Coffee Shop Business Plan

Opportunity

Problem

People living near the University of Oregon require more than just coffee and tea. They need somewhere to sit, study, do research, and have quiet conversations. Although it is easy to find this near the University of Oregon campus now, it is too crowded too often and does not offer the right combination of elements for everyone.

Solution

Java Culture coffee shop is committed to becoming a daily necessity in the lives of local coffee addicts.

Market

Java Culture will concentrate its marketing efforts on University students and faculty. Our market research has shown that these are the best customer groups for gourmet coffee products. Because gourmet coffee consumption is common across all income groups and greatly depends on education level, it will be easy to get to the right customer audience by being near the University of Oregon campus.

Competition

Java Culture’s direct competition will be other coffee shops near the University of Oregon campus. These include Starbucks coffee shops, Cafe Roma, The UO Bookstore and other Food service establishments offering coffee.

Why Us?

Excellent coffee, pastries and additional tea options, friendly atmosphere, wireless internet, ample desk space, comfortable tables, pastries and good chairs, all in a convenient location near the university campus.

Expectations

Forecast

As shown below, we plan to grow as derived from our sales forecast. We want to maintain a 60% industry-standard gross profit margin and allow for reasonable operating costs, and to make reasonable profits in our second and third years.

Financial Highlights per Year

Finance is required

The owners will invest $140,000 and take out a bank loan for $30,000 to cover the start-up expenses and assets needed plus deficient spending in the early months.

Start-up costs of $27,000 include:

• Legal costs for obtaining licenses, permits, and accounting services total $1,300
• Marketing expenses for Java Culture’s grand opening were $3,500. Flyer printing was also done at $0.04 per print. The total cost of the event was $3,580.
• ABC Espresso Services received $3,000 in consultants fees for setting up the coffee bars.
• Coverage for general liability, workers’&#8217, compensation and property damage at a total premium $2,400
• Pre-paid rent expenses for one month at $1.76 per square feet in the total amount of $4,400.
• Remodeling premises for $10,000
• Other startup expenses include stationery ($500), phone and utility deposits ($2,500), and stationary ($500).

These expenses will be incurred prior to launch. They are included in our financial projections as a negative retained earnings of $27 680 at the month’s end. This number is shown in the balance sheet.

The start-up capital required for $143,000 includes:

• Cash in Bank in the Total Value of $67,000. This includes enough to cover owner and employee salaries of $23,900 for two months and cash reserves (approximately $14,400 per month).
• Initial inventory of $16,000 which includes:
  • Coffee beans (12 regular brand and five decaffeinated brands). #8211 $6,000
  • Coffee filters, baked goods, salads, sandwiches, tea, beverages, etc. – $7,900
  • Retail supplies (napkins, coffee bags, cleaning, etc.) – $1,840
  • Office supplies $287
• Equipment up to $60,000
  • Espresso machine – $6,000
  • Coffee maker $900
  • Coffee grinder &#8211: $200
  • Food service equipment (microwave, toasters, dishwasher, refrigerator, blender, etc.) – $18,000
  • Storage hardware (bins. Utensil rack. shelves. Food case.) #8211 $3,720
  • Counter area equipment (counter top, sink, ice machine, etc.) – $9,500
  • Flatware (plates/glasses, flatware and serving area equipment) #8211 $3,000
  • Store equipment (cash Register, security, ventilation. signage) #8211 $13,750
  • Office equipment (PC, fax/printer, phone, furniture, file cabinets) – $3,600
  • Other miscellaneous expenses – $500

Funding for the company comes from two major sources–owners’ investments and bank loans. Arthur Garfield, James Polk and $25,000 each have been the major shareholders. All other investors have contributed $40,000, which brings the total investments to $140,000. The $30,000 remaining to cover start-up expenses, assets and costs came from two bank loans: a $10,000 one-year loan and $20,000. long-term (20 years) loans. Both loans were secured through the Bank of America. Accordingly, total startup loss is estimated at $27,000

The balance sheet shows these amounts for the month that preceded opening. Paid in Capital appears as the $140,000 invested. The $27,000 expenses show up as negative retained earnings. There are assets and liabilities. This is all according to financial standards.