Coffee Kiosk Startup

[jnsellison]

I would really like some no nonsense comments on starting a Kiosk in a local Mall. There are four major department stores (Sears, Dillards, Maceys, and J.C. Penney), several smaller name-brand retail outlets, and a food court. However there is not a coffee outlet. There have been three attempts at a coffee related business in the past 15 years there but none were espresso based coffees, just brewed coffee sitting in a carafe, and none lasted more than a year.. The mall has good traffic and my location would be at the center hub of the mall. I plan to offer espresso based coffees along with a few other things. My space rent will run around 1.5k a month average. I plan to invest around 70K. I have calculated a profit margin of around 65%. I would like to know of similar operations, quantity of sales, difficulties, and any suggestions at all. Thanks, if all goes well I would like to open in March.

 

[Zimmy]

what is your profit margin calculated on?

General profit margin for the industry when you are not your own roaster is more along the lines of 10%... and thats if you're running an optimized shop...

COGs~35%
Tax~10%
Fixed cost/Payroll~45%
Profit Margin~10%

Keep in mind these are down the road numbers... You need to make it through the first year or two building your brand...

Sounds like it could be a great opportunity!

 

[jnsellison]

what is your profit margin calculated on? General profit margin for the industry when you are not your own roaster is more along the lines of 10%... and thats if you're running an optimized shop... COGs~35% Tax~10% Fixed cost/Payroll~45% Profit Margin~10% Keep in mind these are down the road numbers... You need to make it through the first year or two building your brand... Sounds like it could be a great opportunity!

Profit based on COGS at 35% product sale Fixed Cost i.e. rent, internet, insurance Labor operating business myself until established.