5 Things to Know about Operating Costs for a Coffee Shop
Sit-down coffee shops can cost from $200,000-$375,000 to start up, large drive-thru shops can cost from $80,000-$200,000, and a small coffee kiosk can cost from $25,000-$75,000. Opening a franchised sit-down coffee shop can cost up to $673,000.
Account for fixed monthly costs such as rent, which should not exceed 15% of sales, utility bills and staff costs such as payroll taxes and benefits.
There are also fixed costs such as equipment, i.e. espresso machines which can cost up to $20,000, and industrial coffee roasters which can cost over $10,000.
Increase revenue as much as possible to be able to cover the monthly variable costs as well. Costs can change depending on how many cups of coffee are being sold or how much milk and sugar are used per drink, for example.
To foster the success of the coffee shop, consider additional revenue streams such as offering products that have low variable costs, i.e. selling raw coffee beans, and perfecting the ergonomics of the shop. Ensure that the layout of the workstation promotes efficiency amongst baristas.