 Do you want to open up a coffee shop? Because in this video, we're going to be talking about how to create a coffee shop business plan that can make your dream come true. Hello friends, my name is Wilson, your friend in helping you build a thriving small business or a profitable food business. I actually want to know from you, why is it that you want to create a coffee shop? Let me know in the comments section below. Now without further ado, let's dive right in. So to start off, why do you need a business plan for your coffee shop? Because the reason is, you're not going to be able to raise funds, you're not going to be able to find a partner and you're not going to have clarity in building up your cafe. Now, when it comes to raising funds, you must have a business plan in order for you to raise funds from your friends, family, or even the banks. Why is that the case? Because they want to know what kind of plans you have in order for you to be profitable. It might take you a year, two years, or three years, but they want to see exactly the plan of action that you have, and then that way they can have much more confidence to put their hard-earned money in you. That's number one, raising funds. Second of all, if you're looking for a partner, a founding partner that can help you build this business with you, then you must have a business plan as well. Why is that the case? Because you must align your own vision with your partner's vision in this whole coffee shop business. Because if the alignment is not there, if the vision is not the same, then it's really hard to be able to bring them on board as well. And number three is to have clarity in your own coffee shop. Now, what I mean by that, it is because when you have a business plan, you're thinking about all the fundamentals, from the location, to the strategies, to the SWOT analysis, to your competitors, to your pricing, and all these things that you must consider. And on top of that, when you're building your business, you're going to be slammed with the left-right center of different types of problems. And when you're hit with different types of problems, it's very easy for you to be buried in the noise without seeing exactly what you need to do, without remembering all the strategies, which is a reason why, when you have a business plan, you can see through the noise and to really focus on what will drive your business forward. So then that way, you can have a profitable and successful coffee shop. Now as a disclaimer, before you flame me on, hey, this is not the proper business plan. I'm only going over all the essential part of the business plan, so then that way you can be up and running as soon as possible. Now with a further ado, let's dive right in. The first component you must have for your coffee shop business plan is your concept. Now what do I mean by concept? It means that what is the vision that you have that you're building out? Whether this is a mobile food truck that is only serving the most artisan cup of coffee or is it going to be a sit-in coffee shop that only serves three to five people? Or is it going to be a big coffee shop that you're going to have a lot of people come in, study and have meetings? For you to actually identify that and really write down what your concept is, it allows you to build out this entire plan to the tee. That means that if you're looking for just a mobile coffee shop, that means the equipment might be very different. That means your startup capital would be very different as well. And it allows you to actually be a lot more accurate when it comes to the forecasting, the amount of resources that you may need. And it also allows your investors, your partners and yourself to stay on course and to set the tone throughout this entire business plan. So make sure you have your concept and visually laid out in front of you as clear as possible. In addition to your concept, you must identify what is the problem that you're trying to solve in a marketplace? Because ultimately your job is not to create a coffee shop. Your job is to provide a solution to an existing problem. And what does that mean? That means that when people want to meet for business meetings, when people are looking for places to study and they don't have that place, the only place they can go to is Starbucks. And that's what Starbucks is solving, to be able to have a nice place for people to have business meetings, to be able to have a place where people can come and study. And that's the reason why Starbucks Moto is your second home. For you, you must identify what is the problem you're solving for your specific concept as well. The second component of building a coffee shop business plan is your team. Specifically, we're going to start with you first. Now for you, you need to identify exactly what you've done in the past and what you can actually bring forth to this specific business. So for example, if you have management experience from the past, you can talk about that and the strengths and what makes you so special and uniquely qualified to open up this coffee shop because that's really the pirate chance of your coffee shop's success. Now for a lot of our viewers, I know that you may not have the experience to begin with, then you must be resourceful. What does that mean? That means you count on the people you know and look at their networks. So for example, if you have an uncle that is doing important export and they know how to import coffee beans, that's a really big plus that you can put into this section as well because you would have that resource which I don't have and that would make you that much more likelier to have success over me, someone that doesn't have this kind of resource. So definitely sit down and really jot down all the different people that you know. Their background and how they can help you and propel your coffee shop forward. The second part of your team is that you must include other partners that you may have or the management team that you have created to build this coffee shop business with you. Same thing with thumb as well. You need to highlight their strengths and what they can actually bring forth to this business whether it be management skills or their network or the resources that they have is very important for you to highlight those items so then that way it gives a confidence to your potential investors, to the banks that hey, you know what, this guy has a pretty solid team, I'm willing to invest in him. And at the same time it really also challenges you and your partners to really count the resources that you may have. Send them this video, show them and let them write down exactly all their networks and the resources that these networks may have in order to help with your coffee shop business. As an example for you with our previous business 720 suites before we sold it, we have a really strong team. And the reason why we had a really strong team is that each of the individuals we brought in different strengths to the business. We all put in different things to the business that made us a very solid team in order for us to get a lot of good funding. Now as an example for you, one of our partner, he is the biggest distributor for bubble tea supplies in Western Canada. What does that mean? That means that we always get the cheapest cost of ingredients and that means we don't need to actually pay premium for our cost of goods sold. And that allowed us to actually attract more investors and funding from the bank because of the relationships that we have within our team. So for you, you must look at what your people and your team is bringing to the table. And when you don't know, then you must ask them what is the reasoning? What is it that they're bringing to the table to strengthen your coffee shop business? Whether it be resources, whether it be capital, whether it be just pure talent. Third component you must identify in your business plan for your coffee shop is your target market. Now who is your target market? It is the people that you're trying to help. Once again, I always come back to this. You're trying to create a solution to someone's problem. Whose problem are you trying to solve? For example, if you're trying to create a cafe for students to come hang out for late night so then that way they don't need to be stuck at home and they wanna be able to focus, then everything within your coffee shop must align to that. To give you a few examples, Wi-Fi must be free and must be strong because a lot of people are gonna come with their laptops and they are gonna be on your Wi-Fi network. And on top of that, you must have outlets, why? Because people need to charge their laptops. These are the little details that you must focus on because you're trying to give a solution to someone's problem. The problem is the fact that these students don't have a place to study and to focus. And on top of that, you must offer food items. The food items that are quick grab and go eat so then that way they can really focus on their study. And these are just little examples of things that you can do to better serve your customers. Now it is time for you to identify your customers, identify exactly who they are so then that way you can actually serve them the best that you can. For us at 720 Suites, we have identified our customer avatar and actually created a sheet like this. Her name is Michelle. And we identify exactly who they are, from how old, from what school they go to, from what are some of their desires, some of their passion, what they're passionate about and to really have a good idea on who we're trying to serve. Now, everything we do from marketing to designs to the chairs are all catered to Michelle because this is the problem that we want to solve for them. Same thing for you. Identify exactly who is it that you want to solve and really come back to the concept idea, the concept of the problem you want to solve and who to solve it for. When you identify this to the T, then it gives confidence for your audience and actually for your investors and your partners to actually invest in you when you have this very specific. Now, if you want to learn more about the fundamentals of building a business, how do you align your values with your customer's values so then that way you can connect with them, connect with them so then that way they become a loyal customer and in turn for you to explode in sales. Then you must check out our link below. It is a free hour of masterclass that you should definitely check it out because that's where we are able to teach you, show you the fundamentals of building a profitable restaurant. Definitely check it out after this video in the link below. The fourth component you should definitely consider when building out your coffee shop business plan is location. Location, location, location. A lot of people talk about location but how do you distinguish between locations? There are two different types of location. First up is a destination location and second is a high traffic location. Now the difference between the two is that usually with destination location, the rent is much cheaper because there are not much traffic around that area. So for example, it might be a neighborhood tucked in the corner around the block coffee shop and those are really just not that much walking traffic so the rent is much cheaper and you need to be able to have reasons of what entices people to come by that neighborhood coffee shop. It could be because you have very good artisan coffee that really attracts people to drive all the way just out of your coffee or versus a high traffic location. For example, having a coffee shop right on downtown core that itself would have a lot of traffic and in turn potential customers for your coffee shop. However, with that amount of traffic that rent is much more higher than that. So for you, it's always looking at the prices versus the walk by traffic. Now, especially with what's going on in today's world right now, another thing you should consider is the density, what does that mean? Because a lot of people are now working from home and they're wanting a good cup of coffee then you would want to be able to consider having a location that is in a residential density location, what does that mean? That means that you must surround yourself in a lot of different residential areas so then that way much more people are willing to be able to order take out from you. So more things to consider because of the pandemic. Now as an example with 720 Suites, our first location we know we wanted to serve university school students. However, having a coffee shop at the university is very expensive and that's the reason why we had to make a decision whether to actually have that risk of putting in five to $6,000 per month and to have that traffic and to really bet everything on that or should we be situated a little bit further away from the university and have cheaper rent? We chose the latter, we chose to have a coffee shop, our location, our ice cream shop 10 minutes away from the university, still close by yet the rent was substantially cheaper so then that way it allowed us to actually try more newer things and to actually still be accessible for university students. And on top of that, the reason why we chose that location is because it is situated right outside of a bus stop that goes straight to the university. So that's why we really find that spot as a really good alternative to having a coffee shop inside the university. If you guys enjoyed this video and find value in this video, make sure you guys smash the like button and let me know this is the type of content that you enjoy. Now back to regular programming. The fifth component that you must have for your coffee shop business plan is your sample menu. Now I know a lot is still in the air and you're trying to figure everything out and you don't know exactly what you're serving. However, it is super important for you to actually have an idea of what you're proposing for your menu. Now according to exactly who you're trying to serve, your target market, you should actually allow yourself to build a menu that is serving for them. I'll give you an example of why that is the case because for example, we want to serve the students that is lacking a place to study. Now for the people that are coming in at 9 p.m., 10 p.m., they're looking for a sandwich or a soup to eat late at night or just noodles, then those would be good items to supplement your coffee shop that you're offering. That's how you're going to be able to come up with that menu. And on top of that, you need to identify how much are you selling these items for? What are your costs and what are your margins? So in that way you can really do a forecast, a financial forecast of how long does it take to make your money back. And oftentimes if you're just selling coffee as an item, you're going to have to sell a lot of coffees in order for you to make back your money. And that's the reason why even for Starbucks, they're selling cookies, they're selling muffins, they're selling chips, a lot of different things that they're selling along with coffee as well. So for you, for you to come up with this proposed menu, look at exactly who you're trying to serve and look at exactly what they need in order for you to come up with this proposed menu. Another way for you to get more accurate data is for you to survey people that you are planning to serve. Ask them whether this would be a good item. Ask them how much are they willing to pay for it and actually go to your competitor's coffee shop and see exactly what they're offering. See how much they're charging. See what is popular and what is not popular for you to get a better insight on what you should offer to your customers. The sixth component that you need for your coffee shop business plan is design. Design is practically my favorite component of all time because I get to be able to have whatever I have in here to share with my investors, to share with my partners. And that's exactly why this is a very crucial component for your business plan because you want to be able to show people that you're working with exactly what you have envisioned in your mind. What are some of the color scheme? What does the vibe look like? What's the ambience within the coffee shop? How does your coffee, mobile coffee truck look like? These are things that you can actually work very closely with the designer in order for you to come up with that color template, come up with the logo, come up with what the uniform looks like and really come up with the basic foundation of this whole vibe, what you're going for. So then that way, you can actually submit this business plan to investors, to partners, to help them bring them into your world. That's the whole point of design to be able to actually bring what's here out on a piece of paper. As an example for you, whenever we sell locations for our ice cream shop 720 Suites, we always design renders for every single location, for every single proposal, for every single country that we're entering. We always have designs and renders because that really just shows our partners, people we're dealing with, vendors, exactly what we're trying to build. And it also allows me to see exactly what I'm trying to build and whether it is in line with what I believe in as well. So super important for you to do the same. The seventh component for your coffee shop business plan is your SWOT analysis. Now I know this sounds like a cliche that everyone is working on a SWOT analysis, but it is super crucial when it comes to building your coffee shop. Why is that the case? Because we need to identify what our strengths are, what our weaknesses are, where the opportunity lies and where the threats are as well. So diving a little bit deeper for each one is that for your strength, what makes you different? What makes you more successful than all the other competitors? Is it because you're really focusing on the ambience and you know exactly who you're serving and you want to create this massive experience all just for the students? And if that's the case, that is what's going to make you special within your neighborhood. Now, what are some of your weaknesses? If you are once again, if you're focusing just on students, we all know that students don't have a lot of money, more disposable income and they're going to sit in your coffee shop for hours on end, then we know that is part of your weakness over your competitors grabbing go. For us, it's really about exploring and understanding where our opportunities and where our strengths are, where our weaknesses are. It's okay to have weaknesses, but we need to be aware of them. Next up is opportunity. Where does the opportunity lie? Let's say for example, if you have a uncle that knows how to do franchising and you know you can count on him and as an advisor to coach you along the way, that becomes your opportunity where your competitors don't have because now you're building a business, building this whole concept and once it is a proven concept, then your uncle's going to be able to help you expand to other cities as well. That is an opportunity that is strictly for you. So identify what opportunities you have in the marketplace. Now lastly, threat. Let's say for example, you're choosing a location that is going to be redeveloped soon and you're choosing a location that already has three different coffee shops as well. These are threats that you need to put in your SWOT analysis because it just allows you to have a full picture of the business that you're trying to build, identifying all these different types of strengths, weaknesses, opportunities and threats allows you to have this overall picture. So in that way, you can run your business successfully. On top of that, this is exactly what investors and your partners would want to see because ultimately they're not looking into investing a business that is like 100% bulletproof. They want to be able to see that you as the owner, as the founder, are aware of different exposures that you are exposed to. So that way it is a bigger picture and you're going to be able to get that funding you need. The eighth component you need for your coffee shop business plan is marketing. What is your plan to gain that initial traction? What is your plan to gaining people to buy from you? What is your plan to going to market? Whether it be Facebook ads, whether it be influencer marketing, whether it be stunts, whether it be just promoting on university grounds, these are all different strategies that you must put on your business plan because this is a way to showcase to your investors, your partners, even yourself, a roadmap for yourself of hey, now that we built this coffee shop, how am I going to get customers? You don't want to build a coffee shop and then wait for people to come in. No, we don't want to be like that. We don't want to be sitting duck. We want to be proactive. We want to have a plan and strategy on how we can actually promote our coffee shop even before we build this coffee shop. And that's the reason what distinguishes people who are very successful and people that build a business and are not too successful and not to close down in the first year. You want to avoid closing down in the first year, which is the reason why you must plan for success. Understand what would bring in the customers, identify your list, so then that way it gives not only yourself the confidence, but also your investors and your partner the confidence to invest in you. So if you want to learn more about marketing, the different strategies that we use of 720 suites, how can you actually get people to talk about you for free? How do you get media attention? Then definitely check out the link below. We created an hour of free masterclass. That shows you exactly how we do that. Definitely check it out completely for free. The ninth and final component of a coffee shop business plan is the financials. Yes, I know this is a topic that everyone's waiting for. Everyone's excited about this. I know it's dry. I know it's difficult. I know probably you don't want to deal with this. However, this is the most important part of this whole business plan that your investors and your partners would look at. And it is also the most important for you when you actually have all the information there. And I'll tell you the reason why. Because if you don't know your numbers, you're basically swimming in the dark. You don't know for every cup of coffee you sell, whether you're making money or not. You don't know every month how much you need to make in order for you to break even. You don't know when you're actually gonna be able to make back your investment. And without understanding all these, then why are you creating a coffee shop? Ultimately, this coffee shop should be a vehicle to provide for you to have freedom of choice, freedom of time and freedom of financial burden. And that's the reason why you're creating this coffee shop. So understanding your numbers is key in doing that. What kind of numbers are we talking about? We're talking about either the startup costs of how much your equipment gonna cost you, how much our packaging, how much is cost of goods sold, how much our labor, how much is everything going to cost you. And if you don't know these numbers, then it is very important for you to go out and find these numbers. If you don't know how much people are willing to pay for your menu item, then make sure you go out there and survey people to get the best numbers possible. If you don't know how much and what is the cost of per pound of coffee, then go to suppliers and ask them how much does it cost. The more accurate you are in identifying all the different costs for your coffee shop, the better it is for you to actually map out how and when you're gonna make back all your investment. And when you are presenting this business plan to investors, they will challenge you, they will rip it apart and they'll poke holes in you. And it is up to you to always come back and revise, come back and revise as they give you more and more feedback. And the more this is bulletproof, the more that you're accounting for. Because the last thing you want is for you to be in business, running for a year, two years, and you still don't know why you're losing money. That is the worst thing that can happen. And believe it or not, more than 80% of the people that are running their business, they don't know their numbers. They don't know why and how to turn their business around because they didn't focus on the financials to begin with. So there you go, guys. The nine components of a coffee shop business plan you must have in order for you to actually get funding, for you to find partners, and for you to have clarity in building this coffee shop business. You must have these components. And if you're serious about building your own coffee shop business, then I highly recommend you to attend a free masterclass in the link below as we talk about how do you align your values and create the values so then that way, you can start attracting your loyal fans and to communicate and to connect with the people that you're serving. And lastly for you to explode in revenue. Follow this sequence and follow this formula so then that way you can have a thriving coffee shop. In the link below, attend it. Otherwise, I really hope you find value in this video. And if you do, all you have to do, smash the like button just to show me that this is the type of content you enjoy. Otherwise, I'll see you guys in the next video.