Coffee shops.....opening and closing....

[Muzarella]

I just sold my small Italian restaurant, in good price, but...more than a business was a hobby for me. Now my wife wants for me to open a coffee shop.

I am tired to see many food business opening and closing in few months, some with big investments, specially coffee shops.

I did some easy math and I figure out that, in the best of case, a coffee shop needs to sell at least 1000 cup of gourmet coffee a month to make 50000 THB in gross sale....in a very optimistic calculation.

Considering the investment, cost, and rental, probably needs to sell double of that to make some profit, or triple if having employees.

Most places I know, are empty most of the times, and closed in few months, and I am talking about many places. Too many.

Am I wrong with my numbers?

Edited September 28, 2015 by Muzarella

[inzman]

You could try and be different than other coffee shops. Maybe open early morning when people want coffee. I notice most coffee shops in this country open around noon. Never could understand that. Good luck!

[darko dang]

by my calculations to make one coffee will coast you ,per cup = 10.20 bath(if the cooffe beans cost 141.50 bath per 250g bag =18g per cup ,I recomend you "Aroma" Espresso 2 Formula they are my favorite ones + Fresh milk NO powder milk(like they use in "Amazon coffee"- but they still saying "Nom Sot"- ooouuw! i want to cry Mamy)= 2.30bath +condensed milk as per Thai standard =1.5bath+sugar 0.10 bath per cup, So we get 14.10 bath per cup +electricty =no idea but if use "AC"a lot money+ICE 40 Bath XXXXL Bag + plastic cups =around 2bath with straw for each cup Or ceramic how you want. So we get 16.10 +electricity unknown +Ice Let say 20bath maximum per cup,Ouuw I forget the rent and the equipment too.Now we need a profesional specialist who will take care of that 1000 coffees a month to be made all of them in a same quality because makeing a good quality coffee is between science and art OK -(By my experience Thai people don't know what is the proper pulling of Espresso Shot- period) So now you figure out for how much you will sell one cup of coffee but you can not sell only coffee, right.Good luck buddy,that all from me ,for now . See yaa

[dddave]

Location, location, location....near a university, hospital, government offices, any institution or place that has a concentration of people with regular income.

Don't oversell on "quality"; most Thais think Nescafe "3-in-1" is gourmet coffee...style over substance wins more often in Thailand. As long as your "barrista's" can make cute little swirl patterns, you'll be ok. No need to spend big baht on top-line machines and expensive premium beans.

[Thian]

Coffee costs 70 baht in BKK.

Good beans cost 175 baht in Foodland, DE-brand in the aluminium pack of 500 gram.

Also sell good cookies/sandwiches so it becomes breakfast.

Be the first one and make it drivethrough along one of the very busy roads into BKK. On the way out we need take-away drivethrough warm meals.

[Nomyai]

no you are not wrong. My eyes see that some shops have customers more dont!

[Smithson]

I think the whole coffee shop craze started in 97, I remember a Chinese guy went broke and set out to open shops in every petrol station. I'm guessing it grew into Amazon.

I'm really impressed with the calculations here, but even a fool like me can see all the empty places. I think it's become a status thing, something they can do with mum or fan and tell there friends about.

Opening late morning says it all.

[allanos]

The coffee shop business is fraught with pitfalls, but, in that sense, it is no different to

any other business. If you made a success of your Italian eatery, sit down and itemise

the reasons why you think it became a success, and apply these concepts to any other

business you decide to enter into.

My initial suggestion would be that you re-work your figures, and factor in the likely

return you will get on selling either convenience take-away foods (ready-made sandwiches,

for example) to go with the take-away coffee your customer has purchased, and the

likely value-added (and high mark-up) foods that your "sit-down" clients will buy alongside

their gourmet coffee, e.g. cakes, gateaux and other confectionery.

Good luck with what you decide.

[ExpatOilWorker]

I know of 2 small coffee shops I frequent that are located in office buildings, one is run by a mom/son team, and they must be dishing out 20-30 cups/hour when you include green tea, chocolate, coffee and what else they mix together.

Price and location is the key. They charge a very reasonable 40 baht for a nice cappuccino.

Good seating, maybe some kind of sofa arrangement or living room chair is also a most. Forget about the "modern" taburet stool.

Bangkok Post and one Thai newspaper is also a bit plus.

NB: Make sure you have real spoons. I HATE the wooden sticks they have a Starbucks!

Edited January 11, 2016 by ExpatOilWorker

[MaeJoMTB]

The coffee shop business is fraught with pitfalls, but, in that sense, it is no different to

any other business.

Put your much younger and attractive wife in a relaxed setting where she can interact with 100's of wealthy foreigners.

Sounds like a great plan, no different to any other business ...........

Edited January 11, 2016 by MaeJoMTB

[Gutenberg]

Be the first one and make it drivethrough along one of the very busy roads into BKK. On the way out we need take-away drivethrough warm meals.

Drive through, like McDonalds and Starbucks in BKK?

[MaeJoMTB]

Coffee costs 70 baht in BKK.

Good beans cost 175 baht in Foodland, DE-brand in the aluminium pack of 500 gram.

Aribica Coffee beans (unroasted but shucked) cost 120bht/Kg from the coffee plantations around CM.

Do you really think coffee shops purchase supplies from retail stores?

[Thian]

Coffee costs 70 baht in BKK.

Good beans cost 175 baht in Foodland, DE-brand in the aluminium pack of 500 gram.

Aribica Coffee beans (unroasted but shucked) cost 120bht/Kg from the coffee plantations around CM.

Do you really think coffee shops purchase supplies from retail stores?

Yes my friend had a coffeeshop (it's closed of course) and he bought coffee from Thailand for 400 baht 500 gram. DE-coffee tastes even better.

I don't care how cheap coffee is or can be, if it is worse then DE i won't drink it. Also i won't wait for coffee.

Drivethrough for officepeople would be perfect. We have huge trafficjams every day and sure they like coffee with a nice sandwich but are too lazy to park and go stand in a qeueu.

On the way home they all need a nice meal, drivethrough of course. Parking is a crime in BKK and even worse if you drive a pickup.

[Gutenberg]

The real thing would be a coffee drone.

People order via gps app and the drone is flying to that location and brews hot coffee.

Call it TrafficJamCoffeeDrone .

[steven100]

The coffee shop business is fraught with pitfalls, but, in that sense, it is no different to

any other business.

Put your much younger and attractive wife in a relaxed setting where she can interact with 100's of wealthy foreigners.

Sounds like a great plan, no different to any other business ...........

she can assist any foreigner with his desire .. $$$ ... just relax and enjoy !

[sushyoshi]

Location, location, location....near a university, hospital, government offices, any institution or place that has a concentration of people with regular income.

Don't oversell on "quality"; most Thais think Nescafe "3-in-1" is gourmet coffee...style over substance wins more often in Thailand. As long as your "barrista's" can make cute little swirl patterns, you'll be ok. No need to spend big baht on top-line machines and expensive premium beans.

This!

Let me present you some real number before you make any big investment.

I own a coffee shop in Chiangmai. Here are an approximate of my numbers:

- Coffee beans - Around 550B/Kg - Bought directly from supplier. These are premium quality beans. So 10g = 5.5B

- For hot coffee you use a single shot - Around 7-10g - 5.5B

- For iced coffee you use a double shot - Around 12-15g - 7B

- Cups with top, logo and straw around 6B

- Ice 30B a bag. I would say can make around more than 10 cups a bag so I estimate around 2B a cup

- Milk is 46B/Liter - If you serve a latte hot/cold can go from 170-200ml. That goes around 9.2B per cup maximum.

I am not considering condensed milk and sugar for now. The total cost of a latte to you (without water/electricity) is already reaching 25B

- Electricity and water - Depends, but be aware a coffee machine spends alot of electricity when running continuously. A small one is around 3,000W. So if it is running for an hour it will consume 3 units = 24B (at 8 baht per unit standard). Of course this calculation is if the machine is running full power in an hour but this is just to give an idea.

Rule of thumb for food services (not sure but goes something like this): 1/3 ingredients + 1/3 utilities + 1/3 profit = selling price

Following the rule you will have to sell around 75B each cup of coffee.

Selling 100 cups a day - Profit around 2,500B/day = 77,500/month - That is great!

Only one problem. 100 cups a day is very unrealistic, specially at 75B a cup. Depending on the location I believe you can sell around a quarter of that in a good day.

[MaeJoMTB]

^^

Yeah, but you're being ripped at every stage in the process.

That isn't what a Thai would pay for anything.

The Ice man at my local coffee shop in CM brings in multiple 25Kg sacks of ice on his shoulder.

I've never seen him handed more than 100-150bht.

Ice at 30bht a bag ....... they seen you coming, I only pay 5bht a bag for a large shopping bag full (7-11/Tesco standard size)

CM university, all the coffee shops use the same organic supplier 400bht/Kg roasted and ground.

Cups with a random logo ..... around 0.5bht/cup or less.

30bht for a hot Latte/Mocha/Cappuchino at NaNa in Santhitam or 25bht for an Americano with no milk.

And they're making a profit, and they sell well over 100 cups a day.

Edited February 11, 2016 by MaeJoMTB