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  • Uni Assignment - Chillax Coffee House

    My name is Max,

    I am currently studying at the University of Western Sydney. We have been given an assignment to create a business plan, I have choosen a Coffee Shop and I came accross this site. I was just curious if anyone could help me out with any general information or pointers on starting up a coffee shop, any information is appreciated. I have done a lot of work and this is going to be used as some primary research for the report.

    My company, which I guess people can steal the idea for is a coffee house for the youth, named Chillax. It will be an arcade style, relaxed atmoshere with hamocks and TVs, pool table etc. thoughts??

    The concept I am most struggling with is start up costs that i should consider ie. what licences are needed.

    Also ideas on how i could forecast sales and expenses would be helpful, currently i have based sales on how many people can fit on the premesis, peak times and multiplied that by an estimated spending of each customer.


    Advice??

  • #2
    Re: Uni Assignment - Chillax Coffee House

    Welcome to Coffee Snobs.

    You should be able to get some useful information here as a few members own a "Coffee Shop".

    My 2 cents though: Hammocks?
    All (successful) businesses work on turnover.
    It doesnt matter if you are selling money (banks), hamburgers, dresses or coffee.
    If your turnover is too low you go bust.
    Example:
    Your coffee shop has room for 20 customers to sit.
    5 of those spots are hammocks.
    I dont think I could drink coffee while in a hammock so that really leaves 15 seats.
    The longer people linger the less money you make.
    You dont want to "rush" them but you dont want them drinking one cup of coffee for 4 hours.
    Lose the hammocks and add more tables unless you have lots of room to spare.

    My father ran a Greek kafenio or two when I was younger.
    One had 3 x 12 foot snooker tables and 6 pinball machines.
    He sold coffee and greek sweets. Nothing else.
    Im not sure if the tables were paid for but in your case pool tables will be coin operated.
    So it can be done but you need lots of room.

    TVs annoy me in coffee shops.
    You can never choose what you want to watch and thats not what youre there for anyway.
    If the sound on the TV is always too loud, I wont be back.

    Same for too loud music.


    Comment


    • #3
      Re: Uni Assignment - Chillax Coffee House

      Interesting, hamocks have been removed didnt think to much about the having room to fit more bums on seats.

      Its aimed for younger people so the pool table etc. will all be coin operated so they will hopefully pay themselves off in the long run. Space isnt really a problem because we can make up the dimmensions as part of the assignment, just needs to be realsitic.

      The TVs and noise will hopefully be confined to the back of the shop so the front can be for those looking to have some coffee and just hang out with friends.

      Comment


      • #4
        Re: Uni Assignment - Chillax Coffee House

        Instead of hammocks, go for lounge chairs...I see all along Fitzroy Street in Melbourne (Brunswick?) that most if not all the cafes have lounge chairs for seating. (Melbournites correct me if Im wrong on the suburb or the street!)

        Comment


        • #5
          Re: Uni Assignment - Chillax Coffee House

          There are 2 types of coffee businesses
          1) Speciality coffee shop that has coffee as its main selling point
          2) Food outlet that has coffee as a draw card but food related items are the main products sold

          Which one is your model??

          They also attract a different clientèle

          KK

          Comment


          • #6
            Re: Uni Assignment - Chillax Coffee House

            One doesnt associate pool tables with coffee. Pool tables are usually associates with beer unless it is a dedicated pool parlor...

            Its all about atmosphere. I know that most of the cool coffee shops appear to spend a lot on fit out.......and you need a LOT of contingency with the fit out - council plans, delays, DAs etc. Will you seat people outside? Another license...

            Comment


            • #7
              Re: Uni Assignment - Chillax Coffee House

              Originally posted by 7F7D687F74312E2E1C0 link=1239020468/5#5 date=1239084625
              One doesnt associate pool tables with coffee.
              See my post above.

              Most people dont associate pool tables with coffee. Greeks do though.

              Comment


              • #8
                Re: Uni Assignment - Chillax Coffee House


                Im not Greek, but I do like a pool table at a coffee shop, board games are good too

                Comment


                • #9
                  Re: Uni Assignment - Chillax Coffee House

                  Interesting, a start up costing forecast. Lets roll the sleeves up!

                  Its just personal opinion but I am in the "lose the hammocks, pool tables, TVs" camp, as you are trying to attract maximum turnover from people that will spend money in ways that will produce good income for you.

                  Assuming you have 4 walls and a modest sized empty space, and none of the trade work is done by your freinds or family (for very little cost) ie all professional paid for trade work, and for a "smick" job:

                  Painting: say $15,000.00
                  Plumbing: say $5,000.00
                  Cabinet making: say $30,000.00
                  Floor coverings: say $10,000.00
                  Furniture: say $5000.00
                  Equipment: coffee equipmt plus fridges plus kitchen etc etc etc : say $50,000.00
                  Left anything out? Say, bits and pieces to add to the decor, wall coverings, signage, mirros, lightfittings etc.

                  Total $115,000.00 plus, for something that will be a little upmarket and hopefully have a decor that will attract custom in the first instance.

                  ////

                  If you want to keep the hammocks, pool tables, TVs etc and think you can get turnover from the different crowd that kind of decor will attract, then your fitout can cost a heap less as it can be a lot more rustic in nature. But be aware that crowd my spend a lot less with you (linger longer, buying less profitable stuff from you).

                  I dont know how the cost of licences differs between states but budget say, $1000.00, and you might also budget your loss in wages as a cost, because you would be setting this up for some time when you could have been out working and receving a weekly wage.

                  Turnover / sales is a guess. Lets say you are in a good area with lots of through traffic and can start immediately by selling an average of 100 cups a day, at $4.00 per cup. Lets say you do a minimum of food, but I cant forecast that for you as I know nothing about that side of it. Someone else may be able to pipe in.

                  Lets also say that within 6 months you have built it up to sell an average of 200 cups a day plus food, and by the end of 12 months its up to 300 cups a day (good on you).

                  Plug that all into your calculator, factor in some wages for some help, plus electricity telephone and rent and other stuff, and see what happens over the course of a year. Oh dont forget some bank interest on the loan you might need.

                  Its crystal ball stuff but I hope this is helpful.

                  Kind regardz.
                  Attilio
                  first CS site sponsor.





                  Comment


                  • #10
                    Re: Uni Assignment - Chillax Coffee House

                    Originally posted by 635740564D7A664A43434040250 link=1239020468/8#8 date=1239090398
                    Interesting, a start up costing forecast. Lets roll the sleeves up!

                    Its just personal opinion but I am in the "lose the hammocks, pool tables, TVs" camp, as you are trying to attract maximum turnover from people that will spend money in ways that will produce good income for you.

                    Assuming you have 4 walls and a modest sized empty space, and none of the trade work is done by your freinds or family (for very little cost) ie all professional paid for trade work, and for a "smick" job:

                    Painting: say $15,000.00
                    Plumbing: say $5,000.00
                    Cabinet making: say $30,000.00
                    Floor coverings: say $10,000.00
                    Furniture: say $5000.00
                    Equipment: coffee equipmt plus fridges plus kitchen etc etc etc : say $50,000.00
                    Left anything out? Say, bits and pieces to add to the decor, wall coverings, signage, mirros, lightfittings etc.

                    Total $115,000.00 plus, for something that will be a little upmarket and hopefully have a decor that will attract custom in the first instance.

                    ////

                    If you want to keep the hammocks, pool tables, TVs etc and think you can get turnover from the different crowd that kind of decor will attract, then your fitout can cost a heap less as it can be a lot more rustic in nature. But be aware that crowd my spend a lot less with you (linger longer, buying less profitable stuff from you).

                    I dont know how the cost of licences differs between states but budget say, $1000.00, and you might also budget your loss in wages as a cost, because you would be setting this up for some time when you could have been out working and receving a weekly wage.

                    Turnover / sales is a guess. Lets say you are in a good area with lots of through traffic and can start immediately by selling an average of 100 cups a day, at $4.00 per cup. Lets say you do a minimum of food, but I cant forecast that for you as I know nothing about that side of it. Someone else may be able to pipe in.

                    Lets also say that within 6 months you have built it up to sell an average of 200 cups a day plus food, and by the end of 12 months its up to 300 cups a day (good on you).

                    Plug that all into your calculator, factor in some wages for some help, plus electricity telephone and rent and other stuff, and see what happens over the course of a year. Oh dont forget some bank interest on the loan you might need.

                    Its crystal ball stuff but I hope this is helpful.

                    Kind regardz.
                    Attilio
                    first CS site sponsor.
                    In addition to what he said...

                    What you need to have done is a business plan..

                    See here as an example of  some of the topics you have to consider... http://coffeesnobs.com.au/YaBB.pl?num=1237887482/11#11

                    Comment


                    • #11
                      Re: Uni Assignment - Chillax Coffee House

                      Add to your plan -

                      project management
                      contingency
                      consultancies - business advisors, decorators etc
                      advertising
                      building applications and licenses
                      ohh - and you forgot staff

                      Comment


                      • #12
                        Re: Uni Assignment - Chillax Coffee House

                        Trying to picture relaxing in a hammock after drinking a cup of coffee...?

                        Comment


                        • #13
                          Re: Uni Assignment - Chillax Coffee House

                          You need to consider the demographic that this Coffee House is intended to appeal to, or not

                          Regardz,
                          Attilio
                          first CS site sponsor

                          Comment


                          • #14
                            Re: Uni Assignment - Chillax Coffee House

                            As someone doing an MBA and Master of Commerce, and who has previously been an owner of a pub, I can tell you there is a BIG difference between the reality and the assignment. Make sure you show how the models provide improvements to the business design, and do some NPV calculations to prove its viability. Then, if you decide to open up a cafe, make sure you forget all that and build it properly.

                            Also consider the implications of supplier financing, where suppliers will provide you with machines/fridges etc in exchange for a supply contract. This can make for an interesting discussion regarding financial decisions vs qualitative impacts.

                            Either that, or pretend you are interested in buying a coffee franchise and steal their information ;D

                            Comment

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