Fresh Cup Magazine, providing specialty coffee and tea professionals with unique insight into the trends, ideas, products and people that shape their world.
Issue link: http://freshcup.epubxp.com/i/71652
CAFÉ FINANCE BY CHRIS LEGLER You don't need a traditional store, but you do need planning ho says you need brick and mortar to gain profits and legitimacy? Carts and kiosks can be a relatively inexpensive way to get into the coffee business or to expand a company that's already rolling. Typically, the upfront investment in the cart/kiosk area is more modest than that of a full store. In addition, the model offers you flexibility to go into nontraditional locations (office-building lobbies and high-traffic parking lots, for instance) where a typical coffee shop just wouldn't fly. A self-contained cart also allows you to shift from location to location without much extra work. You can capture sales at events where a large number of people are gathered for a short period of time. If done right, this strategy can give you the ultimate bang for your buck. So how can you figure out the numbers to see if the scaled-down setup is right for you? Start with determining your needs and subsequent costs. Carts and kiosks can be purchased or built for a wide range of prices, depending on how the unit is outfitted—the initial output can range anywhere from $10,000 to almost $100,000. It is important to determine what you need or what your target 30 Fresh Cup Magazine freshcup.com market is prior to purchasing or building a kiosk/cart. Questions that you will want to ask yourself include: 1. Will mobility be necessary? 2. What will be offered, and what equipment will such items require? Espresso, drip, frozen beverages and food all come with their own needs. 3. Will municipal water and electrical hookups be available, or does the unit need to be totally self contained? 4. Will rent be required at the expected locations? Here is a scenario we can examine to see how profitable the concept can be: Let's say you're opening a kiosk in the lobby of a bank building in a downtown urban environment. In this scenario, you will be building a kiosk that is not mobile, you will hook into existing water and electric, and you will be paying rent to the building for your location. The kiosk will probably need an espresso machine, refrigeration, blenders and drip coffee. Essentially, you will need all of the equipment that would be necessary to serve beverages at a full-line location.