t just focus on the interior of the building

It’s likely that you’ll stress over every little detail of your shop, from what paintings to hang on the wall to the point of sale system (POS System) you’ll use. That being said, it can be very easy to ignore the exterior of your shop or coffee cart which directly contrasts with choosing a location with heavy foot traffic.

According to Wilson, you’ll want to “pay attention to the landscaping, signage, and exterior appearance because that’s the first thing people see.” Some people decide whether or not to come in based on their first impression of the building, so make it count.

By creating a clean and unique exterior, you’ll begin to create a buzz in your community. People will start to wonder, who is setting up shop there? Every little thing you can do to attract attention to your coffee shop can serve as a marketing tool.

• 11. Have a positive attitude

Like every business, you’ll face challenges to get your shop off the ground. Renson says keeping a positive attitude when things aren’t going your way is a must. Not only does it benefit your outlook, but it showcases strong leadership to your employees and a welcoming presence for customers.

Fake it if you have to. If you get in the habit of keeping an optimistic attitude, even if it’s less than genuine to start, you’ll eventually teach yourself to stay upbeat and will keep those around you optimistic and ready to work.

• 12. Hire slowly

You need help manning the register, waiting on customers, and making drinks, but don’t hire too many people too fast. Renson suggests hiring a few friends, or neighbors who will volunteer to help you out for the first few weeks. Slowly, bring on staff as needed.

Hiring trusted staff can be tough. No matter how well someone does in an interview, you don’t know how well he or she fits until they’re on the floor. Keep a close eye on the register, Renson suggests, and don’t be afraid to let people go if they are hurting the business.

• 13. Set high standards

It’s okay to set high standards for your employees and overall business. That’s not to say that you should micromanage your employees. You’ll want to focus on effectively training your staff at the start and building an effective workflow that encourages collaboration and high-quality work. Their ability to make good coffee drinks quickly will have an impact on customer loyalty and satisfaction.

Starting an independent coffee shop is hard work, but that doesn’t mean it has to be a long-term struggle. If you focus on establishing these core pieces while developing your coffee shop business plan, you’ll set yourself up for success early on.

Candice Landau is a marketing consultant with a background in web design and copywriting. She specializes in content strategy, copywriting, website design, and digital marketing for a wide-range of clients including digital marketing agencies and nonprofits.

Table of Contents

• 9. Develop your marketing plan — before you open
• 10. Don’t just focus on the interior of the building

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How to Start a Cafe Business in 14 Steps (In-Depth Guide)

Updated:   January 26, 2024

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The cafe business market is expanding, with consistent success. With a projected compound annual growth rate (CAGR) of 3.7% from 2022 to 2032 , the market could reach $243 billion by 2032.

Success hinges on astute planning, attention to customer experience, quality products, and adaptability in our digital age. This guide will cover key steps – from crafting your business plan to designing your space and menu to budgeting smartly. While competition varies by location, the rewards of operating your café often outweigh the demands.

This guide will walk you through how to start a cafe. Topics include market research, marketing, customer focus, registering an EIN, obtaining business insurance, and forming an LLC. Here’s everything you need to know to start your own cafe business.

1. Conduct Cafe Market Research

Market research is important for newcomers to the cafe business market. It offers insight into your target audience, local coffee shop trends, and market saturation. There are two types of market research, primary research you do yourself, and secondary research compiled by a third party.

Some details you’ll learn through market research include:

• Several key drivers feed the skyrocketing demand for cafés and specialty coffee shops.
• Consumers increasingly view cafés as “third spaces” outside work and home to socialize, remote work, or simply enjoy high-quality drinks and snacks.
• The millennial cohort in particular fuels growth – young generations drive trends like specialty brews, mobile ordering, and sustainability that cafés readily incorporate.
• While chains like Starbucks, Dunkin’ Donuts, and Caribou Coffee dominate, independent cafés thrive by offering unique atmospheres and hyperlocal community connections.
• Market saturation remains relatively low, indicating room for new café entrepreneurs to carve out territory with creative differentiation and localization.
• The most lucrative café segments currently include specialty coffee, Latin coffee shops, dessert cafés, and automated mobile cafés.
• Keys to continued success and profitability include astute site selection, efficiency, customer loyalty programs, and social media integration.
• Adaptability also proves vital – café owners who rapidly implemented online ordering and contactless payment during COVID-19 mitigated revenue drops by up to 60%.

In summary, industry analytics overwhelmingly confirm the café sector’s resilience and viability for aspiring business owners. While big chains present competition, the broad market appeal, relatively low barriers to entry, and manifold opportunities for innovation symbolize a bright future.

2. Analyze the Competition

Competitive analysis is an important part of building a business. It helps you assess your pricing structure, build a thorough business plan, and develop services and products based on successful coffee shop ventures.

Some ways to learn more about other coffee shop owners include:

• Drive around town with fresh eyes – note coffee shops already operating, and jot down specifics like size, appearance, hours, and menu options visible. Also check whether or not they offer additional services such as hookahs and other leisure areas, or if they let cats stay at the cafe, essentially doubling as a cat cafe . This can increase your overall reach and business attractiveness to new customer groups.
• Covertly observe the in-store customer experience at multiple times of day – how busy do they seem, what offerings get ordered most, is the atmosphere inviting?
• Search online reviews for existing cafés on Yelp, Google, and Facebook to gather customer sentiment.
• Pay attention to what people rave and complain about to identify unmet needs a new entrant could satisfy.
• Study their social media engagement across platforms – follower counts, post reactions, and user-generated content featuring their brand.
• Assess the polish and functionality of online ordering platforms and mobile apps.
• Consider search engine visibility by plugging “cafés near me” into Google Maps – where do rivals rank?
• Incorporating both offline and online investigative work allows founders to realistically evaluate direct and adjacent competition while informing their positioning.
• A SWOT analysis can then synthesize findings to illuminate viable differentiators – maybe an avant-garde drink menu, monthly comedian nights, and reservable workspaces.
• Data and creativity together enable new cafés to stake out a distinctive niche.

Use details gleaned through competitive analysis to build up your coffee shop business. From forming a coffee shop business plan to sourcing ingredients for your coffee shop menu, competitive analysis helps your new coffee shop secure a place among independent coffee shop owners.

3. Costs to Start a Cafe Business

When launching a café, the majority of initial expenses stem from real estate, build-out, equipment, inventory, and permitting. Here, we’ll break down the coffee business expenses you may encounter as you begin your own coffee business.

Start-up Costs

• Total start-up costs often range from $80,000-$250,000+ depending on size and services offered.
• Appropriate commercial space is essential, be it leasing, buying, or even a food truck. Average small café lease rates run $15-$30 per square foot annually.
• Purchasing an existing restaurant property can require $100,000-$500,000+ depending on location and features. Food trucks have lower barriers to entry around $50,000.
• Build-out costs to furnish, renovate, and optimize the site layout add another $15,000-$38,000.
• Specialized equipment constitutes a significant fixed cost. High-volume espresso machines range from $8,000-$15,000.
• Fridges, ovens, dishwashers, and other kitchen appliances add a few thousand each. Ventilation, fire suppression systems, point-of-sale setups, and dining furniture also add up quickly. New cafés can expect to invest $20,000-$45,000 in key equipment.
• Ingredient inventory must be purchased upfront before opening day. Estimate $5,000-$10,000 to stock coffee beans, bakery items, produce, dairy, paper products, utensils, and more until cash flow stabilizes.
• Cafés with liquor licenses require extra capital for wine, beer, and spirits – at least $3,000 initially.
• Various permits and professional services facilitate a smooth launch. Filing fees for LLC formation and food service licenses cost $500-$1,500.
• Lawyers and accountants may charge $2,000-$5,000. Designers, architects, and contractors also have pricey fees but prove worthwhile for space planning and efficient build-outs.

Altogether, a 1,200 sq ft counter-service café with mostly second-hand equipment may launch for $80,000 if opting for a basic built-out space. A 2,500 sq ft full-service site with entirely new equipment and custom architecture could demand upwards of $250,000.

Also worth noting that smaller cafes are often present in movie theaters , whether in-house or external (e.g. Starbucks). Consider branching out as you’ll constantly have a steady influx of customers at such a hot spot.

Ongoing Costs

Once opened, cafés face numerous ongoing operating expenses split into fixed and variable costs:

• Rent/Mortgage – $24,000-$100,000+ annually
• Loan repayment – $8,000-$30,000
• Equipment leases – $2,000-$10,000
• Payroll including taxes and workers comp – $60,000-$250,000+
• Insurance – $4,000-$8,000
• Utilities – $6,000-$15,000+
• Point of sale fees and subscriptions – $1,000-$4,000
• WiFi and music licensing – $600-$1,500
• Accounting and legal retainers – $500-$5,000
• Advertising – $2,500-$15,000+
• Food/beverage inventory – 30-50% of monthly sales
• Janitorial supplies and shop upkeep – $1,000-$4,000

Careful financial planning and cost control will help offset slim profit margins in the competitive café sector. But for owners who curate an in-demand concept and brand identity, the earnings potential remains highly stimulating.

4. Form a Legal Business Entity

As you open a coffee shop, owners must weigh options on the legal business entity. The four primary formations each impact taxes, regulations, liability protection, and expansion capabilities differently. For coffee shops specifically, limited liability companies (LLCs) tend to offer the best balance of flexibility and owner protection.

Sole Proprietorship

Sole proprietorships represent the simplest yet riskiest entity. They involve minimal paperwork and cost nothing to initiate. Owners report profits or losses on personal tax returns. However, solo presenters bear unlimited financial liability – meaning their homes and assets get tied up if sued.

Partnership

Partnerships allow the sharing of operations and expenses across two or more founders. But similar to sole proprietors, general partners remain personally liable for debts and legal issues.

Corporation

On the incorporated side, C-corporations have the highest start-up costs – incorporation filing fees plus annual franchise taxes. They provide limited liability shielding but face double taxation on company earnings and shareholder dividends. S-corp election avoids double tax but adds accounting complexity with strict ownership rules that can prove overly restrictive for café growth.

Limited Liability Company (LLC)

By comparison, Arizona State University’s business experts hail LLCs as the best option for small hospitality firms like cafés. LLC registration protects owners’ assets if sued, avoiding sole proprietorship exposure. Taxwise, earnings, and losses pass to members’ returns without corporate double taxation. Operations governance brings flexibility akin to partnerships but with the liability limits of a corporation.

5. Register Your Business For Taxes

All new business owners must obtain an Employer Identification Number (EIN) from the IRS, which functions like a Social Security Number for your company. This unique 9-digit number identifies your LLC, corporation, or other legal business structure for federal tax purposes.

While sole proprietors can use their SSNs initially, the SBA highly recommends securing your own EIN even if you don’t plan to hire employees. Having an EIN adds legitimacy for partners, lenders, and vendors. It also enables opening business bank accounts properly titled to your company.

Thankfully obtaining an EIN takes just minutes online. Simply:

• Navigate to the IRS EIN Assistant
• Answer a few basic questions about your LLC or corporation
• Provide your personal identifying information for verification
• Get your EIN immediately upon submitting the form

The online EIN application has no fees or processing delays. You must print/save the final assignment notice from the IRS for record-keeping.

With your federal EIN secured, contact your state revenue office to register for additional tax IDs used in sales tax collection, payroll taxes, alcohol licenses if applicable, and other filings. States charge no registration fees either, though you’ll need to integrate reported sales and income on separate state returns annually.

Streamlining legal compliance from the start helps cafés focus on customers and growth in a complex regulatory environment. An EIN only takes minutes via the IRS portal but unlocks essential business functions down the road.

Let me know if you need any other details about obtaining an EIN, applying for state tax licenses, or navigating business taxes as a new café owner!

6. Setup Your Accounting

With slim profit margins prevailing in the food service industry, café owners must implement rigorous financial systems right from the start. Careful record-keeping, accounting software, fiscal diligence, and retaining a tax professional provide vital foundations for success.

Accounting Software

After securing your EIN, invest in user-friendly accounting software like QuickBooks to track all transactions in one place. The cash basis method recognizes income/expenses when money exchanges hands, which simplifies reporting for small cafés. Link your business bank and credit card accounts so payments automatically download into preset categories like supplies, payroll, utilities, etc.

Hire an Accountant

While the software does the heavy lifting, working with an accountant or bookkeeper safeguards accuracy in documenting deductible expenses, estimating quarterly taxes, reconciling accounts, and producing clean financial statements to spot issues.

Expect to invest $100-$250 monthly for comprehensive outsourced accounting or around $700-$1,500 for annual filing prep. An accountant also proves invaluable if audited down the road, supplying evidence to validate deductions claimed.

Open a Business Bank Account

Separating business finances from personal avoids monstrous headaches at tax time. Open dedicated café checking/savings accounts and apply for a business credit card solely for company expenditures. Consumer cards often can’t handle high transaction volumes anyway.

7. Obtain Licenses and Permits

While exciting to finalize menus and décor, new cafés must allot time upfront to navigate licensing requirements. Find federal license information through the U.S. Small Business Administration . The SBA also offers a local search tool for state and city requirements.

At a minimum, register for a baseline food service establishment permit through local health departments before serving anything edible to customers. These prevent foodborne illness by stipulating protocols for ingredient sourcing, prep, storage, cleaning, and employee health policies.

If planning to sell alcoholic beverages, apply for separate liquor licensing through alcohol control boards in your state. Eligibility for beer/wine versus full liquor depends on the cuisine type, seating capacity, and hours. Liquor permits run $500-$2,000 with annual renewals and staff training mandates. Bartenders must obtain additional certification.

Cafés hosting live entertainment or background music require analog music licensing like an ASCAP or BMI Permit. These royalties compensate artists when songs commercially play and cost around $275-$590 yearly. Venues above certain occupancies need concert/event permits for talent shows, trivia nights, or open mic events too.

While not universally mandated, café owners concerned with public health may additionally pursue recognized food safety training and display-related signage. Programs like ServSafe offer evidence you uphold best practices for contamination avoidance, thereby attracting discerning patrons. Some cities even incentivize such voluntary credentialing.

Confirm precise requirements with business licensing departments and schedule adequate lead time. The permitting process held Emilie’s Bakery from a disastrous incomplete inspection at their grand opening ribbon cutting! Confirming regulatory obligations early keeps new cafés compliant and audit-proof.

8. Get Business Insurance

While an unbudgeted expense, business insurance gives café owners peace of mind against scenarios threatening their livelihoods. Policies cover losses from theft, property damage, customer injury lawsuits, and other risks – no small problem given hot liquids, slippery floors, and heavy equipment.

Imagine a winter pipe burst flooding your newly renovated space, destroying walls, wiring, and custom tile work. Without coverage, the café must pay six-figure repair costs out of pocket. Now imagine a patron spills tea and slips on your vinyl floors.

Thankfully getting insured does not break the bank and prevents catastrophic loss. Start by researching café-specific risks using Hartford’s industry risk profiler. Next, connect with independent insurance brokers familiar with local food-service clients. Standard policies include:

• General liability – covers 3rd party injury/property claims
• Equipment coverage – replaces stolen/damaged appliances
• Workers comp – pays staff medical bills
• Loss of income – continues some profits after a disaster

Ensure adequate limits given major assets like machinery or real estate improvements. For optimal protection, secure policies 30-60 days before opening doors to customers and require certain coverages from vendors. Defending your livelihood deserves priority!

9. Create an Office Space

Although counterintuitive given their physical retail sites, securing office space proves essential for café owners to operate administrative functions outside chaotic kitchens. An external headquarters, be it home-based, shared, or private, offers a space for administrative duties.

Home Office

Home offices allow bootstrapping cafés to avoid paying rent elsewhere initially. Dedicating space for filing, equipment storage, and food science experiments also enables tax write-offs on a portion of residential bills. However, separating work and personal life often proves beneficial for concentration.

Coworking Office

Coworking spaces like WeWork supply turnkey office infrastructure for around $300-$500 monthly. Many provide meeting rooms to interview chefs, kitchen incubators to test recipes after hours, and networking events to connect with fellow entrepreneurs. While budgets tighten, the flexibility and amenities keep startup costs manageable until cash flow stabilizes.

Commercial Office

As managers build out management teams over time, leasing a private commercial office better accommodates more employees permanently stationed behind the scenes versus just running the register. Expect monthly rates from $1,000-$1,500 but with no restrictions on hours or storage for extra equipment/records.

10. Source Your Equipment

Outfitting a café requires significant upfront investment in durable commercial-grade inventory spanning furniture, cooking gear, point-of-sale systems, and small wares. Thankfully multiple acquisition options balance quality and affordability.

When buying brand new, beverage-focused sites like Espresso Parts offer barista tools like high-end Italian espresso machines, grinders, tampers, and steaming pitchers often sold in discounted bundles. Commercial kitchen retailers like Webstaurant Store supply heavy-duty ovens, refrigeration, ventilation, prep tables, utensils, and display cases configurable to space.

To conserve startup capital, browse used listings on eBay , Facebook Marketplace , and Craigslist for quality floor models or refurbished wares at 40-60% discounts off retail. Peer networks connect buyers and sellers of specialty baking gear through their online exchange. Try searching locally first to inspect the condition before committing.

Renting essential equipment also limits large outlays while opening helps cash flow early on. National companies deliver commercial dishware, tables, linens, and servers for off-site catering gigs with flexible terms. Rental fees apply to eventually owning certain items too.

Leasing agreements for expensive machinery like high-performance coffee roasters allow spreading payments over 3-5 years until the balance is satisfied. This pay-as-you-go approach prevents major asset purchases from paralyzing young businesses. Credit checks often factor in leases, however.

11. Establish Your Brand Assets

Crafting a distinctive brand platform fuels recognition, trust, and customer loyalty over commodity competitors. While initially daunting, methodically curating visual identity, communications channels, and an online hub need not break tiny startup budgets.

Get a Business Phone Number

Secure an official business line via cloud-based providers like RingCentral for around $30 monthly. Toll-free numbers project credibility while call routing, voicemail transcriptions, and custom greetings operate professionally.

Design a Logo

Design aesthetics likewise convey persona. Have a designer create a timeless wordmark logo evoking your café’s vibe through font, color, and icons from Looka . Expect to invest $200-$500. Vector files adapt easily to signs, cups, ads, and swag. Steer clear of overused visual clichés.

Print Business Cards

Print 500-1000 business cards for under $20 from Vistaprint to share during guest interactions, vendor meetings, hiring fairs, and community networking. Cards enable quick captive messaging after pleasant café encounters.

Prominent exterior signage also drives lucrative foot traffic – illuminate hours, menus, and brand insignia outside. While pricier than print materials, quality metal and neon signage lasts for years with proper installation.

Get a Domain Name

Digital real estate equally enables discovery by neighborhood patrons and tourists alike. Register an intuitive .com domain with your name via Namecheap for about $12 annually. Use this consistently across platforms like GMB, social media, and email.

Design a Website

Building out an owned website on Wix or WordPress enables showcasing menus, events, catering details, e-commerce, and contact options without third-party interference. Expect to invest $100-$500 launching with custom branding. If funding is extraordinarily tight, you can also commission affordable site development on Fiverr .

12. Join Associations and Groups

While competitive, the food and beverage industry encourages remarkable collegiality. Connecting with community resources, complementary businesses, and hospitality pros pays dividends for novice café owners through traded secrets and elevated visibility.

Local Associations

Joining the local chapter of the Specialty Coffee Association offers workshops on brewing techniques and customer retention alongside peer networking. Membership fees of around $100-150 prove worthwhile for insider tricks. Restaurant alliances additionally lobby for legislative changes benefitting eateries.

Local Meetups

Attending regular startup meetups via Meetup enables you to meet fellow entrepreneurs plus sponsor Booths featuring your scones or pour-overs and get your brand directly in front of potential customers and vendors like commercial linen services. Expect to invest $50+ monthly to maximize exposure at multiple events.

Facebook Groups

For free perpetual advice, join hyper-targeted Facebook Groups like RESTAURANT BUSINESS OWNERS and Coffee Shop Owners Only alongside local conversations. Learn from peers globally in managing staff, marketing on Instagram, saving money, and preventing common pitfalls.

13. How to Market a Cafe Business

While tempting to focus solely on perfecting recipes and interiors, dedicating time to strategic marketing proves indispensable for attracting initial customers and sustaining patronage long-term. By tapping personal connections alongside targeted digital and print channels, new ventures can amplify visibility and sampling.

Personal Networking

Start close to home, most small businesses earn new clients from word-of-mouth sources like friends, family, neighbors, and colleagues. Savvy owners incentivize referrals by offering free drink cards to existing patrons who check in on social media and tag new guests.

Digital Marketing

• Run hyperlocal Facebook and Instagram ads highlighting signature breakfast sandwiches or oat lattes
• Claim and optimize free business profiles like Google My Business, Yelp and TripAdvisor
• Produce snackable behind-the-scenes café culture videos for TikTok and YouTube
• Send limited-time reopening offers via SMS and email collection
• Partner with workplace offices, fitness studios, and apartment buildings nearby to fuel referral rewards
• List catering menus on gig marketplaces like UberEats for expanded visibility

Traditional Marketing

• Distributing menus and flyers at the public library, rec center, and local colleges
• Placing radio ads spotlighting trivia nights on community stations
• Sponsoring Little League teams and putting up banners at games
• Staking signs at busy neighborhood intersections

The most effective strategies entice trial from a fusion of existing networks and targeted local outreach. Space limitations prevent covering everything here but let’s brainstorm other ideas that could uniquely work for your café!

14. Focus on the Customer

In an increasingly commoditized food service sector, stellar customer service stands out as a competitive differentiator for cafés striving to build loyalty and earn referrals.

Some ways to improve customer focus as a coffee shop owner include:

• Tactics like greeting every patron by name, customizing orders for regulars, and gift card bonuses after frequent visits make customers feel individually appreciated, not just processed.
• Baristas might also deliver samples of new whole bean arrivals to spark conversation and showcase expertise.
• Little service touches spotlight the care and pride owners place in their neighborhood oasis.
• A memorable send-off like “Your lunch is on us today, we so appreciate your continued support!” demonstrates genuine recognition of patronage that earns huge dividends offline and on platforms like Yelp.
• Putting people first with thoughtful hospitality and attention powers expansion more than any single marketing tactic alone ever could.

Let’s discuss additional ways we can wow your café guests! Delivering consistently excellent service remains every entrepreneur’s secret weapon.

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How to Open a Café: A Step-by-Step Guide to Your Dream Business

Business Advice , Restaurants

Are you a coffee enthusiast with a passion for entrepreneurship? If so, opening your own café might be the perfect venture for you! But where do you begin? Follow this step-by-step guide to help you navigate the process of launching your dream café.

Step 1: Develop a Clear Concept 

First and foremost, decide on the unique selling proposition of your café. Consider factors such as target audience, location, ambiance, and menu offerings. Will you serve specialty coffee, delicious pastries, or offer unique brewing methods? Having a clear concept will help your café stand out in a competitive market.

Step 2: Create a Business Plan 

A comprehensive business plan is crucial for obtaining funding and keeping your café on track. Key components include:

• Executive summary
• Company description
• Market analysis
• Product offerings
• Marketing and sales strategies
• Management and organization structure
• Financial projections, including Business Model and Prime Cost percentages
• Profit First for Restaurants (PF Cash Management System)

Understanding Your Business Model

To create a solid financial foundation for your café, you need to develop a detailed understanding of your business model. This involves identifying your main revenue streams, estimating your prime cost percentages (Cost of Goods Sold (COGS) and Labor (Payroll)), and outlining your strategy for profitability.

Start by determining the pricing structure for your menu items, factoring in COGS and labor costs. Aim to keep your prime cost percentages below 60-65% of your total sales, allowing for sufficient profit margins. Additionally, account for fixed costs like rent, utilities, and insurance, as well as variable costs such as marketing expenses.

Step 3: Secure Funding 

With a solid business plan in hand, approach banks, investors, or other financing options to secure funding, if needed. Be prepared to present your plan and discuss your café’s unique selling points.

Step 4: Choose a Prime Location 

Location is a critical factor in the success of any café. Research your target market and competition to determine the best area for your business. Consider factors such as foot traffic, parking, visibility, and accessibility to public transportation. Also, note if there are other similar businesses in the area where you can “piggy back” off their audience.

Step 5: Design Your Café and Source Equipment 

Design your café with your target audience and brand identity in mind. Prioritize functionality and workflow, as well as aesthetics. Work with a professional designer or architect if needed to create a welcoming and efficient space. Simultaneously, invest in high-quality equipment to ensure a smooth operation. You’ll need items such as espresso machines, grinders, brewing equipment, refrigerators, and display cases.

Step 6: Select Suppliers and Obtain Necessary Permits 

Research and select suppliers for your coffee beans, pastries, and other menu items. With your suppliers and equipment in place, make sure you have all the required permits and licenses to operate your café. These may include business licenses, health permits, food service licenses, and building permits. Requirements vary by location, so check with your local government to ensure you’re in compliance.

Step 7: Hire and Train Staff

Your staff will be the face of your café, so carefully select and train your team. Look for individuals with excellent customer service skills, a passion for coffee, and experience in the food service industry. Provide comprehensive training on your menu, equipment, and company culture.

Step 8: Develop a Marketing Strategy 

Spread the word about your café through both online and offline channels. Create a website, build a presence on social media, and consider using traditional advertising methods like print ads or radio spots. Host a grand opening event to create buzz and build relationships with your local community.

Step 9: Implement Profit First for Restaurants (MacDaddy PF Cash Management System) 

To ensure your café remains profitable, consider implementing the Profit First for Restaurants (PFR) cash management system. This method, also known as the MacDaddy PF Cash Management System, prioritizes profit allocation before covering expenses.

The PFR system involves setting up multiple bank accounts to allocate revenue into different categories, such as profit, owner’s pay, taxes, and operating expenses. By following this system, you’ll be able to maintain healthy cash flow and ensure your café remains financially stable.

Step 10: Launch and Iterate 

With everything in place, it’s time to open your café! Once you’re up and running, regularly evaluate your business performance and adjust your strategies as needed. Continuously refine your menu, marketing efforts, and customer experience to ensure long-term success.

Opening a café requires careful planning, but with passion, determination, and the right strategy, you can turn your dream into a thriving business. By following these eleven steps, you’ll be well on your way to creating a café that will be a cherished part of your community. Happy brewing!

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How to Start a Cafe

Last Updated: March 17, 2024 Approved

This article was co-authored by Pete Canalichio and by wikiHow staff writer, Christopher M. Osborne, PhD . Pete Canalichio is a Brand Strategist, Licensing Expert, and Founder of BrandAlive. With nearly 30 years of experience at companies such as Coca-Cola and Newell Brands, he specializes in helping brands find the most authentic parts of their story to build a brand strategy. Pete holds an MBA from the University of North Carolina at Chapel Hill and a BS in Physics from the United States Naval Academy. In 2006, he won an MVP Award from Newell Brands for his contributions to their Global Licensing department. He’s also penned the award-winning book, Expand, Grow, Thrive. There are 11 references cited in this article, which can be found at the bottom of the page. wikiHow marks an article as reader-approved once it receives enough positive feedback. This article has 20 testimonials from our readers, earning it our reader-approved status. This article has been viewed 452,332 times.

Opening a small, cozy, "cute" neighborhood cafe may be the most common dream of the prospective small business owner, but "cute" doesn't pay the bills. [1] X Research source [2] X Research source Cafes run on tight profit margins, require a significant initial investment, and demand long hours and many headaches of their owner-operators. Before abandoning all hope, however, do your homework regarding the steps required to start a cafe. With the right planning beforehand, your cafe will stand a fighting chance of success, and of becoming the small business of your dreams.

Planning Your Small Business

• Title Page and Table of Contents.
• Executive Summary, in which you summarize your vision for the company.
• General Company Description, in which you provide an overview of your company and the service it provides to its market.
• Products and Services, in which you describe, in detail, your unique product or service.
• Marketing Plan, in which you describe how you'll bring your product to its consumers.
• Operational Plan, in which you describe how the business will be operated on a day-to-day basis.
• Management and Organization, in which you describe the structure of your organization and the philosophy that governs it.
• Financial Plan, in which you illustrate your working model for finances and your need from investors.

• To begin with, you'll have to determine the nature of your business organization. The options include (but are not necessarily limited to) a sole proprietorship, partnership, and limited liability company (LLC). There are pros and cons for each option. [4] X Trustworthy Source U.S. Small Business Administration U.S. government agency focused on supporting small businesses Go to source
• From there, you can begin investigating what business licenses and permits you will need to secure in order to open for business. Consider consulting your local chamber of commerce, the Small Business Administration , or similar group for assistance. [5] X Trustworthy Source U.S. Small Business Administration U.S. government agency focused on supporting small businesses Go to source
• For tax purposes in the U.S., you'll also want to secure an Employer Identification Number (EIN) from the IRS.
• You may want to consider hiring a business attorney to help you navigate the legal processes.

• Take the time to scout out the best options for securing a small business loan from a financial institution. You may or may not find your best deal at a bank with which you already have a financial relationship. Organizations like the U.S. Small Business Administration can help walk you through the process of securing your best loan.
• Your funding options need not stop with a bank loan and your own savings. Try to entice investors or partners with your business plan, for instance. If you are willing to deal with the potential pitfalls of doing so, ask family and friends for personal loans. Your creative options can range from running a crowdfunding campaign to renting out the third floor of you home. Always keep on the lookout for prospective funding sources. [6] X Research source

• Consider the target clientele for your cafe based on your observations and research of the surrounding community, and your business goals. Is it nine-to-five office workers? College kids? A tech-savvy crowd, or people looking for quiet conversation? Let this information help guide your branding as well.
• Your ultimate goal is to create "one voice" that speaks across everything from your promotional materials to your lunch menu to your bathroom decor. [7] X Research source
• If you are having trouble developing a brand identity, or sense that your concept is becoming too complicated, seek out the services of professionals that focus in this area.

Preparing Your Cafe

• If it has been previously used as a cafe, this may work to your benefit because you won't need to spend time and money converting it into a cafe. Of course, consider why that previous cafe failed.
• Personally scout prospective locations. Count how many cars or people pass by over an hour during different times of day. People will seek out good food and drink, but a new cafe will have a better chance of building a loyal clientele if it is in a high-traffic area. [8] X Research source

• Try to match the brand of the business with a product that will be unique, unusual, but will also help to sell the business
• While important, don't focus solely on things like wall color and lighting fixtures. For a cafe in particular, make sure you create a kitchen area with good traffic flow that allows those preparing food to move their feet minimally.
• While you'll probably want your cafe to be a comfy spot where customers will want to come and linger, lay it out so that it is friendly to take-away customers as well. People who grab their food or drink to go cost you less to serve and make happy. [9] X Research source

• Look for savings where you can find them. Perhaps a mix-and-match, eclectic furniture decor can work with your cafe theme, allowing you to save some money by picking up used tables, chairs, and other pieces as you find them.
• For a cafe, though, don't skimp on the key equipment, such as an espresso machine. If coffee is going to be your focus, make sure you can produce a quality product. People who pay a premium for coffee tend to know the difference. [10] X Research source
• Research equipment rental vendors in your area. Consider multiple options to find your best deal, because you need to find savings wherever you can.

• For a cafe in particular, it is often better to keep the menu somewhat limited, especially at first. Focus on key items that complement each other, such as a selection of pastries that pair up with your coffee options, or a manageable array of soups and sandwiches. [11] X Research source
• Make sure you are an expert on the items on your menu, whatever its size. If you aren't already a coffee expert, research the subject extensively. Know where your produce comes from. Be able to discuss the sourcing of the meats in your sandwiches. Display a personal connection to your food, to separate you from the big chains. [12] X Research source

• Suppliers are the lifeblood of a cafe. Without product that's there when you need it (at a fair price), you have nothing. [13] X Research source
• Ask other restaurant and small business owners in the area which suppliers they use. Once you've selected your suppliers, work to establish and maintain a good working relationship with them. Don't be afraid to make a switch to get better prices or better service, though.

Opening for Business

• While spreading the word, try to remain consistent with your brand identity in your promotional materials. [14] X Research source
• Establishing a marketing budget for your grand opening (which some say should be 20% of your first year's marketing budget). [15] X Research source
• Using traditional media, like TV, radio, and newspapers.
• Using digital media like social networks, websites, and advertising technology such as Google Adwords.

• Familiarity with the cafe business is of course helpful, but pay at least as much attention to personality, temperament, and attitude. Conduct thorough interviews, and ask insightful questions (how they have dealt with adversity before and how they would deal with a particular example in the cafe, for instance). [16] X Research source
• Remember, on the rare instances when you are not in the cafe, your employees will be the face of your business.
• Once again, How to Open a Small Business provides useful information on hiring employees, including details on your initial responsibilities as an employer.

• You want your official grand opening to go as flawlessly as possible, so it may make sense to do a "soft opening" beforehand as a practice run. Invite a small group of guests, maybe even just friends and family, and run through the operation of your cafe. See what works and what doesn't before the official grand opening. [17] X Research source
• Make your grand opening "grand" with ample advertising, giveaways, and whatever else will make people notice and be curious enough to stop in. Also think about the best day and time to officially open. When will your target clientele be most likely to come in? A workday morning? During the lunch hour? Weekend brunch?

• For instance, offer a loyalty program. It's not just a way to retain customers, it's also a good tool to understand them and build strong relationships with them. The lure of a free coffee after all the spots on a card are punched out can be enough to bring people back until it becomes a habit. [18] X Research source
• Beyond simple punch-cards or coupons, there are a number of loyalty platforms using QR code.They make it very easy to offer a loyalty program and they are also cost-effective. Whatever method you use, do not see a loyalty program as giveaways. Rather, see it as a powerful marketing tool.

Expert Q&A

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Thanks for reading our article! If you'd like to learn more about being an entrepreneur, check out our in-depth interview with Pete Canalichio .

• ↑ http://www.forbes.com/sites/quora/2012/12/20/whats-the-secret-to-a-successful-coffee-shop/
• ↑ http://www.slate.com/articles/life/a_fine_whine/2005/12/bitter_brew.html
• ↑ https://www.sba.gov/writing-business-plan
• ↑ https://www.sba.gov/category/navigation-structure/starting-managing-business/starting-business/choose-your-business-stru
• ↑ https://www.sba.gov/content/follow-these-steps-starting-business
• ↑ http://www.businessnewsdaily.com/1733-small-business-financing-options-.html
• ↑ http://www.entrepreneur.com/article/231966
• ↑ http://smallbusiness.foxbusiness.com/starting-a-business/2014/04/09/want-to-open-coffee-shop-read-this/
• ↑ http://www.ladyironchef.com/2014/12/things-to-know-before-opening-cafe/
• ↑ http://fitsmallbusiness.com/grand-opening-ideas/
• ↑ http://www.entrepreneur.com/article/241524

About This Article

To start a cafe, start by buying or renting a space that's in a high-traffic area, which will help you get more customers. Then, fill the space with all of the equipment and furniture you need, like tables, chairs, and coffee machines. Once you've set up your cafe, design a menu and find distributors and suppliers to buy your food and coffee from. Finally, hire employees and make sure you have all of the necessary certificates and registrations to be operating a business before you open. To learn how to write a business plan for your new cafe, keep reading! Did this summary help you? Yes No

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CAFE BUSINESS PLAN: How to Write With Templates & All You Need

• by Folakemi Adegbaju
• August 10, 2023

Table of Contents Hide

Why do you need a cafe business plan, tips for writing a cafe business plan, #1. executive summary, #2. business description, #3. industry research, #4. the marketplace, #5. swot analysis, #6. marketing plan, #7. financial plan, #8. operational plan, cafe business plan template, is a cafe a profitable business, how do i start a cafe idea, is it hard to open a coffee shop, how do you attract customers to your coffee shop, do cafes make money, how much does a cafe owner make a month, final thoughts, why do most cafes fail, what does a coffee shop owner do, what are the duties of a café manager.

The first step to a successful cafe is developing a business plan. Make sure your cafe business plan is prepared if you intend to pitch investors for financing because they will undoubtedly request to view it. This article discusses how you can write an impactful cafe business plan for your cafe, and it comes with a cafe business plan template checklist to help you arrange things accordingly.

Get the cafe business plan template

 Let’s start the journey.

What Is a Cafe Business Plan?

A cafe business plan is a simple way to show how serious and committed your business is. It outlines your devotion as a business owner and can be compared in order to gauge how successful your cafe is. It includes an executive summary, an overview, and a description of a coffee shop business, market data, marketing strategies, business operations, and financial plans, among other essential components of a solid cafe business plan.

A cafe business plan is not only necessary to keep your business on track for success, but it also demonstrates your commitment as a business owner. You can sketch out and examine all conceivable outcomes in your cafe business plan, from the advantages to the challenges posed by competitors. Without one, determining whether your company is flourishing might be difficult.

A cafe business plan gives your cafe shop a clear direction while also emphasising any obstacles and competitive businesses you may face. With this knowledge at your disposal, you may determine ahead of time what solutions you will require for any issues you might run into, thus increasing your chances of being a successful business owner.

You can now begin creating your business plan for a coffee shop. Here are some helpful suggestions to help you write more effectively:

• Gather helpful materials to aid you in your writing. This can include how-to manuals, market studies, emerging trends, and real or hypothetical sample company plans. All of these can serve as your source of inspiration and be incorporated into the relevant areas of your cafe business plan.
• Write as much as you can without censoring yourself. Once everything is laid out, you may decide which elements apply to which sections of your cafe business plan.
• Avoid being too focused on a single piece. If you run into writing difficulties, make a note and move on to the next paragraph. When you have more knowledge or are more certain, you can go back and review it.
• Every worthwhile thing requires time. Your cafe business plan will too. If it takes longer than you anticipated, don’t be concerned. You’ll be able to hone your message and articulate your ideas in a cogent and concise manner as time goes on and you continue to work on your plan.

How to Write a Cafe Business Plan

There are numerous approaches to writing a cafe business plan, and we provide important advice from subject-matter experts to get you started. This will help you write the perfect cafe business plan.

Although the executive summary should be the first section of your business plan, it should actually be the last section completed because it provides a summary of the entire cafe business plan. It should be no more than one page in length and is the most crucial section of your business plan. To help your audience save time, the goal is to outline the key ideas of the plan. If they wish to learn more, they can then go back and examine the portions that most interest them. Keep this section brief while still being inspirational.

Your cafe’s concept will be realized in this part. It’s important to give a thorough description of your business, including specifics like how the concept will look, where it will be located, and the type of atmosphere or brand you plan to establish. Your company’s description paints an accurate image of your mission and objectives.

This entails gathering in-depth information about nearby cafes, their average foot traffic, break-even points, and other important insights that can help you run your own cafe successfully. Determine possible locations by analyzing and making a list depending on your target market. The majority of cafes perform better in locations with heavy foot traffic, like malls or shopping centres. The site ought to be convenient for customers and reasonably close to your suppliers and vendors.

Determine possible locations by analyzing and making a list depending on your target market. The majority of cafes perform better in locations with heavy foot traffic, like malls or shopping centres. The site ought to be convenient for customers and reasonably close to your suppliers and vendors. The competitors you face should be mentioned in your cafe business plan.

You want to show in this area of the cafe business plan that you have done a comprehensive analysis of your target market and that you can show there is a market for your product or service. Analyzing your competitors’ strategies is a smart way to collect intelligence. Visit your competition, make notes about their menu items, marketing strategies, operational procedures, pricing, and brand positioning, and then do a thorough analysis of your results.

You can also inquire about the performance of local companies from residents in the neighbourhood where you intend to live. Your marketplace analysis will be realistic and more clearly depict how your business can succeed if you gather as much information as you can.

Strengths, Weaknesses, Opportunities, and Threats are referred to as SWOT. A thorough examination of the numerous aspects, including market- and regulatory-related changes, that may have an impact on how your cafe is run must be included in your cafe business plan. You can make sure that you are better equipped to manage risks by performing a SWOT analysis. It will also provide you with a greater understanding of the industry and enable you to better plan for unforeseen circumstances that can negatively impact your café.

If you don’t advertise your café effectively, it might not be profitable. You should therefore set aside money in your budget specifically for marketing. This should be mentioned in the cafe business plan to provide a thorough account of your marketing plan.

The financial plan is the most crucial part of your business plan for your cafe , especially if you require loan funding or are trying to convince investors to invest. Your financial strategy needs to show the expansion and profitability potential of your company.

For your cafe to be successful, you must have a solid operations plan. This needs to contain every component necessary for you to operate your café successfully every day. These would consist of:

• Choosing the Right Employees: This is essential to running your cafe. All potential avenues for finding suitable staff should be covered in a thorough hiring plan, including recruiters, employee recommendations, and advertising in newspapers, job sites, or on other social media platforms.
• The most important duty, after hiring the correct workers, is to train them. For your personnel to follow, develop Standard Operating Procedures (SOPs) and a training manual. Techniques for managing crises and disasters must be included in the training.

Download our cafe business plan template.

It is important to note that aside from having a business plan, there are more crucial steps to how you can start a cafe business. The essence of this cafe business plan template is to ensure that you follow all the necessary steps that can help you start your business. The checklist below will serve as a reminder. 

• Create a concept
• Select a name
• Compose a business plan
• Have financial projections
• Approved legal aspects
• Employ your management team
• Promote your business
• Provide your menu

Download our cafe business plan template .

Yes, a cafe business is a very profitable business. Depending on food production costs and other KPIs, most coffee shops turn a profit during their first few years of being in business. A cafe can anticipate a double-digit increase in sales by the fifth year. You should also budget carefully for unforeseen expenses, startup fees, and the costs associated with your first year of business.

Following the right steps when you are about to start a cafe business is very important. Succeeding in business will surely be easier once you follow the right steps. We’ve listed below some of the steps you can follow when you want to start your cafe business:

• Define your vision.
• Create a detailed business plan.
• Choose a location.
• Find the best suppliers.
• So source commercial equipment.
• Design your café
• Create a menu.
• Hire the right people.

Even though opening an independent cafe requires a lot of labour, the process doesn’t have to last for a very long time. You’ll position yourself for success early on if you concentrate on building these fundamental components while creating your cafe business plan.

What is the essence of your cafe if you have no customers or an overflow of customers? Here are some steps you need to take to attract customers to your coffee shop:

• Look at your pricing.
• Start a loyalty card program.
• Run a competition, particularly if you can get the local press to give you coverage.
• Tap up your suppliers for marketing materials
• Consider branded takeaway cups

Cafes can have gross margins of up to 85%, but small cafés often have operating incomes of just 2.5% of gross sales on average. Despite the financial obstacles, if you create a cafe, you might discover that you’re doing work you enjoy and making a gathering place that serves as a focal point for your neighbourhood.

A modest independent coffee shop’s typical annual revenue is between £100,000 and £150,000, and 22% of all cafés and coffee shops reach this level. However, just 12% will earn more than £250,000, while only 5% have a turnover of £25,000 or less.

If you’re thinking about opening a cafe, the first thing on your priority list should be preparing a business plan. Keep in mind that you are preparing the way for success. As a result of having your finances in order, you’ll be able to save money and actually obtain funding from banks and investors. The general message you want to convey must be woven into your business plan.

Coffee shops close their doors for a variety of reasons, including weak management, insufficient revenue to pay expenses, unreliable staffing, poor customer service, and excessive debt.

The choice of what kind of coffee to sell at your shop is entirely up to you as the owner. You must also make sure that your brewing procedures are excellent. However, coffee cannot generate all of the sales by itself. In actuality, only around 40% of a coffee shop’s overall sales come from coffee.

Managers of cafés are in charge of day-to-day operations. In addition to ordering café supplies, they hire, train, and oversee café staff, handle client complaints, and make sure that food safety and health rules are followed.

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Last Updated on August 11, 2023 by Folakemi Adegbaju

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Free coffee shop business plan template for 2025

• Published on September 6, 2024
• by Oguzhan Uyar
• Last updated: 5 days ago

Opening a coffee shop is an exciting venture, but it requires careful planning and execution to succeed in a competitive market.

A well-crafted business plan is your roadmap to turning your coffee shop dream into a thriving reality.

In this comprehensive guide, we’ll walk you through the essential components of a winning coffee shop business plan, complete with examples and free templates to help you get started.

From crafting a compelling executive summary to designing the perfect layout, we’ve got you covered every step of the way.

Whether you’re a seasoned entrepreneur or a first-time business owner with many coffee shops, this article will provide you with the insights and tools you need to create a solid foundation for your coffee shop’s success in 2024 and beyond.

Let’s dive in and start brewing up your dream business!

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Coffee Shop Business Plan Template: Comprehensive Examples to Kickstart Your Venture

Coffee shop business plan example.

To help you kickstart your coffee shop venture, we’ve created a comprehensive business plan template outline that you can adapt to your unique vision and goals. This sample covers all the essential components of a winning coffee shop business plan, with placeholders for you to fill in your specific details and ideas.

The key components of a successful coffee shop business plan include:

Executive Summary

Company Overview

Market Analysis

Organizational Structure and Management

Product or Service Offerings

Marketing and Sales Strategy

Funding Requirements

Financial Projections

How to Develop a Coffee Shop Business Plan

A coffee shop business plan is a meticulously crafted document that lays out the vital elements involved in starting and running a coffee-centric business. It offers a thorough exploration of the coffee business’s objectives, target audience, competitive landscape, marketing strategies, financial forecasts, and operational procedures. This plan serves as a strategic guide, helping entrepreneurs navigate the different phases of establishing and operating their coffee shop, ensuring a clear path toward success. This document is your roadmap to launching a successful coffee enterprise, intimately detailing the necessary steps to ensure your coffee shop blossoms into a flourishing and profitable coffee venture .

In the highly competitive coffee industry, creating a comprehensive and clear business plan is crucial.

Why a Coffee Shop Business Plan is Essential

Creating a detailed business plan helps entrepreneurs define their business objectives, whether it’s offering unique coffee blends, various food products, creating a welcoming atmosphere, or promoting sustainable practices. A well-prepared plan also necessitates a deep understanding of the target audience, allowing for customized marketing strategies, menu offerings, and customer experiences that align with customer preferences. Explore the depths of crafting a business strategy for your coffee roasting venture , detailing essential elements such as competitive analysis, sustainability efforts, and financial forecasts.

Key Benefits of a Coffee Shop Business Plan

Securing Investment and Funding: A well-organized business plan can be a persuasive tool when seeking investors or securing funding. It demonstrates your in-depth understanding of the coffee industry, market trends, and strategic approach, thereby increasing credibility and attracting potential investors.

Resource Planning: Drafting a business plan helps you identify the essential resources, supplies, and staff needed to start and run your coffee shop, from coffee beans and brewing equipment to furniture and décor.

Financial Strategy: A comprehensive plan outlines financial projections, startup costs, operating expenses, and revenue forecasts, guiding you in determining the required funding, pricing strategies, and cash flow management.

Market Insight and Differentiation: Through detailed market research, the business plan provides insights into your target audience’s preferences and behaviors, enabling you to tailor your offerings, ambiance, and marketing efforts to attract and retain customers effectively.

Risk Management: Developing a business plan encourages you to recognize potential risks and challenges, allowing you to create contingency plans to mitigate their impact.

Operational Efficiency: The plan details the operational processes needed to run your coffee shop smoothly, including staffing, inventory management, and quality control measures, ensuring consistent customer satisfaction.

Goal Setting and Monitoring: Your business plan serves as a benchmark for measuring your coffee shop’s performance over time, helping you track progress and make adjustments as needed to stay on track toward your goals.

The Outline of the Plan

Business concept: Briefly describe your coffee shop’s concept, theme, and atmosphere.

Target market: Identify your ideal customers and how your coffee shop will cater to their needs and preferences.

Unique selling proposition: Highlight what sets your coffee shop apart from competitors and why customers should choose your establishment.

Financial snapshot: Provide a brief overview of your projected revenue, expenses, and profitability for the first few years of operation.

Funding requirements: State the amount of funding you are seeking and how it will be utilized to launch and grow your coffee shop.

Company Description

Coffee shop concept: Provide a detailed description of your coffee shop’s theme, atmosphere, and overall vibe. Will it be a cozy, rustic retreat or a sleek, modern hub for remote workers?

Mission statement: Craft a compelling mission statement that encapsulates your coffee shop’s purpose, values, and commitment to customers and the community.

Core values: Outline the guiding principles that will shape your business decisions, customer service, and employee culture.

Management team: Introduce your coffee shop’s owners, managers, and key team members, highlighting their expertise, experience, and passion for the industry.

Location and facilities: Describe your chosen location, size of the establishment, seating capacity, and any unique features or amenities that will enhance the customer experience.

Target market: Provide a detailed profile of your ideal customers, including demographics, psychographics, and buying behaviors. Consider factors such as age, income, lifestyle, and coffee preferences.

Market trends: Identify current and emerging trends in the coffee industry, such as the growing demand for specialty coffee, sustainable sourcing, or mobile ordering and delivery.

Competitor analysis: Conduct a comprehensive analysis of your direct and indirect competitors, assessing their strengths, weaknesses, market share, and pricing strategies. Identify gaps in the market that your coffee shop can fill.

Market size and growth potential: Estimate the size of your local coffee market and its projected growth rate, based on industry reports, economic indicators, and demographic trends.

SWOT analysis: Perform a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis to evaluate your coffee shop’s internal and external factors that may impact its success.

Marketing plan: Innovative approaches to attract and retain customers, ensuring a steady flow of coffee enthusiasts through your doors.

Roadmap to success: A detailed timeline outlining key milestones and objectives from launch day through your first year of operation.

Management: Spotlight on your management team, showcasing their expertise and defining their pivotal roles in driving the business forward.

Long-Term Financial Outlook: Comprehensive 5-year financial projections, including revenue forecasts, expense breakdowns, and projected profitability, giving investors a clear picture of your coffee shop’s economic potential.

By using this outline as a starting point and adapting it to your needs, you’ll be well on your way to crafting a winning coffee shop business plan that will guide you through the exciting journey of bringing your dream to life.

When to Use a Coffee Shop Business Plan

Securing Financial Support: When approaching financial institutions for loans, applying for small business grants, or pitching brewed coffee itself to potential investors, your business plan is your golden ticket. It’s the tangible representation of your coffee shop’s potential, translating your vision into hard facts and figures that financial backers require.

Attracting Business Partners: If you’re looking to bring a partner on board, your business plan serves as a comprehensive overview of your venture, helping potential collaborators understand and buy into your vision.

Decision-Making Compass: Your business plan acts as a invaluable guide when facing tough choices. By forcing you to articulate every aspect of your business plans in detail, it helps eliminate grey areas and provides a clear framework for decision-making. This process of committing your ideas to paper often reveals insights and helps solidify your strategy.

Remember, a well-prepared coffee shop business plan isn’t just a document – it’s a powerful tool that can open doors, attract support, and steer your business towards success. Whether you’re presenting to stakeholders or refining your own strategy, your business plan is the foundation upon which your coffee shop dream will be built.

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Coffee Shop Business Plan Samples and Templates: Learning from Successful Examples

When crafting your coffee shop business plan, it’s essential to examine successful local establishments and identify the factors that contribute to their success. By studying their business model, strategies, and customer experience, you can gain valuable insights to incorporate into your own plan. To assist you in this process, we’ve gathered coffee shop business plan templates crafted by industry experts.

1. PandaDoc’s Coffee Shop Business Plan Template

PandaDoc offers a comprehensive coffee shop business plan template that serves as an excellent starting point for aspiring cafe or coffee shop or owners. This template provides a structured framework to help you organize your thoughts and present your business idea professionally. It covers all the essential sections of a business plan, including the executive summary, company description, market analysis, products and services, marketing strategy, financial projections, and more.

The template is customizable, allowing you to tailor it to your specific coffee shop concept. Whether you’re planning a cozy neighborhood cafe or a trendy specialty coffee bar, PandaDoc’s template can be adapted to suit your needs. It also includes helpful prompts and guidance throughout, making it easier for even first-time entrepreneurs to craft a compelling business plan.

Use PandaDoc’s template for your coffee shop

2. Venngage’s Coffee Shop Business Plan Template

Venngage offers a user-friendly and visually appealing coffee shop business plan template that’s perfect for entrepreneurs who want to create a professional-looking plan without design experience. This template provides a comprehensive framework for outlining your coffee shop concept, including sections for market research, operational procedures, location analysis, and financial projections.

Key features of Venngage’s template include:

Easy customization: The template is fully editable, allowing you to tailor it to your specific coffee shop vision.

Rich icon library: Access a variety of icon styles, including coffee-themed sets, to enhance your visual presentation.

Flexible design options: Easily adjust the layout, add pages, or extend dimensions to fit your content needs.

Multiple export formats: Download your plan as a PNG, HD PNG, or PDF, or embed it in emails for easy sharing with potential investors.

Real-time charts: Incorporate dynamic visuals to represent your financial projections and market data.

The template streamlines the process of creating a coffee shop business plan, helping you focus on content while ensuring a professional and visually engaging presentation. Whether you’re seeking investors or simply organizing your ideas, Venngage’s template offers a practical solution for crafting an impressive coffee shop business plan.

Use Venngage’s template for your coffee shop

3. Business in a Box’s Coffee Shop Business Plan Template

For aspiring coffee shop owners looking to make a strong impression on potential partners and investors, this professional yet creative Coffee Shop Business Plan Template offers a comprehensive solution. It is available for immediate download, allowing you to start working on your business plan right away and move one step closer to realizing your entrepreneurial dreams.

Key features of this template include:

Professional design: Utilizes standard business fonts and portrait orientation for a clean, authoritative look.

Comprehensive content: Includes detailed information sheets to guide you through all essential aspects of your business plan.

This template streamlines the process of creating a thorough, professional-looking business plan, helping you focus on articulating your unique vision while ensuring you cover all necessary details. By using this tool, you can save time and present your coffee shop concept with confidence, potentially giving your business proposal an edge in competitive situations.

Use Business in a Box’s template for your coffee shop

4. DojoBusiness’ Coffee Shop Business Plan Template

Elevate your coffee shop dreams with DojoBusiness’s comprehensive Coffee Shop Business Plan Template. This meticulously crafted document is your secret weapon in the competitive world of café entrepreneurship.

Key features of this powerhouse template include:

Comprehensive Coverage: Spanning 35 pages, this template leaves no aspect of your coffee shop business unexplored.

Expert-Crafted Content: The result of 80 hours of intensive research and analysis by the DojoBusiness team, ensuring you have access to the most current industry insights.

Funding-Ready: Specifically designed to meet the rigorous standards of potential investors and lenders, helping you make a compelling case for funding.

Fully Customizable: Tailor every section to reflect your unique vision and business model.

Cutting-Edge Strategies: Packed with proven techniques to help your coffee shop thrive in today’s market.

Regular Updates: Stay ahead of the curve with semester updates, keeping your plan aligned with the latest industry trends.

Expert Guidance: Benefit from free consultation with DojoBusiness experts, providing you with personalized advice to refine your plan.

Future-Proofed: Receive all future updates at no additional cost, ensuring your business plan remains relevant.

Whether you’re planning a quaint neighborhood café or a trendy specialty coffee bar, this template provides the robust foundation you need to turn your coffee shop vision into a well-planned, investment-worthy reality.

Use DojoBusiness’ template for your coffee shop

5. TouchBistro’s Coffee Shop Business Plan Template

Brew up success with TouchBistro’s Free Coffee Shop Business Plan Template – a robust tool designed to help aspiring café owners turn their existing coffee shop dreams into a well-structured reality. This template is more than just a document; it’s your first step toward creating a compelling case for your coffee shop venture.

Key features of this free template include:

User-Friendly Format: Compatible with both Microsoft Word and Apple Pages, making it accessible for users across different platforms.

Comprehensive Structure: The template covers 8 essential sections, providing a thorough framework for your business plan.

Customizable Content: Each section is fully editable, allowing you to infuse your unique vision and local market insights.

Guided Approach: Comes with helpful instructions and tips, making the planning process smoother even for first-time entrepreneurs.

Investor-Ready Design: Structured to address key points that potential investors look for, helping you make a strong impression.

Cost-Effective Solution: Offered completely free, allowing you to allocate your resources to other aspects of your startup.

Whether you’re planning a cozy neighborhood café, a bustling downtown coffee bar, or a specialty roastery, this template provides the flexibility to capture your unique business model. It’s designed to help you articulate your passion for coffee and food products while demonstrating a clear understanding of the business side of running a successful café.

Use TouchBistor’s template for your coffee shop

Bringing Your Coffee Shop Dreams to Life

Launching a successful coffee shop in 2024 requires careful planning and execution. By crafting a comprehensive business plan, you lay the foundation for a thriving venture that has a local customer base and stands out in a competitive market. Explore the intricacies of a business plan for a coffee roaster , covering essential aspects like strategic planning, market analysis, distinctive value propositions, and financial forecasts to ensure your coffee shop’s success.

Remember, a well-structured business plan is your roadmap to success. It helps you define your unique identity, understand your target audience, and secure the necessary funding to bring your vision to life.

Are you ready to turn your passion for coffee drinks into a profitable food service business?

Take the first step by downloading our free coffee shop business plan templates. Use it as a guide to develop your own personalized free business plan template, tailoring it to your specific goals and market conditions.

As you embark on this exciting journey, don’t hesitate to seek inspiration from successful coffee bars and shops in your area and beyond. Learn from their strategies, adapt their best practices, and create a coffee shop experience that truly resonates with your customers.

What unique twist other coffee shops will you bring to the coffee shop scene in 2024? Share your innovative ideas and let’s brew up a conversation!

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How Much It Costs To Own A New Cafe? (6 Countries?)

If you’re dreaming of opening a coffee shop the first questions you’re probably asking yourself are: How much does it cost to open a coffee shop?

There’s no hard and fast answer on how much it costs to start a coffee shop. Your costs will depend upon the type of coffee shop you want to open, the costs of retail space in your community and many other variables.

How Much It Costs To Start A Cafe In USA?

Here are some ranges for the costs of opening various types of coffee businesses in USA:

• Coffee kiosk: $60,000 to $100,000
• Mobile coffee food truck: $50,000 to $100,000
• Coffee shop with seating: $80,000 to $250,000
• Coffee shop with seating and drive-thru: $80,000 to $275,000

If you already own a suitable building or have a complementary business such as a bakery, your costs might be much lower. If you want to add a brew bar to your coffee shop, add about $5,500 to $20,000 to your initial costs. In addition to start-up costs, you should have cash on hand to cover all of your operating expenses for the first six months.

Read the full article from  www.crimsoncup.com

Start-up Cost To Own A New Cafe In UK?

The lowest amount you could probably get away with is £20k. A big coffee shop on the high street could easily cost you £50k and of course, you could spend even more if you want to.

These are just rough estimates and there will be many more things to spend your money on but we hope it gives you a rough idea.

• £2,500 – £10,000 for espresso equipment
• £1,000 – £2,500 for dishwashers
• £1,000 – £2,000 for flooring
• £500 – £2,000 for ceiling
• £100 – £500 for painting
• £500+ general building work
• £500 – £3,000 for AC
• £250 – £1,000 for crockery
• £250 – £2,000 for a till
• £500 – £1,500 for accountancy
• £500 – £2,000 for a solicitor
• £500 – £1,500 for insurance
• £1,000 – £3,000 for initial stock
• £100 – £2,000 for signs and marketing
• plus working capital, deposit, rent, rates, planning applications, change of use, professional advice etc etc

Read the full article from  www.howtostartacoffeeshop.co.uk

Starting Your Own Coffee Shop: Opening & Running a Successful Coffee Business

How much it costs to start a cafe in singapore.

To start a decent cafe in Singapore, we are looking at a minimum sum of S$120,000 to S$150,000. The amount can vary quite a bit depending on the scale of your cafe. Some cafe owners spent S$120,000 while there are others who pumped in more than S$250,000.

The odds are very much stacked against independents who do not have sufficient financial capital and liquidity, the proper experience of running an F&B establishment, bargaining power, as well as the right connections to sustain their businesses. Moreover, many new hipster cafes are too often more hype than substance by focusing too much on the aesthetics and miscellaneous furbishing instead of working on the more important factors like food and service.

Read the full article from  www.ladyironchef.com

A Cafe Startup cost In Malaysia

First things first, you have to be financially secure to start a cafe. Investing in a cafe business will cost you at least RM500,000 to RM600,000 to cover your location rental, deposit, labour costs, equipment and supplies, amongst many other things.

That’s not all. Competition in the cafe and F&B industry is quite high these days so the chances are, you may not be making a lot of money starting out.

Read the full article from  says.com

How to Start a Cafe Plus Business Plan

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How Much It Costs To Start A Cafe In Australia?

Starting up your business in Australia is a big investment, and needs to be taken very seriously. Besides the existing competitions between surrounding cafes (more than a thousand in Brisbane alone) and budgeting for land space, there are many more factors which can alter the cost needed.

That being said, all costs are still depending on individual cafes (as all cafes are special and unique), but the basic expenses are still more or less the same. To have a better overview, below is a list of main expenses, broken down to stages.

The total cost will round up to approximately 200k to 500k, so plan, plan, and plan again for your business!

Read the full article from  surpass.com.au

Start-up Costs For A Small Café In Japan

Here is the information to start a small cafe in Tokyo:

• 8-seater café in Meguro-ku with 2 staff, took 15,000,000 JPY in start-up costs (about $185,000 / £119,000). Monthly sales goal of 2,000,000 JPY ($25,000/£16,000), with current estimated sales at 680,000 JPY ($8,500/£5,300).
• Café with 20-seats in Setagaya-ku, 4 staff. 10,000,000 JPY cost at start-up ($125,000/ £79,000). Monthly sales goal 1,800,000 JPY ($22,600/£14,000), current estimated sales of 1,512,000 JPY ($19,000/£12,000).
• Café in Ishikawa prefecture with 28-seats and 2 staff took 8,000,000 JPY to get started ($100,000/ £63,000). No monthly goal stated, but current estimated sales of 600,000 JPY ($7,500/£4,700).

Read the full article from  alittleshopintokyo.blogspot.my

Think Twice Before Starting A Cafe

As you can see, there is no a fixed cost to start a new cafe but it is quite hard to own a cafe no matter where you are!

If you still consider starting a cafe business, we highly recommend you to read our article on  What You Need To Know To Start A Coffee Shop?

8 Things To Learn From John Letoto About WBC ?

Black Coffee ☕ Americano vs Long Black

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Moscow's culinary opportunities: How to open a restaurant

Having a nice family-style restaurant in the Russian capital with a flavor of your home country is a popular business option for many expats. But it’s not as easy as it might seem. Here are a few things to consider for potential restaurant-owners.

Thinking it through

First and foremost, one should make sure that owning a restaurant, even a small one, is really something you would like to do. As any kind of business, it takes a significant amount of time and money to manage and develop. “Success in public catering requires hard work, without weekends or holidays,” Ilias Iliadis, owner of Pita&Suvlaki Greek restaurant in Moscow, told Russia Beyond. “It is not as hard to open a place as running it.”

One will need to learn everything about every aspect of a business, from legal, fire and sanitary requirements to managing business partner relationships and hiring experienced staff. “There are many difficulties in this sphere, so you need to be totally in love with what you do to be successful,” says Radomir Krajinovic, owner of Serbian restaurant Optimist.

The number of national cuisine restaurants have grown in Moscow over the last few years.

Market trends

As we noted previously, the economic crisis had led to many Russians cutting back and, as a result, there has been a growth in interest in developing fast food outlets.

Yet, the general dynamic for restaurants is toward growth: According to Poster company 2017 review of trends in the restaurant business, healthy eating, vegetarian food, open kitchen format, craft beer, food trucks (mobile cafes), and regional cuisine are becoming more popular in Moscow. The number of restaurants and bars grow and they compete for custom by offering special deals and interesting dining formats.

“Over the last few years the number of national cuisine restaurants have grown,” says Krajinovic. ”Yes, the crisis has led to fewer people visiting us, but we are still doing well - we are opening a new restaurant soon.”

Iliadis’s venture is also experiencing growth: He opened his first café in city center in 2014 – now he has opened a second restaurant and a third one is on the way.

Of course, setting up a firm without back is impossible. “To open a small restaurant or a cafe one would need 5 million rubles ($87,160),” Vladimir Shalaev, a lawyer at BMS Law Firm, told Russia Beyond. Iliadis confirms this figure. “In our case it was a year before it paid off. Our small restaurant became popular quickly so we had to find a bigger place,” he adds.

“The biggest part of what you’ll need to pay is rent. It is very expensive here,” Krajinovic says. “Other things depend on what one wants. A home-style restaurant might require from seven to 10 million rubles of investment which will pay off in two years.”

Russian banks also offer business loans. “You need to have 30 percent of the necessary investment for the new project and the bank will cover the remaining 70 percent,” says Igor Glukhov, deputy director of Credit Department of RosEvroBank.

If you serve good food and your clients sense it, they will become regulars and inspectors will not come often if they don’t receive complaints.

Legal aspect

The procedure of setting up a legal entity is no different for a foreigner than for a Russian national. “You need to gather all necessary documents to register a firm: Passport, various papers, a receipt of registration fee payment; foreign citizens need to provide a certified passport translation as well,” Shalaev said.

Of course, just registering a company will not be enough. You need to get a license for selling alcohol, rent a place for your café, add it to the commercial register, then get all necessary permits from sanitary and fire inspections, as well arrange for garbage disposal, Shalaev added.

“The legal framework is very similar to that in Greece,” Iliadis says. “The Russian requirements gradually develop to European standards. Of course, like in Greece, there are still some outdated rules, such as having a separate room for peeling potatoes, but inspectors don't take it seriously. No one terrorizes you every day without reason. If you serve good food and your clients sense it, they will become regulars and inspectors will not come often if they don’t receive complaints.”

Krajinovic, who has been running his restaurant since 2012, agrees. “There are no problems. If you follow all the necessary requirements and use fresh products, no one will bother you asking for money,” he says. “A good thing here is that 3-4 months after starting a business you know how much tax you will need to pay, as opposed to Europe, where the percent might change. Here we pay 15-20 percent of our profits.”

How to open a farm in Russia if you're a foreigner

3 years of embargo in russia: the winners and losers, why foreigners can still line their pockets in russia, how a florentine is bringing italian cheese to russia’s far east, 13 bizarre (real) job offers that will make you move to russia.

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Restaurant Management Blog

How to Start a Spaza Shop in South Africa

Starting a spaza shop in South Africa can be a lucrative business opportunity, particularly in local townships where these small, informal convenience stores are deeply integrated into community life. Spaza shops, also known as tuck shops which originated in Apartheid-era South Africa, provide everyday essentials, such as groceries, snacks, cleaning products, and basic household items, often catering to the needs of lower-income areas.

This guide will outline the steps you need to take to establish a successful spaza shop in South Africa, including legal requirements, financing, location, stock management , and marketing strategies.

1. Understanding the Spaza Shop Business Model

Spaza shops in South Africa typically operate as small, informal stores. They are often located in residential areas, making them convenient for local consumers who may not have easy access to larger supermarkets. These shops are known for selling essential items like bread, milk, soap, and soft drinks, among others, in small quantities that are affordable for customers.

Historically, spaza shops have been family-run businesses, but more recently, they have become more structured, with owners aiming to professionalize their operations. The informal nature of the business means that starting a spaza shop does not always require a formal business plan, but having a clear strategy can help you maximize profits and sustain the business in the long term.

2. Create a Business Plan

Even though a spaza shop is often seen as an informal business, a simple business plan can help you clarify your goals, strategy, and target market. Your business plan should include:

• Startup costs: Estimate how much you need to get started. Include costs for stock, rent (if applicable), equipment, and initial marketing.
• Target market: Identify who your customers will be. Typically, spaza shops serve township residents, and your product selection should reflect their needs and preferences.
• Revenue projections: Estimate how much you expect to make in a month or a year. Include daily sales targets.
• Business model: Determine if you will run the shop from your own home, rent a space, or set up a mobile spaza shop.
• Marketing strategy: Outline how you will attract and retain customers.

3. Location and Shop Setup

Choosing the right location is critical to the success of a spaza shop. You want to be in a high-traffic area that is easily accessible to your target customers. Here are some options:

• Home-based setup: Many spaza shops operate out of homes in townships. If you have space at your home or in your yard, this could be a cost-effective option as you won’t need to pay rent.
• Leasing space: If you don’t have enough space at home, consider leasing a small shop in a busy area. Look for locations near schools, bus stops, or popular community centers.
• Mobile spaza shop: You can also operate a mobile spaza shop by using a vehicle or cart to move between different locations, catering to areas with less competition.

When setting up your shop:

• Ensure you have enough space to display your products neatly.
• Install shelves, refrigerators (if selling perishable goods), and secure storage for stock.
• Prioritize security with locks, gates, or alarm systems, especially if you are operating in a high-crime area.

4. Registering Your Business

While many spaza shops operate informally, formalizing your business can give you access to various benefits, such as government support, grants, and legal protection. Consider these steps:

• Business registration: Register your spaza shop with the Companies and Intellectual Property Commission (CIPC) to formalize your business. This will help you open a business bank account and access financial support.
• Licenses and permits: Depending on the municipality, you may need specific licenses to operate, especially if you plan to sell alcohol or tobacco. Check with your local government office for any zoning laws or permits required.
• SARS registration: Register your business with the South African Revenue Service (SARS) for tax purposes. Small businesses with a turnover below R1 million may qualify for tax relief.

5. Stock and Suppliers

Stock management is key to running a successful spaza shop. The items you sell should reflect the daily needs of your customers. Typical products include:

• Bread and bakery products
• Milk, butter, and other dairy products
• Soft drinks and juices
• Snacks and confectionery
• Toiletries like soap, toothpaste, and toilet paper
• Cleaning products like dish soap and washing powder
• Basic groceries like rice, flour, sugar, and cooking oil

Finding suppliers :

• Wholesale stores: Purchase your stock in bulk from wholesalers such as Makro, Devland Cash & Carry, and Jumbo Cash & Carry. This will allow you to benefit from lower prices and increase your profit margins.
• Local producers: Some spaza shops source stock from local farmers or bakeries, especially for fresh produce and bread.
• Distribution agreements: Build relationships with distributors of specific brands, who may offer credit terms or promotional discounts.

Stock management :

• Keep track of which items sell the fastest and ensure you always have enough stock on hand.
• Avoid overstocking perishable goods to reduce the risk of waste.
• Use a basic point-of-sale (POS) system or manual stock tracking system to monitor your inventory.

6. Financing Your Spaza Shop

Starting a spaza shop does not require a large capital investment, but you will need some money to get started. You can fund your spaza shop through:

• Personal savings: If you have saved money, this is the simplest way to finance your shop.
• Loans: You can approach banks, micro-lenders, or community credit organizations for small business loans. If you have registered your business, you may be eligible for government-backed funding.
• Stokvels: Community-based saving schemes known as stokvels are popular in South Africa. If you are part of a stokvel, you can use the pooled savings to start your business.
• Government grants: The Department of Small Business Development offers grants and support programs for informal traders and small businesses, including spaza shops. You can apply for assistance to help with startup costs, stock, or equipment.

7. Marketing Your Spaza Shop

Even in a township setting, marketing is essential to make sure your spaza shop stands out from the competition. Here are some low-cost ways to market your business:

• Word of mouth: Encourage your existing customers to spread the word about your shop. Offering excellent customer service and competitive prices can help build loyalty.
• Signage: Place a large, clear sign outside your shop with your shop name and what you sell. Bright colors and bold lettering will attract attention.
• Special offers: Offer promotions or discounts on popular products to attract customers. For example, you could offer a free soft drink with the purchase of certain groceries.
• Community involvement: Sponsor local events or sports teams, or offer to sell products at community gatherings to increase your visibility in the area.
• Social media: Even in informal settings, social media can be an effective tool. You can use platforms like WhatsApp to notify customers of promotions or new stock.

8. Managing Your Finances

Proper financial management will ensure the sustainability of your spaza shop. Here are a few tips:

• Keep financial records: Track your daily sales, expenses, and profits. This can be done manually in a cashbook or using a simple digital POS system.
• Separate personal and business finances: Open a business bank account to keep your personal and business finances separate. This will help you track your profits and losses more accurately.
• Reinvest profits: Use a portion of your profits to reinvest in your shop by expanding your product range, improving your premises, or buying new equipment.
• Budgeting: Prepare a monthly budget to manage your expenses, such as stock purchases, rent, and utilities. Having a budget helps ensure you don’t overspend.

9. Adapting to Market Needs

The success of your spaza shop will depend on your ability to adapt to changing market needs and competition. Stay updated on what your customers want and continuously seek ways to improve your offerings. This might include introducing mobile payment options like e-wallets or selling prepaid airtime and electricity, which are popular in South African townships.

Additionally, you should be aware of your competitors and their pricing strategies. Offering better service or slightly lower prices than your competitors can help you retain loyal customers.

10. Compliance and Legal Considerations

Although many spaza shops operate informally, there has been a push by the South African government to formalize these businesses. Complying with the legal requirements ensures you can operate without the risk of being shut down or fined:

• Health and safety regulations: Ensure your shop meets basic health and safety standards, especially if you sell food items.
• Tobacco and alcohol sales: If you plan to sell cigarettes or alcohol, you will need to obtain the necessary licenses from your local government.
• Local bylaws: Be aware of local municipal bylaws that may impact your business, such as trading hours and zoning restrictions.

Starting a spaza shop in South Africa can be a rewarding venture, both financially and socially. By selecting the right location, managing your stock carefully, and providing excellent customer service, you can build a sustainable business that supports your community. Taking steps to formalize your shop can open up new opportunities for growth and financing, and adapting to the needs of your customers will ensure long-term success.

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Money blog: How much should you spend on wedding gift? 'Annoyed' Britons give verdict in survey

The Money blog is your place for personal finance and consumer news. Scroll down to read about new research on how families with twins or triplets face are driven towards bankruptcy, PrettyLittleThing U-turning on its returns policy, and a survey on people's feelings about wedding gifts.

Wednesday 11 September 2024 19:24, UK

• UK economy flatlines for second month in a row
• Paul Kelso: Chancellor signals first budget will be painful
• 'I gave birth to triplets and it pushed me to brink of bankruptcy'
• How much should you spend on wedding gift? 'Annoyed' Britons give verdict

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• What is Labour's Renters Rights Bill - and will it end no-fault evictions?  
• Top chef shares cheap pasta recipe - and favourite budget eats in North East
• Student finance special: Best paying jobs after uni, cheapest cities for students, top discounts and freebies

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Wedding gift demands have been branded "cheeky", with a new survey finding a quarter of people think the amount spent on attending a wedding is enough of a gift already. 

The research, by greetings card marketplace Thortful, found almost half (48%) think the expectation of cost for many wedding gifts is "annoying". 

Other reasons those questioned were against wedding gifts are shown in this chart:

It comes as the cost of attending a wedding as a guest increased by 18% between 2022 and 2023 (from £883 on average to £1,045), with overnight stays and lavish hen and stag dos topping the list of expenses. 

The surveyr found millennials are the most generous, while Generation X think you should spend the least, with almost a third of them stating less than £30 is sufficient for newlyweds.

Twice as many men as women said they would spend big money (£100+) on wedding gifts, suggesting men are more generous when it comes to gifts (or they just have more money).  

For those who are open to wedding gifts, almost a quarter want to spend less than £30 for their friend's or relative's gift. 

The most popular response, of the survey of 1,000 people, was to spend between £31 and £70 on the happy couple, and this was pretty universal across all regional categories apart from Northern Ireland. 

Anyone hoping for a big spend on their wedding, just 3% said they would spend more than three digits, while two-fifth (20%) were unsure about how much to stump up.

'Can I have a Peloton bike please?'

Responding to the survey, Joshua Adams from Manchester said: "I feel like it's completely cheeky, they don't need these things and requesting them is slightly spoilt. People already spend a fortune on the stags or hens, travel to the wedding, accommodation, book days off work, get new clothes, then you turn up and they're like 'Can I have a Peloton bike please?'" 

He said the concept of a wedding gift is completely different to what it once was: "I think times have changed. Back in the '80s when our parents got married, they tended to do it at an earlier age and they genuinely didn't have anything because they were young. The idea of a wedding list then was to help a new couple get started in life." 

He said he has seen everything from air fryers to weekends away on the lists of weddings he has attended, as well as smaller, but "expensive" items, including cutlery and table settings. 

Eleanor Lewington from Selby said: "I was once given a John Lewis wedding gift list where the bride and groom had selected items from the store that they wanted and none of them were cheap! There was everything on there from kettle and toaster sets to televisions!" 

The Renters Reform Bill returned to the Commons today, five years and four prime ministers after it was first promised.

This time it's Labour's version - with the new party of government vowing to improve and complete the set of proposals the Tories pledged, then watered down and then abandoned altogether before the general election.

Now it is being called the Renters Rights Bill, and it aims to "decisively level the playing field between landlords and tenants", according to housing minister Matthew Pennycook.

So what will be in the legislation?

The bill is wide-ranging and includes the following changes:

• No-fault evictions banned:  Crucially, the legislation will include a blanket ban on no-fault evictions under Section 21 (S21) of the 1988 Housing Act. This allows landlords to evict tenants with two months' notice without providing a reason. Housing campaigners say they are a major contributing factor to rising homelessness.
• Awaab's Law extended: This was named after the toddler who died after exposure in his family's social rented home in Rochdale, Greater Manchester. It proposed that social landlords will have to investigate hazards within 14 days, fix them within a further seven, and make emergency repairs within 24 hours. Under the bill, this will be extended to the private sector to ensure all landlords speedily address hazards and make homes safe.
• Ban on mid-tenancy rent hikes:  It will also ban rent increases being written into contracts to prevent mid-tenancy hikes, leaving landlords only able to raise rent once a year at the market rate.
• Allowing pets:  Labour's reforms will also give tenants the strengthened right to request a pet, which landlords must consider and cannot unreasonably refuse
• Bidding wars crackdown: The reforms alsocrack down on bidding wars between potential tenants. Labour's bill will include a legal requirement for landlords and letting agents to publish the required rent for a property. Landlords and agents will be banned from "asking for, encouraging, or accepting any bids" above the publicly stated price.
• Tenancy reform:  The bill will remove fixed-term assured tenancies, which mean renters are obliged to pay rent regardless of whether a property is up-to-standard and prevent them from easily moving out in response to changing circumstances, such as a relationship breakdown or new job.
• Ban on benefit discrimination:  The bill will also outlaw landlords imposing a blanket ban on tenants receiving benefits or with children.

For more details on the changes - and whether campaigners think it goes far enough - read our comprehensive explainer here :  

By Sarah Taaffe-Maguire , business reporter

Thousands of workers being made redundant at Britain's biggest steelworks will receive at least £20,000 under government intervention to reduce the fallout from the closure of its blast furnaces.

As many as 2,800 jobs are to be lost, despite the previous government issuing £500m of funding. In return, the company would invest £750m.

Labour, which had expressed hope in opposition to reduce the number of redundancies, confirmed its intervention in government had failed to secure a rethink on the company's plans.

The last blast furnace currently used to produce steel is being closed and an electric arc furnace, which requires less labour, will be built to replace it.

The Tata Steel site in Port Talbot is the UK's single biggest source of CO2 emissions and its closure will reduce the UK's overall CO2 emissions by around 1.5%.

It is understood most job losses will have happened by Christmas, with the remaining redundancies taking place by March 2025.

The package was described by the government as the "most generous voluntary redundancy package ever for a restructure of this size" - read more here:

Mortgages are being used as a "weapon" by domestic abusers, plunging them into debt and homelessness, a charity has warned.

Survivors are left in arrears, with destroyed credit ratings and facing a lifetime of housing insecurity. 

One woman described how she remains in a "mortgage prison" - despite having left her former husband more than a decade ago.

"I can't sell the property without his permission and, at any point, he can use his position to stop me from making mortgage repayments by withholding child support payments. Me and my children remain trapped in a mortgage prison with no way out."

The charity Surviving Economic Abuse said that in general, perpetrators are refusing to pay their agreed share of the mortgage, agree to new terms or sell up.

More than 1,000 women across the UK who have had a joint mortgage in the past two years, surveyed by Opinium on behalf of the charity, were asked about whether they had experienced mortgage-related abuse from a current or ex-partner.

One in eight (12%) cited at least one aspect of abusive behaviour related to the mortgage from a partner or ex-partner.

More than three-quarters (78%) of those who experienced abuse felt unable to leave their partner or an unsafe living arrangement due to abuse through the joint mortgage.

Nearly half (49%) had to cut back on utilities or go without essentials, such as food, clothing or toiletries, to cover monthly mortgage repayments.

Sam Smethers, interim chief executive of Surviving Economic Abuse, said: "Mortgage abuse is a hidden crime that’s destroying the lives of hundreds of thousands of survivors.

"Survivors are doing everything they can to make ends meet - cutting back on food, turning off the heating, and borrowing money to keep up with repayments. But right now, banks are limited in what they can do to stop abusers from causing a lifetime of debt and homelessness for survivors."

Rachel Reeves has signalled her first budget as chancellor could be a painful mix of spending cuts, tax rises and increased borrowing.

Speaking to Sky News after official figures showed the economy flatlined in July with GDP growth of 0.0%, she refused to rule out increasing business and wealth taxes, or further cuts to already strained departmental budgets, as she seeks to address what she says is a dire economic inheritance from the last government.

"I've been really honest that there are difficult decisions to come in the budget, on spending, on taxation and welfare, after the mess that the previous government created with the public finances and the state that they are in, that was inevitable," she said.

"I was clear during the election campaign that, if I became chancellor of the exchequer, tough choices lie ahead."

Ms Reeves has ruled out increasing personal income taxes, National Insurance and VAT as well as corporation tax, leaving a limited field of other taxes on private wealth and business.

She said her choices in the budget would be directed at getting a grip on the public finances.

"It is important to bring stability back to our economy, but we will do that in a way that helps promote growth, so we can grow our economy and make our country better off," she said.

Read the rest of business correspondent Paul Kelso 's report here:

An Instagram competition by a fast fashion brand has been criticised for not making it clear someone had won, falling foul of the advertising watchdog.

An Instagram post by Nasty Gal, posted on 3 December 2023, featured a picture of Paris Hilton on the phone, with text stating "$1000 Cash. That's hot." 

The caption said "12 days of Christmas Giveaways. Day 3 of #Nasty12DaysofChristmas Win a $1000 CASH."

It outlined the terms, including tagging friends in the comments on the post. 

But there was no announcement of a winner, despite requests from Nasty Gal's followers for that information - with questions raised over whether the promotion had been administered fairly.

Nasty Gal Ltd said they had replied to the winner's comment on the post because they believed that announcing competition winners via the comments section was standard practice for influencers and those within the fashion industry on social media. 

They said the algorithm would mean it was "extremely likely" this comment would show up for their followers. They added that there was currently no guidance which stated that competition winners could not be announced via the comments section. 

But they have fallen foul after advertising rules after the ASA pointed out there were thousands of comments on the post, which it considered meant Instagram users were extremely unlikely to know that a winner had been announced without clicking into and looking at the comments section below the post. 

The algorithm, the ASA said, could not be relied upon to ensure Nasty Gal's comment was one of the top comments and therefore easily accessible to entrants. It said the fact users had commented asking about a winner also suggested this method was not sufficient.

The promotion breached CAP Code (Edition 12) rules, 8.2 (Promotional marketing) and 8.28.5 (Prize promotions).

Nasty Gal was told it could not run a competition again like this, unless it made clear a winner had been announced.

It's a busy morning for company announcements and plenty to watch out for on the markets.

The online property portal familiar to many looking for a new place to live, Rightmove, announced it had rejected a takeover bid from the Rupert Murdoch-owned Australian rival REA Group. The announcement was only good news for London Stock Exchange-listed Rightmove, which saw its share price rise 0.6%. 

Europe's largest airport Heathrow reported a record number of passengers in the summer months amid booming demand for travel as 7.97 million people flew to or from its terminals in August, the fourth consecutive month of record numbers. 

Travel demand was also good for business at WHSmith. The retailer reported its fast-growing UK and international travel business had sales growth of rise 10% over the year while the UK high street business fell 4%. 

Getting from A to B could become cheaper as the oil price remained low. For the first time since December 2021 a barrel of Brent crude, the international benchmark, slipped below $70. This morning there's only been a minor rise to $70.68 a barrel. 

After news of another month of a flatlining economy, there was little change in sterling with a pound buying nearly $1.31 - $1.309. Against the euro one pound equals €1.1839.

Heathrow has set a new monthly record for passenger numbers - and one billionaire pop star has been credited with helping. 

Nearly eight million people passed through Britain's biggest airport in August, with its busiest day seeing 269,000 passengers on the 18th of the month. 

The airport said Taylor Swift concerts brought in an additional 40,000 passengers this summer, with fans passing through its terminals for the European leg of her Eras Tour.

The star performed eight nights at Wembley and appeared in other cities on the continent. 

Heathrow said that more than 950,000 Pret coffees were sold at the airport across July and August.

It is on course to serve 30 million passengers between June and September, which would be the most for that period in the airport's history.

Spain, Greece, Italy and Turkey were popular summer holiday destinations last month.

Every Wednesday we ask top chefs to pick their favourite Cheap Eats where they live and when they cook at home. This week we speak to Nick Grieves, chef-owner of Ophelia  in Gosforth, Newcastle.

Hi Nick, can you tell us your favourite places around Newcastle where you can get a meal for two for less than £40?

Barrio Comida in Durham - I've been a long-time fan, the food there is incredible and worth the short train journey out of Newcastle. 

It's all class but I'd seriously recommend the birria tacos (with the consommé), camaron tacos and pollo quesadillas. Time it right for Taco Tuesday or for Happy Hour and you'll be well fed and watered for an absolute bargain.

Master Wang's in Newcastle - excellent, authentic and incredibly reasonable Chinese food just down from Haymarket in the centre of town. 

A friend of mine recently told me about it and now I'm there whenever I get a free afternoon. 

The pork dumplings in hot and sour soup, braised lamb noodles and their pork burger are all incredible and my go-to when ordering. I'd definitely recommend just ordering lots and sharing it between you.

What is your go-to cheap eat to cook at home when you have a night in?

It would most likely be a pasta dish, something fast and cheap with sausage, fresh tomatoes and a crumbly cheese such as Wensleydale.

During lockdown I posted a few at-home cooking videos on The Patricia's Instagram account - this was one of them and it's still up there on the highlights for a slightly more detailed walk-through.

You'll need some pasta (a small shape like fusilli, macaroni or orecchiette is ideal), a herby sausage like Lincolnshire, fresh cherry tomatoes, chilli flakes, garlic, Wensleydale and some fresh basil.

Start by crushing the garlic, halving the tomatoes, and removing the sausage from its casing and tearing it into small pieces. 

Fry the sausage pieces in oil until you get a light colour on one side, then stir and move it over to half the pan. 

In the other half of the pan, add the tomatoes, a bit of salt and some chilli flakes and fry it all for another five minutes or so.

Then lightly squash the tomatoes and combine them all, adding in your cooked pasta at the same time with a little pasta water to emulsify the sauce. Plate it up and top it with a good amount of torn fresh basil, thinly grated cheese and a drizzle of olive oil.

Super tasty, fast and cheap.

How did you get into cheffing?

I only started cooking seriously when I was 27 and took over The Garden House in Durham. 

Before that, I was in construction and although I always cooked at home I never thought it would turn into a profession. It all happened by accident. 

During the recession, the construction company I was working for in Qatar went bust. I came back to the North East and took on shared ownership of The Garden House with family and friends, just to make a bit of money.

We were pretty naive in the beginning and were short on kitchen staff, so I ended up helping with all the food and just fell in love with it. 

From there I taught myself a lot, watching and reading everything I could, including a lot of Ruth Rogers and Rose Gray.

After leaving the pub I headed to London and worked in both Fera and The River Cafe where I learnt a great deal, especially about discipline, attention to detail, the importance of good produce and how proper kitchens work. 

I loved my time there, but I'd always wanted to be my own boss and was desperate to open somewhere off my own back home in Newcastle. 

Fortunately, backed by my gran Pat, I was able to open The Patricia in Jesmond shortly after that - she's the reason I am where I am today. 

And then following on from the success of The Patricia I was then able to open my current restaurant, Ophelia, a French-inspired bistro in south Gosforth in Newcastle.

We've spoken to lots of top chefs - check out their cheap eats from around the country here...

The UK economy recorded no growth in July, according to official figures.

It's the second consecutive month of stagnation, the Office for National Statistics (ONS) said.

GDP - the measure of everything produced in the UK - flatlined in the weeks after the election of the Labour government.

But there's "longer-term strength" in the services sector, meaning there was growth over the last three months as a whole and 0.5% expansion in the three months up to July.

Commenting on the GDP figures, Liz McKeown, ONS director of economic statistics, says: "The economy recorded no growth for the second month running, though longer term strength in the services sector meant there was growth over the last three months as a whole.

"July's monthly services growth was led by computer programmers and health, which recovered from strike action in June. These gains were partially offset by falls for advertising companies, architects and engineers.

"Manufacturing fell, overall, with a particularly poor month for car and machinery firms, while construction also declined."

Chancellor Rachel Reeves says: "I am under no illusion about the scale of the challenge we face and I will be honest with the British people that change will not happen overnight.

"Two quarters of positive economic growth does not make up for fourteen years of stagnation.

"That is why we are taking the long-term decisions now to fix the foundations of our economy."

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