How to Make a Coffee Shop Business Plan

Any coffee enthusiast can brew coffee and learn about different types of bean profiles, but those aren’t enough to run a successful business. Turning your coffee shop idea into a profitable venture requires a clear plan that addresses key aspects like finances and operations.

Writing a detailed business plan isn’t just optional. It serves as the foundation for launching, growing, and sustaining your coffee shop even in today’s competitive market.

How to write a coffee shop business plan

Writing a business plan for your coffee shop is more than just displaying numbers. It’s about using data to prove your business will thrive in a saturated market. Before opening a coffee shop, make sure you create a thorough plan that details your concept, market potential, and unique selling proposition. 

Step 1: Start with a strong executive summary

The executive summary is the first section of your coffee shop business plan, but it’s best to write it last. This way, you can accurately summarize your entire plan.

Think of it as the “elevator pitch” for your coffee shop business. It should be concise, engaging, and informative, which gives readers a clear snapshot of your vision and strategy.

First, describe your coffee shop’s name, concept, and unique selling proposition. Are you opening a minimalist espresso bar, a cozy neighborhood spot, or a mobile coffee truck? Highlight what sets your coffee shop apart from others.

For example, you can make your business unique by sourcing single-origin, direct-trade beans from sustainable Colombian coffee farmers.

Then, state your mission. What do you aim to achieve with your coffee shop? With the example above, you could focus on promoting fair trade practices and supporting small-scale coffee producers.

Next, outline your short-term and long-term goals, such as reaching a specific sales target within the first year or expanding to multiple locations within five years.

You can also discuss your coffee shop’s location and explain why it’s ideal for your business. Talk about foot traffic, proximity to offices or schools, and the local demographic.

Your executive summary should provide an overview of your expected coffee shop opening costs as well, including expenses for equipment, renovations, inventory, and initial marketing efforts. If you’re looking for funding options, discuss how much you need and how you plan to use it.

While there are lots of sections to talk about, the executive summary should be no more than one to two pages. You can always adjust and refine this section as you write out other parts of your business plan. 

Step 2: Write a company overview

The next part of your coffee shop business plan is your company overview. It’s different from an executive summary, although they often cover overlapping information.

As mentioned, the executive summary comes first and acts as a high-level snapshot of your business plan. It’s written to grab attention and give readers, particularly potential investors or lenders, a quick but compelling look at what your business is, why it matters, how it will succeed, and what kind of funding or support you’re looking for.

On the other hand, the company overview goes deeper into the background and structure of your business. It explains the type of coffee shop you’re opening, your ownership structure, your brand identity, and how your shop is designed to operate.

Common coffee shop types include kiosks, drive-throughs, and sit-down establishments. Choosing the right format depends on your target market and location. For instance, a drive-through may thrive near highways, while a full café suits urban neighborhoods with foot traffic.

Meanwhile, you must also clarify your legal business structure since it affects taxes, liability, and operations. Common structures include:

• Sole Proprietorship: Simple setup, but personal liability for business debts.
• Limited Liability Company (LLC): Offers liability protection with flexible management.
• Partnership: Shared ownership and responsibilities among partners.

Next, establish your brand identity. Create a memorable and relevant brand name and logo that makes a lasting impression. You also have to decide on the interior design and ambiance, or vibe, in this part of your business plan.

While the executive summary is your elevator pitch, the company overview is the blueprint that shows how the pitch is actually going to work in real life. 

Step 3: Outline your management and staffing plan

Building a successful coffee shop business in 2025 starts with assembling the right team. Your management and staffing plan is a crucial section of your business plan, detailing who’ll run your shop, who you’ll hire, and how you’ll train and retain restaurant employees.

You should outline your coffee shop’s leadership structure, including:

• Owner(s): Responsible for overall business decisions, financial management, and strategic planning.
• General Manager: Oversees daily operations, manages staff, and ensures customer satisfaction.
• Kitchen Manager (if applicable): Manages food preparation, inventory, and kitchen staff.

Then, determine the number and types of employees required based on your shop’s size, hours of operation, and menu offerings. Key positions typically include baristas, kitchen staff if you’re offering food, cleaning staff, and admin personnel.

For example, a medium-sized coffee shop operating from 7 AM to 9 PM may require four to six baristas, two kitchen staff, one person for admin tasks, and one manager.

Discuss and develop training programs to maintain service consistency and quality. These should cover product knowledge, customer service, health, and safety.

Additionally, you can detail the benefits you’re offering in this section, such as health insurance, paid time off, and employee discounts. You can also implement employee retention strategies, like recognition programs and career advancement opportunities.

Step 4: Do a detailed market analysis

A solid market analysis is important because it shows investors you understand your competition, customers, and how your shop fits into the local market. Start by identifying nearby coffee shops.

In the U.S., there are over 42,000 coffee shops, with Starbucks holding about 40% of the market share. These shops fall into two categories: second-wave (like Starbucks and Dunkin’) and third-wave (independent shops focusing on high-quality beans and brewing methods).

Visit these competitors and take note of their menu items, pricing, customer service, and ambiance. Observe their busiest times and customer demographics. Knowing this information helps you spot what works and where there’s room for improvement.

Next, define who your coffee shop will serve. Millennials and Gen Z are significant coffee consumers, with one-third of Americans aged 18 to 29 visiting coffee shops regularly.

Depending on your location, you dive deeper and target specific demographics. For instance, you can offer free Wi-Fi and comfortable seating to entice remote workers. Students, on the other hand, want affordable options and a study-friendly place.

Make sure to present data that supports your analysis. If you say you’re targeting young professionals, include local employment data, average income levels, and local business surveys to substantiate your claims.

Having quantitative data strengthens your argument and shows you have a thorough understanding of the local market. 

Step 5: Create a sample menu with products that set you apart

A sample menu shows exactly what your coffee shop plans to sell, and why customers will choose your shop over others. As such, it helps potential investors, partners, or lenders understand your business concept, target market, and pricing strategy.

First, it defines the type of coffee shop you’re opening. Are you offering classic espresso drinks, trendy seasonal specials, or plant-based pastries?

Your sample menu also affects your operational needs, like what kind of equipment, staff, and ingredients you’ll need. If you’re serving cold brew on tap, you’ll need kegs and refrigeration. For housemade syrups, you’ll need prep space and kitchen staff. These choices shape your startup costs, daily workflow, and expenses.

Additionally, your menu drives your financial projections. You’ll estimate pricing, average ticket size, and how many items you expect to sell each day. That data feeds into your revenue forecasts and helps investors assess your profit potential.

Include staples that customers expect in your sample menu, including espresso-based drinks, like espresso, iced Americano, cappuccino, and latte. For non-coffee drinkers, you can offer teas, smoothies, and hot or iced chocolate.

Then, create signature drinks that make your coffee shop different from the rest. For instance, you might serve a lavender honey latte made with local honey from a nearby farm or a spiced orange cold brew made with housemade syrup and fresh citrus zest.

The goal is to offer something people can’t get at big chains, while keeping prep simple enough for your staff to make quickly and consistently.

While coffee is the main attraction, you can also offer a selection of light snacks that pair well with your beverages, like croissants, muffins, scones, and cookies. Other, more filling options can include artisanal sandwiches and breakfast burritos.

Don’t forget to apply menu engineering techniques to your actual menu to increase the chances that people order high-margin items.

Step 6: Develop a marketing and advertising plan

Since your business plan shows your coffee shop’s viability and profitability, it makes sense to include a marketing and advertising section. A solid restaurant marketing plan can help you reach more customers, which can increase sales.

Social media platforms like Instagram, Facebook, and TikTok are useful for showcasing your menu items and engaging with customers. Publish posts, stories, and reels regularly to highlight your menu and create a loyal following.

Make sure you also create a Google Business Profile to help potential customers find your coffee shop online. Include high-quality photos of your space, menu items, and contact information. Encourage satisfied customers to leave positive reviews as well, which can improve your visibility in local searches.

Consider email marketing for personalized outreach. Collect customer emails to send newsletters featuring promotions, new menu items, and events. Personalized emails have six times higher transaction rates, so you should leverage them as much as possible.

Of course, don’t forget about offline marketing since your business is a real brick-and-mortar location. Distribute flyers in nearby neighborhoods, colleges, and offices to promote your coffee shop’s opening, special offers, or events.

You can also join local events like farmers’ markets and festivals or host your own events, like acoustic nights or art showcases, to increase brand awareness and connect with the community. 

Additionally, set up a loyalty program, like a simple stamp card, where customers earn a free drink after purchasing a certain number. This encourages repeat business and helps build customer loyalty. 

Step 7: Set up your business operations and systems

It’s also important to add the details of how you’ll be operating your business and what tools you’ll be using. This part of your business plan focuses on outlining your day-to-day processes, from technology solutions to operational infrastructure.

First, you should choose your POS system, which manages inventory and keeps sales data for future reference. For coffee shops, speed and simplicity are key.

Consider systems like Clover, known for its flexible software and seamless payments, or Toast, which offers more customer engagement and stock management features. These systems can help you track sales, manage your menu, and understand customer preferences.

Aside from your POS system, it’s also good to have restaurant management software to make scheduling shifts, time tracking, and team communication easier. Having this tool keeps everything on the admin end organized and reduces manual work, even if you have to schedule employees across multiple locations.

Next, list your key equipment needs. At minimum, you’ll need an espresso machine, grinders, a drip brewer, refrigeration units, and a freezer for pastries or cold items. Depending on your menu, you might also need blenders, a prep table, or a convection oven for warming food.

Don’t forget coffee shop decor, seating, storage shelves, and signage. These are all part of your daily setup and impact both customer experience and flow.

Then, outline your daily systems. This includes how orders will be taken and fulfilled, when prep happens, how often cleaning tasks are done, and how you’ll track inventory.

Writing these systems down maintains consistency, especially when training new staff. It also shows investors that your coffee shop is built for efficiency and success.

Step 8: Forecast revenue and operating expenses

Your business plan should include projected revenue and operating expenses. It helps potential investors understand your financial needs and provides them with data to assess your coffee shop’s profitability.

The cost to rent a coffee shop plays a significant role in operating expenses, which can go as high as $10,000 per month in high-traffic, urban areas. You also have to consider staff salaries, utility bills, supplies, and marketing costs.

Once you have a figure for the operating expenses, it’s time to calculate revenue projections, which help determine when your coffee shop will break even.

Aside from coffee sales and food items, some coffee shops also earn from merchandise like mugs, t-shirts, and coffee beans, especially if they have unique coffee shop names. Events are another potential revenue stream. You can cater to weddings or conferences or host your own workshops, like latte art classes or coffee brewing seminars.

Present realistic financial projections, including a break-even analysis. Remember that the average profit margin for a mid-sized coffee shop falls between 2.5% and 6.8%, so you can set achievable financial goals.

Afterward, you need to create a cash flow forecast and a restaurant profit and loss statement if you’re already operating. These documents help you track income, expenses, and profitability over time, and give potential investors or lenders confidence that you’ve thought through the financial realities of running a coffee shop.

A cash flow forecast shows when money will come in and go out, helping you plan for slower months or unexpected costs. Meanwhile, your P&L statement shows whether your shop is earning more than it’s spending, month by month and year over year.

Keep these documents updated, so you have accurate data when you need to make financial decisions, like hiring new staff, raising prices, or investing in new equipment. Check our restaurant forecasting guide for formulas and techniques to use.

Step 9: Explain your funding and financing strategy

Having a clear funding and financing strategy helps you cover startup costs. It also shows investors that you take your business seriously.

Calculate the total capital required to start your coffee shop. This includes expenses such as equipment, permits, buildout, and licenses. For example, opening a sit-down coffee shop can cost up to $275,000, covering lease, equipment, construction, and initial inventory supplies.

Next, discuss the different funding options you’re considering. The U.S. Small Business Administration offers 7(a) loans, which are popular among small businesses due to lower down payments and flexible terms compared to traditional loans.

Traditional bank loans are a common choice for coffee shop owners as well. You may also detail how much of your own personal savings you’ll be pouring into the business.

Make sure you outline how the funds will be used. Allocate budgets for equipment purchases, interior design, initial inventory, marketing, and staff training.

If you’ve applied for loans, specify the repayment schedule, interest rates, and duration. For equity investments, detail the percentage of ownership offered and any profit-sharing arrangements. Clear terms prevent future misunderstandings and set expectations for all parties involved.

Discuss plans for your coffee shop’s growth, like expanding product offerings or opening additional locations. Doing so keeps you grounded on your long-term vision, while providing investors with a clear picture of potential future returns. 

Bonus: Free coffee shop business plan template

This fill-in-the-blank business plan template is built to help you quickly create your own custom coffee shop business plan. Just replace the placeholders with your actual info.

[Your coffee shop name] – Business Plan

Executive summary

[Write two to three paragraphs that quickly discuss your coffee shop concept, location, unique selling point, mission statement, short- and long-term goals, and financial projections.]

Example:

Golden Roast is a community-focused, third-wave coffee shop opening near the University of Texas at Austin. Our goal is to serve high-quality espresso drinks and housemade pastries in a space where people feel welcome and inspired.

We expect strong foot traffic from students and remote workers and aim to break even within 11 months. Our projected monthly sales will grow steadily thanks to local partnerships and smart marketing.

Company overview

Management and staffing

Market analysis

[Write a short paragraph describing your local market.]

Example: 

Golden Roast is located a few blocks from UT Austin, close to student housing and co-working spaces. This location gives us a steady stream of potential customers all day long.

Sample menu

Marketing and advertising

Operations

Financials

[Attach or insert cash flow forecast and P&L statement here]

Funding strategy

Everything you need for success

A business plan gives you a strong starting point to map out your vision and goals. Edit each part of the template with data you’ve collected, and you’ll be ready to pitch to investors or apply for funding. Make sure to keep your business plan updated as your coffee shop grows, and use it as a guide to stay focused every step of the way.

Planning a successful coffee shop isn’t just about your menu or location. It’s about how you run your team day to day.

Use coffee shop employee scheduling software like 7shifts to manage shifts, track labor costs, and keep your staff connected, showing potential investors and lenders that you’re serious about efficiency, retention, and profitability.