The Ultimate Coffee Shop Business Plan and Template

Coffee Shop Marketing Ideas to Supercharge Your Business

A coffee shop business plan is an essential tool for coffee shop owners or people who want to open a coffee shop. It will help you plan your strategy for success and act as a guide as you look to build your business.

In this article, we’ll look at why you should write a business plan for your coffee shop or cafe, as well as provide you with a sample and a template that contains inspiration for the things you should include in your document.

Why Write a Business Plan for Your Coffee Shop?

Latte on a Table

The basic idea behind a coffee shop is simple. The business needs to sell enough coffee to cover costs and make a profit. However, many variables will define whether your business is successful.

A business plan for a coffee shop will help you plan your strategy. It will consider factors such as opportunities, risks, and how you will market yourself. By having a good idea of this before you get started, you will be better placed to overcome or avoid any difficulties.

Here are some examples of how a business plan could help iron out any difficulties:

  • While creating the market analysis section, you may decide that competition is too intense. If this is the case, you could look for a new area to open in or find a way to make your coffee shop stand out.
  • By creating a marketing plan before you open, you can put itself in an excellent position to make sales from the moment your coffee shop opens its doors.
  • By creating cash flow projections, you will be able to spot any potential issues well before they come to light, preventing cash flow problems.

Without a business plan, you would either not know about the potential difficulties listed above, or you would be aware of them but lacking any defined strategy for overcoming them. By creating a business plan, you can tackle issues with a clearer head.

Business plans are also essential documents if you plan to apply for funding for your business.

You’ll likely need to submit the document to the bank when applying for a loan, or to investors when applying for equity funding. Having a well-thought-out business plan shows you have analyzed your idea and helps give investors an overview of the risks and potential rewards of investing.

If you are going to use your business plan to apply for funding, you’ll need to go into a little more detail about the financials of your business. You’ll also need to include a section that discusses how you will use the money you’re raising.

Coffee Shop Business Plan Template

Trendy Coffee Shop

A Google search will reveal differences when it comes to the exact sections you should include in your business plan.

Nonetheless, most business plans will include the sections listed below. In this part of the article, we’ll go through a coffee shop business plan template and discuss what you should include in each section.

Executive Summary

The executive summary is a short overview of your business plan. It should include all the important details about your business. When deciding what to include, think about what you would want someone to see if they told you they would only read this one section of your plan.

Open your executive summary with a statement about what your coffee shop is all about. Talk about what it will offer that is unique and mention why you think it will be successful. Is it the only coffee shop in town, for example? Or will you specialize in a particular type of coffee?

Sample

Business Name: AI Coffee Shop

Executive Summary:

AI Coffee will serve high-quality coffee to office workers and business people who work nearby. We will sell espresso-based drinks with a focus on providing quality at speed. We will sell coffee to take away as well as to eat in, with an indoor seating area with space for 25 customers. 

While there are other coffee shops in the area, we believe that there is demand for moreespecially ones that focus on a high-quality product. We will also provide a light lunch menu and pastries that we believe will differentiate us from other coffee shops in the area. 

We are on a busy street and expect to get custom from passersby during the day. Going forward, AI Coffee will look to build customer loyalty within the area. We will keep a core offering but regularly rotate specials to continue generating interest within our customer base.

Company Overview

Barista Holding Latte

In the company overview section, you should include practical details about your business. Write about the structure and ownership of your company, the staff you plan to hire and what you will pay them, you company’s mission statement, and startup costs.

Sample

AI Coffee will be a privately held company owned entirely by Mr Smith, who will also manage the coffee shop. We will hire two full-time employees with at least two years of barista experience, as well as four part-time employees to help during busy periods.

Startup costs for the coffee shop will be $70,000, which will be spent on rent, renovations, and purchasing equipment. The owner has put up half the money and has borrowed half from a bank. Based on annual sales of $160,000 and after costs and wages, we expect to be profitable within the second year. 

Market and Customer Analysis

In the market analysis section, you should include details about the local market. This can include information on competitors, such as other coffee shops or any fast-food joints, restaurants, or bars that you think will be competing for your customers’ money.

You should also outline what makes your coffee shop unique and why you think it can be successful despite the competition. You can also include wider information about the coffee industry.

In the customer analysis section, you need to include information about your customers. Include details on who they are and why you think they will like your coffee shop, with metrics where possible. If you performed market research before starting your business plan, include that here.

Market Analysis

The coffee industry is expected to keep growing between 2020and 2024 in the U.S. Research suggests that coffee is one of the most consumed beverages in the country, with the average person drinking two cups per day. We believe that this growth, plus the high volume of coffee people drink each day, makes opening a coffee shop a good business opportunity. 

Competitor Analysis

AI Coffee will be located in a vibrant district that is seeing offices open up and new companies move in. There are currently two other coffee shops in the immediate area, but we believe there is room for more.

Our shop’s main advantages are that it is closer to a new office building than the other shops. We also plan to differentiate ourselves by offering a small lunch menu, unlike any of the existing coffee shops, as well as various customer loyalty schemes

Two fast food joints serve coffee nearby. We believe that our coffee shop produces significantly better coffee than these outlets. 

Customer Analysis

The location of the coffee shop has high footfall, especially before and after work and during lunchtimes. The area has a high proportion of professionals who can afford to spend money on coffee and other drinks. 

The office blocks in the immediate vicinity are home to around 2,500 people. There are also other buildings being developed nearby. The location is also close to shopping and entertainment districts. We expect to receive significant revenue from passersby, who will keep us busy during the day. 

Sales and Marketing Plan

Business Plan Doc

Your sales strategy contains practical details on how you will handle sales. You should also include sales forecasts and how you have come up with these forecasts. In this section, you should include information about the products you will sell and your pricing strategy.

Your marketing plan will discuss the strategies you will use to get customers through the door. Discuss your budget and expected returns on investment. If you have a particularly complex marketing plan, you may want to create a separate document for this and only include the highlights in your business plan.

Sample

Sales Plan

AI Coffee will open from 7.30 a.m. until 7.30 p.m. seven days a week. We expect the hours immediately before and after office hours, as well as between 12 p.m. and 1 p.m., to be the busiest of the day, with much of our sales being to take out. 

Our coffee shop will have seating for up to 25 people. This will include benches and individual tables. We will use a commercial espresso machine and we expect to able to produce up to a maximum of 70 cups of coffee per hour, which should be sufficient during busy times. 

We will sell our espresso-based drinks and tea at between $3 and $6, depending on the drink and the size. We will sell pastries at between $2 and $5, as well as light meals at between $7 and $12. These meals will be packaged so customers can either eat them on-site or take them away. 

We expect to generate around $730 per day from food and drink sales. 

Marketing Plan

We will market our coffee shop to businesses in the nearby area through display marketing in relevant locations. We will also use social media marketing to target people nearby, and we will connect with people through our social media accounts. We will use these accounts to keep people updated with new menu items as well as offers and discounts. 

We will also create a website and an app, which we will use to run a customer loyalty scheme. We will provide the option to order coffee through the app and pick it up at the shop. We think this will appeal to busy professionals.

Finally, we will display posters and images in our shop, which, due to its location, will market our coffee shop to a high number of potential customers at a very low cost.

Our marketing will focus on the quality of the coffee we sell, as well as the benefits of our shop to office workers (in-app ordering). During the week after we open, we will offer substantial discounts on coffee to attract people to our business. This offer will be central to our marketing during this period. 

We will encourage repeat customers using a loyalty scheme that will give them a free cup of coffee when they buy eight drinks.

Our marketing budget will be $500 in the first two months, but we will cut this down to around $350 a month after that. 

Operating Plan

Barista Making Latte

The operating plan will include details of how you will run your coffee shop. This will include costs, as well as specifics about things like opening times, food and drink production, prices, and more. This section is especially useful, as by outlining all the steps you will go through each day you will take the first steps towards building efficient processes.

It will also allow you to spot any potential conflicts. For example, if you plan to serve 150 office workers between 7:30 a.m. and 9 a.m., can you do it with only two members of staff or would you be better off hiring another employee?

You can also use this section to explain any licenses or certifications you need to get before you open your shop, as well as how you will train employees.

Sample

We will open from 7:30 a.m. to 7.30 p.m. We will always have at least three staff members in place to take care of making coffee, process sales, and keep the coffee shop tidy.

We will buy our coffee wholesale from a supplier that specializes in high-quality coffee. This coffee will cost $40 per five-pound bag. We will keep enough coffee in stock to last for at least one week. 

To ensure our coffee tastes great, we will use a commercial grinder to grind beans before making each cup. 

We will buy pastries and light meals from a local supplier who will also take care of the packaging. We will receive a daily delivery at 7 a.m., thirty minutes before the shop opens. This means we will have food available so commuters can grab breakfast on the go.

We will thoroughly clean up the shop after closing to ensure it is ready for the following day. We will build HACCP processes to stay compliant with food safety regulations. All members of staff will receive training so they know about these processes.

Management Team

In the management team section, you should include who owns and manages your coffee shop. You should write about any experience or qualifications they have that will help make them successful.

If the owners won’t be managing the coffee shop, you should include details about who will take care of the day-to-day running of the business. In this section, include how much you will be paying each of the management team as well as how any profits will be shared amongst the owners.

Sample

The owner will also manage the coffee shop. The owner has over ten years’ experience working in coffee shops, including six years in various management positions. AI Coffee will also hire two full-time employees. These employees will have at least two years’ experience working in a coffee shop. We will pay each full-time employee $22,000 a year.

We will also hire four part-time employees with or without experience to work at weekends and provide cover during the week. We will pay these employees $10 an hour. 

Financial Plan

The final section of the business plan is the financial plan. Here you need to go into detail about how your business will be financially successful.

Include operating costs, loan repayments, cash flow, expected revenue, expected profit. Also, include a break-even analysis that shows how much revenue you need to take in to become profitable. Finally, include a balance sheet.

Sample

Financial Plan

In this section, we will explain our financial plan, including costs, expected sales, and profit. We will also include a break-even analysis. We believe this plan accurately illustrates why AI Coffee will be financially successful. 

ADD FINANCIALS 

Wrapping Up

That’s all for our coffee shop business plan guide. To find out more about getting a business up and running, check out our guides to writing a business proposal in 2019 and writing a small business marketing plan.