How Much Does it Cost to Open a Coffee Shop?

If you’re dreaming of opening a coffee shopCrimsonCup Ribbon 300x253 Is Owning a Coffee Shop Right for You?, the two questions you’re probably asking yourself are: How much does it cost to open a coffee shop? Do I need a coffee shop business plan?

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. 

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

  • 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

Costs are current as of September 2016.

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.

Here is a brief list of costs to consider when opening a coffee shop, and some recommended maximums:

  1. Rent and build-out costs for your chosen location. As a rule, rent should be no more than 15 percent of projected sales.
  2. Coffee Shop Equipment, including a top-of-the-line espresso machine, espresso and coffee grinders, blenders, gourmet drip coffee brewers, refrigerator, etc.
  3. Coffee, milk, chocolate, syrups and other drink ingredients as well as pastries, muffins and other baked goods, which should be no more than 40 percent of projected sales.
  4. Professional fees for architects, attorneys, accountants and business consultants.
  5. Payroll costs, including wages, benefits, payroll taxes, worker’s compensation and costs of payroll processing. As a rule of thumb, payroll costs should be 35 percent or less of sales.
  6. Principal and interest costs (if you plan to borrow money).
  7. Income taxes (usually about 35 percent of operating profit).
  8. Other expenses, including business insurance, supplies (napkins, stir sticks, porcelain cups, etc.), licenses and permits, office supplies, utilities, advertising, and repairs and maintenance.

You’ll find a more detailed discussion of coffee shop start-up costs, including an entire coffee shop business plan, in Seven Steps to Success in the Specialty Coffee Industry, written by Crimson Cup founder Greg Ubert.

Do you have more questions about how to start a coffee shop? We’re here to help!  Give us a call at 888-800-9224 or fill out this form, and we’ll get right back to you.

Since 1991, Crimson Cup Coffee & Tea has hand-roasted great-tasting specialty coffee in Columbus, Ohio. We’ve also taught more than 250 independent business owners how to open a coffee shop through our coffee shop franchise alternative program.  We were honored to be selected as the 2016 Roast Magazine Roaster of the Year.

Want to learn more about our wholesale coffee roasting programs for specialty grocerscolleges and universities and restaurants and food service operators? Give us a call at 888-800-9224 or fill out this form, and we’ll get right back to you!

 

7 Responses to How Much Does it Cost to Open a Coffee Shop?

  1. Bill Hemby says:

    How current are these numbers? Do you have market demographic information by regions?

  2. The Kray Kray Cafe says:

    We are going to be opening a stand in about 4 years from now, we are excited and are starting to save now! Hopefully some people reading this will come and see us in the future!! #kickass

  3. malou lozasa says:

    Hello I’m interested on opening a coffee shop here in jersey city, nj…. maybe you can guide me on opening a coffee shop. also I need a supplier of a good coffee and a rental equipment. thank you

    Regards
    Malou

  4. Jared Cisco says:

    My Wife and I are in the research portion of opening a small coffee shop in a small rural Missouri town. We moved here from Kansas City and couldn’t find a good cup of coffee, in turn we have decided to gather as much information as possible in order to be able to successful. This is a good website in order for us to start.

  5. Ivana Manzo says:

    Would it be wise to take a few business classes or management classes before attempting to open a coffee shop? Or would it be the same to start a business with out having taken classes as long as you have access to the resources to inform yourself on the subject matter?
    If classes are recommended, which classes specifically?
    If classes aren’t necessary do you recommend a website or books for reference?

  6. Tiffany Spencer says:

    Hi,
    My name is Tiffany. I am in the process of finishing up my business plan for a small coffee shop in a small farm town. I am just curious as to what your think my next steps should be.
    Thanks!
    Tiffany Spencer

    • Hello,
      Thank you for contacting us about your coffee shop business. We would be happy to speak with you about the next steps. Scott Fullerton will be the main support contact to help you through your business process. He can be reached at: sfullerton@crimsoncup.com.

      Yours in Coffee + Community

Comments are closed.