How to Start a Coffee Shop Business Successfully
How to Start a Coffee Shop Business Successfully
Coffee Shop Startups
The Ultimate Step-by-Step Coffee Shop Guide
This is the best time to start a coffee shop.
With 210 million daily coffee drinkers in the United States and two billion cups consumed worldwide, the American and global markets point to a solid retail coffee future.
Whether you want to start a coffee truck business, open a drive-thru coffee stand, or a brick-and-mortar coffee shop, you will likely find coffee lovers in your community who would visit your business. After all, the world runs on coffee!
Starting a coffee shop requires thoughtful research, planning, attention to detail, and dedication to providing the best customer experience.
Today’s post will explain what to consider as you start your coffee shop business journey, helpful tips, and frequently asked questions.
Laying The Ground Work
Prepare to Start a Coffee Shop
As you formulate your thoughts about your coffee business, you will want to let these competing coffee shop concepts merge into a single vision. This vision will help you develop your action plan.
Here are a few critical recommendations as you set out to start a coffee shop:
Do Your Research.
When we start anything for the first time, we “don’t know what we don’t know.”
Dedicate to learn as much knowledge as possible about opening a coffee business. You can do this in different ways. For example, you may work as a barista or train as a coffee roaster for a coffee shop. You may have experience in other relevant backgrounds, such as accounting, finance, marketing, or food service – that are all helpful in operating a coffee shop.
Successful coffee shop owners come from every walk of life – so don’t fret if you are not a barista champion or a seasoned coffee roaster! Chances are that your personal and professional experiences have likely prepared you to start your journey.
Consider exploring our coffee business blog for relevant topics and purchasing our Complete Coffee Shop Startups Kit. It is a complete coffee shop business course, with one-on-one interviews with experts and business owners, multiple guides, worksheets, and resources.
Write a Coffee Shop Business Plan
Business plans can effectively bring your thoughts and ideas in sync with your vision, budget, and resources.
Your coffee shop business plan is your road map, built to help you reach your ultimate goal: a successful and profitable coffee shop.
A business plan is also essential for two crucial outside stakeholders: Lenders and property managers. Both will likely require a business plan before they enter into any financial arrangement with you.
Your plan should outline your coffee shop concept, target market, budget (costs), branding, income projections, and more.
Consider the Costs
Your specific coffee shop concept, menu, location, and vision will likely determine your costs. We discuss this in greater detail in our article, How Much Does a Coffee Shop Cost?
Still, there are specific elements that make up much of the costs of a coffee shop that you should be aware of.
Coffee shop costs are impacted by the following:
- Your Concept
- Coffee Shop Menu
- Coffee Shop Equipment
- Build out Costs
- Legal and Administrative Fees
- Contract work and Labor
Determine Your Budget & Funding Mix
After understanding your concept, location, menu, and coffee equipment needed, you’ll want to put this together in a budget. It is recommended to write down every possible expense and put them into categories to help you keep track of all your anticipated expense areas.
- Be honest with yourself about the numbers
- Diligently write everything down
- Keep your “budget” updated
- Determine where you will get the money from
Coffee Shop Permit and License Requirements
Every city, county, and state will have its requirements for coffee shops, restaurants, and other businesses. Before you open, you will need to get various permits and licenses for your coffee shop. You’ll want to research your specific requirements for your region to obtain the permits you’ll need.
Agencies and departments essential to your opening:
- County or city health department
- State or county buildings department
- County or city fire department
- State, city, and county business licensing
- Secretary of State Business Formation
- IRS (EIN)
Your Business Structure
When starting a coffee shop, you’ll have several options to form your business. From a sole proprietor to a limited liability company (LLC) to a corporation, you have choices to set up your business legally.
You’ll want to research which type of business formation will work best for you. From our experience, many independent coffee shop owners have found that establishing their coffee shop as an LLC has many benefits.
What to do:
- Determine the best business formation for you
- Contact your state’s Secretary of State’s office
- Register your business
- Apply for an EIN
Three Ways to Open a Coffee Shop
Starting a coffee shop, mobile, or drive-thru coffee stand business is a great way to make money and earn a living.
Three main ways to start a coffee shop:
- Start a coffee shop from scratch.
- Invest in a coffee shop franchise.
- Buy an existing coffee shop.
Today’s article will guide you through the steps to open your coffee shop from scratch. But we’re not going to pull any punches. Starting a coffee shop will take knowledge, determination, and hard work – and we’re here to help you with that.
Coffee Shop Startups
Steps to Start a Coffee Shop Business:
- Determine Your Concept & Vision
- Develop Your Menu
- Write a Business Plan
- Build a Coffee Shop Budget
- Create a Funding Mix
- Establish Your Business Structure
- Determine Your Competitive Advantage
- Create Your Coffee Shop Brand
- Determine Your Target Market
- Understand Your Health & Buildings Department Regulations
- Choose an Excellent Coffee Shop Location
- Purchase Your Coffee Equipment
- Explore Wholesale Coffee Roasters, Vendors and Partners
- Analyze the competition
- Get Your Permits & Licenses
- Hire Amazing Baristas
- Promote Your Coffee Shop
Determine Your Concept & Vision
Developing your coffee shop concept is where you turn your ideas into action. Your coffee shop concept is a universal idea that combines all essential elements.
These elements include:
- Vision & mission
- Menu offerings
- Your Unique Selling Point (USP)
- Location and space
- Customer experience
Your coffee shop’s concept centers on the experience you want your customers to have when they walk through your doors.
A few questions might help you develop your concept:
- What kind of experience would you like to provide your coffee customers?
- What kind of products would you like to offer?
- What location would be most accessible to the customers I’m trying to reach?
Whether you are starting your coffee shop on a shoestring budget or you have ample funds, determining your vision, menu offering, unique selling point, location, and customer experience can cost little, if any, money.
Build Your Coffee Shop Menu
Your coffee shop menu will be the foundation of your business planning.
Without your menu, you won’t be able to determine your coffee equipment needs, estimated budget, physical space requirements, target market, and, thus, your geographic location.
Spend some time developing your coffee shop menu. For starters, visit potential vendors (For example, bakeries and wholesale sandwich vendors). It’s also good to see what your competitors serve and how customers respond to their menus.
While coffee might be your central focus, other essential products (and money-makers) will play an important role in expanding your average ticket price. This may include beer, wine, and hot food.
Planning early is critical because your menu can boost your coffee business’s startup costs, increase scrutiny from the health department, and require a more specialized space. These costs are offset by the potential to generate more sales and significant revenue with likely higher-margin food items.
Time Saver: Our Complete Coffee Shop Startups Kit has a Coffee Shop Menu Concept Worksheet to help you develop your menu.
Write a Coffee Shop Business Plan
Your coffee shop business plan will serve as your road map. It will help lay out your vision and mission for yourself and other important stakeholders.
Business plans can be a powerful tool to help secure your funding through lenders and provide your future property manager with the necessary information.
Consider your business plan an opportunity to shine and strengthen your thoughts and ideas so that others can understand and believe in your vision.
No doubt, your coffee shop business plan helps to connect all the dots – from your financial goals to your financial needs and everything in between.
Sections of a business plan:
- Your Executive Summary
- Concept, Vision, and Mission
- Business Structure Details
- Budget and Funding
- Coffee Shop Menu
- Net Income Projections
- Permits and Licensing Issues
- Branding and Marketing
Time Saver: Our Complete Coffee Shop Startup Kit provides an easy-to-use business plan template and guide.
Build a Coffee Shop Budget
How will you estimate your coffee shop startup costs?
Creating a coffee shop cost analysis – or a document that documents your costs will be necessary. These would include your initial startup costs, materials for your build-out, contract work design and layout, coffee shop equipment, barista training, and other operational expenses, such as inventory, labor, and utilities.
I recommend building your menu, considering potential equipment needs, and considering location costs when developing your budget. Once you have these elements, you can build your overall coffee shop budget.
Be honest with yourself and confront the anticipated costs directly. If you have a solid business plan and an excellent way to execute it, you will have a better chance to secure the money to start your coffee business.
Looking at Your Coffee Shop Startup Costs:
When you start a coffee shop, the numbers will vary. Some coffee business consultants will give you a range of coffee shop startup costs:
- Coffee Cart/Kiosk: $5,000 – $55,000
- Mobile Coffee Unit: $15,000 – $85,000
- Coffee Drive-Thru Stand: $20,000 – $150,000
As you can see, a coffee business can cost anywhere from $15,000 to $250,000. That’s a broad spectrum of costs, but your costs depend on what kind of coffee business you want and what’s on the menu.
Once you determine your overall coffee shop budget, you can create your coffee shop funding mix. Your funding mix will break down the funding sources that will be made available to you.
Further coffee business reading: Understanding the Costs of Your Coffee Shop (Explained).
Your Coffee Shop Funding Mix
When developing your coffee shop budget, put everything on the table and figure out the total costs of getting up and running.
You’ll determine where you will get the money from this funding mix. If you plan to fully or partially fund your business, start by figuring out how much you must invest personally. This means considering how much capital you need to borrow and/or save.
Establish Your Coffee Business Structure
The official start of your business begins when you first establish your coffee business as a legal entity with your state.
A legal business structure, like an LLC, is an important step that will help protect your assets and establish essential business elements, including your bank account, taxes, worker’s compensation, liability, commercial auto insurance, etc.
Finding the best structure that works for you, your business, and your locality will be essential to consider early.
Many coffee shop businesses in the U.S. and Canada often establish themselves as LLCs. However, others are set up as corporations and partnerships.
Consider reviewing what business structure works best for you and the type of coffee business you set up. This entails examining your tax obligations, obligations to maintain your business entity, controlling funds, and liabilities.
In most states, creating your coffee shop business structure is usually done through your state’s Secretary of State office. Some states have other designated departments.
Determine Your Competitive Advantage
What makes your coffee business unique?
Your competitive advantage will separate you from the rest of the competition and answer the question: Why do your customers choose to buy from your coffee shop rather than the competition?
Your competitive advantage is your North Star. It helps guide your priorities, training, branding, customer service, and marketing.
Your competitive advantage – or Unique Selling Proposition – plays to your strength and what your target market cares about.
Capture the essence of that difference, write it down in your business plan, and develop a barista training program around it.
Focusing and training to fulfill your competitive advantage will help you strengthen your position in your marketplace.
Create Your Coffee Shop’s Brand
Branding your coffee shop business is fun and essential to generating value for your coffee business.
As consumers, we all have some understanding of what a brand is. We are likely seasoned shoppers; we know what brands we like and those we don’t.
From the concept, colors, logo, and slogan, your branding will play a vital role in the perception of value your customers will have and the connection they feel about your business.
Whether you want to set up a coffee shop, drive-thru espresso stand, or a mobile coffee trailer, spend time and thoughtfully cultivate your coffee shop brand.
Determine Your Target Market
Every successful business solves a problem – even coffee shops. Believe it or not, you are solving someone’s problem with coffee.
To come up with your target market, first, you must understand the problem and who you are solving it for.
Are your customers going to be:
- Students waiting for the bus?
- Commuters on their way to work?
- Lunchtime casual coffee drinkers?
Knowing your target market requires you to do a little research and understand the traits and needs of your customers. Sometimes, this means understanding the demographics of your target coffee drinker with a specific geographic location.
Learn about your customers:
- What is their income level?
- Are they students or professionals?
- What mode of transportation do they depend on?
Knowing your target market helps you with your entire effort and aligns your competitive advantage to better position your coffee shop, drives sales, and creates effective marketing.
Know Your Health Department Regulations
Every coffee business will fall under the jurisdiction of one health department’s rules and regulations.
All coffee businesses require health department permits to operate legally. Your local health department will be a prominent agency signing off on your coffee shop’s readiness for business.
It would help if you determined your contact within your local health department. Start early and decide what you need to do to meet their requirements.
Most health department agencies want you to succeed and will work with you, but you’ll need to do your part and understand what is required for your business.
Time Saver: Our Complete Coffee Shop Startup Kit offers an informative look at one of the nation’s seasoned health departments. It’s worth listening to as it will allow you to think about the essential steps to addressing your health department’s permitting.
Choose an Excellent Coffee Shop Location
Your coffee shop location will maximize your potential success or disable it. Your coffee shop location is critical for the following:
- Customer accessibility
- Sales and repeat business
- Customer convenience
Choose a location with high visibility, easy accessibility, and close to your target market.
As you would imagine, you need to start early with this part of your coffee shop business plan and evaluate the best coffee shop location for your business.
Consider exploring multiple coffee shop locations in the general area where you wish to do business. Find out where your competitors might be. Talk to neighboring residents and businesses. Determine the traffic flow of the area. Look at other “anchor” businesses, living spaces, and organizations like other restaurants, apartment buildings, dorm rooms, colleges, and office buildings.
In addition to looking at possible coffee shop locations, have a written business plan so you can readily give your plan and proposal to the property manager.
Coffee Shop Property Lease
You found the perfect coffee shop location, but the lease may ruin your business.
A good property lease may help promote your business and be an element that leads to your success. A poor lease, on the other hand, can pile up the challenges and cost you much more in the long run.
Signing a multi-year property lease that could cost you tens of thousands of dollars can be intimidating. Therefore, preparing for your coffee shop property lease and understanding more than the basics is essential.
If you need help, get help with your lease.
Our Complete Coffee Shop Startup Kit offers a great discussion on your coffee shop property lease and location. It is highly recommended that you listen to it before looking for a lease to sign.
How to Choose Your Coffee Equipment
Your coffee equipment needs will depend on your menu, concept, budget, space, and health department regulations.
To first determine your menu needs, consider asking the following questions:
- Who is your target market?
- What food or beverages does your target customer want?
- Will you serve breakfast, lunch, snacks, or alcohol?
In addition to determining what food and products you will sell, your sales volume will play a big role in the size, brand, and model of your coffee shop equipment. For example, you may want a three-group espresso machine or two separate two-group espresso machines for high-volume coffee shops.
Consider estimating your future sales before buying your coffee equipment.
Having the wrong equipment will cost you more money in the short-run (and long-run) and lead to lost sales if your coffee equipment cannot handle the sales volume you may get.
Example of coffee equipment:
- Espresso machine
- Ice machine
- Toaster oven
- POS System
- Coffee roaster (If you will roast your beans)
Pro Tip: When you open a coffee shop, you will want to use NSF-labeled items to ensure commercial grade.
Additionally, there are many other pieces of coffee-related equipment, supplies, and fixtures you may need to get and/or build out before you can open and serve your menu. These may include your electrical system, plumbing, and your physical coffee bar, seating, and other elements of your space. You will want to plan and budget for those items.
Time Saver: *Our Complete Coffee Shop Startup Kit contains an excellent hour-long discussion on coffee equipment you want to hear before you buy your coffee equipment.
For more information on coffee shop equipment, please read our post, Coffee Shop Equipment You Need to Start a Coffee Shop.
Explore Local Coffee Roasters
The quality of coffee matters.
You likely want to sell the best coffee possible when opening a coffee shop. Therefore, choosing where and how you get your coffee will be essential to success.
If you opened a wine shop, you would not aspire to sell mediocre wine, would you?
Make it a priority to learn about serving excellent coffee and the coffee roasting process and appreciate the effort that goes into developing delicious coffee taste profiles and blends. In time, you’ll choose a wholesale coffee roaster that appeals to your tastes and favorable vendor terms.
Roasting Your Own Coffee Beans
You can either roast your coffee beans or select a roaster to deliver their coffee to you.
While roasting your coffee beans can save you significant money in the long run, you probably already know that roasting your beans will take up much of your time and will require extra financial capital, including cash for a coffee roaster, equipment installation, and the administrative effort to coordinate purchases and deliveries of green beans.
If you buy your beans wholesale from an existing coffee roaster, I recommend approaching local coffee roasters early in your coffee shop business planning process. It will also be fun and exciting to speak to passionate coffee roasters, exploring different blends and how their coffee would fit into your menu, concept, and brand.
Many coffee roasters will offer a free “coffee cupping” for you to sample their coffee. I recommend visiting several local coffee roasters and attending their cuppings.
Feel free to reach out to local coffee roasters. Ask them to provide their wholesale cost of a coffee per pound and what type of support they could offer you if you served their coffee.
Analyze the Coffee Shop Competition
Your coffee shop will likely have competition from other local businesses. This is not necessarily bad, as competition often drives businesses to improve.
However, knowing what competition exists in your market and how you will respond to it is essential – and vital to act upon. For starters, you will want to determine the experience other coffee shops provide, what menu items they serve, and how they serve it. You’ll also want to devise a plan to beat the local coffee shop competition.
You will want to analyze the competition before you choose a location and while you are open.
Consider asking yourself:
- Where will your coffee shop fit within the marketplace?
- How will your competitive advantage stack up against the competition?
- Can you compete on your product quality or service?
- How can I adapt to better compete and drive sales up?
Good coffee shop management includes making decisions that improve your competitive advantage and increase sales and customer retention.
Know Your Local Laws, Regulations, Zoning Permits
The city and county you are in will provide the framework for your coffee shop operations. Getting in touch with them early and determining their specific regulations is essential.
Taxes, employment regulations, health and building codes, and other coffee shop requirements can all be impacted by where you decide to set up your coffee shop.
If you live in an urban area where many local cities and counties are smashed together (and it is difficult to tell where the borders are), a slight change in location – from one street block to another – can dramatically impact your coffee shop startup costs.
Many business districts within a city can also impose additional regulations to promote a cohesive shopping experience. You should just be aware of these. Your taxes can also be impacted. Undoubtedly, some retail businesses fail to collect the correct percentage of taxes only to be hit with a considerable expense.
You want to look at these issues before settling on a specific location.
Understanding your local laws and obligations will be essential before you set out to open a coffee shop.
Coffee Shop Permits and Licensing
Before you open your coffee shop, you will need various licenses and permits from multiple departments to operate legally.
Different elements will determine the permits and licenses you need to open your coffee shop. These include your business concept, location, menu, and power needs.
Permits and licenses from your buildings, health, and fire departments (occupancy) will be needed.
Permits and Licenses Required:
- Health Department Permit
- Buildings Department Approval
- Fire Department Occupancy
- Fire Department Fire Suppression Units
- State Business License
- City Business License
- LLC or Business Structure Certificate
- Liquor License (If applicable)
- Food Handler’s Permit
- Reseller’s Permit
For a more in-depth look at the coffee shop licenses needed for your coffee shop, read our post, Permits, and Licenses You Need to Open a Coffee Shop.
Coffee Shop Design & Layout
Your priority may be to create a welcoming environment for your customers to sit and enjoy your coffee and menu items. Your coffee shop design and layout will impact your customer’s mood, energy, and overall experience. However, it also affects your efficiency, workflow, and safety.
Your coffee shop design and layout are intertwined with your central concept’s goal: defining your customers’ experience.
Design your layout to maximize comfort, ease of sitting, and efficient workflow. Every location and every space is different, so prioritize safety, understanding the regulations, and fulfilling your permit requirements.
Hire Amazing Baristas
Your baristas will be the face of your coffee business, so the hiring process is essential.
Use the process to weed out poor candidates or those without the skills you seek.
A barista training program for your new hires (and established baristas) is essential. Barista training allows your staff to be their best, improve their skills, and deliver a consistently good cup of coffee. Training also improves morale, reduces turnover, and creates a healthier work environment.
Hire your coffee shop staff for:
- Having People Skills
You can always train and educate your staff on how to serve coffee, implement quality control mechanisms, and serve your menu items with care. However, you can’t train for good attitudes, honesty, or reliability, and therefore, your hiring decisions are critical to your ultimate coffee shop success.
Promote Your Coffee Shop Like Crazy
Promoting your coffee shop and building greater awareness of your new coffee business is critical to getting off to a great start.
Consider having a marketing and coffee shop promotion plan that starts with your coffee shop’s grand opening. A coffee shop grand opening aims to create excitement and a social buzz about your new coffee shop. It also provides you the opportunity to meet your future customers.
Ultimately, coffee shops are about community. Having a grand opening and developing a marketing and promotional strategy that builds trust, improves your brand, and generates sales will be paramount.
You may want to develop connections with local school businesses and promote your coffee shop with local blogs, newspapers, social media, and your website.
Other Essential Steps to Starting a Coffee Shop
Choose a POS System
Every coffee shop needs a POS system and a modern-day cash register, like the Square POS system. Having a reliable coffee shop POS system is essential for your business transactions.
Your Coffee Shop POS system can either make your life easier (with accounting or inventory management), or it can slowly bleed your bottom line.
You may decide based on your choice of accounting software, ease of use and implementation, or fees associated with every transaction. Like the other recommendations, it’s always best to start early.
We recommend Square POS.
Open a Business Bank Account Early
Combining your business funds with your personal money isn’t a good idea. Commingling money is frowned upon by the IRS.
Make your life easier at the beginning of your coffee shop planning by establishing your business bank account early.
Separating your business money from your money has its advantages. Come tax time, this will help ease the accounting headaches.
Before opening your bank account, you must establish your business structure and obtain an EIN, which you may have to apply separately at the time of your business formation.
Setup Your Coffee Business Website
It’s been said that if your business doesn’t exist online, it doesn’t exist. Sometimes, this is true for coffee shops.
At the very least, your coffee shop website will be advantageous for affirming your coffee brand and sharing your story with your customers.
And unlike social media sites, you ultimately control the website’s content, look, and feel. You can also utilize your website to strengthen and defend your coffee brand when necessary, sell merchandise, and provide vital information such as menu, phone number, address, and more.
For more information about having your coffee shop website, read How to Setup Your Coffee Shop Website.
Create a Timeline To Open Your Coffee Shop
Develop a timeline for starting your coffee shop development. A timeline will help propel you to create your coffee business more effectively and efficiently.
We recommend setting an end goal (or date) and working backward.
Create a realistic time frame with periodic benchmarks. Balance your timeline by placing a little pressure on yourself, but not so much that you get overwhelmed and paralyzed.
Start small, but start.
Get Insurance For Your Coffee Shop
Every coffee shop needs insurance. You want to protect your coffee shop business and your employees. This means having general liability and workers’ comp insurance, among others.
Determine what coffee shop insurance you’ll need and get it immediately. You will likely need worker’s compensation insurance in every state. This will satisfy your state’s requirements and protect you and your business assets from a potential accident.
Avoiding accidents will be important through hiring competent people, training, and developing best practices, but “accidents do happen,” so insurance is a must-have.
Ask an insurance agent in your city to help you determine what suits you and your café (for general liability insurance), and check with your state’s Worker’s Comp agency.
Strive for Excellence
As you open a coffee shop, continuously look for ways to improve. Always strive for excellence, whether with providing a higher level of service, improved coffee, menu items, service, or ambiance.
Listen to your customers and employees and be willing to adapt to fit your customers’ needs. By prioritizing excellence, refining your competitive advantage, and always looking for ways to be responsive, you’ll position your coffee shop for lasting success and profitability.
Start a Coffee Shop Business Checklist
Starting a coffee shop business requires many elements to work together.
Here at Coffee Shop Startups, we provide additional blog resources to help you start your coffee shop business planning.
Whether you want to start a bookstore cafe, drive-thru espresso stand, or mobile coffee business, the essential topics for new and aspiring coffee business owners are always published or updated in our Kit.
Our Complete Coffee Shop Startup Kit comes with exclusive and important audio interviews – packed with knowledge and wisdom for everyone.
Are You Ready to Start Your Coffee Shop Journey?
What’s the Next Step?
Once you decide to move forward with greater purpose, you’ll likely want to know what’s next.
Each of you starts from a different background and place in your life.
First, you’ll want to set yourself on the course of learning all you can about starting a business.
- Work every day towards your goal
- Research as much as possible before you start
- Get the help you need
- Get our affordable Complete Coffee Shop Startups Kit (Saves You Time, Money, Avoid Big Mistakes)
Steps to Open a Coffee Shop
Frequently Asked Questions
How much does a coffee shop cost?
A coffee shop’s cost depends on your business concept, menu, and location.
For example, a drive-thru coffee stand might cost less than a full coffee bar. A bakery & café may cost much more than a small mobile coffee business.
Critical factors like your geographic location, real estate market, labor cost, etc., significantly affect your coffee shop business’s cost.
Traditional Coffee Shop Business Startup Costs
- Small coffee shop with seating: $40,000 to $200,000
- Large coffee shop with seating: $75,000 to $350,000
- Franchise coffee shop: $100,00 to $350,000
- Café & Bakery: $120,000 to $350,000
- Coffee Shop Bookstore: $80,000 to $250,00
We discuss coffee shop startup costs in greater detail:
- How Much Does It Cost to Open a Coffee Shop?
- How to Start a Coffee Shop on a Budget
- Low-Cost Coffee Shop Ideas
What are the requirements to start a coffee shop?
Each city and agency will have business regulations and steps you’ll need to follow and take, including the appropriate licenses and permits you need to obtain before opening.
A list of local agencies may include your health department, buildings department, licensing department, and fire department. Your requirements will be based on the type of coffee shop business you’ll have, your menu, and other essential factors.
Despite the differences between states, counties, and cities, there are often standard requirements to start a coffee shop from one jurisdiction to the next. We’ve covered this important topic in our post, Requirements to Start a Coffee Shop.
Should I structure my coffee shop as an LLC?
We don’t give legal or investment advice. However, we can say that it is common for many independent coffee shops to form an LLC. This is because there are many benefits to having an LLC.
You should research and determine which structure works best for you.
Establishing your business structure will depend on several important factors specific to you, your investors, your business concept, your growth strategy, and taxes.
How much money can I make by opening a coffee shop?
How long your coffee shop turns a profit depends on several important factors, including your total coffee shop startup costs, your operational costs, and your total revenue.
Determining how much money your coffee shop will make is essential to your business planning and should be estimated early.
Your menu, anticipated pricing, sales volume, and costs impact how much revenue your coffee shop will make. Creating strategies to improve your coffee shop profits is an ongoing challenge for coffee shop owners.
For a more in-depth post, please read aagallery.id How Much Do Coffee Shop Owners Make?
Should Invest in a Coffee Shop Franchise?
One way to open a coffee shop is by becoming part of a franchise. This business model is standard for many industries, including restaurants and coffee shops. If starting your independent coffee shop may be too difficult to muster, but you still want to own your own business, then a coffee shop may be one option.
A coffee shop franchise with a well-established brand, proven menu, and operational guidance – may be appealing. Like others, a franchise can have its pros and cons. Determining whether a specific coffee shop franchise will work for you will require research, careful budgeting, and planning.
Should I buy an existing coffee shop?
Buying an existing coffee business is another way to start a coffee shop.
Buying an existing coffee business offers advantages and disadvantages, like opting into a franchise or starting a new coffee shop from scratch. Which option you choose always depends on your current situation, access to funds, timing, and management abilities.
Buying an existing coffee shop can be one of the fastest ways to enter the retail coffee scene and start making money. But you inherit the potential for pitfalls, such as lackluster sales, debt, past tax obligations, and poor branding and goodwill within a community.
Indeed, starting any business from the ground up takes much work, time, and money. Finding a suitable location, negotiating a lease, spending thousands on a build-out, and going through the permitting process can be a big hassle.
Yet, even the most promising coffee shops may be riddled with baggage (financial obligations, legal matters, and a poor reputation). Buying an existing business may also cost more as business owners want to maximize their profit and cash out.
Depending on the coffee shop, buying an existing coffee business might be a good deal. However, it’s essential to consider all the pros and cons and decide based on what works best for you.
Are You Ready To Get Started?
Unlock Your Dream Coffee Shop Business with Our Exclusive Coffee Shop Startups Kit!
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