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  1. #1
    Junior Member
    Join Date
    Jul 2014
    Location
    Pasadena MD
    Posts
    5

    New Shop in Maryland Initial Planning your advice wanted.

    Hey All, I have just completed my 5th Afghan Deployment and I don't want to deploy again and i am thinking of opening up a small coffee shop and would appreciate some advice on any of the holes I am missing for start-up costs etc. I plan on purchasing most of my equipment used to keep start up costs way down. Yes,I know this is somewhat of a gamble but I would like success stories if you have them.
    I will have a expert Barista as my store manager.
    Can you please tell me your experiences and your pitfalls and what you would do different? What worked great?

    Est. Budget Below:

    Coffee/Pastry equipment. ~Price (from what i've seen off of used restaurant equipment sites).
    Espresso Machine 2-group $500-$1000 (Yes, I know they sell for waaaaay more new but has anyone had any luck starting a business with a used machine?)
    2-Coffee brewers/holders $300
    Bulk Coffee Grinder $300
    Espresso Grinder $300
    Upright Fridge $300
    Under cabinet fridge $300
    Pastry case $1500
    Ice maker/bin $1000
    Racks/storage $500
    Sinks $300
    Mugs/Wares $500
    Credit card machine $200
    Phone $50
    3 compartment sink $250
    Sound System $200
    Cash register $250
    Counter Top ~$2000
    Signs ~$1000
    = ~$10500

    I have friends that will do plumbing and electrical So I figure $2000 in material costs?
    Decor I plan on doing cost for around $3000 ( I have reclaimed fire code bricks I am using, etc) I will be doing the labor on this.

    That is ~$15050

    Rent will be ~ $1400-1500 a month x 3 months startup = $4500
    Labor cost will be mostly my family we will say 2x $8.00 an hour 10 hour days (does that sound right) + insurance ~$2 an hour on top = $10 an hour x 10 = $200 a day =$6,000.00/month x 3 months = $18,000
    Utilities = $500 a month x 3 = $1500
    = $39050
    + Advertising =~$3000 Start up
    =~$42,050

    +Start up product
    How much product do you estimate I would need for start up? Market = 150 customers a day?

    What else am I missing?
    How much can I expect to pay for licenses and inspections?


    Thanks All!
    Andy

  2. #2
    Senior Member
    Join Date
    Jan 2007
    Location
    Salt Lake City
    Posts
    1,021
    Andy,

    Thanks for your service, it's much appreciated. One of my best friends just retired after he put in his 20 years, most of which was over thereabouts and he vowed to never set foot there again. Sounds like a miserable place.

    So let's talk numbers...

    It looks like nobody has had the courtesy to tell you to save your money. So, "Save your money." Or at least save more money.
    Depending how much labor you/friend can do regarding plumbing, I would (conservatively) add $20 to $35K to your total number.

    A dirt cheap, used commercial espresso machine --- the kind that I would advise against even taking for free would be at least $3K. The Grinder and espresso machine (grinder being the single most important piece of equipment) are the heart and soul of the business. You can't be cheap, nor nickel and dime on those. There is a HUGE difference in quality of build, and the ability for the machine to produce consistent excellent espresso time after time in a machine that is $7K vs one that is $12K (for a 2 group). In the scheme of things a $6-$10K price difference for a better espresso machine is nickels and dimes. If your budget is that tight that you can't buy proper equipment, you need to save/create/find/borrow more money.

    I am sure that there are SBA Loans or equivalent for former military. Maybe there is something attached as a benefit to the GI bill.

    No reason to break down every price at this point, but What I will say is that if you try to find equipment at the prices you've listed, you will either A) Be woefully disappointed. B) End up with sh!tty equipment. C) Both

    Develop a clear and reasoned plan.
    Assess whether that plan is reasonable in the real world and not just in your head.
    Execute said plan.
    Evaluate. Adapt. Succeed.
    John Piquet
    caffe d'bolla
    Salt Lake City, UT
    caffedbolla.com

  3. #3
    Junior Member
    Join Date
    Jul 2014
    Location
    Pasadena MD
    Posts
    5
    Quote Originally Posted by John P View Post
    Andy,

    Thanks for your service, it's much appreciated. One of my best friends just retired after he put in his 20 years, most of which was over thereabouts and he vowed to never set foot there again. Sounds like a miserable place.

    So let's talk numbers...
    .
    John,
    a big thank you for your advice. I definitely have my concerns about used equipment. I see a slew of high end grinders and espresso makers, etc.. That many shops that went under and are liquidating. I very much like your suggestion about checking out the GI bill. I'll definitely start looking into that.

    What about anyone else? Any success or failure starting out with used equipment?

    Thanks!
    Andy

  4. #4
    Senior Member
    Join Date
    Jun 2014
    Location
    Hollywood Fl
    Posts
    380
    An average coffee shop build out cost is around $150k to $500k including equipment. Not saying it can not be done for less BUT this is the average. Hope this helps.
    Great coffee does not just happen!
    South Florida Artisan Coffee Roaster

  5. #5
    Senior Member
    Join Date
    Jan 2007
    Location
    Salt Lake City
    Posts
    1,021
    Andy,

    It's not necessarily whether it's used or not, but what make/model, WHO used it, and was is maintained properly?
    I always caution people to not get caught up with the romance of owning a coffee shop. Undercapitalization will kill you.

    Also 150 ppl a day is not realistic in the beginning... not without a busy area and effective use of PR and Marketing.

    Take your time. Keep asking questions. Do it right.
    John Piquet
    caffe d'bolla
    Salt Lake City, UT
    caffedbolla.com

  6. #6
    Senior Member
    Join Date
    Jun 2014
    Location
    Hollywood Fl
    Posts
    380
    Quote Originally Posted by John P View Post
    Andy,

    It's not necessarily whether it's used or not, but what make/model, WHO used it, and was is maintained properly?
    I always caution people to not get caught up with the romance of owning a coffee shop. Undercapitalization will kill you.

    Also 150 ppl a day is not realistic in the beginning... not without a busy area and effective use of PR and Marketing.

    Take your time. Keep asking questions. Do it right.

    +1 well stated John P
    Great coffee does not just happen!
    South Florida Artisan Coffee Roaster

  7. #7
    Junior Member
    Join Date
    Jul 2014
    Location
    Pasadena MD
    Posts
    5
    Ok got your ideas on machines...it probably pays in the long run to go with known quality machines/equipment rather then gamble with equipment of unknown quality/condition.
    What about product? How often do you order product? How much did you order for start-up? Obviously, one can adjust but i would love to get your experences.

    My location has great pedestrian traffic, shops, small chain restraunts and large outside seating with a population that likes to do so. Not to mention a thirst for a good coffee shop, with none in the area. I would think 80-150 a day would be very doable. Most surrounding shops have much more then that. My model has a break even of around 70 ppl a day.
    Thanks,
    CoffeeMD

  8. #8
    Member
    Join Date
    Apr 2012
    Posts
    37
    My question to everyone out there is how do you know your location is going to be good? Assess the town and block your on? How do you check how the proximity of other places
    How do you market and advertise?
    I don't own a shop, I am wholesaling but always thinking about it. And actually I have had customers ask me to take over part of their operations.
    But my two cents...
    From what I see, people who frequent coffee shops want to know that its good and special and that has to be said with the equipment, staff, layout and hopefully the coffee. You can't look mom and pop, naive or desperate. I say learn all you can talking to salesmen while shopping for equipment and looking at other places. If your location is really good you could maybe afford leasing equipment if you haven't happened on some good clean stuff.

  9. #9
    Senior Member
    Join Date
    May 2013
    Location
    Port Republic, MD
    Posts
    180
    CoffeeMD,I am recently retired, 25 years Navy. Thanks for your service! I am a roaster located in MD, but don't own a shop. Perhaps we should talk about product if you get to that point. This isn't a sales call, but there may be synergy, and always happy to talk to and work with fellow vets.Freeman

  10. #10
    Junior Member
    Join Date
    Jul 2014
    Location
    Pasadena MD
    Posts
    5
    Bardo/Freeman,
    thank you for your offer. I have been talking to wholesalers and I am definitely intreated. I'm prior Marine Corps so I hope you won't hold that against me . I'll send you a pm with my contact info.
    Thanks!
    Andy
    Quote Originally Posted by Bardo View Post
    CoffeeMD,I am recently retired, 25 years Navy. Thanks for your service! I am a roaster located in MD, but don't own a shop. Perhaps we should talk about product if you get to that point. This isn't a sales call, but there may be synergy, and always happy to talk to and work with fellow vets.Freeman

 

 
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