Last Updated:

How to Start a Profitable Coffee Shop in the U.S

Vincent Nyoike
Vincent Nyoike SMEs US

The U.S has a robust economy that makes it favorable to start a coffee shop. People love taking coffee especially when it is hot. Half of Americans take at least a cup of coffee in a day, while a majority take about three cups in a day. Coffee is the most consumed beverage in the U.S. A coffee shop can work well in both large cities and small towns.  This is how you can start a profitable coffee shop in the U.S. 

Write a Coffee Shop Business Plan

You need to draft a business plan before you can start a coffee shop. The business plan should capture startup costs, business location, target market, competition, revenue projections, mission and vision statements. To make it in the coffee cafe business, you need to come up with excellent ways to win the competition. A business plan is a blueprint for your coffee shop that will help you navigate through and solve challenges you will face.

Read also: How to start a grocery store in the U.S. 

Find a Good Business Location

The location of any business plays a critical role in its success. You can start a coffee shop business in an area with high foot traffic. Look for a central place proximity to attract customers. Make sure to balance between rent payable and proximity of your business location. The location should be easily accessible and convenient. Depending on your target customers and business size; you may also need ample parking space. You can set up a coffee shop near offices or institutions, to serve a group of people.

Acquire Business Licenses and Insurance

You need to run a legal coffee shop business by registering it and acquiring business insurance. You need to check with your local government authorities about some of the business licenses you need to secure. Make sure that the coffee shop meets all the necessary health requirements. Get business insurance to cover the business against possible losses caused by fires, or attempted theft.

Read more: How to register a business in the U.S. 

Develop a Good Product and Market your Coffee Shop Business

The other thing you need to do is to attract and retain customers to your business. You need to advertise your business through signage and posters. Make sure that your business signage is visible from far. Once customers visit your coffee shop, make sure to offer them quality service. This is a great way to retain customers to your business  and keep them coming back. 

Brew high-quality coffee by souring your coffee beans from excellent suppliers. Serve your coffee in different blends and roasts like light, medium and dark roast. People have different preferences in coffee and it is important to avail all blends.  

Read also: How to start a bookstore business in the U.S.

Cost of Starting a Coffee Shop Business in the U.S

The cost of starting a coffee shop depends on its size and location. For instance, it is cheaper to start a coffee shop in a small town compared to a city like New York. To start a sit-down coffee shop in a large city will cost you at least $200,000 while a small kiosk will cost you around $100,000. The following is the startup capital breakdown for an average coffee shop.

  • Rent - $15,000
  • Espresso machine - $10,000
  • Coffee roaster - $10,000
  • Furniture - $15,000
  • Business licenses - $5,000

Equipment You Need to Start a Coffee Shop Business

To start a coffee shop, you need the following equipment:

  • Espresso machine. It is useful in brewing coffee into preferred blends or thickness.
  • Coffee grinder. It is useful in grinding your grain before you can prepare coffee.
  • You need a fridge to store ingredients so that they can stay fresh.
  • Automatic drip coffee maker. It is useful in making coffee. You need to buy a durable machine and one that can prepare enough quantity that can serve many customers. You will not need to prepare coffee very many times.

Read also: How to start a barbershop in the U.S. 

Is Coffee Shop a Profitable Business in the U.S?

A coffee shop is a profitable business to start in the United States due to the high demand for coffee. However, the competition is usually high and you need to figure out how to win the competition. Find a good business location and get a relatively cheaper space to rent. Set prices that will help you generate enough revenues to meet your operational costs and also retain enough profits. The coffee shop business is a profitable venture if you are in a good business location.