Average start of cost?

Strawberry78

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Aug 14, 2004
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Approximately how much is it to start up a coffee house? I'm thinking of 900 SQFT, no drive thru.
Thanks.
 

drrule

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Aug 13, 2004
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????

MMMM

Thats a tough question.

Starbucks spends about 320k to get a new one going.

I am currently consulting with a party that is opening with aprox. 800 sq. ft. Not including the building we should be able to keep there cost under the 60k mark. Of course, they are buying good equiptment, but they are skimping on furniture. A very casual setting w/ used furniture.
They have very little modification needed on the inside as well.

If I can help more drop me an email or give me a call,

Jason Rule
drruley@yahoo.com
 
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Strawberry78

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Thanks

Thanks for the help. I was calculating last night that it shouldn't be any more than $50, 000 but i'm sure you'd know more than i do since don't have any experience in it.
 

Coffee Guy

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Oct 19, 2003
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My first bit of advise would be to hire a qualified consultant that can help you with many of your questions. Rather it be our company or another. My reason for saying so is if you plan on having a successful business, stop beating around the bush and invest properly in the beginning. Sure you can always get others opinions on what you should do, however, investing in a good consultant can lead you in the right direction without a bunch of guess work. It's a great benefit to have someone working with you from the start to the opening. Additionally, you can also employ them to put on training that will be valuable to your business, as well as on going consulting throughout the life of your business.

As for the cost of equipping a sit down type of operation, and 900 sqft is going to be quite a bit more than the 50K you are looking to spend. Actually you can erect a drive thru for about that cost. But keep in mind that the overhead to run a sit down shop is at least double than that of a drive thru. A few examples would include, the rent, the furnishings, dishes, display areas, utilities, multiple coolers, more equipment, and more supplies. And we haven't even addressed the cost for architectual drawings and permits. Things can add up pretty quickly and they do. If you are going to do this business it's best to invest wisely, and not go into things half way.

Just my two cents for what it's worth... :wink:
 
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Strawberry78

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Hi Coffeeguy,
Thanks for the advice. You are right that things can add up pretty quickly. There were many things that i forgot to calculate into the total that i realized i needed to.
 

janie1963

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Mar 8, 2004
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speaking from trial and error experience...you'll need at least twice as much $ as you'll estimate(gotta have $$$$ to fund expenses before you see the sales to support the business) and it'll take 4 times as long as you think it will to get started.

Good luck to you and don't let the bad days discourage you....I've been open 2 weeks and it's been like a rollercoaster for sure!!!
 
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Strawberry78

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Thanks Janie. I hope your business is running smoothly. We are planning to look for a location before the end of March. We are actually moving to Canada to open this coffee house. We are thinking of moving sometime between Nov and Mar. I honestly don't think it'll cost more than $70,000. My inlaws opened a fast food restaurant that needed more expensive equipment for that price. But i know what you mean when you say everything will be not like i predicted it to be. My father in law has opened 3 restaurants in his life and this 3rd one he has now has run successfully for 14 years. He has given me some words of advice that i know i'll need and that was one of them...the unpredicability of costs and timing.
 

Chelle

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Sep 14, 2004
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Interesting $$$ thoughts....I am working on my drive thru business plan and I've gotten numbers closer to 80k-100k maybe more with a cushion...Am I way high?? 8'x20' building with a double drive thru, serving coffee, espresso treats, smoothies and a few baked goods.
 

janie1963

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My building is 8x16-my husband did all the construction( other than hiring an electrician to wire it) and I can't imagine having spent $80,000. Ours is a double drive thru, handicapped accessible restroom, etc. We also had to pour concrete and have a lot of gravel hauled in and leveled. If you add in equipment, signage and start up inventory, we were still under $20,000 for everything. I do, however wish someone had advised me on how much of a cushion I'd need. I guess the bright side is that we've started a business without financing any of it.
Thats not to say I won't soon need a loan to keep it going until we get the sales to support the monthly cost of doing business . Anyone have any advice on that---I've got the business loan application, but need some help with putting together a loss/profit for 12 months or so.
 

Chelle

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Sep 14, 2004
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Wow janie....that's impressive. I guess were budgeting a considerable amount for a great location, and not sure if we should if its worth it to ground lease high traffic location??

Any comments on other ways to decrease start up costs??? Sure would make it much more feasible if I could get it down about 30k :?
 

Coffee Guy

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janie1963 I applaud you for what you have done to get your business up and running. How long did you research this business before you knew it was the right time to start? I think it's great that your husband was able to build a state and L&I approved building. I think it's equally impressive that you were able to accomplish all of this including (new?) equipment and opening inventory etc. for $20K. Did that also include permits, etc.? And are you hard plumbed? May I ask if you have a prime location? If so, depending on your traffic count, your business may be able to support itself within a year or so. Also alot would depend on how much competion you have in your immediate area. That's amazing! You have a great story, I wish you a lot of luck :) And for those who may not be as fortunate to be able to pony up that kind of money, I would advise them to continue to do the ground work themselves and learn as much as possible as I'm sure janie1963 did before entering the business. Or if you find yourself still unsure, I would still advise contacting an experienced consultant in this industry that can help you. After all it is a business expense that can be written into your business plan. If you decide to go that route, interview them to be sure they are qualified. Nothing worse than hiring some "Joe Schmo" selling snake oil promises like books and tapes and you do nothing but sit them on the shelf to collect dust. :twisted:
 

janie1963

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Mar 8, 2004
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All new equipment and we are hard plumbed. It's a great little building and we thought it was a great location (hopefully will still prove to be), but we are having a tough time getting people off the hwy...they are in "auto pilot" mode on the way to and from work. It will take a while-we're in an area where people don't adapt to change too easily.

Now I need to vent: started with 4 employees and am now down to 2. The first to go was more of a relief than anything. The 2nd is the one I've tried to please the most....adjusting to her college and child care schedules, etc. Today she tells me that she was offered a temporary position with a former employer and they need her immediately. Shes doing this at the worst possible time-another employee also starts classes Monday. I told her that I understand taking advantage of an offer of more $$$. And I let her know she is leaving me in a bad situation...NO notice, no time to hire and train another. I really wanted to be able to take more time to hire and not have to be in a position of desperation. I need at least 2 weeks to train as I'll never hire anyone with coffee experience again. This is the same employee who brought up the idea to have Spiderman make an appearance-assured me that her brother said he'd do it "no problem". Her brother decided to go to the fair. She then said she'd do it, though not without complaint. Well, tomorrow is our Spiderman day and she had to leave early today because her son was sick...how much would you bet she calls in sick tomorrow and I have to be Spiderman!? Did I mention the migrain I've had for 6 days?

I certainly would never wish to discourage anyone, however I will agree with Coffee Guy-seek a qualified consultant and ask exactly what you can expect from every aspect of the business. I knew I'd encounter problems with employees, I just didn't expect to be hit so hard in the first month. And you know what really irks me? I've been so nice, flexible and giving to them, I've provided a safe and friendly and fun work environment.
What should I say to her tomorrow? I really want to let her know how unhappy I am, but I'm so stressed out that I know everything would come out wrong.

Sorry so much whining!
 

Chelle

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Sep 14, 2004
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janie...if I'm close enoughI'll come help you :) I don't think I can play spiderman though...I can imiagine your frustration...Good luck!
We are looking at a location just off the highway with a very high traffic count. I am considering using my marketing budget for a great sign and a billboard near the exits. Great attention getter for for your "autopilots". Can be a litttle costly depending on size, length of time. Around here about $1500/month, but well worth the exposure. Maybe you could get a BB company to give you a discounted "trial" offer....just a thought
 

Coffee Guy

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Oct 19, 2003
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Seattle,Washington USA
Hey janie1963:

Everything sounds great except your location. That's one of the most important parts of this business. As the old saying goes, "The three most important things to look for in a business is...location, location, location." And that is very true.

I feel your pain :evil: Unfortunately when screening new employees in this business, a lot will depend on how well you can read people. It's easy for the prospective employee to be at their best behavior during an interview and tell you what you want to hear. Then later come up with every excuse in the world not to perform. A long time ago we developed a pre-interview test and give it to each applicant that wishes to be considered for an interview. After they take this test we review it and let them know if they are granted an interview. During our interviews we ask the usual drink prep questions, in addition to their personal life type questions including if they attend school, have children, etc. this gives us a better idea of the accountability and availability. We also ask questions of their trustworthliness. Remember this is a cash business and it's not rocket science, and a lot of your employees depend on tips more than their salary. If they are getting good tips, they are more liable to stick around and not look for something else. But an owner also has to be the one to call the shots and not let the employee hold them hostage by not showing up to work or flaking out when they are needed the most. All of these things we usually cover during our interviews. And we give them a probation period. If they don't pan out, we have to let them go. Always accept applications and keep them on file even if you don't hire that person right then, you never know if you might need them to fill in part time or offer them a full time position in the furute. You know it's not too late in your case to seek the help of a consultant.[/b][/i]
 
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