Business Gurus: I need some advice for starting up a coffee shop?

A guy I knew from work retired, and he put his entire retirement buyout savings into opening a sandwich/ coffee shop. He lost it all inside 6 months. It didn’t help that he rented a building right next to the BIGGEST STARBUCKS IN THE EAST BAY.

Borrowed from a recent and similar question:

“Here’s a 2005 sample coffee shop business plan. Actual costs will be much higher and the tax laws may be different, but this will give you a realistic idea
Intro:
If you are planning to open a coffee shop, the very first thing you need to do is write a business plan. This is useful in many ways: it will allow you time to consider all your options before committing as well as put down on paper your goals and ideas. But, most importantly it will provide an analysis of your idea and give you a clue as to whether it will be a viable business venture.

Below is a sample business plan for a fictional coffee shop. You may use this plan to formulate your own. Use your own objectives and revenue figures to work out your business plan.”
************
Here’s an article from 2011 Blookberg Businessweek entitled “Waking up to the Reality of Running a Coffee Shop.”

Intro:

“If your underlying business model is not financially sound, there’s little you can do to improve it. Dressing up a business plan—or even finding a great location—cannot save a business that simply won’t bring in enough revenue to cover expenses and turn a profit.”

I asked a few questions on this topic about a month ago, and got a ton of great responses. Due to the limitations of the iPod I’m on at the moment, I can’t really give you direct links, but you should be able to find them fairly easily on my profile. Good luck to you!

^^^See my link to your question in the answer above yours.

@filmfann That is insane! I’ll be sure to set up in a “pro small business town” that’s for sure.

Make a business plan. Don’t put any of your own money into it until you see if you can get someone else to fund it. If no one will put money in your plan, you know your plan isn’t much good. Believe that. Do not believe your blind faith in yourself.

Hi,
for opening a coffee shop first you have knowledge and proper place to open means shop should be at good place and proper sitting arrangement.

One of the reasons the coffee shop failed was it had a hard time opening. The city health people kept coming in to do inspections, and constantly changed the requirements for his opening. I think he had to change the counter 3 times! This was BEFORE he ever opened for business. By then, he had been paying rent and franchise fees for 3 months, not to mention the cost of all the improvements. He never had a chance.

I worked at a local coffee shop in my town for six years and believe me it’s not as easy as it seems but the experience with working there definitely helped me to learn how to run a business I would definitely suggest that you have some business experience in the coffee shop world before you open your new business and also dream big you can totally do it if you put your mind to it. I would recommend getting experience and learning about how to run a business. Business classes always cone in handy.

Learn how to count your costs and measure your margins. I come from an accounting background, so I tend to poo-poo the marketing classes on offer and suggest you learn some essential book keeping skills. I told clients, if you don’t measure it, you will have no idea where your money goes or be able to build on what brings it in. Know how much the cakes or muffins cost to produce (inclusive of labour cost, if you are paying someone to make them in-house or if you are making them yourself because you should never short-change yourself or your time.) Then, you work out what you will sell them for. You should know how many units of product you need to sell each day to break even. You need to know how to sell those products you are making a greater margin on so you can make a profit and for heavens sake, don’t make a slice of cake for $4.00 and sell it for $2.00. You have no idea how many times I have seen this or the equivalent there-of.