It’s been a few decades since Starbucks emerged from Seattle to take over the world and made a coffee shop on every corner the norm. As a result, the way Americans drink coffee has changed drastically. This has also created a window for entrepreneurs looking to start a business. While the big coffee chains have expanded, so have specialty, independently run shops. According to an article in the New York Times, Americans drink less coffee today than we did in the 1930s, but we’re drinking higher quality, better-brewed cups. As such, many entrepreneurs are wondering how to start a coffee shop to serve their own high-quality brews.
How to open a coffee shop in 7 steps
Wondering how to start a coffee shop of your own? These seven steps will take you through everything you need to know.
Step 1: Decide whether you want to open your own shop, a franchise, or buy an existing business.
When it comes to starting a business you usually have at least two ways to go about doing it, and with coffee shops, you’ve got three.
When it comes to how to open a coffee shop you can do one of the following:
Completely start from scratch and open your own shop
Open a coffee shop franchise
Buy an existing coffee shop that’s for sale
Each of the options has its pros and cons and varying degrees of work required by you. If you choose to open a franchise you’ll be bound by many of the aspects of that franchise like the beans they use and the decor of the actual shop. If you buy another coffee shop you might have less construction to do to set up the space as a coffee shop. These options come with limitations as well. Once you determine which one you want to do, you can move on to the next step, which is coming up with a business plan.
Step 2: Create a business plan.
A well-thought-out business plan is key to creating any business, and a coffee shop is no exception. If you want to open a coffee shop, you probably already have a love of good coffee. To create a successful coffee shop you have to decide how you’ll get other people to love coffee as much as you do. A business plan will help get your ideas focused and in one place. Besides the basics of what your coffee shop will be and the products you’ll sell, a business plan also includes a marketing and sales plan, as well as financial projections.
An important consideration you’ll need to take care of in the early stages, and that you’ll include in your business plan, is to decide on the business structure you want your company to operate as. There are several business entity options you can choose, including a sole proprietorship, LLC, C-corp, and more—and the entity you choose will have both tax and legal implications for your business. It’s always a good idea to seek the advice of a business attorney when making these big decisions as you start your coffee shop. if you choose to open a franchise, you might already have a business entity that you have to use.
While creating your business plan, you’ll have to come up with a name for your business and an idea of where you want to open your coffee shop. Once you find the perfect location be sure to add it to your business plan, it might happen before or after you’ve written the plan.
You’ll also want to outline the pricing of your products, what goods you want to offer, the type of coffee shop you want to have (sit-down, drive-through), and more. It’s a lot to think about, but a business plan is where you can get all of these plans down in one place. Beyond that, if you’ll need outside capital to make your coffee shop dreams a reality, you’ll need to provide a business plan for funding consideration. Luckily, there are several options for business loans for a cafe, and whether you’re looking for funding to start your coffee shop or want to leave the option open for expansion down the road, having a solid business plan from the start will make the process easier.
Step 3: Find the right location.
This step can not be glossed over and you should take your time and consideration when completing it. The location of your coffee shop can make or break it in terms of success. There are some things to look for when looking for a coffee shop location.
Coffee shop location considerations:
Size: You want to make sure enough people can fit in the space without feeling cramped. Coffee shops are relaxing areas where people tend to hang out with friends or colleagues and you want the space to be accommodating.
Accessibility: Make sure your cafe is accessible and anyone can enter.
Parking: Will you be dependent on foot traffic? If not you’re going to want to make sure there’s somewhere for your customers to park either a lot or street parking nearby. If biking is popular in your area, consider adding a bike rack.
Seating: Will customers be limited to seating indoors or is there some outdoor seating you could set up when the weather is right for it?
Rent: This should be one of your top considerations when deciding on a location. How much a business location will cost you is going to be a significant chunk of your budget and you should be sure to include this in your business plan.
Step 4: Register your business and get the proper licenses and permits.
The city or county where you plan to open your coffee shop will dictate the specifics of registering your business, what taxes you’ll be responsible for, any necessary licenses and permits, and more. The details of registering a business vary from state to state, but you will need to apply for an employer identification number (EIN) and establish your business structure before you can start the registration process.
You also need to make sure that since you’ll be serving coffee, and most likely some food, that you have the right business licenses and permits for that, as well. Usually, health licenses and permits are necessary for serving food. Other types of business licenses include building, zoning, and land-use permits. Be sure you consult with your local business resources so you have the proper documentation in place before you open your coffee shop.
Step 5: Find suppliers.
Customers are looking for a quality experience when they come into your coffee shop. That means quality ingredients and coffee, but also quality service and experience.
While it’s tough to produce the same quality every time, this is crucial in the coffee business, especially in a time when people are becoming more knowledgeable about specialty coffee. Having consistent and quality providers, from the beans to cups and everything else customers interact with can help keep your coffee shop running smoothly and customer experiences consistent.
When you’re first starting your coffee business, don’t be afraid to spend the necessary time finding the right coffee supplier for your business. Though if you’re starting a franchise, they’ll take care of this step for you by having their specific grounds. You may have to try a lot to find the right one that will work for the products you want to offer, at the right price, with the perfect taste.
The other way to create consistency is by training employees extensively. If you want patrons to walk past all the other coffee shops on the block and go into yours, you need to offer consistent quality.
Step 6: Create a warm, inviting environment.
A coffee shop is never just about a good cup of coffee. Many people frequent coffee shops as a place to do work, catch up with friends, or to take a break from the workday.
You want your coffee shop to have a warm and inviting atmosphere that’s conducive to meetings, relaxing, and chit chat, but also one that’s easy to keep clean and orderly. When choosing how to design the shop, be sure to take into account how many people you want the shop to fit and the kind of atmosphere you’re looking to create for them all.
Remember when we were talking about the location of your shop? Here’s where that comes in because the location can only do so much work for you. The work you do to design the cafe on the inside will also greatly matter. You’re creating an entire atmosphere that also serves a purpose.
Step 7: Adopt a good inventory system.
Pay attention to your inventory. At first, you won’t really know how much you need when it comes to things like beans and baked good, you probably won’t even know how many cups you need a day. So track these things carefully at first so you can get a good handle on how much you’re using.
There are a number of inventory management apps available to small business owners who need a way to manage their inventory and budget. Some point of sale systems also offer inventory management, which is something you might want to consider when choosing one. There are specific coffee shop POS systems out there to consider. No matter what you choose, you want to make sure you have a way to manage what you need for your business so you don’t run out of customer favorites or over-order on what you don’t need.
How much does it cost to open a coffee shop?
We’ve gone over many of the expenses you’ll face when opening a coffee shop. The rent of the location, everything for the interior design, the machinery, the supplies like beans and cups, employees and more will all add up. Some of these things may cost far more than you’re expecting them too, a good espresso machine along can run you up $20,000.
In all you can expect that opening a coffee shop will likely cost you upward of $200,000 when all is said and done. This goes for some franchises as well, Dunkin’ for example, requires that you have $250,000 in liquid assets to start a franchise with them. You could consider starting smaller, with a coffee cart or a small pop-up location if you’re unsure of the cost or if you don’t want to dive in headfirst. But know that none of these options will be cheap or require no money up front.
The bottom line
Running a small business is no easy feat, but for all of those coffee enthusiasts who have dreamed of opening a cafe of their own, now might be the time. Consumption and interest in the specialty coffee culture has increased steadily in recent years and doesn’t seem to be stopping any time soon. While competition from bigger chains might have been a problem at one time, modern consumers prefer to support local neighborhood shops—especially if they’re offering what the big chains can’t. So if you’ve been wondering how to start a coffee shop, start thinking about the above steps to see if this is a feasible business venture for you.
This article originally appeared on JustBusiness, a subsidiary of NerdWallet.
How to Kick-Start Your Online Clothing Resale Gig
With the recent rise of resale apps like Depop and Poshmark, the idea of selling old clothes online is becoming more fashionable. Many people have turned clothing resale into a lucrative side gig or even a full-time job, gaining thousands of followers and making dozens of sales per week.
The secondhand-clothing market is projected to more than triple by 2030, according to a 2021 study by reselling platform Mercari and research firm GlobalData, as more fashion enthusiasts clean out their closets and search thrift stores to find valuable pieces to resell.
But whether you have a collection of band T-shirts or office attire, finding success on these platforms takes time and effort. Before diving into your closet, there are a few things to know.
You set your prices
Unlike consignment and resale shops, you can price items yourself on an online platform. Before listing a piece of clothing, look it up on multiple platforms to find out what it’s currently selling for. Depending on age, condition and brand, prices can vary widely.
You can also take advantage of direct messaging to negotiate with buyers and use features on apps like Depop and Poshmark that let you accept offers and create multi-item discounts.
“Sales can be sporadic,” says Andres Castillo of Los Angeles, who sells rare designer pieces through Depop, eBay and Instagram under the name Debonair Vintage. With rare or high-value items, it may take a while to find the right buyer, especially if you’re looking to break even or make a profit.
There’s a big time commitment
“I treat [reselling clothes] like my job,” says Eve Perez, a full-time student in Lebanon, Pennsylvania, who sells under the name Fitsfinesse and was featured in Teen Vogue in 2021 for her Depop success. She responds to messages daily, on top of taking product photos, sewing custom pieces, and packaging and shipping orders.
Communicating clearly with first-time buyers is essential: “If you don’t build that relationship, then you won’t get sales and returning customers,” she adds.
Although you have control over the prices, reselling online takes much more time and energy than selling to consignment stores. According to Depop, sellers who list consistently — around 15 items per week — sell more over time.
“It takes a lot of time and dedication,” says Castillo. Top-notch sellers have to learn to take eye-catching photos, understand shipping rates, negotiate over text, and research brands and trends to make the most of their inventory.
Overhead costs add up
Yes, you can set your prices — but there are a few overhead costs to factor in. Online resale platforms charge commission fees, plus additional fees for shipping through the platform or accepting payments through a processor like PayPal. Depop takes 10% of every sale and eBay takes 15%; Poshmark takes $2.95 for items under $15 and 20% for items over $15. PayPal, which integrates with Depop, Poshmark and eBay, charges another 3.49% plus 49 cents per transaction for payment processing.
On top of that, you’ll need to pay for packaging, label printing and possibly storing inventory including bins, hangers and shelves. Top sellers also recommend adding a personal touch in shipments, like free stickers, small accessories or a thank-you note. When all those costs add up, you may find that only higher-value items are worth listing.
You can cut costs by reusing shipping mailers and boxes, and printing labels at your local FedEx or UPS store instead of purchasing a label printer. Or, reduce shipping costs for buyers by bundling several items into a single shipment, which can motivate buyers to purchase more from your shop.
The social aspect is a priority
The most successful online resellers have one thing in common: a strong personal brand. Finding your niche and building a loyal following is essential to long-term success on a resale platform.
“It’s like Instagram, but for selling,” says Perez, who focuses on curating a consistent aesthetic and marketing her shop on social media platforms like TikTok.
Castillo grew his business by catering to a very specific market: vintage designer collectors, specifically for Moschino and Chanel. He sells across several platforms, using his Instagram to rent pieces out to stylists for photo shoots and red-carpet events. Though he targets a fairly small community, his narrow focus helps him reach his ideal buyers.
Other top sellers on resale platforms can be seen taking a similar approach, with shop themes ranging from band T-shirts to vintage gowns. “Lean into your personal taste,” says Castillo. Even if you don’t have a curated collection to sell, personalized packaging or a unique photo background can help your items stand out.
Both Perez and Castillo emphasize the importance of cross-linking social media platforms to reach as many potential customers as possible. Creating a dedicated Instagram Business account and following other online sellers and designers can help drive buyers to your shop. Check popular pages for trendy hashtags and add those to your posts. Making the time to promote on social media can help transform your closet into some serious income.
Turning Your Hobby into a Business? Here is What You Need to Know
Do you dream of one day quitting your job and following your passion in life? You can do it! Many successful entrepreneurs turned their hobbies into profitable businesses.
Do you have a hobby? Doing the things you love keeps you engaged with life, gives your mind a focus, and helps you enhance your concentration. Investing time in your hobby also provides you with a great way to relax, unwind, and relieve daily stress.
You shouldn’t be ashamed of your hobby even if your friends and family don’t share it. Only because they find interest in something else doesn’t mean that no one in the world shares the same interests that you do. In fact, millions of people engage in the same hobby as you do daily.
So if you thought that no one shared your enthusiasm for this activity until now, think again. Whatever activity you can imagine, millions of other people on the planet are doing it as you read this article.
If you’re one of the individuals who wonder how they can transform their hobby into a successful venture, this article provides information on how to start a business based on the things you love.
Do a Self-assessment
Do you know what it takes to turn your hobby into a lucrative business? Do you have the required stamina and energy to take the necessary steps and transform it into a venture? Yes, it would be nice to spend your days doing what you love and making money, but make sure you don’t ruin your hobby by transforming it into a business. You started pursuing it to blow off some steam, but you could take its charm away if you add a lot of pressure on it to deliver money.
Research to understand what starting a business in this sector implies and make sure there’s a paying public before you bet the farm on it. Running a successful company requires plenty of work and responsibility, two things that could take the fun out of your hobby.
Test The Idea
If you decide that you have what it takes to turn your passion into a business, the next step is to test the concept by starting a side hustle. When the profits reach a level that allows you to cover monthly bills and support yourself, you can quit your job and pursue this venture.
However, don’t leave your present job if your side gig doesn’t make enough cash flow to last you at least two years. Be ready for the shock you’ll get when you turn from getting a monthly salary to having to pay taxes yourself. To make sure that you won’t worry about housing, food, or monthly bills, save up at least two years of living expenses.
Before investing time, money, and effort into starting a business, take a look at the market and see what your future competitors are doing. Research the niche online, on social media and among the public to see what customers expect from you and what other companies provide.
You can research the market on your own or hire a professional company to do it for you. It’s recommended to work with specialists because they know the aspects that require extra attention and can help you determine if starting a business in this niche is worth it.
Make a list of your biggest 10 competitors and analyse their activity to figure out what they do to position themselves as leaders in the industry. Check their website, evaluate its functionality, and have a look at their Google ranking. Remember that people start searching for a product or service online in the present digital world, and it’s crucial to rank high in search engines to reach your ideal customer.
After doing research, you’ll have a clear idea of what you’re dealing with in terms of competition.
Write a Business Plan
The business plan serves as a blueprint for your company, and you’ll definitely need it if you want to apply for a loan. However, don’t skip creating a business plan because it’s quite useful in starting your venture, even if you don’t seek funding. Research shows that the business people who make a detailed business plan are 16% more likely to develop a profitable business.
Here are some elements your business plan should include:
- Financial plan
- Executive summary
- Business overview
- Management team
- List of services and products
- Marketing and sales plans
- Marketing strategies
- Metrics and milestones
If you want to transform your hobby into a profitable business, you need to take it seriously and write a complete business plan.
Build a Brand
Branding is essential when trying to build an easy-to-recognise business. It would help if you had a unique business name and logo that match your company’s personality and values. Pick brand colours that resonate best with your target audience, and craft a message they resonate with.
You can use free online tools to create a logo and elements for your business cards and advertising materials. Canva is such a solution that provides access to a huge library of elements.
Establish a Strong Web Presence
In the digital era, all businesses need an online presence to attract attention and reach their target audience, no matter their size or specific. You should create a website that allows you to present the benefits your clients get if they purchase your products and even create a shop page that allows them to buy online. However, establishing a solid web presence extends beyond creating a website. It also implies creating and maintaining the page, connecting it to social media profiles, and posting regularly on the blog.
Your purpose is to brand your company as an authority in the industry that also provides valuable pieces of advice beyond selling products.
Try to be consistent in how you present yourself to your public because you need to establish an image. Your web presence and brand are the main elements that impact your company’s identity and help loyal clients differentiate your products from your competitors.
Q&A With Dr Ryan Shelton on Starting Up a Natural Healthcare Business
”Dr Ryan Shelton is the Medical Research Director For Zenith Labs. He believes that there is a way to help sick people with natural treatments complimenting the conventional pharmaceutical approach. He has created a regimen of natural treatments consisting of holistic and complementary medicine, and it’s all backed up by science-based research.
Dr Ryan Shelton had dreams about being a doctor from a young age. His love for helping people inspired him to study the human body and how its internal and external environments change it for the better or for the worse.
Dr Shelton’s path to becoming a doctor was anything but typical. His undergraduate education focused on biochemistry and genetics. After attending medical school for one year he withdrew to “think in slow motion” and received another degree in Philosophy. He left because he disagreed with the way doctors were being taught to practice medicine. Dr Shelton believed that the better way to treat his patients was to heal their whole bodies rather than just treating the symptoms.
After receiving his Philosophy degree, Dr Shelton understood how important it would be to be able to treat or prevent chronic diseases holistically. He returned to medical school, where he earned his Naturopathy Doctorate. Now, Dr Ryan Shelton gets to follow his passion by helping his patients achieve their best overall health through natural remedies.
With chronic disease being on the rise, Naturopaths like Dr Shelton want to do their best to try and stop it from spreading by treating patients holistically. He does this by turning their food into medicine first and using natural remedies to increase their overall health. His goal is to balance his patient’s systems, and he passionately believes that his ultimate goal is to help his patients achieve optimal health.
Dr. Ryan Shelton’s work with Zenith Labs has helped him attract patients interested in pursuing wellness rather than focusing solely on disease care. His successful medical practice complements this passion, as does the company he founded. Whether you’re looking to improve your overall wellness or just want an alternative to the traditional pharmacological regimen, Dr Ryan Shelton has a plan for how to help you.
Hello Dr. Shelton, can you briefly tell us who you are and what you do?
Currently, I’m the medical research director for Zenith Labs and a Naturopathic Doctor with a successful private practice. I am also the Wellness Director and on the admissions team for a behavioral therapeutic program.
For the last few years, I’ve been running an online supplement business where people outside of where I am can get the same kind of advice that I give to my in-person patients from anywhere in the world. I do my best to promote a concept of total wellness and natural health solutions.
I have developed several natural health regimens over the years based on my research. I’m working hard to teach people that everything else will follow if they improve their overall health.
Please describe your company in a few words
Yes, it is a company, but really what we’re trying to promote here is a culture. Sure, we could go online and sell supplements till the cows come home. Lots of people do that. This naturalistic approach has been my life’s work ever since I was in medical school. I initially left medical school because I felt that the traditional way medicine was practiced was to treat the symptoms rather than treat the whole person.
I’m working hard to use my company as a vehicle to teach my customers and patients that they can improve their total body health, which makes healing other symptoms easier.
What is your company’s biggest achievement in recent years?
The surge in online business, I would say, has been our best achievement in recent years. When we first moved into this space, I felt like the company wasn’t getting the attention it deserved. We did traditional promotions and bought advertising, but nothing was really getting us over that plateau.
Just when I thought I might have to just let it go, word of mouth started spreading, and it spread like crazy. Satisfied patients were telling other people about what they’d experienced by using these treatments, and those people turned out in droves to get these benefits for themselves.
In what direction do you see natural healthcare going?
The coolest thing I think I have seen recently is that natural medicine is becoming more and more mainstream all the time. For a long time, people who preferred natural remedies were seen as “uninformed” or “Weird.”
Nowadays, people are flocking to find out what natural remedies they can incorporate into their own life. We’ve all seen so many odd things come from big pharma over the past ten years, so is it any wonder people are looking for a way that they can take charge of their own health. It will become much more focused on environmental medicine, lifestyle medicine, and anti-aging medicine.
We will begin using natural treatments not in response to crises, but rather to promote a level of optimal health not yet seen in the general population.
Which recent developments in your industry do you find exciting?
The way in which people seem to be flocking to natural medicine. It’s no longer on the fringes of people’s thoughts. I see people take a more open-minded approach to learn about things that natural healers from around the world have known for centuries.
The general attitude that people have, that they want to discover things for themselves rather than just taking the proscribed wisdom as gospel, is really exciting. I feel like I’m getting closer and closer to being able to reach more people than ever before.
Again, environmental medicine and anti-aging, natural agents specifically targeting your unique specific genes and DNA to promote optimal health. The days of degeneration and disease are hopefully going away soon.
What keeps you motivated?
My vision. It’s been front and center in my mind since I was a child. I watched so many of my older relatives that suffered from chronic conditions just wither away with the traditional medical approaches. I knew there had to be a better way, and I feel like I’ve found it.
What keeps me motivated is the drive to bring what I’ve found to as many people as possible, so maybe they won’t have to watch their loved ones suffer as I did.
What advice would you give someone starting out in the health field?
Hang in there. It’s the best advice I could give anyone. Medical school is tough, and it should be. Then you’ll have your residency and boards, which are brutal. Becoming a doctor is a privilege that we, as a society, only bestow on those who have proven themselves to be the best at what they do.
If being a medical professional is your dream, then hang in there, and fight for it tooth and nail until you’ve achieved your dream.
Thanks for your time, Dr Shelton!
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