Coffee Shop

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Executive Summary

Corner Cup Coffee is a neighborhood coffee shop in our city. We serve espresso drinks, drip coffee, tea, pastries and light food in a welcoming space where people can work, meet or grab something quickly. People want good coffee close to home and a friendly place to sit. Many neighborhoods have only chains, or coffee shops that close early or have slow lines. We will win customers by serving great coffee, knowing our regulars by name, keeping the line moving and making the shop a place people want to be. Here is what our numbers show. We expect sales of about $197,000 in Year 1, growing to about $759,900 by Year 5 as we add baristas, extend our hours and grow our food sales. We expect a loss of about $51,600 in Year 1 while we build our customer base, then a profit from Year 2 (about $12,000), growing to about $184,100 by Year 5. We need $168,000 in total. That covers $111,600 in startup costs (an espresso machine and shop equipment, a small build-out, opening inventory, permits, insurance, a sign and a lease deposit) and a cash cushion of about three months of bills. I am putting in $18,000 of my own money, and I am asking for $150,000. The startup costs include a small build-out and a lease deposit for a storefront. I am Eric Howard, the owner. These numbers are estimates based on the assumptions listed at the end of this plan, not promises.

Company Description

Corner Cup Coffee will be a limited liability company (LLC) in Alabama, owned by Eric Howard. We will work from a small storefront with an espresso bar, a seating area and a back room for storage. What we believe. Serve great coffee, welcome everyone, keep things clean and treat our regulars like friends. What we offer:
- Espresso drinks, drip coffee, cold brew and tea. - Pastries, breakfast items and light lunches. - Beans and merchandise to take home. - Free Wi-Fi and a comfortable space to work and meet. - Catering and coffee for small meetings. Licenses and insurance. Coffee shops are regulated by the health department. We need a business license, a food service or health permit, food handler cards for staff, a sign permit and a certificate of occupancy for the space. Our county requires a food service permit with a pre-opening inspection, and our city requires a business license. We will carry general liability and property insurance, and workers' compensation once we hire. We label allergens and follow the health code for food storage and cleaning. Where things stand today. I have worked as a barista and manager for six years, I have written a menu, and I have looked at three storefronts.

Problem & Opportunity

People near us want good coffee and a friendly place to sit. 1. Few choices. Many areas have only chains or places that close early. 2. Slow service. Long lines and mixed-up orders are common at busy times. 3. Little community. Many cafes do not feel like a neighborhood gathering place. 4. Limited food. Many shops have only a few pastries. How we know people want this. I served 200 customers at three weekend markets last year, and a nearby office asked about a daily coffee order.

Products & Services

What we sell. 1. Beverage sales. Espresso drinks, coffee, tea and cold drinks. Our plan assumes an average of about $6 per drink in Year 1, rising to about $6 by Year 5. Beans, milk, cups and other direct costs run about $2 per drink. We expect about 26,000 drinks in Year 1 (about 520 a week), growing to about 85,000 a year by Year 5. 2. Food and pastry sales. Pastries, breakfast items and light lunches. Our plan assumes an average of about $6 per item in Year 1, rising to about $7. Ingredients and direct costs run about $2 per item. We expect about 9,000 items in Year 1, growing to about 33,000. Our prices. Drip coffee $3. Latte $5.25. Cold brew $4.75. Pastry $4. Breakfast sandwich $7. How it works for the customer:
1. A friendly welcome and a short wait. 2. A drink made right, with the name called out. 3. A comfortable seat, Wi-Fi and a clean space. 4. A loyalty card, so regulars earn a free drink. Gross margin, explained. "Gross margin" is the share of each sale left after paying for materials and direct job costs. Our plan shows about 69% in Year 1. That money pays the owner and crew, vehicle costs, insurance and other bills.

Market Analysis

Who will hire us:
- Neighbors and commuters who want coffee on the way. - Remote workers and students who need a place to work. - Families and friends who meet over coffee. - Local offices that order coffee and pastries for meetings. Where we will work. A corner storefront on Main Street in a walkable area with good foot traffic and parking, near an office park and two neighborhoods. Season. Coffee is busiest in the morning, and in cooler months. We offer cold drinks and food in summer, and special drinks for holidays to keep sales steady. Our plan is careful on purpose. About 520 drinks a week in Year 1 is about 75 drinks a day, a pace two baristas and the owner can handle well.

Competitive Landscape

Other choices customers have:
1. Chains and drive-throughs. Big Bean Chain (a made-up name) charges about $5 for a latte; known for convenience, but busy and impersonal. 2. Other independent coffee shops. We study their hours, prices and menus and differentiate. 3. Convenience stores and offices with coffee. Cheap, but without the experience. How we will win customers: great coffee, a friendly and fast team, a welcoming space and good food.

Marketing & Sales Strategy

How people will find us. - A free Google business listing with photos and hours, and a simple website. - Opening-week offers and a loyalty card. - Social media photos of drinks and the space, and posts about local events. - Partnerships with nearby offices, gyms, schools and churches. - Hosting local events: open mic nights, art shows and book clubs. Marketing budget. About $5,000 a year. The exterior sign, logo and menu are paid for from startup costs.

Operations Plan

How the business runs day to day. Daily operation. The shop opens early, with the owner and baristas making drinks, serving food and keeping the space clean. In Year 1 the owner works with two baristas, and we grow to six by Year 5. Each day has an opening and closing checklist, with inventory counted weekly. Equipment. About $75,000 to start: commercial espresso machine; grinders; brewers and batch brew equipment; refrigeration: under-counter and reach-in; pastry and food display case; ice machine; water filtration and plumbing hookups; point-of-sale system and card readers; blenders and smallwares; tables, chairs and seating; menu boards and music system; counter and bar fixtures; three-compartment sink and dish equipment. We set aside about $5,000 to $6,000 a year for repairs and replacements. Upkeep. Espresso machine cleaned daily and serviced regularly, grinders calibrated, refrigeration temperatures logged and the space deep-cleaned weekly. Safety. Safe handling of hot liquids and steam, food safety and storage rules, allergen awareness, clean hands and equipment and a first aid kit. Running costs in Year 1: rent and utilities about $38,000, marketing about $5,000, admin and insurance about $7,000. Scheduling and billing. A point-of-sale system with online ordering, and daily sales and labor tracked in a spreadsheet.

Management & Organization

Who runs the business. Eric Howard, owner. As owner I will make drinks, manage the team, order supplies, handle the shop and handle the money side of the business. I plan to pay myself $48,000 a year in salary in Year 1. Crew. Baristas (full-time equivalents) at about $28,000 a year each (or part-time pay): two in Year 1, three in Year 2, four in Year 3, five in Year 4 and six in Year 5. People who will help us: a bookkeeper or tax preparer, an insurance agent, and a free mentor from SCORE or the Small Business Development Center (SBDC). William Torres serves as a key volunteer advisor.

Milestones Narrative

Our goals and when we plan to reach them. - Before starting: sign the lease, get permits and insurance, build out the space, buy and install the equipment, hire and train baristas and open. Target start: June 2027. - First year: serve about 26,000 drinks and 9,000 food items, for about $197,000 in sales. - Year 2: add a barista and extend our hours, about $332,400 in sales, and a profit of about $12,000. - Years 3 to 5: grow to six baristas (full-time equivalents) and about $759,900 in sales by Year 5. Growth depends on hiring good people and winning the work, so treat the later years as goals, not promises. What we check every week: sales by day and hour, waste, labor hours, supply costs, reviews, and cash in the bank.

Funding Request

How much we need and how we will use it. Total needed: $168,000. This number comes from the Funding Need Calculator in this plan. It adds up: - Startup costs of $111,600, listed item by item in the Startup Costs section (about $75,000 for the espresso machine, grinders, refrigeration, display case, furniture and fixtures, $15,000 for paint, flooring and lighting, $4,000 for opening beans, milk, syrups and pastries, $1,500 for the health permit, business license and food handler cards, $2,500 for the first insurance payment, $2,000 for business setup, lease review and bookkeeping, $4,000 for the exterior sign, logo and menu, and $7,600 for the lease security deposit). - A cash cushion of about $56,400: the deepest cash dip in the early months plus about three months of bills, so slow weeks do not put the business at risk. Lenders call this "cash cushion." - Together that comes to about $168,000 (rounded up to the nearest $500), which is the total we are planning for. Where the money comes from: - My own money: $18,000. - Amount requested: $150,000. Kind of funding we are looking for: an SBA 7(a) loan through a local bank or community lender. How we will pay it back. We expect a loss of about $51,600 in Year 1 while we build our customer base, then a profit from Year 2 (about $12,000), growing to about $184,100 by Year 5. With this funding, the business has money in the bank every year of the plan. The loan is planned at 12.75% interest over 10 years, the most the SBA allows for a loan this size, so payments of about $2,218 a month are already included in our cash flow. What we are offering the lender: our equipment and my personal guarantee A smaller first step, if needed. If we cannot raise the full amount right away, we can start smaller and grow into this plan: - Phase 1: start with a coffee cart or a market stall on weekends, with a small espresso machine, while keeping your current job. Startup can be under $5,000. - Phase 2: once you have regular customers and a following, lease a storefront and follow this plan. To plan the smaller start, make a copy of this plan (use Duplicate) and lower the numbers to match. All numbers in this plan are estimates. We will update them as real results come in.

Appendix Notes

Documents to attach before you send this plan:

- Your resume (one page is fine) and any licenses or certificates. - A personal financial statement (a list of what you own and what you owe; lenders usually provide a form). - Business registration papers and your EIN (your business tax number from the IRS, free at irs.gov). - Proof of insurance, or a quote. - Your lease or letter of intent, if you have one. - Quotes for the equipment and build-out. - Your menu or price list. - Photos of your product or past work, if you have them. If you don't have any of this yet, no worries - let's continue. The assumptions behind our numbers (change them in the Financials section to match your own):
- Beverage Sales: about $6 per drink in Year 1, rising to $6; about $2 per drink in direct costs; about 26,000 drinks in Year 1, growing to 85,000. - Food & Pastry Sales: about $6 per item in Year 1, rising to $7; about $2 per item in direct costs; about 9,000 items in Year 1, growing to 33,000. - Owner salary: $48,000 a year. Crew: $28,000 a year each, from two in Year 1 to six in Year 5. - Other yearly costs in Year 1: rent and utilities about $38,000, marketing about $5,000, admin and insurance about $7,000. - Tax rate: 21%. - Every dollar amount is an estimate. Replace them with your own quotes and research.

Startup Costs