You’ve always dreamed of owning your own coffee shop business. You know the coffee culture in your city inside and out, and you’re confident you could make it big with your own cafe business. But there’s one big problem: you don’t know how to write a business plan.
Don’t worry, we’re here to help.
This guide will walk you through the big picture of writing a business plan for your dream coffee shop, from beginning to end. So sit down, put on your thinking cap, and let’s get started!
Before we get into the details though, let us give you a tiny bit of background!
We are professional business coaches (and entrepreneurs ourselves), and our job is to push business owners to their next steps. Business planning and writing business plans are part of that, and this page is part of a free series of articles on how to write a business plan.
We provide about 80 percent of our content for free, but in case that’s not sufficient, we’ve also created our Business Plan Builder Module, which gives you access to a complete and solid business plan writing work-frame tool, two designer-made templates (comprehensive + pitch deck), and about two hours of videos recorded with a business coach to explain all the logic you’ll need to master if you plan on writing a business plan that converts.
Now, let’s get back to our topic of the day: how to write a business plan for your coffee business!
This article will give you the general lines and will guide you through the key points you have to consider, and it will then point you in the right direction should you want to dig deeper. If you’re not clear about what a business plan is for, however, please follow the link and start there – these are the basics you need to know about.
Ready? Perfect.
Why do you need a business plan for your coffee shop?
There are a lot of reasons why you need to write a business plan for your coffee shop. First, a business plan gives you a strategic way to think about what needs to be done – which gives you a competitive advantage against all the coffee shop owners out there who don’t go through the exercise.
You can use it to lay out your vision for the business, your goals, and objectives, how you plan to achieve them, and who will help you make it happen.
Second, business plans give you a way to plan your business from a financial perspective. By detailing your expected expenses and revenue streams, you can get a better idea of whether your business is sustainable over the long term.
That also creates an opportunity to look at your market, i.e. how the coffee industry is doing in general, how many coffee shops – whether solo-handled or chain-managed – could be direct competitors around you, so forth, and so on.
This is especially important if you’re looking for outside investment: investors will want to see that you have a well-thought-out plan and that you understand the basics of financial planning, hence your business plan should show them that.
Similarly, they will want to know if they are about to put money in a small business than aims to stay small, or if you are looking to turn a small business into something much bigger in the medium or long term.
And, of course, writing a business plan shows that you know what you’re doing and that you’re serious about your business.
This is important whether you’re making your business plan with professional investors in mind or just trying to get funding from family and friends. Having a well-written business plan reassures them that you’re taking your venture seriously and that they can trust you with their money.
How to write your business plan
Now that you know what your business goal is, it’s time to start writing your business plan. But where do you start?
A good place to start is by clarifying what your business is—and what it isn’t. This will help you develop a better understanding of the fundamentals of your business and what you will need to do to achieve your goal.
After that, take the time to consider who will help you achieve your goal. Do you have the team in place? What resources do you need to make your vision a reality?
Make sure you understand financial tables and how they work, so you can confidently predict your business’ financial outlook and defend your case if anyone wanted to grill you on the numbers side of things (because they will!).
Start from a competitor’s business plan
Of course, one way to start writing your business plan is to find inspiration using a competitor’s business plan.
If you can put your hands on that – which is pretty confidential, let’s be honest – then use it to see what makes their business model strong or weak, and adapt your conclusions and model accordingly.
If you can’t get that kind of document, have a look at their business model and see what seems to work, and what doesn’t seem to work.
Another possibility is also to look at what indirect competitors do. For instance, a bakery business plan, a restaurant business plan, or even a food truck business plan could give you major hints as to how other people possibly sell coffee and donuts around you, even though they are not coffee specialists.
Start from an existing template
Alternatively, you could also start from an existing template, which would give you a framework and tools to get everything into place – especially from the numbers side of things.
We are providing you with a free template and with even more efficient tools down the page – keep reading and we’ll explain everything.
What should you include in your coffee shop business plan?
When it comes to writing your document, there are a few key elements that you absolutely need to include in your business plan outline. For starters, you’ll want to give a brief executive summary, but you’ll also want to provide a detailed overview of your business, including what it is, what you offer, and how promising your target market is – as previously mentioned.
Avoid the one-page business plan trap, however, and focus on giving your reader a good read with good storytelling.
What will be your costs?
Will you need a large or small team to run the coffee house? A point-of-sale / POS system An expensive commercial espresso machine, perhaps? An expensive fridge to store food? Tables and furniture for full service cafe & restaurant, or just a a couple of standing tables and stools on the street?
What will be your business model? Will you rely on a franchised brand, or will you build everything from scratch? What type of investment is needed either way, and what income streams will you develop based on that model?
Also, what profitability do you expect? For what types of coffee products? For instance:
- How profitable are coffee shops these days?
- Is quality coffee more profitable than average coffee?
- What is the profit margin on each americano?
- What is the profit margin on a cappuccino?
- What is the profit margin on donuts?
- Can you provide any numbers showing a potentially reliable trend?
Your market research also needs to outline your marketing plan and sales strategy – what would your customers look for and what customer acquisition strategy do you have? What is a typical coffee shop marketing plan look like?
Talk about your social media strategy if you have one, and explain your plans for expansion.
Writing a coffee shop financial plan is super important!
And last but not least, don’t forget to include a section on financials – totally required! – including your estimated start-up costs and revenue projections – not to forget of course your cash flow statement and balance sheet.
Need a little bit more details?
- What would be the shop financial income next year, the year after and the year after that?
- What would be the net profit?
- What is the net cash flow you expect to get?
- What would be your total operating expenses?
- What are the total current assets at your disposal, and what do you need to acquire?
We know that putting together a business plan can be daunting, so we’ve made it easy for you.
Believe it or not, but you would be surprised how many people get stuck at the numbers step, and how many more get burnt because they can’t defend their financial estimates in front of their bankers or investors.
Our free business plan template and business plan writing tool will help make the process a lot less daunting because we have detailed and automated most of the steps. So go ahead and try it out!
In the end, you’ll be glad you took the time to put together a comprehensive business plan. You may even find that you’ve missed some key elements, which can help you make any necessary adjustments before opening your doors for business.
Tell them about your coffee shop management plan as well!
We’ll repeat ourselves here, but elaborating on your management plan is very important because it will show whether or not your business project is scalable – which obviously makes a big difference.
If your goal is to work for yourself and create a job for yourself over the next few years, then investors are likely to invite you to talk to a banker.
However, if your point is to hire a team to run that coffee shop, then the coffee business becomes a possible system capable of operating at all times, without you, because processes and teams are in place to make everything work smoothly.
For instance, how will you guarantee smooth and coherent customer service? Will you have a management team at all times to keep your clients happy and deal with the operational parts, like placing supply orders and dealing with the human resources part?
That suggests an ability to keep rolling and generate profits for you and without you – which is exactly what investors are looking for. Can you see the idea?
Tell them more about your coffee shop management plan!
How long should my business plan be?
This is another typical question, and the answer is very simple: your business plan doesn’t need to be long. In fact, it should stay short, precise, and concise.
As we said before, there are a few points that absolutely need to be present in your final business plan pdf document, but you don’t need to go into extensive details there.
Why? Because the document should be a teaser that contains the main information and gives people a good reason to talk to you. Once you get that discussion going, you’ll have all the opportunities to get into the details – don’t give too much too early, build the storytelling instead!
How Often Should You Review and Update?
Now that you know how to write a business plan for your coffee business, it’s important to know how often you should review and update it. The exercise can take time, so people often avoid going back to it, but that’s important!
Ideally, you should review and update your business plan once or twice a year, taking into account any changes in your business or the market.
You should particularly review and update your business plan at the end of your fiscal year, adapting your income statement and financial previsions to match actual results.
And don’t forget to organize a brainstorming session every so often to review and consider your blind spots!
Overall, what are the benefits of having a business plan for your future coffee shop?
So, overall, what are the benefits of having a business plan for your coffee shop? Here are just a few:
- Just having a business plan document means nothing – what matters is to have a business, with a plan.
- The exercise will give you perspective on what you want to achieve and how you will get there.
- It is also (and essentially) a huge opportunity to build storytelling around your company overview and tell people a cool story about your coffee shop business project.
Tips for writing an effective business plan for your coffee shop
Now that you understand the basics of writing a business plan and that you can tell where a good business plan start from, it’s time to put that knowledge to work and create a plan for your coffee shop. Here are a few tips to help you get started:
- Start by writing down your business goals and objectives. What do you want your business to achieve?
- Make your target market analysis. Who are you hoping to sell coffee to? Do you have a customer base at all?
- Outline your business strategy. How will you compete with the other coffee shops in your area to develop that customer base?
- Calculate your startup costs. How much money do you need to get your business off the ground?
- Create a financial forecast. What do you predict your sales and profits will be over the next few years?
- Make sure your plan is well-written and easy to read. Use clear and concise language, and avoid jargon and complex terms.
Study other business plans and make your own conclusions!
Use the template & do it yourself!
Another typical question: you are ready to write your business plan and you are wondering if you should hire a business plan consultant. STOP!
You can do this yourself. In fact, writing your own business plan is the best way to learn about your business and make sure your ideas are realistic – so don’t expect an external consultant who doesn’t have a clue to do the job right.
Instead? Do it yourself and make it your plan, for your business!
Look, it’s simple – a self-made business plan should cost you under $100 – that’s it!
In particular, the Impactified Business Plan Builder is a good place to start. This tool provides all the information you need to create a professional-looking document.
Shameless plug: meet The Business Plan Builder!
If you are looking for a push to get started with your business plan, The Impactified Business Plan Builder is THE tool you have been dreaming of.
The Builder comes very handily, in the shape of a Module built around over 2 hours of explanatory videos and a package will tools and working documents you’ll be able to use to
- Figure out what you need to figure out – powerful, uh?
- Understand the business plan code
- Write your business plan – with just the right amount of words and pages
- Build your financial estimates – with an automated table
- Create a visually appealing (designer-made!) document, and deck people will want to read
Pssst! And if you don’t want to invest any money in this, remember that there are also plenty of resources on Impactified to help you write a great document – including a free business plan template and a companion mini-course – download them, you really have no excuse!
Conclusion
Now that you understand the basics of a business plan, it’s time to put that knowledge to use and write your own plan for your coffee shop. Let’s get started!
