coffee trading business plan

Coffee Roaster Business Plan Template

Written by Dave Lavinsky

Over the past 20+ years, we have helped over 1,000 entrepreneurs and business owners create business plans to start and grow their coffee roaster businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a coffee roaster business plan template step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your coffee roaster business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start a coffee roaster business, or grow your existing coffee roaster business, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your coffee roaster business in order to improve your chances of success. Your coffee roaster business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Coffee Roaster Businesses

With regards to funding, the main sources of funding for a coffee roaster business are personal savings, credit cards, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings is the other most common form of funding for a coffee roaster business.

If you want to start a coffee roaster business or expand your current one, you need a business plan. Below are links to each section of your coffee roaster business plan template:

Executive Summary

Your executive summary provides an introduction to your coffee roasting business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of coffee roaster business you are operating and the status. For example, are you a startup, do you have a coffee roaster business that you would like to grow, or are you operating a coffee roaster business in multiple markets or regions?

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the coffee roaster industry. Discuss the type of coffee roaster business you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of coffee roaster business you are operating.

For example, you might operate one of the following types of coffee roaster businesses:

• Retail Coffee Roastery : this type of roastery sells roasted coffee to individual consumers, either online or through a brick-and-mortar storefront.
• Wholesale Coffee Roastery: this type of roastery sells roasted coffee to other businesses, such as grocery stores, restaurants, hotels and resorts.

In addition to explaining the type of coffee roaster business you will operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of customers served, number of positive reviews, total number of bags of coffee sold, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the coffee roaster industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the coffee roaster industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy, particularly if your research identifies market trends.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your coffee roasting business plan:

• How big is the coffee roaster industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your coffee roaster business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your coffee roaster business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individual consumers, grocery stores, restaurants, hotels and resorts.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of coffee roaster business you operate. Clearly, individual consumers would respond to different marketing promotions than grocery stores, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most coffee roaster businesses primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.  

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other coffee roaster businesses.

Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes coffee shops and grocery stores. You need to mention such competition as well.

With regards to direct competition, you want to describe the other coffee roaster businesses with which you compete. Most likely, your direct competitors will be roasteries located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What types of coffee do they sell?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide better roasted coffee?
• Will you provide features or services that your competitors don’t offer?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a coffee roaster business plan, your marketing plan should include the following:

Product : In the product section, you should reiterate the type of coffee roaster company that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to selling roasted coffee, will you sell brewed coffee, sell teas, provide barista event services, or provide any other products or services?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the services you offer and their prices.

Place : Place refers to the location of your coffee roaster company. Document your location and mention how the location will impact your success. For example, is your coffee roaster business located in a busy retail district, shopping plaza, mall, etc. Discuss how your location might be the ideal location for your customers.

Promotions : The final part of your coffee roaster marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Advertising in local papers and magazines
• Reaching out to local websites
• Social media marketing
• Local radio advertising

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your coffee roaster business, including purchasing supplies, performing inventory, marketing, roasting coffee, and selling and/or delivering coffee.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to sell your 1,000th bag of coffee, or when you hope to reach $X in revenue. It could also be when you expect to expand your coffee roasting business to a new city.

Management Team

To demonstrate your coffee roaster business’ ability to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in managing coffee roaster businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing coffee roasteries or successfully running small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you gain one new customer per month or per quarter (as a wholesaler), or will you sell 100 bags of coffee per day or per week (as a retailer)? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your coffee roaster business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a coffee roaster business:

• Location build-out including design fees, construction, etc.
• Cost of equipment and supplies
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your roastery location lease or descriptions of roasts you are working on.

Putting together a business plan for your coffee roaster is a worthwhile endeavor. If you follow the template above, by the time you are done, you will have an expert coffee roasting business plan; download it to PDF to show banks and investors. You will really understand the coffee roaster industry, your competition, and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful coffee roaster business.

Coffee Roaster Business Plan FAQs

What is the easiest way to complete my coffee roaster business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily complete your Coffee Roaster Business Plan.

What is the Goal of a Business Plan's Executive Summary?

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of coffee roaster business you are operating and the status; for example, are you a startup, do you have a coffee roaster business that you would like to grow, or are you operating a chain of coffee roaster businesses?

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Table of Contents

Dreaming of opening a coffee shop? You’re not alone. The coffee industry is bustling with passionate business owners eager to make their mark. However, becoming successful coffee shop owners requires more than just a love for the brew. It demands a clear vision that differentiates your coffee house in a saturated market. A well-crafted business plan not only gives life to your idea but also sets your business on a path to thrive. Whether you’re a newbie or a seasoned entrepreneur, this guide, complete with a free template, will help you craft a business plan that markets and propels your coffee venture to success.

What is A Coffee Shop Business Plan?  

A coffee shop business plan is a comprehensive document that explains what your business idea is, how you intend to penetrate the coffee market, and the strategies you’ll employ to run your coffee shop successfully. When opening a cafe, many aspiring cafe or coffee shop owners underestimate the value of a structured plan. However, this document does more than just outline the needs to open a coffee shop; it gives a detailed roadmap for your new business, offering clarity on every aspect of its operation.

More than that, presenting a well-structured business plan to potential investors is essential. It not only showcases your commitment but also your understanding of the industry, making it a vital tool for securing funding. While crafting a business plan can seem daunting initially, it’s the foundation that both clarifies your idea and sets your business on the trajectory for growth and success in the competitive world of cafes and coffee shops.

Why A Business Plan Is Important For A Successful Coffee Shop Business?

1. Clear Vision and Objectives

When you set up your coffee shop, having a business plan establishes a clear vision and defines your objectives. It is the backbone that steers every decision you’ll make. Without a clear outline, you may find yourself swaying from one idea to the next. With a detailed business plan, you can present a clear business proposal to stakeholders, ensuring them and yourself of the path you plan to tread.

2. Financial Planning

A comprehensive business plan is imperative for accurate financial planning. It will include information on how much capital is required to start, what your ongoing costs will be, and the revenues you plan to generate. If you’re seeking external funding, investors will want to see how you plan to use their money, and most importantly, how you plan to make a return on that investment. If you plan to sell specialty blends or unique treats, the financial section can also help you plan a strategy for pricing, promotion, and sales forecasts.

3. Operational Efficiency

Operational efficiency is the linchpin that holds all business operations together. A business plan will map out every detail, from supplier agreements to employee schedules. You may want to create special events or loyalty programs for regular customers, and this is where a business plan can help you plan a strategy for success. It becomes the reference point, ensuring that daily tasks align with the broader objectives, guaranteeing that resources, time, and efforts are used optimally.

Step-by-step Guide To Write A  Coffee Shop Business Plan

1. Executive Summary

The Executive Summary is like the introduction of a novel – it provides a snapshot of what is to come. Typically, you write the executive summary last, even though it appears first in your business plan. It encapsulates the essence of your coffee shop’s mission, objectives, and financial overview, succinctly explaining what your business concept is about. This section is crucial because many coffee shops fail to engage potential investors right off the bat. Ideally, it should be concise – a page or two.

What should you cover in an Executive Summary?

• Introduce Your Coffee Shop or Cafe: Provide a company overview, giving readers insight into what makes your coffee shop unique from the myriad of coffee bars in the market.
• State Your Mission and Vision: Describe what drives your coffee business and where you see it in the future.
• Outline Your Objective: Define clear, measurable goals that you aim to achieve.
• Provide a Financial Overview: Highlight projected profit margins, a brief balance sheet, and other pertinent financial data.

2. Coffee Shop Business Description

This section paints a picture of your coffee shop. It’s where you elaborate on how you plan to infuse the local coffee market with your unique brews and pastries.

What should you cover in the Coffee Shop Description section?

• Coffee Shop Concept: Dive into the types of coffee drinks you plan to offer, whether it’s a rich espresso or a classic brewed coffee.
• Unique Selling Proposition: Discuss what makes your coffee shop stand out, be it a special blend of coffee beans, a unique roasting method using a specific coffee roaster, or artisanal pastry offerings.
• Operational Plan: Briefly touch upon how you’ll manage your coffee shop, from sourcing beans to serving cups of coffee.

3. Market Analysis

Before pouring your first espresso, performing market research before starting your coffee business is essential. This section dives deep into understanding your potential customer base and the coffee industry landscape in your area.

What should you cover in this section?

• Target Market: Describe your ideal customer. Are they local residents, office workers, or students?
• Location: Discuss the significance of your chosen location. Are there many coffee shops in the area? How does your location cater to your target market?
• Competition: Analyze existing coffee shops. What coffee and food products do they offer? What pricing strategy do they employ? How will your coffee shop compete or complement them?

4. Organization and Management

Behind every successful coffee shop is a robust organizational structure and a competent management team.

What should you cover in the Organization and Management Plan?

• Coffee Shop Ownership Information: Highlight the business’s legal structure.
• Profiles of Your Coffee Shop Management Team: Include details about your baristas, perhaps a part-time accountant, and someone to manage marketing. It can be helpful to create profiles for each role, detailing responsibilities and expertise.

5. Sample Menu

Your menu is the heart of your coffee shop. It’s more than just a list of coffee and tea; it’s an expression of your brand.

What should you consider when creating a Sample Menu?

• Menu Items: Detail the types of coffee, espresso drinks, and pastries you plan to offer. Maybe consider including non-coffee items like teas or specialty drinks.
• Unique Selling Proposition: Reiterate what makes your coffee or food items different from other coffee shops in the area.
• Menu Pricing : Discuss your pricing strategy, keeping in mind profit margin, competitors’ prices, and your target customer base.

6. Marketing Plan

To brew success, it’s not enough to have a fantastic coffee product; you must effectively market it.

What should you cover in a Marketing Strategy for your Coffee Shop Business?

• Define Your Brand: What voice, theme, or emotion do you want your coffee shop to evoke?
• Lay out your plans for social media campaigns, local partnerships, loyalty programs, SEO for website, and other promotional strategies.
• Considering using an  online food ordering system  in your food truck
• Create a  digital menu with QR code  to make your menu easy for your customers to access online

7. Operations Plan

Efficiency is key to the daily grind of running a cafe. The operations section provides a detailed look at the day-to-day operations of your coffee shop business. 

What Operational Issues should you address in your Business Plan?

• Supply Chain: Where will you buy your coffee beans? Who will be your coffee roaster?
• Operating Hours: Consider the best times to cater to your target market.
• Staffing: Detail roles, such as barista, manager, and part-time support.
• Equipment: List down essential equipment, from espresso machines to ovens.

8. Financial Plan

In this crucial section of your business plan, delving into the financial specifics is paramount to lay out a concrete roadmap for the fiscal aspects of your coffee shop.

How Much Does It Cost to Start a Coffee Shop?

Starting a coffee shop is not just about brewing the perfect espresso; it’s also a substantial financial commitment. The cost for opening a coffee shop can range from $80,000 to $250,000. These costs can vary widely based on factors such as location, size of the establishment, equipment quality, and inventory requirements. Moreover, the process of opening a coffee shop might also involve unexpected expenditures, so it’s essential to account for some buffer in your budget.

How Many Ways to Fund Your Coffee Shop?

There are multiple avenues for funding your coffee venture. Traditional bank loans, personal savings, angel investors, crowdfunding campaigns, and partnerships are just a few options. It’s crucial to assess which option aligns best with your business vision and financial situation.

Important Questions to Consider When You Create Your Funding Request If you’re seeking funding, there are several questions you’ll need to answer in your business plan:

• How much money do you need to start and maintain your coffee shop until it becomes profitable?
• What will the funds be used for specifically?
• How do you plan to handle financial challenges that might arise?
• How do you plan to repay any loans or provide a return on investment?

9. Financial Projections

The financial projections section of your business plan forces you to translate your coffee shop vision into numbers, ensuring you’ve accounted for all key metrics that can make or break your venture.

Break-even analysis:

This is the point where your coffee shop’s total revenues equal its total costs. Simply put, it’s when you neither make a profit nor a loss from selling coffee. 

Use this formula:  Fixed Costs / (Price – Variable Costs) = Break Even Point

Projected profit and loss statement:

This will provide a forecast of your expected income and expenses, giving a clear view of your venture’s profitability.

Cash flow analysis:

Essential for understanding the liquidity of your business, this tool is especially crucial for coffee shops, considering the fluctuating expenses and incomes coffee shops offer. When drafting this, consider who will read it, as stakeholders like investors or lenders might have specific expectations.

Coffee Shop Business Plan Template 

• Mission: To offer the community high-quality coffee in a comfortable and vibrant environment.
• Vision: To become the go-to local coffee spot that fosters community connections and coffee appreciation.
• Coffee Shop Description: “Java Junction” will be a modern coffee hub that emphasizes direct-trade coffee beans and a relaxed, inclusive atmosphere.
• Costs: Estimated initial costs are $125,000.
• Profits: Projected annual profit by year two is $75,000.

2. Description of the Coffee Shop

• Coffee Shop Concept: A community-focused café emphasizing artisanal methods.
• Coffee Shop Name: Java Junction
• Coffee Shop Type: Sit-down café with an adjacent mini-library.
• Location: Main Street, Downtown Area – chosen for its high foot traffic.
• Order Fulfillment: Orders taken at the counter with table service for food.
• Working Hours: Mon-Fri (7 am – 9 pm), Sat-Sun (8 am – 10 pm).

3. Menu Offer

• Type of Food and Drink: Coffee, teas, pastries, and sandwiches.
• Offer: From classic espresso shots to unique blends like “Lavender Latte”.
• Unique Selling Point: Every coffee product uses direct-trade beans, ensuring farmer fairness.

4. Market and Competition Analysis

• Market Analysis: The local population includes a mix of professionals, students, and tourists. Many search for quiet spots to work or relax.
• Target Customer: Professionals aged 25-40 and students.
• Size of the Target Customer: Approximately 15,000 individuals.
• Competition Analysis: Three established coffee shops within a mile.
• Size of the Competition: Ranging from small boutique coffee shops to a larger chain.
• Competitors’ Offer: Basic coffee drinks, with limited specialty items.
• Competitors’ Prices: Average of $4 for a coffee drink.

5. Investment Plan (Detailed Cost Analysis)

Investment Cost (One-off): $75,000

• Equipment: $30,000
• Renovations: $20,000
• Initial Stock: $10,000
• Licenses: $5,000
• Miscellaneous: $10,000

Operating Costs (Monthly): $17,000

• Rent: $3,000
• Salaries: $10,000
• Utilities: $1,000
• Stock: $2,000
• Marketing: $1,000

6. Financial Forecast

Year one is projected to break even, with a profit of $50,000 expected in year two, and $75,000 in year three, considering growth and expanding customer base.

• Owner: Jamie Smith, a coffee enthusiast with a business degree.
• Manager: Alex Brown, previously managed a successful coffee chain for five years.
• Baristas: A team of 4 skilled individuals passionate about coffee.

8. Marketing Plan

Java Junction will use a mix of social media marketing, local print advertising, and loyalty programs to attract and retain customers. Regular events, such as “Buy Our Coffee Day” and collaboration with local businesses, will drive foot traffic and community engagement, integral components for starting your coffee shop and making it successful.

This coffee shop business plan sample is hypothetical and serves as a template. Tailoring specifics to your local market, vision, and unique aspects will be necessary. Every coffee shop has nuances that can make them successful, whether it be the coffee products they sell, the environment they cultivate, or the events they host. Focus on what will make your coffee shop stand out and be sure to engage your community.

Tips For Writing a Business Plan For a Coffee Shop

Your business plan becomes the blueprint of your vision. Here are essential tips to consider:

Comprehensiveness is Key: Ensure your plan encompasses all sections you should include, such as marketing, financial projections, and operations. A well-rounded plan provides a holistic view of your business.

Tailor to Your Audience: If you’re presenting to potential investors, focus on profitability and growth projections. For a landlord, emphasize the benefits your coffee shop will bring to their property.

Specialize in Marketing: Given the competitiveness in the coffee industry, it’s crucial to have a solid marketing plan. If marketing isn’t your strength, consider hiring someone to do marketing for your venture. A strong online presence, loyalty programs, and community engagement can set you apart.

Research Your Market: Understand what nearby coffee shops include in their offerings. Identify gaps in the market and strategize on how your shop can fill them.

Stay Flexible: While a business plan provides direction, remain adaptable. The coffee industry is dynamic, and your ability to pivot can prove invaluable.

Separate Sections for Clarity: If your plan becomes too dense, you might want to create a separate document for specific sections like a detailed marketing strategy or an in-depth market analysis. This makes your primary business plan concise and more readable.

Frequently Asked Questions

1. how profitable is owning a coffee shop.

Owning a coffee shop can be profitable, depending on factors like location, quality of products, and management. On average, after expenses, many coffee shops report a profit margin of around 3% to 5%, with some successful ones achieving even higher. However, it’s essential to factor in initial setup costs, ongoing expenses, and market competition.

2. How do I start a coffee shop business plan?

Starting a coffee shop business plan involves multiple steps. Begin by defining your coffee shop’s mission and vision. Conduct market research to understand your target audience and competitors. Then, detail out sections like your product offerings, pricing strategy, marketing plan, financial projections, and operational procedures. If you’re thinking of opening a coffee shop, a well-thought-out business plan is indispensable.

3. What is a business plan for a coffee shop?

A coffee shop business plan is a detailed document that outlines your coffee shop’s objectives, strategies, and operational procedures. It acts as a roadmap, guiding you from the startup phase to establishing a thriving business. Moreover, if you need a coffee shop business loan or investment, this plan becomes crucial in convincing stakeholders of your venture’s viability.

4. What are the 4Ps in a coffee shop business plan?

The 4Ps stand for Product, Price, Place, and Promotion. In the context of a coffee shop:

• Product: What type of coffee and related products will you offer?
• Price: How will you price your coffee? Will it be premium or competitive?
• Place: Where will your coffee shop be located? Is it accessible to your target audience?
• Promotion: How will you market your coffee shop? Will you offer promotions or loyalty programs?

These elements help in creating a marketing strategy tailored to your coffee shop’s unique needs and market position.

Launching a coffee shop is not just about brewing the perfect cup but weaving a narrative that resonates with your community, fostering an ambiance that people gravitate towards, and maintaining a seamless operation that drives profitability. The meticulous creation of a business plan is a pivotal step in this endeavor. It’s the beacon that guides budding entrepreneurs through the complexities of the coffee industry. In such a competitive marketplace, a well-structured, comprehensive business plan can make the difference between a fleeting venture and a thriving institution. To potential coffee shop owners, embrace the process, let your passion shine through in your plan, and remember that every great coffee shop started with a simple idea, much like a single coffee bean ready to brew greatness.

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Coffee Shop Business Plan: Brewing Profit in the Café Industry

By GGI Insights | October 25, 2023

Table of contents

The coffee shop industry is a thriving and competitive market, with consumers constantly on the lookout for their daily caffeine fix. Opening a coffee shop can be a lucrative venture, but it requires careful planning and execution. In this article, we will explore the key elements of a successful coffee shop business plan , covering market dynamics, revenue models, operations and logistics, branding and positioning, and risk mitigation. By understanding and implementing these strategies, you can set yourself up for success in the café industry.## Market Dynamics in Coffee Retail

Consumer Behavior

Consumer behavior plays a crucial role in the success of a coffee shop. Understanding your target audience and their preferences is essential for creating a menu and overall experience that appeals to them. Conduct market research to identify trends and customer preferences, such as specialty coffee drinks, organic and fair-trade options, or unique flavor profiles. This information will guide your product offerings, pricing, and promotional strategies.

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When it comes to consumer behavior in the coffee retail industry, there are several key factors to consider. One important aspect is the growing demand for specialty coffee drinks. In recent years, there has been a significant shift in consumer preferences towards unique and artisanal coffee beverages. This trend has been fueled by the rise of third-wave coffee shops , which focus on quality, craftsmanship, and the exploration of different flavor profiles.

Another aspect of consumer behavior to consider is the increasing demand for organic and fair-trade coffee options. With the growing awareness of sustainability and ethical sourcing, many consumers are actively seeking out coffee that is produced in an environmentally and socially responsible manner. By offering organic and fair-trade coffee options, coffee shops can attract a segment of consumers who prioritize these values.

It is important to understand the role of convenience in consumer behavior. In today's fast-paced world, consumers often seek quick and efficient service. This has led to the popularity of drive-thru coffee shops and mobile ordering apps. By providing convenient options for ordering and pickup, coffee shops can cater to the needs of busy customers and differentiate themselves in a competitive market.

Commodity Pricing

Commodity pricing, particularly for coffee beans, can have a significant impact on the profitability of a coffee shop. Stay up-to-date with market trends and fluctuations in coffee prices. Consider establishing relationships with local and international coffee suppliers to ensure a steady and cost-effective supply. It may also be wise to explore alternative sourcing options to mitigate the effects of price volatility.

When it comes to commodity pricing in the coffee retail industry, there are several factors that can influence the cost of coffee beans. One major factor is the weather conditions in coffee-growing regions. Adverse weather, such as drought or excessive rainfall, can lead to a decrease in coffee production and subsequently drive up prices. On the other hand, favorable weather conditions can result in a surplus of coffee beans and lower prices.

In addition to weather conditions, political and economic factors can also impact commodity pricing. Changes in government policies, trade agreements, or currency exchange rates can affect the cost of importing coffee beans. For example, if a country imposes tariffs on coffee imports, it can lead to higher prices for coffee shop owners who rely on imported beans.

It is important to consider the role of market speculation in commodity pricing. Speculators, who buy and sell coffee futures contracts, can influence prices through their trading activities. Their predictions and expectations about future supply and demand can cause price fluctuations in the coffee market. Staying informed about these market dynamics and understanding the factors that drive commodity pricing is crucial for coffee shop owners to make informed decisions about sourcing and pricing their products.

Revenue Models: Beyond Just Java

When it comes to running a successful coffee shop, revenue generation is a key aspect that cannot be overlooked. While serving delicious coffee and providing a cozy atmosphere are important, exploring additional revenue models can help take your coffee shop to the next level. In this article, we will discuss two revenue models that go beyond just serving Java.

Merchandising

Merchandising can be a powerful revenue generator for a coffee shop. It not only allows you to showcase your brand but also provides an opportunity to offer unique products that your customers will love. Consider selling branded merchandise such as mugs, t-shirts, or coffee accessories. These items can serve as souvenirs for your customers to take home, reminding them of their pleasant experience at your café.

To make your merchandising efforts even more special, why not develop partnerships with local artists or artisans? This way, you can showcase and sell their products in your café, adding a touch of local artistry to your space. Collaborating with local talent not only enhances the overall customer experience but also supports the local community. It's a win-win situation that can bring in additional sources of income while fostering a sense of community.

Subscription Plans

In recent years, subscription plans have gained popularity in the coffee industry. This revenue model offers a unique opportunity for your coffee shop to establish a loyal customer base while ensuring a stable revenue stream. Consider offering subscription-based services where customers can receive a monthly supply of specialty coffee or exclusive discounts.

By offering subscription plans, you not only provide convenience to your customers but also create a sense of exclusivity. Customers who subscribe to your coffee delivery service or membership program will feel like they are part of an exclusive club, receiving special perks and benefits. This fosters customer loyalty and encourages them to continue supporting your coffee shop on a regular basis.

Subscription plans allow you to showcase a variety of coffee flavors and blends. You can curate different packages each month, introducing your customers to new and exciting coffee experiences. This not only keeps your offerings fresh and interesting but also encourages customers to explore different flavors, expanding their coffee palate.

As you can see, there are various revenue models that can help your coffee shop thrive beyond just serving Java. Merchandising and subscription plans are just two examples of how you can diversify your income streams and provide added value to your customers. By exploring these options and implementing them strategically, you can take your coffee shop to new heights of success.

Operations & Logistics

When it comes to running a successful coffee shop, operations and logistics play a crucial role in ensuring smooth day-to-day operations. From supply chain optimization to staffing metrics, every aspect needs careful consideration and planning.

Supply Chain Optimization

An efficiently managed supply chain is vital for the smooth operation of a coffee shop. It involves a series of interconnected activities, including procurement, storage, and inventory management. To minimize waste and ensure freshness, it is essential to streamline these processes.

One way to achieve this is by establishing relationships with reliable suppliers. By partnering with trusted vendors, you can negotiate favorable terms, including timely deliveries and competitive pricing. This not only ensures a steady supply of high-quality ingredients but also helps in maintaining cost-effectiveness.

In addition to supplier relationships, implementing inventory management systems can further enhance supply chain optimization. These systems allow you to track and control stock levels efficiently, ensuring that you never run out of essential items while avoiding excessive inventory that can lead to waste and increased costs.

Staffing Metrics

Effective staff management is crucial for delivering excellent customer service and maintaining operational efficiency. To achieve this, it is important to develop staffing metrics that help determine optimal staffing levels based on expected customer traffic and peak hours.

By analyzing historical data and forecasting future demand, you can ensure that you have the right number of staff members on hand at all times. This prevents understaffing, which can lead to long wait times and dissatisfied customers, as well as overstaffing, which can result in unnecessary labor costs.

Investing in comprehensive training programs is another key aspect of effective staff management. By equipping your employees with the necessary skills and knowledge, you empower them to deliver exceptional service. This can include training on coffee brewing techniques, customer service etiquette, and product knowledge.

Implementing performance evaluation systems can help recognize outstanding performance and identify areas for improvement. By regularly assessing employee performance, you can provide constructive feedback, reward exceptional work, and address any areas that may need additional attention.

Operations and logistics are critical components of running a successful coffee shop. By optimizing your supply chain and implementing effective staffing metrics, you can ensure smooth operations, minimize waste, and deliver exceptional customer service.

Branding & Positioning

When it comes to running a successful coffee shop, branding and positioning are key factors that can make or break your business. Your coffee shop's visual identity and community engagement play significant roles in attracting customers, building brand recognition, and establishing a loyal customer base.

Visual Identity

The visual identity of your coffee shop goes beyond just a logo and color scheme. It encompasses the overall aesthetic and atmosphere that reflects your café's values and appeals to your target audience. Investing in professional branding services can help you design a visually appealing logo, choose a color scheme that evokes the right emotions, and create a cohesive visual identity that sets your coffee shop apart from the competition.

Consistency is key when it comes to incorporating your visual identity across all touchpoints. From signage and menus to online platforms and social media, make sure that your coffee shop's branding is present and consistent. This will help customers recognize and remember your café, even when they encounter it in different contexts.

Community Engagement

Building a strong sense of community is essential for establishing a loyal customer base and encouraging repeat business. Engaging with the local community not only helps you connect with potential customers but also fosters goodwill and enhances your café's reputation as a community-oriented business.

Consider getting involved with local organizations, events, and initiatives that align with your café's values. This could include sponsoring neighborhood projects, partnering with local charities, or participating in community events. By actively supporting the community, you not only contribute to its well-being but also create opportunities for people to discover and engage with your coffee shop.

Hosting community events at your café is another effective way to build a strong sense of community. Whether it's a live music night, a book club meeting, or a workshop, these events provide a platform for people to come together, connect, and enjoy the unique atmosphere of your coffee shop. They also serve as opportunities for you to showcase your café's offerings and create memorable experiences for your customers.

Community engagement is an ongoing effort. Regularly assess the needs and interests of your local community and find ways to contribute and connect. By doing so, you'll not only strengthen your coffee shop's position within the community but also attract loyal customers who appreciate your commitment to making a positive impact.

Risk Mitigation

Health regulations.

Compliance with health regulations is crucial for the success and longevity of your coffee shop. Familiarize yourself with local health codes and regulations regarding food handling, cleanliness, and safety protocols. Train your staff on proper food safety practices and establish rigorous cleaning and sanitization procedures. Regularly monitor and maintain compliance to ensure the health and satisfaction of your customers.

Economic Downturns

While the café industry can be resilient, economic downturns can pose challenges. Develop contingency plans to navigate financial uncertainty and minimize the impact of economic fluctuations. This may include diversifying revenue streams, exploring cost-saving measures, or adjusting pricing strategies. Staying adaptable and nimble in times of uncertainty can position your coffee shop for resilience and long-term success.

A well-crafted business plan is essential for brewing profit in the café industry . By understanding market dynamics, exploring innovative revenue models, optimizing operations and logistics, establishing a compelling brand, and mitigating risks, you can set your coffee shop up for success. Remember to stay attuned to consumer preferences, embrace creativity and community engagement, and remain adaptable in the face of challenges. With the right strategy and execution, your coffee shop can thrive in the competitive world of café retail.

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Coffee Roasting Business Plan Example

JUL.17, 2018

Do you want to start a coffee roasting business?

Starting a coffee roasting business is one of the best decisions you can ever make given the increasing popularity of coffee uptake. According to statistics from the National Coffee Association, the number of Americans consuming coffee has reached the peak since 2012. Figures indicate over 64% of Americans aged 18 and above have a cup of coffee on a daily basis with a further increase expected which is attributed to the popularity of gourmet drinks. A business  plan coffee roaster is a superb business idea that is poised for success so long you plan adequately. Coffee roasting is more than just a business, it’s an art. Being passionate about your craft and having a good business plan coffee roaster is the secret to succeeding in this business.

Executive Summary

2.1 the business.

The coffee roasting business will be registered as Blonch Coffee and will be located in Harlem neighborhood of New York City. The business will be managed by Maria Rodriguez who is a professional and licensed Q Grader.

2.2 Management Team

Maria Rodriguez, Owner and Proprietor of Blonch Coffee is a licensed and experienced Q Grader with extensive experience in the U.S coffee industry. Prior to starting coffee roasting business , Maria worked for high profile coffee brands across the United States and participated in numerous local, regional and international coffee tasting events.

2.3 Customer Focus

In order for the business plan coffee roaster to succeed, Maria has carefully studied the market and relied on her vast industry experience to come up with an appropriate approach that Blonch Coffee will use to reach out to the target market.

2.4 Business Target

Before starting her own business plan coffee roaster , Rodriguez did extensive market research coupled with her intricate knowledge of the business to identify the right business target. The key is to find creative marketing approaches to effectively reach out to the customer target.

Company Summary

3.1 company owner.

Maria Rodriguez is an experienced Q Grader whose successful career in the coffee making and tasting industry spans over two decades. Having worked for various top brands across the U.S. and participated in high profile events, Maria definitely has what it takes and hands-on skills of how to start a coffee roasting business .

3.2 Aim of Starting the Business

The coffee culture is constantly evolving for this reason, the demand for roasted coffee has increased significantly. Not only is coffee taken as a daily beverage, specialty coffees have now become the norm. Discerning coffee lovers are keen on quality coffee which lays a huge emphasis on how people drink and perceive coffee. To be part of this new exciting culture change, Maria Rodriguez thought of starting a coffee bean business that adopts a unique and transformational approach of coffee roasting.

3.3 How the Business will be Started

With over 20 years of experience in the coffee industry, Maria Rodriguez has a deep understanding of emerging coffee roasting trends and customer expectations. Given her involvement in the industry on a day-to-day basis, she knows what is required to start a successful business plan coffee roaster . To actualize her plan, Maria has worked closely with a team of experienced financial experts to formulate a comprehensive financial analysis and business plan coffee roaster that will guide the entire setup and operation of the business.

Services for Customers

Blonch Coffee has specialized in sourcing, roasting, packaging and organizing delivery for uniquely customized and specialized coffee products. The business offers a wide array of blended and roasted coffees which have been prepared from different kinds of coffee beans. Starting a coffee roasting company poised for success depends on how well blending is done for various kinds of beans.

Blonch Roasters intends to offer a wide range of coffee specialties which include:

• Bistro Blend
• Espresso and Decaf Espresso
• African Roast
• French Roast

Marketing Analysis of Coffee Roasting Business

Coffee is the second most popular traded commodity in the world after oil. The worldwide coffee retail market is a whopping £56 billion industry. Nowadays, coffee consumers prefer taking high-grade coffees with increased focus on quality and unique blending of beans. In the U.S. the coffee market industry has reached unprecedented levels of growth and for this reason, Blonch Coffee plans to rely on an objective coffee roasting business plan to set up its operations. To succeed in this business plan coffee roaster , extensive market analysis has been carried out to identify opportunities available to support business growth. Studying local trends and having a deep understanding of the local coffee roasting market will help Blonch to strategically position its brand.

5.1 Market Segment

In order for Blonch Coffee to achieve its targets, the coffee roasting business will focus on offering various kinds of products and services. Identifying the targeted customer segments is an important step Blonch Coffee has to deal with before as part of the plans to start coffee roasting business . After identifying the right market segment, the business plan coffee roaster can then come up with creative marketing strategy for business in order to woo customers.

5.1.1 Coffee Brewing Premises

One of the largest potential customers for Blonch Coffee is coffee brewing facilities which heavily rely on coffee products on a daily basis to serve their customers. These customers buy roasted coffee beans for the purposes of preparing and selling coffee and espresso drinks. This category includes Coffee Shops , Restaurants, drive-through and Bakeries. With the increasing uptake of coffee, selling directly to various coffee businesses is a sure way of boosting revenues for the coffee roasting business. Because these businesses require coffee products on a daily basis, this is a lucrative market Blonch Coffee must make an effort to reach out to.

5.1.2 Corporates

To start a successful coffee roasting business, you cannot afford to ignore the corporate market which is one of the biggest consumers of coffee products. New York City is a corporate and financial hub with thousands of organizations plying their trade in the city. Office coffee is a popular trend in offices and Blonch Coffee is positioned in a strategic New York neighborhood with easy connections to New York’s Financial District whether a majority of corporates have their offices. Aside from catering for offices, other institutions include schools, hospitals and factories among others.

5.1.3 Retail Specialty Shops

Coffee is a popular item that is stocked in various gourmet and gift shops. People nowadays love and appreciate coffee products as gifts which creates a great opportunity for Blonch Coffee to make unique products that are attractive to retailers focusing on selling specialty and gourmet coffee.

5.1.4 Mail Order

Mail Order coffee is increasing in popularity as many people now order for coffee online. This is an incredible way of boosting revenue for Blonch Coffee as the business can produce coffee for shipping to various places across the U.S. and worldwide. When you start your own coffee roasting business , you must be willing to go beyond the traditional market.

5.1.5 Grocery Stores

Grocery stores buy beans from coffee roasters in bulk for the purposes of resale or prepackaging to their customers. Unlike coffee shops, grocery stores don’t prepare coffee drinks for their customers.

5.2 Business Target

Blonch Coffee has an excellent opportunity to offer its services in the greater New York area thanks to the changing perceptions about coffee. New York is a large city with many coffee bean roasting business establishments, but that doesn’t prevent Blonch Coffee from making an impact.  Using a diversified product range and a good business plan coffee roaster , the business hopes to realize an annual sales increase of 20-30% per annum.

5.3 Product Pricing

Before coming up with product prices, Blonch Coffee has carried out an extensive market research that takes into account the prices of competitors. In order to stay afloat, the business has carefully priced its products to compete favorably.

With the right marketing strategies in place, Blonch Coffee has an exceptional chance to appeal to customers and consistently grow revenue margins. Each marketing strategy is aimed at reaching the target customers with awesome products that exceed client expectations. When planning how to start coffee roasting business , there must be an effective marketing strategy in place in order to remain relevant in a fast growing industry.

6.1 Competitive Analysis

Blonch Coffee plans to come up with a business model that will effectively guide its day-to-day operations and ensure customer expectations are fully met. Even though there are numerous coffee roasting businesses in New York, Maria Rodriguez knows how to start a coffee roasting business and put in place the right mechanisms to remain ahead of competitors.

6.2 Sales Strategy

For Blonch Coffee to meet its sales and revenue goals, the following strategies will be implemented to help advertise the business.

• Print Advertising Campaigns is one of the most effective sales strategies that reaches out to a mass target audience. The business intends to print brochures and put advertisements in local dailies as well as local coffee trade publications and journals. By doing this, the local community is made aware about the coffee roasting business.
• Get the word out and organize an opening party to introduce the business to customers and industry stakeholders. A cupping event is ideal as it allows guests to taste, compare and analyze different varieties of coffee. This is a perfect opportunity for prospective customers to sample what Blonch Coffee has to offer.
• Digital advertising is the new kid on the block. Social media channels such as Facebook, Twitter and Instagram among others are excellent ways of sending out word about the coffee roasting business. Online advertising such as Google Ads allow for localized advertising which is aimed at the local target.
• Attend industry related trade shows and exhibitions with an aim of marketing the coffee roasting business. This is an effective sales strategy that connects the business with right people who will be instrumental in growing revenue margins.

6.3 Sales Forecast

To achieve its goals, Blonch Coffee has come up with a sales forecast to show the coffee roasting business intends to meet its financial goals. Using a comprehensive business plan coffee roaster , the business knows which areas to focus on to achieve financial success.

Personnel Plan

In order to realize its goals, Blonch Coffee intends to hire a team of qualified and experienced staff to manage day-to-day operations of the business. How to start a coffee roasting company and run it successfully depends on the caliber of staff hired. A good business plan coffee roaster should incorporate a personnel budget to enable the business plan coffee roaster know how much will be spent on salaries.

7.1 Personnel Plan

To effectively run business operations, Maria Rodriguez who is the Owner and Proprietor of Blonch Coffee will be in charge of running the coffee roasting business on a daily basis. To ensure smooth running of the business plan coffee roaster , the following staff will be employed in various departments.

• Business Development and Sales Manager
• 2 Support Staff
• 1 Admin Assistant
• 1 Shipping Executive

Successful applicants will undergo training to familiarize themselves with business plan coffee roaster operations.

7.2 Average Salaries

Blonch Coffee plans to pay its staff the following salaries within the first three years of operation.

Financial Plan

Blonch Coffee has come up with a comprehensive financial plan that will be instrumental in driving success and business growth. In this business plan coffee roaster of how to start coffee roasting , Maria Rodriguez will use her savings to start the business but will be assisted by two investors. In addition, a business plan for a bank loan will be secured to help finance the budget deficit to meet expenses. For a business to be successful, there must be a good plan to guide operations and finances. Below is key financial data for Blonch Coffee.

8.1 Important Assumptions

The financial forecast for Blonch Coffee is based on the assumptions below.

8.2 Brake-even Analysis

Blonch Coffee Brake-even analysis is illustrated in the graph below.

8.3 Projected Profit and Loss

Profit and Loss information for the coffee roasting business is calculated on a monthly and annual basis as shown below.

8.3.1 Monthly Profit

8.3.2 yearly profit, 8.3.3 monthly gross margin, 8.3.4 yearly gross margin, 8.4 projected cash flow.

Below is a summary of Pro forma cash flow, subtotal cash spent, subtotal cash received, subtotal cash spent on operations and subtotal cash from operations.

8.5 Projected Balance Sheet

Below is a Projected Balance Sheet for Blonch Coffee that shows capital, assets, liabilities, current liabilities and long term assets.

8.6 Business Ratios

The following is the Ratio Analysis, Business Ratios and Business Net Worth for Blonch Coffee.

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Coffee Export Business Plan

Start your own coffee export business plan

Silvera and Sons

Strategy and implementation summary.

Silvera & Sons strategy is to expand production capabilities in order to fulfill the requests of importers with whom we currently deal for larger orders which we are unable to currently fulfill. In addition Silvera & Sons seeks to establish additional contracts with importers on the West Coast of the United States and increase the volume of green coffee sold on the Brazilian market. We intend to first maximize quantity of coffee sold within existing channels and second, establish additional accounts through targeted marketing efforts.

5.1 Competitive Edge

Silvera & Sons competitive edge comes from the advantage of having established relationships with American importers, and Brazilian coffee growers, green coffee brokers and wholesalers. Silvera & Sons has received affirmation of the demand for their product in the form of requests from importers for larger product shipments. Ours is a superior product offering because of the larger average size of the bean and because we purchase from growers who rely on the use of chemicals and pesticides less than two percent of the time. In addition, prompt preparation and shipment provides importers with a product that is up to one month fresher than beans sold by many exporters.

5.2 Strategy Pyramid

Our main strategy is to communicate the unique and desired attributes of our coffee to larger segments of the American and Brazilian markets. We sell a superior product, yet one that can be considered a commodity. It is therefore important that we effectively communicate the unique aspects which make it ideally suited for a niche market.

The unique aspects of our products include superior product selection and preparation, quality assurance, and efficient distribution. These are things we have done since we started doing business. The tactics we will use to communicate these strengths include, personal selling, targeted print advertising, and improved communication capabilities via information system improvements and a sophisticated website.

As tactics below the pyramid, we have identified three specialty publication in the United States and two in Brazil in which we will run print ads. We also plan to increase personal selling efforts to additional American importers. Part of the personal selling will include invitations to importers to visit our facilities, at our expense.

5.3 Marketing Strategy

Silvera & Sons marketing strategy will include the use of targeted print media advertising and direct selling to importers in the United States who provide green coffee to specialty roasters. We will capitalize on existing relationships with importers who have stated their willingness to contact West Coast affiliates and recommend Silvera & Sons coffee. We have positioned ourselves as a differentiated provider of the highest quality Arabica beans. The primary goal of all marketing efforts will be to communicate this to existing and potential customers.

5.3.1 Promotion Strategy

Relationships are key to success in the export business. Importers in Florida have on several occasions visited the Silvera & Sons facility, family home, and farms from which coffee is purchased. Additional accounts and contacts with West Coast importers have all been established and maintained through personal contact. Personal selling will remain our most important means of promotion. Marco Silvera Jr. will continue to lead this effort. In addition to personal selling Silvera & Sons has identified several specialty publications within which print advertisements will run. Direct mail, in the form of personal letters will also be used to communicate with existing and potential clients. Our budget for promotion activities is as follows:

• Personal Selling which includes phone expenses, travel for Silvera & Sons employees and for importers who we invite to Brazil: ($BRL) 35,000 annually.
• Print Advertising in three specialty publications and direct mail: ($BRL) 12,000 monthly.
• World Wide Web presence: ($BRL) 125,000 to produce a new site and $2,500 annually to maintain the site.

5.3.2 Distribution Strategy

Distribution is one of the greatest challenges faced by Silvera & Sons. The distribution system of Brazil is largely outdated and inefficient. Moreover, taxes, specifically excise taxes are high. Distribution costs for internal sales are absorbed by the customer but distribution costs for exports are absorbed by us. Increasing the volume of our exports makes us eligible to receive reduced fees and helps ensure that trucks and rail cars are running at maximum capacity.

5.3.3 Marketing Programs

Our most important marketing program is an increase in personal selling combined with targeted direct mail and print advertising. Marco Silvera Jr. will be responsible, with a budget of ($BRL) 35,000 and a milestone date of May 30, 1999. The program is intended to establish contractual agreements with 10 additional importers, increase brand awareness of our product in the United States, and communicate our position as a provider of the highest quality green Arabica beans on the market.

Another key marketing program is the development of a sophisticated Website. The goal of this program is to increase our presence on the world wide web and provide additional means of communication and customer data collection. The website will cost ($BRL) 125,000.

5.3.4 Positioning Statement

For American importers of Brazilian coffee who use our coffee to supply specialty roasters, Silvera & Sons coffee beans are the highest quality and largest beans available. Unlike many exporters, our beans exceed the minimum acceptable quality standards and are shipped within one week of preparation to ensure the largest and freshest beans on the market. Our products are perfectly suited for the specialty roasting market which constantly strives to offer award winning coffee.

5.3.5 Pricing Strategy

Because Silvera & Sons adheres to higher quality standards, the price of our coffee is slightly higher (four to nine percent) than the market average. The import market largely determines the price of imported coffee in the United States. Beans that do not meet Silvera & Sons quality standards are resold on the Brazilian market at the current market price. Green coffee, on the import market, now sells for US$ 213.56/60kg bag. According to Silvera & Sons pricing strategy, Silvera & Sons coffee would sell for approximately US$ 224/60kg bag. Importers have to this point been willing to pay the additional cost.

5.4 Sales Strategy

Silvera & Sons strategy focuses first on meeting the increased demand from importers with whom we have established relationships for larger orders. These importers are critical to our ability to acquire additional accounts on both the East and West coasts of the United States without having to spend a great deal on sales efforts. Secondly we will focus on increasing the volume, while maintaining the percentage of sales, of beans sold to the internal Brazilian market. When we have reached maximum sales to existing channels we can then shift the majority of our focus to securing additional import accounts.

5.4.1 Sales Forecast

The following chart and table show our present sales forecast. We project healthy growth in sales in 1999, a slightly smaller increase again  in 2000, and reach maximum for production capacity in 2001 representing a large growth over the previous year.

5.4.2 Sales Programs

Personal selling: Through personal contact we need to confirm in writing orders for larger quantities of our product from American importers and Brazilian wholesalers. In addition we need to establish sales agreements with at least six, possibly ten, additional American importers. Marco Silvera Jr. is responsible and the due date is May 30, with a budget of ($BRL) 24,000.

5.5 Strategic Alliances

Our most valued alliances are those we have developed with American importers. They have the ability and willingness to purchase larger quantities of our products and recommend us to other importers. Additional alliances with trucking contractors and the Porto de Santos Cafe Commission are currently established.

5.6 Milestones

The accompanying table shows specific milestones, with responsibilities assigned, dates, and budgets. The milestones represented in this plan are those which we have determined to be the most important.

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How to Create a Coffee Shop Business Plan

Sample plan illustrates the process

• Section 1: Executive Summary

Section 2: Business/Industry Overview

Section 3: market analysis and the competition, section 4: sales and marketing plan, section 5: ownership and management plan, section 6: operating plan, section 7: financial plan.

• Section 8: Appendices and Exhibits
• Small Business
• Online Business
• Home Business
• Entrepreneurship
• Operations & Success

Susan Ward has run an IT consulting firm and designed and presented courses on how to promote small businesses.

A simple coffee shop business plan can help you get your business off the ground by following a standard layout consisting of a single document divided into several sections. Included should be a description of the organization, market research, competitive analysis, sales strategies, capital, and labor requirements and financial data.

Business plans range from a few pages to hundreds of pages long depending on the size and scope of the business. For a relatively small business like a coffee shop, it is best to be succinct and keep the plan to 30 pages or less, especially if you intend to submit it to bankers or investors for debt or equity financing. Potential investors want to see solid research and analysis presented in a concise form.

To give your plan more visual appeal Include photos, designs, or site plans of prospective premises to give your plan more visual appeal. Charts and graphs help illustrate financial information such as revenue projections.

A basic business plan for a coffee shop can be done in eight sections, plus a title page.

Enter your business information starting with the legal name. If you already scouted a likely location or have a website in place, include the addresses. If you have a business logo, add it at the top or bottom of the title page. The title page also should include a table of contents that lists each section and the page number where it begins.

Business Plan

Java Jake's Coffee House

October 15, 2017

2303 Stewart St. East Clovervale 609-458-2020 email: jj@javajakescoffeehouse.com web: javajakescoffeehouse.com

Presented to: "Name" "Company or Financial Institution"

Table of Contents:

1. Executive Summary

2. Business/Industry Overview

3. Market Analysis and the Competition

4. Sales & Marketing Plan

5. Ownership and Management Plan

6. Operating Plan

7. Financial Plan

8. Appendices and Exhibits

Section 1: Executive Summary 

Place the executive summary near the beginning of the plan, but write it last. It should provide a short, concise, and optimistic overview of your business that captures the reader's attention and gives them an interest in learning more about it. The executive summary should be no more than two pages long, with brief summaries of other sections of the plan. 

Java Jake's Coffee House will be the go-to place for coffee lovers. We plan on serving the highest quality coffee and snacks in a trendy, comfortable atmosphere. Our convenient location and excellent customer service should build a steady repeat customer base.

Owners Jack Valdez and partner Juanita Sanchez each have more than a decade in the food service industry, including management experience.

Our main products will be higher margin gourmet coffee products such as espressos, cappuccinos, lattés, and a variety of snacks, including healthy alternatives.

Strategically located within easy walking distance from the technical school, nursing colleges, and a variety of office complexes, we intend to cater to students and young office workers by providing plenty of seating space and superior customer service with a trendy vibe. 

In the immediate area, our competition consists mainly of fast food vendors such as McDonald's and Dunkin. We plan on capturing the upper end of the local coffee market by serving gourmet, nonmachine-made coffee products at reasonable prices. Along with our superior atmosphere and great customer service, we intend to target sophisticated coffee consumers. 

The location we have selected has 2,000 square feet of space, room for an outdoor patio, and requires minimal renovations. The space has been vacant for several months and the owner is motivated and has offered a four-year lease with a fifth year free.

We expect sales revenue to grow from $200,000 in the first year of operations to $250,000 by the end of the third year. To minimize operating expenses, both of the principals will be onsite on a full-time basis to reduce staffing costs, supervise, and maintain quality control. We expect net profits to grow from $50,000 to $100,000 by year three.

$200,000 in startup funding is required for lease costs, renovations, equipment, and furniture. The principals have $100,000 in cash and will obtain the rest from commercial lenders.

Provide an overview of the coffee industry , the local market, and what makes your business unique.  

The Coffee Industry

According to analysis by Pew Research, millennials have overtaken baby boomers as America's largest living generation.   Millennials are more social and mobile than previous generations and prefer to have coffee with friends in trendy, public locations, increasing the popularity of high-end coffee shops. U.S. statistics indicate that:  

• Gourmet coffee's popularity is increasing across diverse demographics
• Americans consume more than 600 million cups of coffee per day  
• Retail sales of coffee exceed $47 billion per year  

Our Position in the Industry

East Clovervale is an affluent area with a high density of students and young professionals, an ideal market for a coffee shop such as Java Jake's Coffee House. People in this area can afford to spend money on specialty coffees and snacks and are willing to do so.

Our market research has shown that seven out of 10 people polled in East Clovervale consume at least three cups of specialty coffee per week. 

The Competition

While there currently are two other coffee shops within the immediate area, neither offer patio seating or substantial parking. One does not offer free wifi.

What Makes Java Jake's Coffee House Unique

Java Jake's Coffee House marketing strategy is to cater to the the young and young at heart with top quality products, great service, and plenty of seating indoors and out. We aim to be the place to meet with friends, relax, and enjoy a great cup of coffee. Ultrafast wifi will enable students and business people to readily communicate and work on school or business activities. 

Demonstrate that you have thoroughly analyzed the target market and that there is enough demand for your products to make your coffee business viable. The competitive analysis includes an assessment of the competition and how your coffee business will compete in the sector.

Given the proximity to schools and office complexes, our primary target market will be students and professional business people. Both groups are heavy consumers of coffee, tea, and snacks. 

Based on our customer surveys, there is a strong demand for a high-end coffee shop in a central location that serves great coffee and has both outdoor seating and available parking. The three most common complaints about the existing competition in the area are:

• Inconsistent product:  Discerning customers are reluctant to become regular patrons of a coffee shop that cannot consistently serve a high-quality product. 
• Lack of patio seating:  Many people prefer to consume their food and beverages outdoors on a sunny day.
• Lack of parking:  The lack of parking makes it difficult to attract vehicle commuters.

The local customer base consists of approximately:

• 3,000 students from two post-secondary schools
• 200 school staff
• 1,000 business people and office workers

Both schools have solid attendance and are expanding their student populations. The local business market is strong and has been relatively unaffected by previous economic downturns.

Compared to our compeition, we expect our revenues to grow strongly as we build our customer base:

Describe how you intend to entice customers to patronize your coffee shop, including advertising, promotion, pricing strategy, sales, and service. 

Our Product Offerings

The existing competition uses lower grade beans, inexpensive equipment, and does not properly train staff — resulting in inconsistent product quality and dissatisfied customers.

At Java Jake's we are passionate about coffee and intend to focus on consistently serving the highest quality product by:

• Sourcing premium beans and snacks and maintaining freshness at all times.
• Using a top-of-the line espresso machine and related equipment.
• Providing baristas with professional training.

By focusing on quality, consistency, and great customer service, we will build a steady repeat customer base.

Pricing Strategy

We intend to focus on specialty coffees including espresso, cappuccinos, mochas, etc. as the profit margins are much higher than regular coffee. To command a higher price for regular coffee, we will not use drip machines. Instead, each cup will be single served using a coffee press so that every cup is up-to-the-minute fresh and delicious. 

Our pricing will be competitive with the higher end of the market. We believe that customers will be happy to pay top prices for a great cup of coffee.

We will be offering counter service in a professionally designed, cozy, inviting interior space. Interior seating will be a mix of smaller individual tables for intimacy, and longer, bench-style ones for larger groups. Exterior seating will consist of weatherproof tables and chairs with available sunshade umbrellas. We intend to be open from 6:30 a.m.-9 p.m. on weekdays, and 7 a.m.-9 p.m. on weekends.

In addition to cash, credit, and debit, we also will be accepting Apple Pay for purchases.

Advertising and Promotion

To minimize costs and connect with our customer demographic, most of our advertising will be of the digital variety. We intend to aggressively promote our products using the following methods:

• Posters on the local campus billboards
• Our state-of-the-art website
• Daily specials announced on Facebook, Instagram, and Twitter

Statistics demonstrate that loyalty cards are highly effective, and Java Jake's will use a custom-designed rewards card to promote repeat business.

Describe the legal structure, ownership, and (if applicable) the management and staffing requirements of your business. 

Ownership Structure

Java Jake's Coffee House is a private corporation registered in the state of Texas. The business is 100% owned by Jack Valdez and Juanita Sanchez:

• Jack Valdez: 60 Class A Shares
• Juanita Sanchez: 40 Class A Shares

Owners Jack and Juanita will co-manage the business, and at least one will be present at all times during open hours. Both owners have previous food service management experience and are trained and experienced baristas.

External Resources and Services

Melford's Design Services will be contracted for the interior design of the premises.

Jackson and Jackson will provide accounting services for the business.

Jody's Catering will supply the baked goods.

Outline the physical requirements of your business, such as retail space, equipment, inventory and supply needs, labor, etc. For a business such as a coffee shop that requires custom facilities, supply chains, specialized equipment, and multiple employees, the operating plan needs detail. 

The premises we have chosen are at 2303 Stewart St. The space features:

• 2,000 square feet of indoor space in a modern, well-maintained building in an excellent location
• Approximately 500 square feet of outdoor patio space, with lockup racks for bicycles
• Existing zoning for restaurant usage
• A four-year lease at $3,500/month with a fifth year free
• The building owner is responsible for trash collection, recycling, pest control, and security
• Utilities (water, electricity, gas, internet, phone) are estimated to be $800 per month

The previous tenant was a restaurant, and there are existing kitchen and washroom facilities already in place. The previous tenant has offered to sell used kitchen equipment at heavily discounted prices.

Two full-time and four to six part-time baristas will be hired at industry standard wages. Baristas will be trained at a regional barista training academy. The two full-time employees are previous employees of the owners. The part-time employees will be sourced from the local post-secondary institutions.  

Owners and staff will share all regular duties, including taking orders, making coffee/tea, clearing tables, restocking, dishwashing, maintaining washroom facilities, etc.

To increase employee loyalty, a bonus/profit sharing system will be put in place.  

The following equipment will be purchased:

• Commercial grade La Marzocco Espresso machine ($25,000)
• Espresso grinder ($1,500)

We currently are negotiating the purchase of used commercial equipment from the previous tenant, including:

• Glassdoor fridge ($1,000)
• Dishwasher ($1,500)
• Microwave ($700)
• Misc. shelving, storage bins, etc. ($500)

Maintenance contracts for the equipment will be negotiated with local vendors.

We have negotiated an agreement with Murphy's Coffee Wholesalers to supply premium gourmet Columbian coffee/espresso beans with two-day shipping. Milk, juices, soft drinks, fruit, etc. will be sourced from the local Costco.

Muffins, scones, cookies, yogurt fruit cups, and sandwiches will be supplied on a daily basis by Jody's Catering.

This is the most important section of the business plan, especially if you need debt financing or wish to attract investors. The financial plan has to demonstrate that your  business will grow  and be profitable. To do this you will need to create projected income statements, cash flow statements, and balance sheets. For a new business, these are forecasts, and a good rule of thumb is to underestimate revenues and overestimate expenses.

Include these financial statements:

• Income Statements:  These shows your projected revenues, expenses, and profits. Do this on a monthly basis for at least the first year for a startup business.
• Cash Flow Projections:  These show your monthly anticipated cash revenues and disbursements for expenses. It is important for demonstrating that you can manage your cash flow and will be a good credit risk.
• Balance Sheet:  This is a snapshot summary of the assets, liabilities, and equity of your business at a particular point in time. For a startup, this would be on the day the business opens. Note that a new business will have no accounts receivable entries on the balance sheet. Note also that the balance sheet is much simpler for unincorporated businesses without employees. Income tax, pensions, medical, etc. are only applicable to incorporated businesses, as are earnings/retained earnings.
• Breakeven Analysis : Including a breakeven analysis demonstrates to financiers or investors what level of sales you need to achieve to make a profit.

Section 8: Appendices and Exhibits

The appendices and exhibits section contains any detailed information needed to support other sections of the plan.

Possible appendix/xxhibit Items include:

• Credit histories for the business owners
• Detailed market research and analysis of competitors
• Resumes of the owners and key employees
• Information about your industry
• Information about your products/services
• Site/building/office plans
• Copies of mortgage documents, equipment leases, etc. (or quotes on these)
• Marketing brochures and other materials
• References from business colleagues
• Links to your business website
• Any other supporting material that may impress potential lenders or investors if you are looking for financing.
• How to Start a Successful Coffee Shop
• How Market Positioning Helps You Connect With the Right Customers
• How to Write a Business Plan for a Pet Business
• How to Write a Restaurant Business Plan
• Important Barista Skills That Employers Value
• How to Start a Vending Machine Business
• How to Write a Home Business Plan
• 6 Essential Parts of a Retail Business Plan
• Learn About the Structure of Starbucks
• The Most Common Business Plan Mistakes
• 9 Critical Steps to Writing a Business Plan
• The Best Small Business Opportunities
• Sample SWOT Analysis for Business: The Kroger Company
• How to Write a Professional Technical Feasibility Study
• Should You Buy or Start a Small Business?
• How to Write a Food Truck Business Plan

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13 Tips to Open a Successful Coffee Shop

Worldwide, experts estimate that people drink about 2.5 billion cups of coffee a day. Sales in the ready-to-drink market—which includes coffee shops—are forecast to grow by 67 percent between now and 2022. Additionally, coffee and other ready-to-drink shops show incredible resilience in volatile markets, helping to eliminate some of the uncertainty associated with small business ownership. If you’ve been thinking of combining your love of coffee with your entrepreneurial spirit, it may be time to try your hand at opening a coffee shop.

What You Need to Open a Coffee Shop

Aside from a love of that sweet java, you’ll want to get a few things in order to get your shop up and running. To help with this, Jack Wilson, owner of Radio Coffee and Beer in Austin, Texas, and Marc Renson, owner of Ambition Bistro in Schenectady, New York, stepped away from brewing and serving to offer 13 tips to prospective owners. Here’s what they recommend you consider when starting a coffee shop:

• Write a business plan
• Find the right location
• Develop a floor plan
• Hire an accountant
• Find local funding options
• Save money for your personal expenses
• Compare prices and quality on everything
• Network with lenders and other coffee makers
• Develop your marketing plan
• Focus on the Exterior
• Remain positive
• Hire slowly
• Set high standards

1. Write a business plan for your coffee shop

One of the most vital steps you’ll take toward starting your coffee shop is to write a business plan. This document spells out:

• What your business is and who it serves
• How it will be profitable
• Your target market (primary customer demographics)
• Your competitors
• Sales and revenue projections
• Milestones and goals

Keep your business plan lean

Before you dive into creating a traditional, long-form business plan, we recommend creating a one-page pitch. This will allow you to quickly validate your business idea and get a good sense of who your market is, how you’re going to reach them, and find ways to differentiate yourself from your competitors. Will you serve pour-overs exclusively? Will you only use high-end coffee grinders and bean varieties? Will you include baked goods on your menu as well?

Similar to a thorough executive summary, this one-page pitch or Lean Plan  is a faster, more efficient way to plan your business.

Browse our free coffee shop sample business plans

Need help getting started? Check out our business plan templates for guidance. They’re free real-world examples for you to work from and are available to download and edit as Word documents. Whether you’re starting a little coffee and internet café or a coffee house bistro, there’s a business plan template—a sample business plan—to suit your coffee shop needs.

Coffee Kiosk Business Plan

Read how The Daily Perc opened drive-thru and mobile coffee stands, serving coffee drinks and other beverages to their target market: daily commuters and captive consumers.

Coffeehouse Business Plan

This sample business plan describes how Dark Roast Java attracted a diverse clientele with its Mediterranean art glass decor.

Internet Cafe Business Plan

The JavaNet Internet Cafe was a true visionary business sample plan when it was written, and with most coffee houses adopting some form of this plan, it’s obvious that it was an idea ahead of its time.

Cafe Bistro Coffeehouse Business Plan

The Watertower Cafe sample business plan describes how the cafe will establish itself as a “destination” of choice to the many residents of the greater Atlanta metropolitan area, as well as numerous out-of-town visitors by providing affordable high-quality food, coffee-based products, and entertainment.

Coffee Roaster Business Plan

Beanisimo Coffee is a startup coffee roaster in Salem, Oregon. Founder Frank Jones aims to bring old-world Italian traditions and recipes to meet the market need for premium coffees. His target market is coffee houses, restaurants, and grocery stores.

The key to making a sample business plan useful is to take the time to modify it so it’s right for your business. A lot of the benefit of creating a business plan is in the process of thinking through each part of the plan. Not sure if you need a plan? Check out this article on reasons why having a business plan is important.

2. Find the best location for your coffee shop

To be successful, you need the right location for your coffee shop. You want something that fits the following parameters:

• Centrally located and easy to access
• Highly visible and experiences consistent foot traffic
• A space that fits your vision

Jack Wilson, the owner of Radio Coffee and Beer, warns that finding this dream spot won’t happen overnight.

His team scoured city after city, scouting each location, even going so far as to count pedestrian traffic by hand. He was looking for a former restaurant space, so he didn’t have to remodel everything from scratch. Finally, one day when he dropped his keys on the sidewalk he noticed a tiny “for sale” sign in a former tavern window. After months of searching, he’d found his spot.

Keep in mind that effective restaurant spaces are highly sought after and difficult to find. It may take a while to find just the right spot, but for a business type that benefits from ease of access and casual traffic, it’s worth taking your time to find the right spot.

3. Create a floor plan

A solid and welcoming floor plan is vital for a coffee shop. You want customers to have space to form a line, employees to have the materials they need within reach for quick access and a comfortable seating area. As with finding a location, it will take some time to produce a good floor plan.

According to Wilson you should, “walk yourself through every scenario you can think of,” he says. “If you’re making coffee, what needs to be near you? If you’re a customer, what do you want in a seating area? Visualize everything you can and start putting those ideas down on paper.”

Demo floor plan via RoomSketcher.

Design your cafe floor plan online

Here are a few free websites you can use to kickstart your planning process. Once you’ve drawn up an initial sketch on paper, get online and make it a reality.

Autodesk Homestyler (free): This is probably my favorite option. You can either start designing your floor from scratch or choose from a gallery of designs to personalize with your own look and feel. In fact, there’s even an option to experiment with real-world products and brands. When you’re done, you’ll be able to share the design as part of your planning process. It can even be used as part of your pitch to potential investors.

Floorplanner: This software is clean and simple to use, with plenty of drag-and-drop furniture and other items to fill out your design. It allows for both 2-D and 3-D visualization of your designs and can be easily printed out if needed.

Gliffy: While it may not be the go-to floor plan solution, I’ve included Gliffy on this list anyway, due to it being a well-known diagram and flowchart application. If you’ve used it before, you may want to give it a try to minimize the learning curve and jump right into designing. While you’re at it, you can even plot out your SWOT analysis.

4. Hire an accountant

One of the best pieces of advice Wilson says he can offer a new coffee shop owner is to turn your books over to an accountant. Aside from taking valuable time away from the business, having a numbers expert works in your favor.

“You won’t be as hard on yourself as you sometimes might need to be,” Wilson says. “Plus, you will make assumptions that an accountant wouldn’t make.”

In reality, your accountant is really your small business consultant. Make sure you find someone who believes in you and can help accomplish your business goals. If you’re unable to hire an accountant right away, you can also look to an online option like QuickBooks . The benefit of online accounting software is that you’ll have direct visibility into the day-to-day finances of your business. As an added benefit, it also directly integrates with the LivePlan business planning software, allowing you to actively compare forecasts and actuals on a dime.

Both are great options for managing your finances, and the decision fully depends on your situation and level of expertise.

5. Attain funding from local sources

Finding startup funds for a coffee shop can be difficult. Renson suggests talking with friends and family about investing in your coffee shop first. Present a solid business plan to them and ask them to invest in your business.

If funding via your family isn’t an option, or if you need more cash than your family can provide, Renson suggests looking into local loan options. In some cases, cities offer business assistance programs to offset costs. Consider an SBA-backed loan or see if a local bank or credit union is an option. Keep in mind that any bank loan will require you to show evidence that your business has some traction already. They want to know you’re a reasonable risk. So if you’re not up and running yet, there are other options for bootstrapping your business that you might consider.

6. Save money for your personal expenses

When identifying startup costs , don’t forget that you need to consider your own personal expenses alongside your business. All of your time and energy will be devoted to your new business, which potentially won’t be profitable for around six-months, even if you start bringing in revenue immediately.

So, plan ahead. Renson suggests making sure you set aside enough money to cover your personal expenses for at least six months if not longer. You’ll need to decide whether it’s possible to run your coffee shop while working another job or side gig or if you’ll be able to solely focus on your new business.

You will also want to understand the concept of cash flow . Considering that over half of the businesses that fail are profitable on paper when they fail, you’ll want to be sure you understand how much cash you’ll need on hand.

7. Shop around for everything

While you’re in the planning and funding stages and working through your finances,  keep a list or spreadsheet of all the startup expenses you’re looking at so you can compare prices.

Before you buy, try to get at least two price quotes for every item so you’re not losing money on basic necessities or recurring costs. Use the internet to your advantage and look for the best prices on everything from comfy chairs to espresso machines.

8. Network your heart out

Having a hot location and brewing superior coffee will only get you so far. You need to network to maintain a connection to the area and to attract more customers. Look into joining the local chamber of commerce, a business association, or partner with a local charity. Be visible in your local community and get dedicated partners long before you open your doors.

9. Develop your marketing plan — before you open

If you start marketing the day you open, you’re already behind. On opening day , you want people excited to come in. You’ll want to develop your marketing strategy and begin advertising to potential customers several months before opening.

Affordable marketing options to consider:

• Partner with other local businesses by providing free coffee in exchange for on-site advertising.
• Leverage social media as direct communication with your customers.
• Participate in local events, providing free specialty coffee samples leading up to your grand opening.
• Do a small direct mail or email campaign that sends coupons to local residents or businesses.
• Call everyone, including the media, to tell them about your plans to open the shop.

Image via Radio Coffee and Beer .

10. Don’t just focus on the interior of the building

It’s likely that you’ll stress over every little detail of your shop, from what paintings to hang on the wall to the point of sale system (POS System) you’ll use. That being said, it can be very easy to ignore the exterior of your shop or coffee cart which directly contrasts with choosing a location with heavy foot traffic.

According to Wilson, you’ll want to “pay attention to the landscaping, signage, and exterior appearance because that’s the first thing people see.” Some people decide whether or not to come in based on their first impression of the building, so make it count.

By creating a clean and unique exterior, you’ll begin to create a buzz in your community. People will start to wonder, who is setting up shop there? Every little thing you can do to attract attention to your coffee shop can serve as a marketing tool.

11. Have a positive attitude

Like every business, you’ll face challenges to get your shop off the ground. Renson says keeping a positive attitude when things aren’t going your way is a must. Not only does it benefit your outlook, but it showcases strong leadership to your employees and a welcoming presence for customers.

Fake it if you have to. If you get in the habit of keeping an optimistic attitude, even if it’s less than genuine to start, you’ll eventually teach yourself to stay upbeat and will keep those around you optimistic and ready to work.

12. Hire slowly

You need help manning the register, waiting on customers, and making drinks, but don’t hire too many people too fast. Renson suggests hiring a few friends, or neighbors who will volunteer to help you out for the first few weeks. Slowly, bring on staff as needed.

Hiring trusted staff can be tough. No matter how well someone does in an interview, you don’t know how well he or she fits until they’re on the floor. Keep a close eye on the register, Renson suggests, and don’t be afraid to let people go if they are hurting the business.

13. Set high standards

It’s okay to set high standards for your employees and overall business. That’s not to say that you should micromanage your employees. You’ll want to focus on effectively training your staff at the start and building an effective workflow that encourages collaboration and high-quality work. Their ability to make good coffee drinks quickly will have an impact on customer loyalty and satisfaction.

Starting an independent coffee shop is hard work, but that doesn’t mean it has to be a long-term struggle. If you focus on establishing these core pieces while developing your coffee shop business plan, you’ll set yourself up for success early on.

Learn more about running a successful coffee shop:

This article is part of our Cafe Business Startup Guide —a curated list of articles to help you plan, start, and grow your cafe business!

• 6 Tips to Maximize Your Coffee Shop’s Revenue
• Get Your Cafe Business Up and Running with These Handy Resources
• Free Cafe and Coffee Shop Sample Business Plans
• Free, downloadable business plan template
• Should You Serve Fair Trade Coffee?
• Know Your Industry Before You Start Your Business

Candice Landau

Candice is a freelance writer, jeweler, and digital marketing hybrid.

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How to Create a Coffee Shop Business Plan and Executive Summary: Free Template & Guide

By Debra Weinryb

Before you open a coffee shop, you will need to have a coffee shop business plan. This important document acts as a roadmap for your coffee shop business adventure – with everything you need to turn your business dreams into a reality. 

If you’re passionate about coffee but have never written a business plan before, it can be nerve-racking to start. To help you out, we’ve put together a complete guide to writing a successful coffee shop business plan. In this guide, we’ll cover:

• What is a coffee shop business plan?
• How to write a business plan for a coffee shop
• The 10 sections of every successful coffee shop business plan
• A free coffee shop business plan template

Create a custom business plan for your coffee shop concept with this free template.

What is a Coffee Shop Business Plan?

A coffee shop business plan is a document that explains what your business idea is and how it will succeed. It answers several questions, like how you will set up your coffee shop, how you will fund your business, and what revenue you expect to make. It includes information about your marketing plan, sales strategy, coffee shop customers , pricing structure, competitors, required labor, and financial plan.

Similar in length to a traditional restaurant business plan , it’s a succinct document that usually spans 15-20 pages, but no more than 30 pages. Coffee shop business owners can make their plans pop with visuals like photos and designs of their coffee house, and site plans of their retail store. Charts and graphs are also used to show financial inventory information, like how much coffee beans will be purchased monthly and at what cost, for example.

Once complete, you will be able to show your coffee house business plan to potential investors, bankers, and business partners. That’s why it’s so important to dedicate a large amount of time and energy into getting your java shop business plan underway early on.

How to Write a Business Plan for a Coffee Shop

With the proper guidance, your brew shop business plan can be easy to write. That’s why having a coffee shop business plan template is a useful aid for conceptualizing your business and goals before you start to write. Additionally, having a coffee shop business plan example can help you think of key elements to demonstrate your coffee shop’s potential for growth and profitability – which are both important to attract funding.

Elements of a Coffee Shop Business Plan

Executive summary for a coffee business .

Start with your executive summary – a short and high-level overview of each section in your coffee house business plan. In any business plan sample for a coffee shop, you’ll see that this is the first section because it gives readers crucial information about your business before you dive into details.

The executive summary section describes your business concept, the problem it solves, your target market, financial highlights, lease information, as well as your vision for the menu, products, and how you will service coffee – whether that’s in a kiosk, drive through, pickup, or sit-down coffee shop. 

As you write your executive summary, consider who will read your brew shop business plan and what you would like them to know. After all, you want to capture your reader’s attention and entice them to continue to read or even invest!

Here are a few key points of interest you can mention in your executive summary:

• Ambiance: The character and atmosphere of your coffee shop
• Location: Information on your potential foot traffic, facility/lease, and seating capacity.
• Kitchen storage: Space for multiple blends of coffee or a high-end espresso machine.
• Goals: Your mission statement and guiding principles that will drive your success.
• Funding: What funds you need and how you will use them to achieve your vision.

Business Overview

The Business Overview section takes a deeper dive into the coffee industry as a whole, your local market, and what makes your coffee shop model unique among the competition. Here, start by giving a brief overview as to when and why you started your coffee shop business. In addition, you can include major achievements such as hitting target sales goals or opening new coffee shop locations.

In this section, you can also go into more detail about the business operations of your neighborhood coffee shop . For example, explain what coffee and food products you will offer, your hiring and labor practices, and how you’ll brew coffee. This, of course, will depend on your coffee shop business model. 

Here are a few types of coffee shops and how they could be described:

• Grab-and-go coffee shop: Pickup or drive through only, so folks can grab a cup of coffee in a heartbeat
• Traditional coffee shop: Sells baked goodies and a variety of coffee drinks in a relaxed atmosphere
• The coffee bar: Like a homey living room, with lounge music, WiFi, and fresh coffee

Management and Staff

In this section, you will talk about ownership. Start with the business owner(s) who will manage your coffee shop, and talk about their experiences/qualifications that will make them successful. You’ll also include details of who will take care of your day-to-day coffee shop operations. 

Every coffee shop will need baristas who take care of sales and make drinks, but those that sell food may also need someone to operate basic kitchen equipment. Additionally, you may want to hire someone to do marketing and advertising, or an accountant to take care of your bookkeeping. 

After deciding on what jobs you want to create, you’ll need to identify if they are part-time or full-time, how you will recruit/train them (e.g., barista training), and what you will pay them in wages and benefits. Your employees will factor into your financial forecast and expenses later on in your business plan for a coffee shop, so it’s essential to get a head start on your hiring budget.

Coffee Shop Market Analysis

Your Market Analysis section should show that you’ve looked at your target market, assessed your location, and understand how you’ll compete against other coffee shops in the area. Remember to consider what makes your restaurant unique and what will help it stand out. Here are two ways you can do just that:

Mention if your coffee shop is in a central location, such as near a college where students break for lunch, or next to office buildings where professionals drop in on their way to work. If you are one of many coffee shops in an area, consider pointing out what makes you different, like your wide variety of specialty coffees and the quality of your food.

Customer Analysis

Include information about your ideal customer – with details on who they are, why they shop at your coffee shop, and any metrics. If you performed market research before starting your coffee shop, include that too. For example, if you have data on a high demand for espresso in your area, the sales potential for a drive-through espresso stand could be very promising.

Sample Menu

A section with a sample menu lets investors know exactly what you’ll be serving. Keep in mind that your sample menu should be a differentiator – otherwise, why would investors think that customers should choose your coffee over competitors who serve similar drinks?

Here are a few tips for choosing what to include in your great sample menu:

• Think about the types of coffee beans that could set you apart. Maybe you only serve organic coffee beans, unlike your competitors.
• Cater the types of drinks you serve to your target market. For a young customer, sweet frappuccinos, hot chocolates, and drinks topped with whipped cream can be popular. For health-conscious consumers, options like tea and “light” coffee may perform better.
• If your customers will be hungry, such as students on a lunch break, or employees on their way to work, then consider including food items like pastries.

Marketing Plan and Publicity

An effective marketing plan is essential for bringing new customers through your coffee shop’s door and retaining your loyal guests. In this section, start by describing how you want to drive incoming traffic, in addition to what budget you have in mind, and your expected return on investment. If you have a lot of detailed information, you may want to create a separate marketing plan document.

To cover all your bases, you can include the Four Ps of Marketing:

• Product: What beverage and food products you will offer? For example, will you offer non-coffee drinks, frappuccinos, espresso, or cold brews?
• Price: What is your average price point and how does it compare to competitive coffee shops?
• Place: The location of your coffee shop and how it will impact your success. For example, will you operate kiosks, and if so, where will they be placed to get the most foot traffic?
• Promos: How will you drive customers to your location(s)? Examples include live music, giving free samples, advertising, or partnering with influencers or other organizations.

Business Operations and Operating Plan

The business plan operations section includes the physical requirements of your coffee shop business, like retail space, specialized equipment, supplies, and labor. When describing your business’ operational expenses, also consider showing where your coffee shop is trying to save money. For example, if you are buying used furniture or equipment, let your reader or potential investor know how you are cutting losses. 

Here are a few areas you can include in the operating plan section:

Retail Space

• Space you plan to lease, buy, or rent for your coffee shop
• Parking spaces for a truck or for customers to access your coffee shop

Specialized Equipment

• Coffee machines like a coffee grinder, a brewing machine, or a hot water dispenser
• Specific arrangements like a sandwich prep table, counter space, or a display case
• Technology such as a coffee shop POS to process transactions and track inventory
• List your suppliers according to type – for your coffee beans and other food and drink products
• Menu items you will buy vs. make in your coffee shop, such as croissants or cookies
• The frequency at which you need to restock your coffee shop inventory
• Staff such as a Barista to brew coffee
• Staff to do food preparation, menu creation, and cleaning
• A manager to oversee payroll and human resources

Financial Forecast and Expenses

This is an important section, especially if you need to attract investors to your coffee shop. Since coffee shops are often smaller storefronts, usually with a lower profit margin , this section needs to emphasize how your coffee shop business will grow and be profitable in the long-term. 

Your financial forecast and expenses section should include the following:

• Cash flow statement with monthly projections for all your coffee shop purchases
• Balance sheet to give investors a snapshot of your assets, liabilities and equity
• Break even analysis to demonstrate the sales you need in order to make a profit

Coffee Shop Business Plan: Next Steps and Plan Template

To get ideas of details to include, use a coffee shop business plan sample.

Whether you own a coffee shop or are just starting out, writing a coffee shop business plan is essential to your success. In such a highly competitive coffee market , you need a business plan to show potential investors what makes your store stand out. 

If you’re looking for a coffee shop business plan example, a template is a great place to start. By using a coffee business plan template , you can improve your chances of securing funding or attracting new business partners. Using a business plan sample for a coffee shop will also keep you organized and show readers how your coffee shop can be successful.

FAQs: Coffee Shop Business Plan

If you have any lingering questions, we’ve answered the top coffee shop business plan FAQs.

How profitable is a coffee shop?

A coffee shop business’ profits can range from 2.5% to 85% of gross sales, according to this Chron article . The amount of profit depends on the size of your coffee shop – smaller coffee shops usually have lower profits.

How do you start a coffee shop business?

To start a coffee shop business, do lots of research on the industry and your market so you can plan how to separate yourself, your menu, and the quality of your products from competitor coffee shops. Consider where your coffee shop might be located and what kind of customer base you’ll have. Map out the expected costs for operations, marketing, etc. in a financial plan. This will help you plan a strategy for success so you can create a strong coffee shop business plan to present to potential investors.

How much budget is needed to open a coffee shop?

How much budget you need to open a coffee shop will depend on the location of your business. Start by doing some research on real estate in the area where you want your coffee shop business, suppliers for your menu items, cost of hiring employees, and other operating costs. Also, consider what kind of marketing campaigns – such as email, direct mail, and advertisements – that you might want to run and include those in your budget too.

How do you start a business proposal for a coffee shop?

To start a business proposal for a coffee shop, use a coffee shop business plan sample and make sure you include the key sections: an executive summary, business overview, management and staff, market analysis, marketing and publicity, operations plan, and financial forecast and expenses.

Also, make sure you do enough research before you start so you understand how a coffee shop business works, your market, and your competitors, and have relevant facts and figures to support the plan for your new business. 

Debra was a Content Marketing Specialist at TouchBistro, writing about the latest food and restaurant industry trends. In her spare time, Debra enjoys baking and eating together with family and friends.

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Top Coffee Trading Brokers

These are the 3 best brokers for trading Coffee:

What Is Coffee Trading?

People all over the world love to drink coffee – collectively, we get through over 2.25 billion cups of the stuff every day. The enduring enthusiasm for the coffee bean has made it a highly valuable and widely-traded commodity, worth more than $100 billion annually.

The most commonly used financial instruments used for coffee trading are futures and options contracts, which allow you to speculate on coffee’s future price movements. Coffee ETFs (exchange-traded funds) are also becoming increasingly popular.

Coffee is grown in subtropical climates across Latin America, Asia and Africa. Brazil is the undisputed king of the coffee-exporting countries, producing 35% of the global annual crop. Other major coffee-growing nations include Vietnam, Colombia and Indonesia.

Beans are typically sent to countries in North America and Europe, as well as Asian countries like Japan and South Korea. It is estimated that over 1.7 million people in the US alone are employed in a coffee-related industry, accounting for 1.6% of the country’s total GDP.

There are two different varieties of coffee: Arabica and Robusta. Arabica is considered the premium bean thanks to its richer, sweeter flavour, accounting for 30% of total coffee production. Robusta, on the other hand, is bitter but more caffeinated.

However, it is often Robusta that fetches higher prices due to demand from global coffee brands like Nestle’s Nescafe. Change in demand from big companies also makes Robusta markets more volatile than Arabica.

Coffee Trading History

According to Ethiopian legend, coffee was discovered by the herdsman Kaldi when, upon eating the famous beans, his flock of goats became unable to sleep at night.

The accuracy of this story is a matter of debate but it is known for certain that people were drinking and trading coffee in Arabia as early as the 15th century.

Coffee houses were a cornerstone of medieval Muslim social circles, providing a space where people could go to catch up on news, play chess and listen to music.

The popularity of coffee and coffee houses had spread to Europe by the 17th century, despite the drink being initially labelled as a “bitter invention of Satan”.

These early cafés offered merchants a place to discuss trade, with some (such as Lloyds of London) going on to become financial firms.

Due to the demand for coffee in Europe, coffee plantations were established in the New World and elsewhere. To this day, coffee remains a globally important export product and is the second-most widely traded commodity after oil.

Today’s Coffee Trading Price

What influences the price of coffee.

Below, we have broken down the factors affecting coffee prices into six key areas:

Coffee production is highly dependent on the growing conditions, which in turn affects how the markets behave. A particularly bad year can push prices sky-high. In 1977, coffee prices hit 339.86 cents when Brazil experienced a devastating frost. Just two years earlier, the price had been 45 cents.

2. Distribution Costs

With some distance between the leading coffee importers and exporters, transport costs can have a large knock-on effect on prices: the higher the cost of transportation, the higher the price of coffee. Transport costs are heavily linked to oil prices, so investors trading coffee futures should always keep an eye on the energies markets.

3. Geopolitics

Coffee is often grown in regions that are prone to geopolitical instability (such as Ethiopia, Colombia, or Mexico). Civil unrest can disrupt the coffee harvest and the supply chains, increasing scarcity and pushing prices up.

4. Consumer Habits

Demand for coffee in the wealthy importing nations can fluctuate based on the season, the state of the economy or fashion. Coffee, like other hot beverages, is consumed less frequently in the summer months, resulting in a fall in coffee trading prices.

Consumers also tend to buy less coffee in times of economic slowdown and high unemployment. Occasionally, the debate surrounding the health impact of coffee can push consumption up or down, leading to a rise or fall in the market.

5. Strength Of The Dollar

How To Trade Coffee

Trading coffee is commonly done through futures contracts, wherein two parties (the buyer and the seller) agree to exchange an amount of coffee at a set date and price.

Futures are often used by coffee producers and consumers as a hedging strategy. Conversely, they are also traded by speculators looking to benefit from favourable price movements: if the future delivery price is greater than the current spot price, the contract is more valuable.

Coffee futures are preferred by many because of their high liquidity and volatility.

The New York Mercantile Exchange (NYMEX), NYSE Euronext, Tokyo Grain Exchange (TGE) and the Intercontinental Exchange (ICE) facilitate trading with coffee futures.

The standard lot size on the Euronext is 10 tons, which may trade upwards of 1,500 USD per ton. The total value of the futures contract is therefore 15,000 USD.

However, futures traders often use leverage to borrow money against the future price of the asset, reducing the deposit needed to open a position. Leveraged trading can produce large returns but may also magnify losses.

Coffee trading futures contracts sometimes come with an expectation that the physical commodity will be delivered. This means that the holder of the contract is responsible for covering any storage, handling and insurance costs when it expires. However, most futures contracts are traded out before expiration.

A popular method of speculating on coffee’s price movements is by trading coffee CFDs.

CFDs function in a similar way to futures: the buyer must pay the seller the difference between the current price of the underlying asset (in this case coffee) and its price when the contract expires.

However, the trader is not tied to the actual commodity. Many prefer the convenience of coffee CFDs over futures. Several leading online brokers offer coffee trading CFDs on their platforms.

Trading coffee CFDs allows the buyer to assume both long and short positions, depending on whether they think the price of coffee will rise or fall by the time the contract ends.

Like futures, CFDs come with a large degree of risk, particularly in the volatile coffee markets. Many experienced traders use leverage to increase the size of their position, though this also increases risk.

ETFs are an increasingly popular instrument used for trading coffee. These securities track price changes in an underlying asset (in this case coffee) but can be bought and sold on a stock exchange. Many investors use ETFs as they are easy to trade and generally less volatile than futures or CFDs. Coffee ETFs are also great for diversifying a portfolio and hedging against downturns.

One of the popular instruments used for trading coffee is the JO ETN (iPath Dow Jones-UBS Coffee Subindex Total Return ETN). This ETF has been designed to reflect the performance of the Dow Jones coffee index and is the largest and most liquid coffee ETF.

Another type of instrument used for trading coffee is options contracts, usually based on coffee futures. The holder of a coffee option has the right (but not the obligation) to take delivery of the coffee or cash settlement at expiry. Coffee options are used by some traders to limit losses as it is impossible to lose more than the initial premium paid to open the position. Options often also allow traders to take on additional leverage compared to futures.

Pros Of Coffee Trading

• High volatility
• High liquidity
• Range of instruments available
• Leveraged instruments available
• Second-most popular commodity by volume
• ETFs for more stable long-term investments
• Fundamental and technical analysis opportunities

Cons Of Coffee Trading

• Can be risky
• Futures can be expensive for retail clients

How To Start Trading Coffee

Step 1: choosing a coffee trading instrument.

Different coffee-based instruments suit the needs of different traders. Coffee futures are the traditional method but are often too expensive and complex for many retail clients, who may prefer to use CFDs or options.

These assets are risky, however, and should be traded carefully, especially when leverage is used. Traders that want a safer long-term investment might consider coffee ETFs, which are designed to track the overall performance of the coffee market. As a widely-traded commodity, coffee futures, CFDs and options markets tend to be highly liquid.

Step 2: Selecting A Coffee Trading Broker

Several leading brokers support the popular commodity. In the world of online trading, there are more than a few fraudulent firms: it is well worth doing a detailed background check to ensure that a broker is trustworthy and regulated.

You should also compare the asset ranges and leverage rates offered. The main factors we recommend you consider when choosing a coffee trading platform are listed below. Alternatively, check out our full broker comparison guide :

• Mobile apps
• Leverage rates
• Customer support
• Payment methods
• Spreads and commissions
• Range of coffee instruments

Step 3: Trading Coffee Strategies

Below are two basic strategies for trading coffee:

Trading Coffee Using Volatility

Many traders aim to capitalise on coffee’s volatile short-term price movements. This strategy involves large risks but the rewards balance that.

Day trading coffee requires close monitoring of the relevant charts and careful position execution. Common instruments used in this style of trading coffee are CFDs, options and futures.

An important indicator used in coffee volatility trading is the Bollinger Band – when this contracts, a sharp rise in volatility is likely to occur. Many traders wait for breakouts in the Bollinger band, which may indicate a strong movement in price action.

Trading coffee using volatility and leverage requires a strict risk management method and you must be prepared to cut your losses promptly and exit your positions when target objectives are met.

Trading Coffee By Trend Following

By monitoring any of the myriad factors affecting the coffee trading market, investors can speculate on coffee’s long-term price movements.

Factors like the price of crude oil and weather conditions in coffee-growing regions can cause prices to rise and fall quickly, so traders need to be hyper-aware of relevant news.

Prices also tend to fluctuate throughout the year as seasonal demand varies. Once a trend has been identified, moving averages or indicators like the MACD can be used to create buy and sell signals.

Step 4: Executing Your First Coffee Trade

Once you have decided on a strategy for your coffee trading, it is time to enter the market. Depending on the information available, decide whether you think prices will rise or fall and take a bullish or bearish position accordingly. It is important to monitor your trades closely as coffee prices can soon change. Be prepared to cut your losses: many new traders lose money by keeping positions open too long.

Top Tips For Coffee Trading

Finally, here are some helpful suggestions to help you trade coffee successfully:

• Diversify your portfolio by buying stocks in leading coffee companies like Starbucks or Kraft
• Pay attention to the weather conditions in coffee-producing nations, particularly Brazil
• Make note of oil prices, as this could increase the cost of coffee transportation
• Have a robust risk-management strategy – coffee markets can be volatile
• Monitor the activity of the large coffee-buying firms

Final Word On Coffee Trading

Coffee is a highly liquid but volatile global commodity that is heavily affected by weather, seasonality and the production of the beans, alongside other assets like oil and the USD. Popular instruments used to speculate on the price of coffee are futures, options and CFDs for short-term trading and stocks, ETFs and indices for longer-term investments.

Check out our guide and top tips above to get started with a broker for coffee trading and take your first position.

What Brokers Can I Use For Coffee Trading?

Most major brokers support coffee trading, including AvaTrade , eToro and Plus500 . The range of coffee-based derivatives will vary from site to site, so make sure there is one that suits you. Check out our full list of recommended firms here .

What Factors Affect The Price Of Coffee?

The key factors controlling the price movements of coffee beans include weather conditions in coffee-producing nations, oil prices and demand from the large coffee importers.

Should I Use A Coffee Trading Strategy?

Coffee is a volatile asset, without a good trading and risk-management strategy many traders will lose out financially.

Should I Use Options Or Futures For Trading Coffee?

Some traders prefer futures as they allow you to take ownership of the underlying commodity. However, futures contracts can be expensive compared to options, which also limit the maximum potential losses.

Should I Use The Arabica Or Robusta Market For Coffee Trading?

The Robusta markets tend to be the more volatile of the two types of coffee beans, offering higher risks but also higher rewards.

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Coffee Shop Business Plan Sample

• Fill the Form to Download Coffee Shop Business Plan Example

The coffee shop business plan is an essential tool for coffee shop owners and those who want to open a coffee shop.

A coffee shop business plan will give you an idea of how much a coffee shop will cost, how those costs will be funded, and how much money you expect to make from it. 

When it’s ready, you can show it to investors, banks, partners, and anyone else who can help you open a cafe. Getting this document right is worth your time and effort, so make sure you do it right.

After helping entrepreneurs in the USA launch more than 400 independent coffee shops , we know that a business plan is vital for success.

We are here to help you write a coffee shop business plan.

Here’s a business plan sample pdf and a template that will give you some inspiration for what should be included in your coffee shop business plan.

1. Business Plan Title Page

3. market overview, 4. competitive analysis, 5. swot analysis, 6. marketing plan, 7. funding request, 8. management summary, 9. financial highlights, coffee shop business plan powerpoint presentation, download coffee shop business plan example pdf.

Coffee Shop Business Plan Template

A coffee shop business plan template should include the following sections. Let’s look at a coffee shop business plan template and discuss what each section should include.

1. Business Plan Title Page 2. Executive Summary 3. Market Overview 4. Competitive Analysis 5. Swot Analysis 6. Marketing Plan 7. Funding Request 8. Management Summary 9. Financial Highlights

Start with the legal name of your business. Provide the address of a likely location or website if you already have one. Include your company logo at the top or bottom of the title page. On the title page, there should also be a table of contents listing each section and its page number.

What makes a great cover page for a business plan?

Visit our page on business plan cover page examples to download our free business plan cover page templates and create a beautiful cover page yourself.

2. Executive Summary

The Coffee Shoppe will be a business service provider based in Miami, Florida. Founded by Mrs. Nancy Harrigan.  The Coffee Shoppe will offer a menu of services which include coffee, lattes, capacinos, expressos, deli sandwiches and baked goods.

While these services will comprise the initial market entry core, long-term plans call for the integration of storage and relocation capabilities to the business mix.

The local area has been in dire need of a service of this type for some time and The Coffee Shoppe plans to adequately serve them through the consistent delivery of real-time hospitality. 

The market is definitely filled with opportunities but in order to capitalize on them, a strong infusion of working capital must be acquiesced. 

The founder projects needing 100K for their business venture with repayment being made out of the profits that are driven annually. Funding that is secured will be used in a variety of areas including marketing, logistics, management, site procurement as well as the day to day operations of the organization.

The marketing for The Coffee Shoppe will be done through a variety of mediums including the Internet, mass media, print and networking. Internet efforts will center on the creation of a user-friendly website that clearly list all of the core services that will be offered. 

To read the full executive summary, click here to download the PDF

Read more: Executive summary examples

Financial Highlights

The Company is entering the market at a time when the industry in which it operates is experiencing substantial growth. According to market research firm IBIS World, the Coffee & Snack Shops Industry has seen an average annual growth rate of 5.8% over the last five years, positioning industry revenue to be around $47.7 billion in

2018. The Coffee & Snack Shops industry is projected to see an average annual growth rate of 1.4% over the next five years, placing industry revenue at $51 billion in 2022.

Market Analysis

Target Market

The following is a listing of the primary competitive advantages of the Companv upon entering the market

• Congenial customer service
• A central location wit greater foot traffic Parking facility available for customers
• Soothing ambiance for calm eating
• Excellent visibility from the road
• Aggressive marketing campaian
• Understanding visitors food choices and integrating the same in the menu
• Inviting feedback from customers
• Key understanding of trends and flavor
• The company will hire experienced management and staff

The following is an analysis of the  SWOT analysis of the coffee shop business as well as the opportunities and threats present in the market.

• Location. The location is one of the primary strengths of the The Coffee Shoppe business model as there are currently no other organizations that have the capabilities to offer the types of services that will be introduced to the market.
• The founder. Founder Nancy Harrigan is a seasoned, strategic business professional with an eye towards success, profit and achievement. These qualities will form the basis of the The Coffee Shoppe brand and be a catalyst that propels the success of the operation.
• Servicing of a need. The services that will be brought to the local residents of Miami are one that is truly needed. The fact that The Coffee Shoppe will be satisfying this need will endear the organization to the customer base and allow for consistently strong growth.
• Lack of funding. Funding is the sole weakness of the The Coffee Shoppe business venture. While funding is a weakness it should be noted that the founder is confident that if adequate funding is secured, she will be able to develop a viable business.

Opportunities

• Limited competition. The limited amount of local competition is the primary opportunity for The Coffee Shoppe as it will give the organization the opportunity to develop a loyal customer base while erecting barriers to entry.
• Small business growth. The projected growth of small businesses will provide another opportunity and will feed opportunities directly into the The Coffee Shoppe pipeline.
• Larger organizations. Larger organizations could possibly realize the opportunities that can be found in the local region and begin entering the market. While this is a threat, the founder believes that with strategic marketing, community efforts and customer service, this threat can for the most part be mitigated.

Free: Business Plan Examples

Do you need help creating a business plan? Check out these six free, proven business plan examples from different industries to help you write your own.

Marketing for The Coffee Shoppe will be done through a variety of mediums with television, print and the Internet being the primary drivers. The website will have SEO capabilities and will be developed using all of the latest in web and graphics technologies.

In addition to the home website, plans also call for the creation of a strong social media presence using Facebook.com and Twitter.com with regular updates occurring on each of the aforementioned pages.

Commercial time has already been purchased through ABC and commercial production will begin immediately following funding acquisition. Print marketing will consist of advertisements being placed in publications that are typically read by members of the targeted audience including small business owners and corporate types.

Networking will round out the The Coffee Shoppe marketing mix with the founder joining various networking groups that give her the ability to champion the brand that she has created.

Read more: how to do market research research

Read more: ways to find investors for your business

Financial Indicators

To learn more about financial indicators, click here to download the pdf

Break even analysis

Profit and Loss Statement

Projected Cash Flow

Projected Balance Sheet

Coffee Shop Business Plan Sample. FAQs:

Starting a coffee shop can vary greatly depending on location, size, and concept. On average, the initial investment can range from $80,000 to $300,000. This includes lease deposits, equipment purchases, inventory, permits, and marketing expenses.

The specific permits and licenses needed will vary based on your location and local regulations. Common requirements include health department approvals, business permits, food service licenses, and zoning permits. It’s crucial to research and comply with all necessary legal requirements.

A successful marketing strategy is essential for attracting customers. Utilize social media platforms, collaborate with influencers, and host events to create buzz around your coffee shop. Offering unique beverages, outstanding customer service, and a welcoming ambiance will keep customers coming back.

While it’s not mandatory, offering organic or fair trade coffee can attract environmentally conscious consumers. It also reflects your commitment to sustainable and ethical practices, which can build a loyal customer base.

Track key performance indicators (KPIs) such as sales revenue, customer retention rates, average ticket size, and social media engagement. Analyzing these metrics will help you gauge the success of your coffee shop and identify areas for improvement.

Implementing a loyalty program, offering personalized perks, and providing excellent customer service are effective ways to retain customers. Engage with your audience on social media, respond to feedback, and continuously improve your offerings based on customer preferences.

Our free real sample business plans will show you how to write a plan that looks as polished and professional as this one.

Click to view the coffee shop business plan sample. Our experienced business plan writers professionally write each business plan and work with you to develop a winning plan.

We will show you some real-world business plan examples so you may know how to write your own, especially if you are seeking a bank loan or an outside investment and need to use SBA-approved formatting.

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The Ultimate Coffee Shop Business Plan and Template

If you are looking to write a coffee shop business plan, you have come to the right place.

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

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 coffee shop business plan.

Table of Contents

• 1 Why Write a Coffee Shop Business Plan?
• 2.1 Executive Summary
• 2.2 Company Overview
• 2.3 Market and Customer Analysis
• 2.4 Sales and Marketing Plan
• 2.5 Management Team
• 2.6 Financial Plan
• 3 Wrapping Up

Why Write a Coffee Shop Business Plan?

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

A coffee shop business plan will help you plan a strategy for success. It will consider factors such as opportunities, risks, and how you will market yourself . By having a good idea of this before you start a coffee shop, 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 with fewer competitors or find a way to make your coffee shop business stand out.
• By creating a marketing plan before you open, you can put yourself in an excellent position to make sales from the moment you start a coffee shop.
• By creating cash flow projections, you will be able to spot any potential financial 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 coffee shop 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 coffee shop.

You’ll likely need to submit the business plan 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 done your market research and analyzed your idea which 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. This will include your income and expenses and you’ll also need to include a section that discusses how you will use the money you’re raising.

Coffee Shop Business Plan Template

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

Nonetheless, a coffee shop business plan template 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 coffee shop 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 business 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 house in town, for example?

Coffee shop 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 in our coffee shop.

While there are other coffee shops in the area, we believe that there is demand for more — especially 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. 

Company Overview

In the company overview section, you should include practical details about your coffee shop business. This will include:

• The structure and ownership of your coffee shop
• The staff you plan to hire and what you will pay them
• Your company’s mission statement, and startup expenses

While this may seem like a lot of work, the good news is this also serves as a way to kill two birds with one stone. As you flesh out your company’s goals & vision statements, it’s important to track this information in an internal wiki . Not only will this help your business stay true to its course, but it can also serve as a great resource for your staff.

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 coffee shop’s money.

You should also outline what makes your coffee shop business 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 target market. 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 coffee shop business plan, include that here.

Market Analysis

The coffee industry is expected to keep growing between 2020 and 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 shop competitors 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 . 

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 local 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

Before you start a coffee shop, you should have a clear idea of what your business’s sales strategy will be.

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.

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. 

We will use a commercial espresso machine and we expect to be 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 customers 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 customers 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. 

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

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.

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.

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. 

In terms of equipment, 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. 

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 the business owners are and who will manage 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.

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 coffee shop business plan is the financial plan. Here you need to go into detail about how your business will be financially successful.

Include operating costs (this includes the cost of equipment), loan repayments, cash flow and expected revenue (in the first year, especially). Also, include a balance sheet analysis that shows how much revenue you need to take in to become a profitable coffee business.

In this section, we will explain our financial plan, including costs, expected sales, and profit. We will also include a balance sheet. 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. We hope that this has equipped you with enough knowledge on how to start a coffee shop and will help you with your business planning.

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.

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Coffee Export Business Plan

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Is this content inappropriate, table of contents, 1.0 executive summary .................................................................................................................... 1.

Page 1  Table of Contents

Chart: Milestones ....................................................................................................................... 13

Page 2  Silvera and Sons, Ldta

1.0 Executive Summary

Silvera & Sons prepares green Arabica coffee beans grown in Brazil for exportation to American specialty roasters and sells to wholesalers on the Brazilian market. We will expand production capacity from 72,000/60kg bags per year to 120-160,000/60kg per year. Our coffee stands out from that of the competition. We prepare the top five percent, in terms of quality standards, of all Arabica beans on the market. Our customers seek this product as it provides them with a point of differentiation to specialty roasters. In the past six years, demand for our coffee has exceeded the amount we are able to supply and we have been forced to refuse requests for larger shipments.

We predict growth of thirty percent in the first year with sales exceeding ($BRL) expectations. In year three the plant will run at maximum capacity and based on the current price of coffee we expect excellent profits ($BRL). We have positive indicators from current importers that the additional amount of beans will be sold.

Our keys to success are:

1. establishing and maintaining working relationships and contractual agreements with.

Chart: Highlights

Page 1  Silvera and Sons, Ldta

1.1 Objectives

The objectives of Silvera & Sons:

 Increase production and sale from 78,000/60kg bags per year to approximately 100,000/60kg bags per year in the first year of operation at the proposed facility and reach maximum capacity of 120,000/60kg bags per year by year three.  Increase sales substantially in the first full year of operation.  Establish strategic relationships with 10-15 American importers in Los Angeles, San Francisco, & Seattle.  Increase gross margins in the next three years.

1.2 Mission

Silvera & Sons Ltda seeks to serve coffee importers and enthusiasts by exceeding minimum acceptable quality standards and by providing the highest quality product at the lowest possible price. We value our relationships with current and future customers and hope to communicate our appreciation to them through our outstanding, guaranteed product quality, personal service, and efficient delivery. Our commitment to our customers and the country of Brazil will be reflected through honest and responsible business.

1.3 Keys to Success

The keys to success for silvera & sons are:,  establishing and maintaining working relationships and contractual agreements with, 2.0 company summary.

Silvera & Sons buys and prepares raw coffee in parchment (pergamino), or coffee in its post- harvest stage. The finished product, green Arabica coffee beans are packaged in 60kg sacks and sold on the U.S. and Brazilian market. Our customers are primarily American importers and Brazilian wholesalers who provide high-quality beans to the specialty roasting market.

2.1 Company Ownership

Silvera & Sons Ltda. is a private, family owned preparer and exporter of Brazilian-grown, green Arabica coffee beans. It is owned and operated by Marco Silvera Sr. and his sons, Marco Silvera Jr. and Antonio Silvera.

2.2 Company History

Silvera & Sons is in its sixth year of operation. The current plant has been in operation for 15 years and for 12 of those years was managed by Marco Silvera Sr. who was then an employee of the former owner, Cafe Fina. Since the plant was purchased, Silvera & Sons has maintained maximum production and sales. It is currently operating at maximum capacity.

Table: Past Performance

Past Performance 1996 1997 1998 Sales $16,262,532 $17,304,066 $18,345,600 Gross Margin $2,439,380 $2,630,218 $2,814,215 Gross Margin % 15.00% 15.20% 15.34% Operating Expenses $12,196,899 $12,631,968 $13,346,424 Inventory Turnover 12.00 12.00 12.00

Balance Sheet 1996 1997 1998

Current Assets Cash $0 $0 $994,260 Inventory $0 $0 $355,200 Other Current Assets $0 $0 $243,936 Total Current Assets $0 $0 $1,593,396

Long-term Assets Long-term Assets $0 $0 $521,650 Accumulated Depreciation $0 $0 $100,000 Total Long-term Assets $0 $0 $421,650

Total Assets $0 $0 $2,015,046

Current Liabilities Accounts Payable $0 $0 $8,435 Current Borrowing $0 $0 $58,000 Other Current Liabilities (interest free) $0 $0 $0 Total Current Liabilities $0 $0 $66,435

Long-term Liabilities $0 $0 $402,000

Paid-in capital $0 $0 $525,000, total capital and liabilities $0 $0 $2,015,046.

Other Inputs Payment Days 0 0 60

Page 3  Silvera and Sons, Ldta

Chart: Past Performance

2.3 company locations and facilities.

The Silvera & Son's main warehouse and office is located in Ouro Fino. The warehouse has the capacity to prepare approximately 6,000 60kg bags of exportable coffee beans. The proposed new warehouse and preparation facility site is also located in Ouro Fino. The new facility will be 3.500m2 and will have 30 selecting machines with capacity to prepare 40,000 bags for exportation and 80,000 bags for storage. The proposed facility will also handle shipping.

3.0 Products

Silvera & Sons deal exclusively in green coffee, grown in the southern states of Brazil and one- hundred percent Arabica. Beans in parchment are purchased directly from growers and are de- husked and packaged into 60kg sacks in the Silvera & Sons' plant. The final product is suitable for sale and exportation.

3.1 Competitive Comparison

In order to differentiate our product, coffee, which is a commodity, from the product offering of competitors, all beans are guaranteed fresh and are shipped within seven days of preparation. In addition all beans are sorted at ninety-five percent screen 18 and above compared to the industry standard ninety percent screen of 17 and above. The beans shipped by Silvera & Sons are therefore larger than most and are guaranteed fresh. In addition, all of the farms from which Silvera & Sons purchases coffee adhere to environmentally sound farming practices and avoid the use of pesticides and chemicals in crop production.

There are approximately ten competitors who offer a product similar to ours. Our research indicates that with the additional capacity we would become one of the top four, in terms of quantity, providers. We have the advantage of established distribution channels and reputation. In addition, improvements to our marketing efforts will further separate us from the larger market and from our close competitors. Page 4  Silvera and Sons, Ldta

3.2 Sales Literature

Silvera & Sons currently works with two importers in the United States who handle all of our shipments. Likewise, we have dealt with the same Brazilian wholesalers, for internal sales, each year. Sales to this point have been handled through personal selling. Additional sales literature will include a website, direct mail to specialty roasters and importers, and print advertising in several trade publications including Coffee Times, a monthly publication which targets American business dealing with issues relevant to the coffee industry.

3.3 Sourcing

Both the existing and the proposed facilities are ideally located in Ouro Fino, in the state of Minas Gerais. Minas Gerais is the largest coffee producing state in Brazil and beans produced in the region are of the highest quality. With additional financing, we would be able to buy larger volumes at lower prices. We now buy from one or more of six private growers or grower cooperatives. Contracts are secured six months in advance of harvest.

3.4 Technology

Improvements in technology will include the use of partially automated selecting machines which will allow for increased production capacity with a lower machine-to-operator ratio than we currently employ. Additional storage capabilities will decrease shipping charges and will reduce the need for permanent shipping employees by thirty-five percent. High-technology information system upgrades will improve all aspects of business, especially inventory control, tracking of shipments, and communication with clients in import countries.

3.5 Future Products

Alternative to the Arabica bean, Coffea Robusta, though it shares some similarities with the Arabica bean, is very different. Coffea Robusta is grown at lower elevations and has a higher yield per plant as well as being more resistant to disease. It also has up to twice the caffeine level as it's cousin the Arabica Bean. Due to the lower cost and larger market amount of Robusta coffee, it is found primarily on supermarket shelves. The Arabica species grows at much higher elevations, better soil rich areas, and is the source of the worlds finest coffees.

By providing the finest species of coffee, Silvera & Sons has taken the first step towards a differentiated product. To further distinguish our coffee, we adhere to higher quality standards than approximately ninety-five percent of the market. In addition, all of our beans are of the Bourbon Santos variety. The "Bourbon" strain is considered one of the finest Brazil has to offer. It is grown in the mountains surrounding Sao Paulo and is highly sought after by specialty roasters from around the world. We have assumed the position of a specialized provider of this exceptional coffee. Our customers, American and Brazilian specialty roasters, recognize Silvera & Sons for our ability to provide the type of beans they require to produce award winning coffee.

4.0 Market Analysis Summary

Coffee is the second largest commodity market next to oil and Brazil has remained the largest producer of coffee in the world for two centuries. Imports of Arabica coffee in the United States have increased ninety-four percent in the past five years and consumption of coffee within Brazil has seen similar increases. In addition, demand for green coffee is above the market clearing level, and market price and crop yield estimates are at an all time high. Page 5  Silvera and Sons, Ldta

The increase in the number of independent specialty roasters in the United States and Brazil has contributed to and is an indicator of the increased demand for coffee. Within the larger coffee market is our target market is the specialty roaster. These discerning customers want the highest quality coffee beans. They serve the growing "gourmet" coffee market and are represented by large American companies like Starbucks and thousands of smaller specialty roasters. The Arabica bean is considered to be the best in the world and as such, the demand for Arabica beans is high on the specialty roaster market. Specialty roasters are willing to pay more for Arabica beans and attempt to distinguish themselves via the characteristics of the bean they use i.e. the location in which it was grown, farming methods, bean size, etc. The final consumer is relatively price insensitive if the coffee is good, has won awards, or is compatible with a popular trend. We estimate that specialty roasting in the U.S. alone is a ($USD) one- billion market.

4.1 Market Segmentation

The potential customer groups for silvera & sons are:.

 American importers of green Arabica beans: Market research suggests that there are approximately 200 importers of green Arabica coffee on the West and East Coasts of the United States that would be able to handle the quantities of our shipments and are in our target market . Combined, they import a total of four to five million/60kg bags of Brazilian coffee per year.  Brazilian green coffee wholesalers: This market serves as a safety valve for our export business. By maintaining relationships with Brazilian wholesalers we have an alternative market with established distribution channels.  Brazilian specialty roasters: As we move towards maximum capacity we will plan to more aggressively target this audience. We hope to eventually reduce transactions with wholesalers and capture their value-added costs as profit. We anticipate that this effort will begin approximately four years into operation of the new facility.

Table: Market Analysis

Market Analysis 1999 2000 2001 2002 2003 Potential Customers Growth CAGR U.S. Importers (60kg bags) 26% 70,140 88,376 111,354 140,306 176,786 26.00% Brazilian Wholesalers (60kg 26% 30,060 37,876 47,724 60,132 75,766 26.00% bags) Total 26.00% 100,200 126,252 159,078 200,438 252,552 26.00%

Page 6  Silvera and Sons, Ldta

Chart: Market Analysis (Pie)

4.2 industry analysis.

Coffee has been a growing industry for the past five years. The most notable growth has been in the American market where imports have increased almost one-hundred percent and the market price has nearly doubled. The number of specialty roasters has increased from a handful of well known companies to thousands of independent entities. There is a constant struggle within this market to produce the best coffee and serve one or more niches within the larger market. Brazilian coffee producers and exporters have made great efforts to improve agricultural techniques, processing methods, and distribution in order to better serve this growing market. Demand for Brazilian coffee is currently greater than supply.

4.2.1 Competition and Buying Patterns

The purchase decision for our customer is based on trust in our process and bean selection. We have established relationships with our customers which extend beyond that of the buyer/seller. The Silvera & Sons label means that the product has been chosen and prepared with the highest quality standards in mind. Our beans are priced up to nine percent higher than similar products. Our customers are willing to pay more for our product because they are familiar with us and trust in the quality of our beans. This is the result of their success in the marketplace with our product.

Page 7  Silvera and Sons, Ldta

4.2.2 Main Competitors

There are approximately 150 exporters of green Arabica beans in Brazil. According to the Brazilian Coffee Exporters Association, ABECAFE, fifty percent (50%) of all green coffee exports come from their 45 members. Approximately eighty percent (80%) of these exports come from 20 ABECAFE members. Market contributions of individual exporters are held in strict confidence and are not available to the public. However, based on this information and given the large number of remaining exporters not affiliated with ABECAFE who account for the remaining sixty percent (60%) of all exports, we assume that many of the largest competitors are amongst the ABECAFE members. They are:

Agro Food Cooxupe Mitsui Alimentos

4.2.3 industry participants.

Silvera & Sons deals exclusively in the exportation and sale of green Arabica beans. There are approximately 150 Brazilian businesses in this market. However, approximately 30 companies account for approximately eighty percent of the total amount of green Arabica exports. In addition many of these companies prepare, export and sell, to the Brazilian market, other coffee products. Additional products include:

 Green Robusta (Conillon) beans: The Robusta bean is produced in far less quantity, in Brazil, than the Arabica and is considered an inferior species. The Robusta market represents less than ten percent of all coffee produced in Brazil.  Soluble coffee products: These are instant (water soluble) coffees and are either decaffeinated or not. Sales of soluble coffee products account for approximately twelve percent of the total market.  Roasted & Ground coffee: Approximately eighty-five percent of all roasted and ground coffee (decaffeinated and non-decaffeinated) goes to internal consumption and represents approximately twenty-seven percent of the total coffee market.  Primary competitors include: Golden Brazil, Bramazonia, Comexim, and Nicchio Cafe.

4.2.4 Distribution Patterns

All of the coffee produced for exportation by Silvera & Sons and approximately eighty-five percent of all coffee produced for exportation in Brazil is shipped from Porto de Santos. Prepared coffee is shipped via rail and/or truck from the Silvera & Sons plant in Ouro Fino to Porto de Santos. From the port it is then shipped, in 40 foot containers to the port of Miami via cargo ship. Distribution charges are assumed by Silvera & Sons up to the arrival of the

Page 8  Silvera and Sons, Ldta

shipments in Miami whereupon importers assume responsibility, as detailed in contract, of the

5.0 strategy and implementation summary.

Silvera & Sons strategy is to expand production capabilities in order to fulfill the requests of importers with whom we currently deal for larger orders which we are unable to currently fulfill. In addition Silvera & Sons seeks to establish additional contracts with importers on the West Coast of the United States and increase the volume of green coffee sold on the Brazilian market. We intend to first maximize quantity of coffee sold within existing channels and second, establish additional accounts through targeted marketing efforts.

5.1 Competitive Edge

Silvera & Sons competitive edge comes from the advantage of having established relationships with American importers, and Brazilian coffee growers, green coffee brokers and wholesalers. Silvera & Sons has received affirmation of the demand for their product in the form of requests from importers for larger product shipments. Ours is a superior product offering because of the larger average size of the bean and because we purchase from growers who rely on the use of chemicals and pesticides less than two percent of the time. In addition, prompt preparation and shipment provides importers with a product that is up to one month fresher than beans sold by many exporters.

5.2 Strategy Pyramid

Our main strategy is to communicate the unique and desired attributes of our coffee to larger segments of the American and Brazilian markets. We sell a superior product, yet one that can be considered a commodity. It is therefore important that we effectively communicate the unique aspects which make it ideally suited for a niche market.

The unique aspects of our products include superior product selection and preparation, quality assurance, and efficient distribution. These are things we have done since we started doing business. The tactics we will use to communicate these strengths include, personal selling, targeted print advertising, and improved communication capabilities via information system improvements and a sophisticated website.

As tactics below the pyramid, we have identified three specialty publication in the United States and two in Brazil in which we will run print ads. We also plan to increase personal selling efforts to additional American importers. Part of the personal selling will include invitations to importers to visit our facilities, at our expense.

5.3 Marketing Strategy

Silvera & Sons marketing strategy will include the use of targeted print media advertising and direct selling to importers in the United States who provide green coffee to specialty roasters. We will capitalize on existing relationships with importers who have stated their willingness to contact West Coast affiliates and recommend Silvera & Sons coffee. We have positioned ourselves as a differentiated provider of the highest quality Arabica beans. The primary goal of all marketing efforts will be to communicate this to existing and potential customers.

Page 9  Silvera and Sons, Ldta

5.3.1 Promotion Strategy

Relationships are key to success in the export business. Importers in Florida have on several occasions visited the Silvera & Sons facility, family home, and farms from which coffee is purchased. Additional accounts and contacts with West Coast importers have all been established and maintained through personal contact. Personal selling will remain our most important means of promotion. Marco Silvera Jr. will continue to lead this effort. In addition to personal selling Silvera & Sons has identified several specialty publications within which print advertisements will run. Direct mail, in the form of personal letters will also be used to communicate with existing and potential clients. Our budget for promotion activities is as follows:

 Personal Selling which includes phone expenses, travel for Silvera & Sons employees and for importers who we invite to Brazil: ($BRL) 35,000 annually.  Print Advertising in three specialty publications and direct mail: ($BRL) 12,000 monthly.  World Wide Web presence: ($BRL) 125,000 to produce a new site and $2,500 annually to maintain the site.

5.3.2 Distribution Strategy

Distribution is one of the greatest challenges faced by Silvera & Sons. The distribution system of Brazil is largely outdated and inefficient. Moreover, taxes, specifically excise taxes are high. Distribution costs for internal sales are absorbed by the customer but distribution costs for exports are absorbed by us. Increasing the volume of our exports makes us eligible to receive reduced fees and helps ensure that trucks and rail cars are running at maximum capacity.

5.3.3 Marketing Programs

Our most important marketing program is an increase in personal selling combined with targeted direct mail and print advertising. Marco Silvera Jr. will be responsible, with a budget of ($BRL) 35,000 and a milestone date of May 30, 1999. The program is intended to establish contractual agreements with 10 additional importers, increase brand awareness of our product in the United States, and communicate our position as a provider of the highest quality green Arabica beans on the market.

Another key marketing program is the development of a sophisticated Website. The goal of this program is to increase our presence on the world wide web and provide additional means of communication and customer data collection. The website will cost ($BRL) 125,000.

5.3.4 Positioning Statement

For American importers of Brazilian coffee who use our coffee to supply specialty roasters, Silvera & Sons coffee beans are the highest quality and largest beans available. Unlike many exporters, our beans exceed the minimum acceptable quality standards and are shipped within one week of preparation to ensure the largest and freshest beans on the market. Our products are perfectly suited for the specialty roasting market which constantly strives to offer award winning coffee.

5.3.5 Pricing Strategy

Because Silvera & Sons adheres to higher quality standards, the price of our coffee is slightly higher (four to nine percent) than the market average. The import market largely determines Page 10  Silvera and Sons, Ldta

the price of imported coffee in the United States. Beans that do not meet Silvera & Sons quality standards are resold on the Brazilian market at the current market price. Green coffee, on the import market, now sells for US$ 213.56/60kg bag. According to Silvera & Sons pricing strategy, Silvera & Sons coffee would sell for approximately US$ 224/60kg bag. Importers have to this point been willing to pay the additional cost.

5.4 Sales Strategy

Silvera & Sons strategy focuses first on meeting the increased demand from importers with whom we have established relationships for larger orders. These importers are critical to our ability to acquire additional accounts on both the East and West coasts of the United States without having to spend a great deal on sales efforts. Secondly we will focus on increasing the volume, while maintaining the percentage of sales, of beans sold to the internal Brazilian market. When we have reached maximum sales to existing channels we can then shift the majority of our focus to securing additional import accounts.

5.4.1 Sales Forecast

The following chart and table show our present sales forecast. We project healthy growth in sales in 1999, a slightly smaller increase again in 2000, and reach maximum for production capacity in 2001 representing a large growth over the previous year.

Table: Sales Forecast

Sales Forecast 1999 2000 2001 Unit Sales Import and Export 100,200 120,000 160,000 Other 0 0 0 Total Unit Sales 100,200 120,000 160,000

Unit Prices 1999 2000 2001

Sales Import and Export $26,260,416 $33,021,600 $46,126,400 Other $0 $0 $0 Total Sales $26,260,416 $33,021,600 $46,126,400

Direct Unit Costs 1999 2000 2001

Direct cost of sales.

Page 11  Silvera and Sons, Ldta

Chart: Sales Monthly

Chart: sales by year, 5.4.2 sales programs.

Personal selling: Through personal contact we need to confirm in writing orders for larger quantities of our product from American importers and Brazilian wholesalers. In addition we need to establish sales agreements with at least six, possibly ten, additional American importers. Marco Silvera Jr. is responsible and the due date is May 30, with a budget of ($BRL) 24,000.

Page 12  Silvera and Sons, Ldta

5.5 Strategic Alliances

Our most valued alliances are those we have developed with American importers. They have the ability and willingness to purchase larger quantities of our products and recommend us to other importers. Additional alliances with trucking contractors and the Porto de Santos Cafe Commission are currently established.

5.6 Milestones

The accompanying table shows specific milestones, with responsibilities assigned, dates, and budgets. The milestones represented in this plan are those which we have determined to be the most important.

Table: Milestones

Milestone Start Date End Date Budget Manager Department

Chart: Milestones

6.0 Management Summary

Silvera & Sons management consists of four full-time employees. Additional assistance is acquired on a part-time basis and/or through the use of consultants, specifically in legal matters. Detailed descriptions are found in the following section. Page 13  Silvera and Sons, Ldta

6.1 Management Team

Silvera & Sons is organized into three functional areas: product sourcing, sales, and marketing; production and shipping; and finance and administration.

Marco Silvera Sr: CEO/President in charge of finance and administration. Marco Silvera Sr., 57 has worked in the coffee export business for 30 years. Before starting Silvera & Sons he was the Chief Financial Officer and general manager of the Cafe Fino coffee company. He began working for Cafe Fino after he finished an accounting degree at the University of Southern California. The current Silvera & Sons plant was formerly owned by Cafe Fino and was sold to Mr. Silvera who had decided to "retire" and wanted to run a small business. Cafe Fino had purchased larger facilities and no longer needed the plant.

Marco Silvera Jr: Vice president in charge of product sourcing, sales, and marketing. Marco Silvera Jr., 32 completed his MBA at Syracuse University and worked for several years on the Brazilian stock and commodities market as a broker. He later took a position as an International Sales and Marketing Representative for a major agricultural brokerage and supply firm in Sao Paulo. He is expected to succeed his father as CEO of Silvera & Sons Ltda.

Antonio Silvera: Vice president in charge of production and shipping. Antonio Silvera, 29 worked as a civil engineer for two years for the Brazilian government after completing an engineering degree at the University of Brazil, Sao Paulo. He is responsible for the supervision of all plant employees.

Additional Management: Ralph Henzo, CFO: Gracie, Renoldo, & Fertado Attorneys at Law, Sao Paulo.

6.2 Management Team Gaps

We currently lack a full-time professional who can deal with the changing legal and financial aspects of international business. We have relied on legal consultants but are now analyzing the possibility of adding an additional position to deal exclusively with international issues. In addition, as we continue to grow and hire more personnel, we may hire a controller.

Page 14  Silvera and Sons, Ldta

6.3 Personnel Plan

The personnel plan requires an increase in plant employees from 11 to 17-20 within the next three years. Additional employees will also be added to increase administrative and accounting support. One additional employee will be added to the sales and marketing division. We will retain all current employees as they will not have to relocate.

Table: Personnel

Personnel Plan 1999 2000 2001 Production Personnel Antonio Silvera, VP Production $38,400 $41,088 $43,964 Plant Employees $219,996 $228,796 $237,948 Other $42,000 $47,000 $50,000 Subtotal $300,396 $316,884 $331,912

Sales and Marketing Personnel

General and administrative personnel.

Other Personnel Name or Title or Group $0 $0 $0 Name or Title or Group $0 $0 $0 Name or Title or Group $0 $0 $0 Subtotal $0 $0 $0

Total People 15 16 17

Total Payroll $645,288 $575,262 $641,810

7.0 financial plan.

We want to finance growth through a combination of long-term debt and cash flow. Purchase of the larger facility and equipment will require approximately eighty percent debt financing. Additional technology will be primarily financed with cash-flow. Inventory turnover must remain at or above four or we run the risk of backing up orders and jeopardizing our freshness guarantees. We have had no problems with accounts receivable and we expect to maintain our collection days at 30 with thirty percent of sales on credit.

In addition, we must achieve gross margins of thirty-five percent and hold operating costs no more than sixty-five percent of sales.

Page 15  Silvera and Sons, Ldta

7.1 Break-even Analysis

The break-even analysis shows that Silvera & Sons has sufficient sales strength to remain viable. Our per month break-even point projections are detailed in the following table and chart.

Chart: Break-even Analysis

Table: break-even analysis.

Break-even Analysis

Monthly Units Break-even 2,049

Assumptions: Average Per-Unit Revenue $262.08 Average Per-Unit Variable Cost $212.00 Estimated Monthly Fixed Cost $102,629

Page 16  Silvera and Sons, Ldta

7.2 Important Assumptions

Table: general assumptions.

General Assumptions 1999 2000 2001 Plan Month 1 2 3 Current Interest Rate 14.00% 14.00% 14.00% Long-term Interest Rate 9.00% 9.00% 9.00% Tax Rate 47.00% 47.00% 47.00% Other 0 0 0

7.3 Key Financial Indicators

The most important factor to Silvera & Sons anticipated growth is the procurement of necessary financing. The size of the orders currently requested by importers are larger than what can be produced given our present plant capacity.

The following chart shows changes in key financial indicators: sales, gross margin, operating expenses, collection days, and inventory turnover. The growth in sales goes above thirty percent in the first year, twenty percent in second, and back to thirty percent in year three after which it will settle. We expect to increase gross margin but our projections show a decline in the first two years following the purchase of the new facility. This is due to the facilities not being run at maximum capacity. The projections for collection days and inventory turnover show that we expect a decline in these indicators.

Chart: Benchmarks

Page 17  Silvera and Sons, Ldta

7.4 Projected Profit and Loss

We expect to close the first year of production in the new facility with quite exempary ($BRL) sales and to increase our sales in the second and third years. Net earnings will be above industry average ($BRL).

Chart: Gross Margin Monthly

Chart: gross margin yearly.

Page 18  Silvera and Sons, Ldta

Table: Profit and Loss

Pro forma profit and loss, gross margin $4,417,620 $5,647,716 $8,072,488.

Operating Expenses

Sales and Marketing Expenses

General and administrative expenses.

Other Expenses: Other Payroll $0 $0 $0 Consultants $18,000 $24,000 $30,000 Other Expenses $0 $0 $0 Total Other Expenses $18,000 $24,000 $30,000 Other % 0.07% 0.07% 0.07%

Total Operating Expenses $1,231,542 $1,173,778 $1,237,798

Profit before interest and taxes $3,186,078 $4,473,938 $6,834,690, net profit $1,545,964 $2,244,809 $3,503,035.

Page 19  Silvera and Sons, Ldta

Chart: Profit Monthly

Chart: profit yearly.

Page 20  Silvera and Sons, Ldta

7.5 Projected Cash Flow

Silvera & Sons expects to manage cash flow over the next three years with the assistance of a loan supported by the Central Bank of Brazil. This financing assistance is required to provide the working capital to meet the current needs for the construction of the new production facility and additional personnel, distribution costs, and other related expenses.

Table: Cash Flow

Pro forma cash flow, cash from operations, additional cash received, expenditures 1999 2000 2001, expenditures from operations, additional cash spent, net cash flow $1,513,404 $2,390,809 $3,601,345.

Page 21  Silvera and Sons, Ldta

Chart: Cash

Page 22  Silvera and Sons, Ldta

7.6 Projected Balance Sheet

As shown in the balance sheet in the following table, our net will grow quickly by the end of 1999 and to continue steadily through the end of the plan period. The monthly projections are in the appendix.

Table: Balance Sheet

Pro forma balance sheet.

Current Assets Cash $2,507,664 $4,898,473 $8,499,818 Inventory $1,958,880 $3,079,078 $4,777,515 Other Current Assets $303,936 $378,936 $463,936 Total Current Assets $4,770,480 $8,356,487 $13,741,269

Long-term Assets Long-term Assets $3,221,650 $3,221,650 $3,221,650 Accumulated Depreciation $316,000 $532,000 $748,000 Total Long-term Assets $2,905,650 $2,689,650 $2,473,650 Total Assets $7,676,130 $11,046,137 $16,214,919

Liabilities and Capital 1999 2000 2001

Current Liabilities Accounts Payable $1,786,801 $2,556,635 $3,572,383 Current Borrowing $4 $4 $4 Other Current Liabilities $0 $0 $0 Subtotal Current Liabilities $1,786,805 $2,556,639 $3,572,387

Long-term Liabilities $2,796,750 $2,502,114 $2,502,114

Paid-in capital $525,000 $1,175,000 $1,825,000, net worth $3,092,575 $5,987,383 $10,140,418, 7.7 business ratios.

Standard business ratios are included in the following table. The ratios show an aggressive plan for growth in order to reach maximum production within three years. Return on investment increases each year as we bring the new facility to maximum capacity and production. Return on sales and assets remain strong and cost of goods decreases based upon efficiency projections. Projections are based on the 1997/98 selling price. Industry Profile is based on NAICS code 311920, Coffee and Tea Manufacturing.

Page 23  Silvera and Sons, Ldta

Table: Ratios

Ratio Analysis 1999 2000 2001 Industry Profile Sales Growth 43.14% 25.75% 39.69% 5.50%

Percent of Total Assets

Current liabilities 23.28% 23.15% 22.03% 8.46%.

Percent of Sales Sales 100.00% 100.00% 100.00% 100.00% Gross Margin 16.82% 17.10% 17.50% 23.32% Selling, General & Administrative Expenses 10.94% 10.31% 9.91% 9.39% Advertising Expenses 0.55% 0.50% 0.36% 2.06% Profit Before Interest and Taxes 12.13% 13.55% 14.82% 4.36%

Main Ratios Current 2.67 3.27 3.85 5.32 Quick 1.57 2.06 2.51 3.45 Total Debt to Total Assets 59.71% 45.80% 37.46% 27.13% Pre-tax Return on Net Worth 94.32% 70.74% 65.18% 12.79% Pre-tax Return on Assets 38.00% 38.34% 40.76% 17.55%

Additional Ratios 1999 2000 2001

Activity Ratios Inventory Turnover 10.91 10.60 9.50 n.a Accounts Payable Turnover 14.25 12.17 12.17 n.a Payment Days 27 25 26 n.a Total Asset Turnover 3.42 2.99 2.84 n.a

Debt Ratios Debt to Net Worth 1.48 0.84 0.60 n.a Current Liab. to Liab. 0.39 0.51 0.59 n.a

Liquidity Ratios Net Working Capital $2,983,675 $5,799,847 $10,168,882 n.a Interest Coverage 11.84 18.76 30.35 n.a

Additional Ratios Assets to Sales 0.29 0.33 0.35 n.a Current Debt/Total Assets 23% 23% 22% n.a Acid Test 1.57 2.06 2.51 n.a Sales/Net Worth 8.49 5.52 4.55 n.a Dividend Payout 0.00 0.00 0.00 n.a

Page 24  Appendix

Sales Forecast

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Unit Sales Import and Export 0% 8,700 8,200 8,800 8,300 8,450 8,050 8,000 8,200 8,050 8,000 9,050 8,400 Other 0% 0 0 0 0 0 0 0 0 0 0 0 0 Total Unit Sales 8,700 8,200 8,800 8,300 8,450 8,050 8,000 8,200 8,050 8,000 9,050 8,400

Unit Prices Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Import and Export $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 $262.08 Other $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Sales Import and Export $2,280,096 $2,149,056 $2,306,304 $2,175,264 $2,214,576 $2,109,744 $2,096,640 $2,149,056 $2,109,744 $2,096,640 $2,371,824 $2,201,472 Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Sales $2,280,096 $2,149,056 $2,306,304 $2,175,264 $2,214,576 $2,109,744 $2,096,640 $2,149,056 $2,109,744 $2,096,640 $2,371,824 $2,201,472

Direct Unit Costs Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Import and Export 0.00% $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 $212.00 Other 0.00% $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Subtotal Direct Cost of Sales $1,844,400 $1,738,400 $1,865,600 $1,759,600 $1,791,400 $1,706,600 $1,696,000 $1,738,400 $1,706,600 $1,696,000 $1,918,600 $1,780,800

Page 1  Appendix

Personnel Plan

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Production Personnel Antonio Silvera, VP Production $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 $3,200 Plant Employees $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 $18,333 Other $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 Subtotal $25,033 $25,033 $25,033 $25,033 $25,033 $25,033 $25,033 $25,033 $25,033 $25,033 $25,033 $25,033

Other Personnel Name or Title or Group $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Name or Title or Group $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Name or Title or Group $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Subtotal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total People 15 15 15 15 15 15 15 15 15 15 15 15

Total Payroll $53,774 $53,774 $53,774 $53,774 $53,774 $53,774 $53,774 $53,774 $53,774 $53,774 $53,774 $53,774

Page 2  Appendix

Gross Margin $385,663 $360,623 $390,671 $365,631 $373,143 $353,111 $350,607 $360,623 $353,111 $350,607 $403,191 $370,639 Gross Margin % 16.91% 16.78% 16.94% 16.81% 16.85% 16.74% 16.72% 16.78% 16.74% 16.72% 17.00% 16.84%

General and Administrative

Other Expenses: Other Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Consultants $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 Other Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Other Expenses $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 Other % 0.07% 0.07% 0.07% 0.07% 0.07% 0.07% 0.07% 0.07% 0.07% 0.07% 0.06% 0.07%

Page 3  Appendix

Total Operating Expenses $77,191 $104,941 $104,941 $104,941 $104,941 $104,941 $104,941 $104,941 $104,941 $104,941 $104,941 $104,941

Profit Before Interest and Taxes $308,472 $255,682 $285,730 $260,690 $268,202 $248,170 $245,666 $255,682 $248,170 $245,666 $298,250 $265,698 EBITDA $326,472 $273,682 $303,730 $278,690 $286,202 $266,170 $263,666 $273,682 $266,170 $263,666 $316,250 $283,698 Interest Expense $23,885 $23,621 $23,356 $23,092 $22,827 $22,563 $22,298 $22,034 $21,769 $21,505 $21,240 $20,976 Taxes Incurred $133,756 $109,069 $123,316 $111,671 $115,326 $106,035 $104,983 $109,815 $106,408 $105,356 $130,195 $115,019

Net Profit $150,831 $122,992 $139,058 $125,927 $130,049 $119,572 $118,385 $123,834 $119,992 $118,805 $146,815 $129,703 Net Profit/Sales 6.62% 5.72% 6.03% 5.79% 5.87% 5.67% 5.65% 5.76% 5.69% 5.67% 6.19% 5.89%

Page 4  Appendix

Expenditures Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Net Cash Flow $4,558,683 ($1,835,317) $139,001 ($364,004) $31,030 ($246,926) ($47,159) ($65,631) ($202,798) ($103,095) $144,277 ($494,657) Cash Balance $5,552,943 $3,717,626 $3,856,626 $3,492,622 $3,523,653 $3,276,727 $3,229,568 $3,163,937 $2,961,139 $2,858,044 $3,002,321 $2,507,664

Page 5  Appendix

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Assets Starting Balances

Current Assets Cash $994,260 $5,552,943 $3,717,626 $3,856,626 $3,492,622 $3,523,653 $3,276,727 $3,229,568 $3,163,937 $2,961,139 $2,858,044 $3,002,321 $2,507,664 Inventory $355,200 $2,028,840 $1,912,240 $2,052,160 $1,935,560 $1,970,540 $1,877,260 $1,865,600 $1,912,240 $1,877,260 $1,865,600 $2,110,460 $1,958,880 Other Current Assets $243,936 $248,936 $253,936 $258,936 $263,936 $268,936 $273,936 $278,936 $283,936 $288,936 $293,936 $298,936 $303,936 Total Current Assets $1,593,396 $7,830,719 $5,883,802 $6,167,722 $5,692,118 $5,763,129 $5,427,923 $5,374,104 $5,360,113 $5,127,335 $5,017,580 $5,411,717 $4,770,480

Long-term Assets Long-term Assets $521,650 $746,650 $971,650 $1,196,650 $1,421,650 $1,646,650 $1,871,650 $2,096,650 $2,321,650 $2,546,650 $2,771,650 $2,996,650 $3,221,650 Accumulated Depreciation $100,000 $118,000 $136,000 $154,000 $172,000 $190,000 $208,000 $226,000 $244,000 $262,000 $280,000 $298,000 $316,000 Total Long-term Assets $421,650 $628,650 $835,650 $1,042,650 $1,249,650 $1,456,650 $1,663,650 $1,870,650 $2,077,650 $2,284,650 $2,491,650 $2,698,650 $2,905,650 Total Assets $2,015,046 $8,459,369 $6,719,452 $7,210,372 $6,941,768 $7,219,779 $7,091,573 $7,244,754 $7,437,763 $7,411,985 $7,509,230 $8,110,367 $7,676,130

Liabilities and Capital Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Current Liabilities Accounts Payable $8,435 $3,606,760 $1,776,433 $2,160,879 $1,798,931 $1,979,476 $1,764,281 $1,831,660 $1,933,419 $1,820,231 $1,831,254 $2,318,158 $1,786,801 Current Borrowing $58,000 $53,167 $48,334 $43,501 $38,668 $33,835 $29,002 $24,169 $19,336 $14,503 $9,670 $4,837 $4 Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Subtotal Current Liabilities $66,435 $3,659,927 $1,824,767 $2,204,380 $1,837,599 $2,013,311 $1,793,283 $1,855,829 $1,952,755 $1,834,734 $1,840,924 $2,322,995 $1,786,805

Long-term Liabilities $402,000 $3,102,000 $3,074,250 $3,046,500 $3,018,750 $2,991,000 $2,963,250 $2,935,500 $2,907,750 $2,880,000 $2,852,250 $2,824,500 $2,796,750 Total Liabilities $468,435 $6,761,927 $4,899,017 $5,250,880 $4,856,349 $5,004,311 $4,756,533 $4,791,329 $4,860,505 $4,714,734 $4,693,174 $5,147,495 $4,583,555

Paid-in Capital $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 $525,000 Retained Earnings $85,985 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 $1,021,611 Earnings $935,626 $150,831 $273,823 $412,881 $538,809 $668,857 $788,429 $906,814 $1,030,648 $1,150,640 $1,269,445 $1,416,261 $1,545,964 Total Capital $1,546,611 $1,697,442 $1,820,434 $1,959,492 $2,085,420 $2,215,468 $2,335,040 $2,453,425 $2,577,259 $2,697,251 $2,816,056 $2,962,872 $3,092,575 Total Liabilities and Capital $2,015,046 $8,459,369 $6,719,452 $7,210,372 $6,941,768 $7,219,779 $7,091,573 $7,244,754 $7,437,763 $7,411,985 $7,509,230 $8,110,367 $7,676,130

Net Worth $1,546,611 $1,697,442 $1,820,434 $1,959,492 $2,085,420 $2,215,468 $2,335,040 $2,453,425 $2,577,259 $2,697,251 $2,816,056 $2,962,872 $3,092,575

Page 6  Appendix

General Assumptions

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Plan Month 1 2 3 4 5 6 7 8 9 10 11 12 Current Interest Rate 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% 14.00% Long-term Interest Rate 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% Tax Rate 47.00% 47.00% 47.00% 47.00% 47.00% 47.00% 47.00% 47.00% 47.00% 47.00% 47.00% 47.00%

Other 0 0 0 0 0 0 0 0 0 0 0 0

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