Fillable Printable Cafe Business Plan Template
Fillable Printable Cafe Business Plan Template
Cafe Business Plan Template
B
USINESS
P
LAN
(C
AFÉ
B
USINESS PLAN
)
THE RUSSET CUP
13351
M
ISSION STREET
(
OVERLAND PARK
,
KS)
(
DATE
)
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Café Business Plan Template
2
T
ABLE OF
C
ONTENTS
1.0 Executive Summary ................................................................................................................ 4
1.1
Business Objectives ..................................................................................................................................... 4
1.2
Mission Statement ........................................................................................................................................ 4
1.3
Guiding Principles ........................................................................................................................................ 4
1.4
Keys to Success ............................................................................................................................................ 5
2.0
Company Description ........................................................................................................ 5
2.1
Ownership .................................................................................................................................................... 5
2.2
Legal Form ................................................................................................................................................... 5
2.3
Start-Up Summary ....................................................................................................................................... 5
2.4
Location and Facilities ................................................................................................................................. 6
3.0
Products/Services ............................................................................................................... 7
3.1
Products/Services Descriptions .................................................................................................................... 7
3.2
Competitive Comparison ............................................................................................................................. 7
3.3
Product/Service Sourcing ............................................................................................................................. 9
3.4
Inventory Management ................................................................................................................................ 9
3.5
Warehousing and Fulfillment ....................................................................................................................... 9
3.6
Future Products/Services .............................................................................................................................. 9
4.0
Market Analysis ................................................................................................................. 9
4.1
Industry Analysis ....................................................................................................................................... 10
4.1.1
Market Size ............................................................................................................................................ 11
4.1.2
Industry Participants .............................................................................................................................. 11
4.1.3
Main Competitors .................................................................................................................................. 12
4.1.4
Market Segments ................................................................................................................................... 14
4.2
Market Tests ............................................................................................................................................... 15
4.3
Target Market Segment Strategy ................................................................................................................ 16
4.3.1
Market Needs ......................................................................................................................................... 16
4.3.2
Market Trends ........................................................................................................................................ 16
4.3.3
Market Growth ....................................................................................................................................... 17
4.4
Positioning ................................................................................................................................................. 17
5.0
Marketing Strategy and Implementation ...................................................................... 17
5.1
SWOT Analysis ......................................................................................................................................... 18
5.1.1
Strengths ................................................................................................................................................ 18
5.1.2
Weaknesses ............................................................................................................................................ 18
5.1.3
Opportunities ......................................................................................................................................... 18
5.1.4
Threats ................................................................................................................................................... 18
5.2
Strategy Pyramid ........................................................................................................................................ 18
5.3
Unique Selling Proposition (USP) ............................................................................................................. 19
5.4
Competitive Edge ....................................................................................................................................... 19
5.5
Marketing Strategy and Positioning ........................................................................................................... 19
5.5.1
Positioning Statement ............................................................................................................................ 19
5.5.2
Pricing Strategy ..................................................................................................................................... 20
5.5.3
Promotion and Advertising Strategy ...................................................................................................... 20
5.5.4
Website .................................................................................................................................................. 20
5.5.5
Marketing Programs .............................................................................................................................. 20
5.6
Sales Strategy ............................................................................................................................................. 20
5.6.1
Sales Forecast ........................................................................................................................................ 21
5.6.2
Sales Programs ....................................................................................................................................... 21
5.7
Legal .......................................................................................................................................................... 21
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5.8
Milestones .................................................................................................................................................. 21
5.9
Table 5.8 Milestones .................................................................................................................................. 22
5.10
Exit Strategy ............................................................................................................................................... 22
6.0
Organization and Management ...................................................................................... 22
6.1
Organizational Structure ............................................................................................................................ 22
6.2
Management Team ..................................................................................................................................... 22
6.3
Management Team Gaps ............................................................................................................................ 22
6.4
Personnel Plan ............................................................................................................................................ 22
6.5
Board of Directors ...................................................................................................................................... 23
7.0
Financial Plan ................................................................................................................... 23
7.1
Important Assumptions .............................................................................................................................. 23
7.2
Start-Up Costs ............................................................................................................................................ 24
7.3
Source and Use of Funds ............................................................................................................................ 25
7.4
Break-Even Analysis .................................................................................................................................. 26
7.5
Projections .................................................................................................................................................. 26
7.5.1
Projected Profit and Loss ....................................................................................................................... 26
7.5.2
Projected Cash Flow .............................................................................................................................. 28
7.5.3
Projected Balance Sheet ......................................................................................................................... 29
7.6
Business Ratios .......................................................................................................................................... 29
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1.0 Executive Summary
The Russet Cup will be a one of a kind coffee house / café located in Overland Park, Kansas.
The 1,500 square foot café will be located in the newly constructed Market Square Plaza located
on the northeast corner of 135
th
Street and Mission Street. The anchor tenant, the Price Chopper
grocery store, has already taken occupancy and the excellent location brings more than 10,000
shoppers weekly.
The Russet Cup, aptly named for the aromatic brown liquid that will fill the cup, fills the void of
original cafes in the market area, stands out from its corporate peers with their fast food concepts
and fast services. The Russet Cup is the alternative to fast food/commercial/coffee shops and
offers a much calmer, civilized gourmet coffee experience. There are no televisions in the café,
the background music is subtle and work from local artists will hang on the walls.
The café is well appointed with overstuffed leather chairs and sofas in a library like setting. The
café is reminiscent of times gone by – yet is cutting edge technologically with WIFI and state of
the art espresso machines.
The Russet Cup measures its financial success in terms of increased market share and in
earnings. With a total local market of $54 million, this is a tremendous opportunity! The keys to
success will be the ability to offer quality gourmet coffees, take advantage of its small size, and
reliance on an outstanding barista staff. In order to achieve these goals, the café will offer some
the area’s finest gourmet beans from local distributors. Because of its small size, the café can
enjoy larger margins in the form of lower overhead. The cafe will hand select baristas and offer
salaries comparable to the chains. In turn the baristas will be trained to cross-sell, and sell the
higher margin products.
1.1
Business Objectives
The primary objectives of the business plan for Russet Cup are below:
•
To increase revenues $36,000 or 5% in Year 2 and by $73,000 or 10% by Year 3
•
Achieve a profit margin of 5.2% in Year 2 and 6.90% by Year 3
•
Be the Café of Choice in the Overland Park area and recipient of the Best
Coffeehouse Award
1.2
Mission Statement
The Russet Cup is committed to its products and employees which they believe is the
recipe for market success.
1.3
Guiding Principles
The Russet Cup is committed to values such as excellence, passion, quality, integrity and
leadership which allow them to navigate challenges and provide for future opportunities.
These core beliefs start with their commitment to their products and their employees
.
The Russet Cup rewards excellence and cherishes loyalty. The café will work with its
employees to build strong businesses and a secure future.
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1.4
Keys to Success
The Russet Cup stands out from the competition. Below are their Keys to Success:
•
Great Products – providing exemplary products at market prices – will make
customers want to return again and again
•
Hire Quality Baristas – Pay employees rates similar to the larger chains with
opportunities for long term careers and opportunities for advancement with long term
plans to open a second facility
•
Convert Customers to Connoisseurs - Only 40% of the nations coffee drinkers
consume premium ground and whole bean coffee – this will aid in continued growth
2.0
Company Description
The Russet Cup will be a coffee house / café located in the Overland Park, Kansas. Located in
the Kansas City area, the cozy café will be located in the newly completed Market Square Plaza.
The café will serve gourmet coffees, espresso and drip coffee, lattes, and smoothies. The simple
pastry offerings may vary with seasonality but the primary line will be muffins, breads, cookies,
scones, and rolls. All pastries will be supplied daily by a local bakery.
The café will be owned and operated by Owen Jones, a veteran restaunteur with several years
experience running and managing chain restaurants. The café will be open for business Monday
– Thursday 7-10, Fridays and Saturdays 7-11 and closed Sundays.
2.1
Ownership
The Russet Cup will be owned 100% by Owen Jones. Mr. Jones a graduate of Kansas
State University has an undergraduate degree in business administration. During high
school he worked as a waiter in a local hospital coffee shop that purchased its beans from a
local roaster. In addition to being an avid coffee drinker himself, this job allowed him to
learn about the business first-hand. In college, Jones worked in a campus coffeehouse for
four years, eventually rising to the position of assistant manager. Following graduation,
Jones secured a business development position for regional restaurant chain, which
provided additional first-hand exposure to the food and beverage industry—especially the
steps involved in establishing new locations.
2.2
Legal Form
The Russet Cup will be formed as an S-Corporation wholly owned by Mr. Jones.
2.3
Start-Up Summary
The Russet Cup will have seating for 40 patrons. The rent is $2,075 a month, with a three-
five-year lease available. The site consists of 1500 square feet of leased space consisting of
a dining room, a coffee bar, two restrooms, and a storage room in back. To be used as a
restaurant, this storefront needs to be plumbed and wired appropriately. Painting, new
floors, and countertops are also needed. A custom coffee bar needs to be built. With
materials bought on sale and volunteer labor, the cost to renovate will be $71,725. The
coffeehouse equipment will consist of two commercial espresso machines, air pots and
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urns, a commercial blender, commercial brewer, top loading coffee bins, barista syrups,
cold drink dispenser, frothing equipment, a commercial refrigerator, microwave and
stainless steel prep bar. The cost for the equipment is $38,275. The furniture will consist
of leather couches, and chairs (purchased at auction), coffee tables, bookcases, and window
treatment. The artwork will come from local artists and will be sold on a consignment
basis. The books were secured via donations. Total cost to furnish is $14,000. Other
startup expenses will be dishes, furniture, rent deposit, and marketing.
2.4
Location and Facilities
The new coffeehouse is located in the highly desirable Overland Park, Kansas area at the
northeastern intersection of 135th Street and Mission Street in the new Market Square
Plaza. The property is located in an excellent location. With an easy 6 minute drive time
to I-435 and 69 Highway. The property is 95% leased with Price Chopper as the Anchor
Tenant. Other tenants include: Life Spring Med Spa, Jane’s Canines (Pet Store &
Boarding), Pride Cleaners Kahn Dental and Swim U. Price Chopper brings more than
10,000 shoppers per week to the center. The location is comprised of a population of 9,420
within a one mile radius, 61,102 within 2 mile radius and 149,550 within a 5 mile radius –
with a median household income of $120,856. Sprint / Nextel’s corporate office is located
within 2 miles of the site.
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3.0
Products/Services
3.1
Products/Services Descriptions
The Russet Cup’s primary offering is gourmet roasted coffees with such varieties such as
mocha, carmelicious, white mocha, candy bar latte, and brewed coffee. Complementing
the coffee will be a smoothie line including wild berry, strawberry, peach, mango and
lemonade. Rounding out the simple menu line will be pastries obtained with an outside
supplier, freshly made and delivered daily. The pastry offerings may vary with seasonality
but the primary line will muffins, breads, cookies, scones, and rolls.
3.2
Competitive Comparison
The research methodology is based on unique coffee shops/cafes in the greater metro area
and omits larger chains or franchises. The findings reveal eight unique competitors.
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Roasterie Café
4511 W 119th St
Leawood, KS 66209
http://www.theroasterie.com/Cafe/
Take Five Coffee Bar
5336 W 151st St
Overland Park, KS 66224-8701
http://www.takefivecoffeebar.com/Welcome_to_Take_Five_Coffee_Bar
Homer’s Coffee House
7126 W 80th St
Overland Park, KS 66204-3715
http://www.homerscoffeehouse.com/about.php
Morning Glory Espresso
5606 Johnson Dr
Mission, KS 66202-3323
http://www.morninggloryespresso.com
/
Revo Cup Coffee
11030 Quivira Rd
Overland Park, KS 66210-1239
http://revocup.com/blog/
Daily Dose Coffee and Bar
12056 W 135
th
St,
Overland Park, Kansas
Java Crossing
8830 W 95th St
Overland Park, KS 66212-4051
Hattie’s Fine Coffees
4195 Somerset Dr
Prairie Village, KS 66208-5242
http://www.hattiesfinecoffee.com/Home_Page.html
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3.3
Product/Service Sourcing
The Russet Cup has negotiated supplier agreements with several local food-service
wholesalers and coffee wholesalers in the Overland Park area that have a reputation for
quality and reliability:
•
Mean Beans Coffee Roasters
•
Overland Park Brewers
•
Healthy Harvest Bread Co.
•
Mary's Organics
In the event that one of the aforementioned specialty suppliers cannot meet their needs, the
following national suppliers can both provide all of the food-service products that they
require. In addition, the following wholesalers will supply the café with general restaurant
supplies:
•
Lawrence Food Products Corp.
•
Gerry Food Supply Inc.
3.4
Inventory Management
N/A
3.5
Warehousing and Fulfillment
N/A
3.6
Future Products/Services
Young families which comprise the third largest market share in Overland Park, are often
overlooked in the coffee market. Coffeehouses traditionally have not been considered
‘kid’ friendly. To overcome this hurdle, the Russet Cup has long term plans (5 years) to
open a 2
nd
coffee shop: A combination indoor play area / coffee bar. This concept allows
parents and caregivers an opportunity to meet and relax with other adults while the
children can enjoy the indoor playground amenities.
Additional future services will include in-store sales for home purchase as well as an
online store.
The website will have an option to purchase prepaid gift card program – Prepaid gift cards
not only provide immediate cash, but also reduce credit card transaction charges and draw
new customers to the business.
4.0
Market Analysis
Overland Park, Kansas is an award-winning place to live and work and is considered the leading
business community in the Midwest. National publications and organizations recognize
Overland Park for its business environment and livability. Here’s a sampling: 6th Place,
America’s Best Places to Live Money, Top 50 Cities to Live and Play, National Geographic
Adventure, 3rd Hottest Town in the U.S., Money, Among 20 Best Places to Live & Work
Employment Review, One of only 72 Sterling Tree Cities in U.S., National Arbor Day
Foundation, Top 10 best Locations to Raise a Family, Southern Business and Development, 1st
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Place, Kid Friendly Report Card, Population Connection, 2nd Best City in America to Live
Business Development Outlook.
Overland Park is at the core of one of the most dynamic local markets in the U.S. It offers easy
access to the Kansas City region’s amenities and, as part of the Kansas City metropolitan area; it
is within the most centrally located major market in the nation. I-35, I-435, I-635 and U.S.
Highway 69 all pass through Overland Park, and no point in the city is more than 3.5 miles from
a freeway. The city maintains an excellent arterial street network and plans to construct
additional lane-miles as the area grows. Three airports serve the region. Kansas City
International Airport (MCI) is just 25 interstate highway miles north of Overland Park. Johnson
County Executive Airport—the second busiest in Kansas—provides complete services for
private business jets and general aviation. New Century AirCenter, just 12 miles southwest of the
city, offers general aviation services and accommodates cargo or passenger jets of any size.
Overland Park supplies some of the most highly educated workers in the nation, with 97% of
Overland Park adults over age 25 holding at least a high school diploma. Johnson County, in
which Overland Park is located, ranks first among the country’s 231 counties with populations
greater than 250,000. The county ranks sixth in percentage of adults with at least a bachelor’s
degree and 16th in the percentage with a graduate or professional degree.
The Overland Park area has a total population of 175,265 based on the 2010 census. The median
household income is $77,881 and the median age is 37.9. (2010 US Census)
Drive
4.1
Industry Analysis
The US coffee shop industry includes about 20,000 stores with combined annual revenue
of about $10 billion. Major companies include Caribou Coffee, International Coffee & Tea
(The Coffee Bean & Tea Leaf), Peet’s Coffee, and Starbucks. The industry is concentrated:
the top 50 companies generate more than 70 percent of sales. Coffee shops are part of the
specialty eatery industry, which also includes retail outlets specializing in products such as
bagels, donuts, frozen yogurt, and ice cream. (First Research)
Competitive Landscape
Consumer taste and personal income drive demand. The profitability of individual
companies depends on the ability to secure prime locations, drive store traffic, and deliver
high-quality products. Large companies have advantages in purchasing, finance, and
marketing. Small companies can compete effectively by offering specialized products,
serving a local market, or providing superior customer service. Specialty eateries, which
include coffee shops, are labor-intensive: average annual revenue per worker is about
$50,000. Coffee shops compete with businesses such as convenience stores, gas stations,
quick service and fast food restaurants, gourmet food shops, and donut shops. (First
Research)
Products, Operations, Technology
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Major products include beverages and food. Beverages include brewed coffee and tea;
espresso drinks (cappuccinos, café lattes); cold blended beverages; bottled water; soft
drinks; and juices. Food includes pastries, bakery items, desserts, sandwiches, and candy.
Many coffee shops sell whole or ground coffee beans for home consumption. Some coffee
shops sell coffee or espresso-making equipment, grinders, mugs, and other accessories.
(First Research
)
4.1.1
Market Size
The US coffee shop industry includes about 20,000 stores with combined annual
revenue of about $10 billion. Major companies include Caribou Coffee,
International Coffee & Tea (The Coffee Bean & Tea Leaf), Pet’s Coffee, and
Starbucks. The industry is concentrated: the top 50 companies generate more than
70 percent of sales. (First Research)
4.1.2
Industry Participants
Within 5 miles of the subject, are 37 businesses involved in the coffee industry,
including chains, restaurants, and tea houses reporting annual revenues in excess of
$54 million. Of these 37 businesses, 20 are Starbucks coffee shops capturing $35.7
million in revenues or 66% of the market share. An additional 8 coffee houses are
franchises capturing $9.7 million represent 18% of the market share. The
comparables – those closely held coffee shops/cafes that will compete for the
subject’s business represent $8.3 million in annual revenues or 15% of the total
market.
