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Why coffee?
Every coffee drinker loves to get their coffee in the morning. We are going to offer speedy, reliable service that can become a part of our customers’ daily lives.
Offering a simple menu made from quality ingredients gives us focus and further speeds the transaction between the customer and the “barista.”
Really, the traditional term “barista” doesn’t do a good job describing what I and, eventually, our workers, will be doing.
Instead, I would like to think of my employees as customer service experts.
We won’t be doing latte art or sampling special blends from Bolivia or some other exotic locale. Instead, we will focus on getting a good cup of coffee for the customer as quickly as possible.
Who?
Namely, at first; ME!!!
I am dedicated to working the truck Monday through Friday, starting out at 4:30 in the morning for the commissary kitchen I am required by the city to use to pack the trailer or truck for the day.
I will be set up and ready for customers by 6am. I will work until 2pm, when the truck will need to be recharged/refueled and restocked for a possible afternoon/evening shift starting as soon a location is secured and employees are available.
I have been reaching out to several people, including friends, past coworkers from several of my walks of life, and former students I taught when I was a teacher as potential employees.
I’m confident I can find employees willing to work the hours I will need and who can be trusted to work to the best of their ability each shift.
Some of them are of a quality I would be willing to give an assistant manager or manager title to and who are fully capable of running a business on their own. Many have experience with the food and customer service industry.
I am fully aware that I am basically going to need to be “on call” and available to cover afternoon/evening shifts when the business first starts.
Kerry McGill- Former chef of the Poinsett Club. We met in recovery meetings, and he has been a constant source of advice and an ear to listen to my ideas. He is going to help me develop sauces and syrups we can make ourselves, thus lowering the price on our flavoring stock by as much as $5 a bottle. As well as helping to develop the menu, he and his father will also be helping me with the books.
Kate Churches- Kate is a graphic designer and artist who has been helping me develop ideas for logos and the like. She has worked for free so far, and I greatly appreciate her for it, so I would like to reward her by paying her a small amount for her work so far. She will continue to work as a consultant,
Kathy Wolfe- My representative from La Colombe. She will not be on staff but has been advising me throughout this process. I will talk more about La Colombe later, but Kathy specifically is the one who was going to give us the expensive espresso machine I need for this to work. She can’t do the same for a coffee truck or trailer business, but she may still be able to get us one for free when we move to brick and mortar.
Zach Hines and Robert Blumenthal- My original investors. Robert is still interested in being involved. Zach has backed out to a degree but is willing to let me put the trailer on his properties for a land lease. These are in my desired location of the Greenville Tech/Augusta Rd./Laurens Rd/downtown area.
Anthony Garcia- Owner: UWANNAEMPANADA Food Truck. He’s been consulting me while searching for the food truck and answering questions.
Adam from Reautomator – Adam is a coffee machine tech based in NC who is helping to find the espresso machine I want and will service the machine for us if we do not go through Kathy and La Colombe.
Why high tech?
We live in a world where we are expected to do more with less. Technology has helped man make his life easier since the first monkey picked up the first rock.
By using technology that does much of the work for us, we can concentrate on providing excellent customer service AND have the added benefit of needing less people to work.
These are expensive pieces of equipment I am asking for, I understand that, but paying for the best up front, while saving in smart ways, would allow us to save money in the long run on employee costs. They also waste less product than older technology, allowing us to save money in the long term.
Toast-
Toast is one of the keys I will be using for success. It is a very popular Point of Sales (POS) system. They also set you up with rewards programs and website online ordering functionality. For only about $90 a month and a few hundred dollars in set-up and equipment costs, you can get basic POS functionality. You could spend up to $350 for the full suite of services, but I don’t suggest we start there. Start small, then grow is my view.
Sysco-
Sysco is the restaurant supply company I will be using. They are large, well respected, and offer a wide variety of foods and nearly every product a restaurant needs. By using them for virtually everything product related that isn’t coffee, I can reduce costs, increase ease of running the business, and have scalability to grow the business.
La Colombe-
La Colombe is a large coffee company that operates mainly out the southeast- cities like NY and Chicago, in cafes, hotels, and airline customer suites.
They not only offered to give us an expensive expresso machine for the first coffee shop, they also were going to help design the café and provide us their coffee at a good discount.
They have a robust online presence and have products in grocery stores all over the country.
By using them, we not only get help with our venture or reduced price on reliably quality coffee, we also get access to a number of products that would be hard to carry with a smaller company.
Their products are designed for ease of use and accessibility- for example, their cold brew comes in boxes. Most stores would have to brew this product themselves, which requires several large receptacles and 24 hours brew time. That time and money could be better spent having our employees concentrate on customer service over brewing cold brew.
Eversys-
If there is one centerpiece to this entire operation, it’s the Eversys Cameo. With this machine, I can produce two drinks at the same time. Capable of brewing 150 cups of coffee an hour, this machine does most of the work a barista has had to do in the past. This time saved can be used by our employees to better serve the customer.
Joule Case
This is a company that has introduced an electric battery system to replace gas generators. This would allow us to save on expensive gasoline trips, would help make our business more eco-friendly, and they have a robust online presence we could use for advertising and to get out story out.
Using them would as money to our overall cost, but would be a great thing for us to do.
Where?
I have started the process of reaching out to several local businesses and real estate brokers and the like to begin the process of securing a spot.
I showed you the information about 349 South Pleasantburg- the empty lot kind of beside where the old Arby’s and Horizon Records used to be located. I have spoken with the broker of that property and the owner is firm on its $380,000 price but was at least curious how much I would pay to use the spot, so that is a possibility.
For evenings, I know the owners of Radio Room, a bar that has recently moved closer to us to the complex where Open Book used to be located. I am talking to them about the possibility of placing the truck there in the afternoon/evening.
I also have one of my original investors, Zach Hines, who owns the property the first coffee shop was supposed to be located on, and he is interested in my using a couple of his properties.
I have started the process of contacting the University Center and Greenville Tech and would also like to take the truck there some. There are also a few businesses that host food trucks, including Wine Xpress down Woodruff rd.
I think the most important thing is that I start somewhere predictable and get the locals used to the idea that they can stop by and get a quick cup from us.
what menu?
The menu will probably change weekly or monthly, but it will always stay simple in length and cost. Pastries will cost about $3.50. Breakfast sandwiches will cost about $5. Brewed coffee will cost about $3.30. Unflavored espresso-based drinks will start at about $4.
This reflects my desire to make it affordable to get a coffee and some breakfast for around $10. This will not only undercut Starbucks, but it will also allow us to make a good profit.
My estimates are prices are low, but there is more earning potential there if we want to price each pastry individually, based off market price.
Here are some examples of the types of products we can get from SYSCO:
A box of 48 mixed pastries would allow us to offer a nice variety, while not breaking the bank at $62. If we sold them all at $3.50, we would make about $106 off this one purchased item. They would only need to be thawed, cooked in our commissary, then reheated when sold. They have a good shelf life, as well.
A box of 56 extra large croissants would cost about $82. Not only are they a nice size, they are cheap- $1.46 per piece. At $3.50, we would make $114.
ChatGPT, the great A.I. software, says this:
Given the low cost of $1.46 per croissant, you’re in a good position to offer competitive prices while still maintaining solid margins. If you’re charging $3.50, that should be enough to cover other operational expenses like rent, labor, and marketing, while leaving you with a good profit per unit.
A five-pound bag of drip coffee beans from La Colombe. We will get it at a discount, but online it is listed at $80. We will pay about $12.55 per pound of coffee from La Colombe.
Five pounds of coffee beans will make roughly eighty cups of 16oz of coffee. If we price our brewed coffee at $3.30 for 16oz, we would make about $40.25 per pound of coffee.
Coffee is one of the most high-margin items in the food and beverage industry. Coffee shops often experience gross profit margins of 70% to 80% on a cup of brewed coffee, primarily due to the low cost of coffee beans compared to the price customers are willing to pay.
The cost of coffee beans typically makes up only about 10% to 20% of the selling price of a cup of coffee. So, for a $3.30 cup, the cost of the coffee beans might only be around $0.30 to $0.50 per cup.
This is a strong profit. You’re making about $40.25 for every pound of coffee sold, which is over 3 times the cost of the coffee beans themselves. In other words, you’re getting about a 320% return on your coffee bean cost.
In the coffee shop industry, a typical gross margin for coffee beans (after brewing and selling) is about 70% to 80%. Given your revenue and costs:
This places you comfortably within the industry standard for coffee profit margins.
While our profit per pound of coffee is strong, it’s important to remember that there are other costs to factor in:
• Cups, lids, and other supplies
• Labor costs (baristas, etc.)
• Rent or truck costs (for a food truck, this could include fuel, maintenance, and parking)
• Utilities and overheads (electricity, water, etc.)
However, $40.25 per pound is a great return when you consider that the cost of the beans is just one part of the overall equation.
We can further increase profitability by upselling items like pastries, flavored syrups, or premium milk options, which also typically have high margins.
A $40.25 profit per pound of coffee is not only good but excellent compared to the industry average. It’s a solid indicator that our business model, especially in terms of coffee bean cost and pricing strategy, is well-positioned for profitability. If we can keep your operational costs (e.g., labor, rent, utilities) under control, we could achieve even higher net profit margins.
When?
Now!
Seriously, there isn’t a better time. There is a major hole in the market in the area around Greenville Tech and Pleasantburg Dr. We can take advantage of this hole and get a foothold on what I believe is a very lucrative market.
I would love it if we could open before the new Starbucks opens at the corner of Augusta and Mauldin rd.
How?
We start by picking which trailer/truck we want to go with. We then pick which espresso machine we want to use and how to purchase it- new or used.
After we go through the process of getting the truck/trailer we pick customized, I begin the process of licensing and getting the truck up and business filings up to code. I will also have to take a class or seminar for DHEC.
During this time, I will continue working at Starbucks, until possibly the point where I need to take the DEHEC requirements, or later, depending on how my store manager wants to handle the eventual conflict of interest Starbucks will see me as having.
During this whole process, I will be working on finding locations, or, preferably, a single location I can set up every day.
Once we take possession of the truck, Kerry and I will begin the task of learning how to use the truck and which foods and drinks will be most beneficial to the business.
How much $?
This is not a cheap enterprise. While going with a trailer over a brick and mortar has a ton of benefits, no matter the form the coffee shop takes, it is going to be a gamble.
Not only do we need to buy an expensive coffee trailer, but we also need to buy an expensive espresso machine AND have some working capital to start the business.
Key Components of Working Capital:
1. Inventory (Coffee Beans, Milk, Sugar, etc.)
• We’ll need enough inventory to cover our sales for at least 2-4 weeks. This includes:
• Coffee beans, milk, syrups, sugar, tea, pastries, and other ingredients.
• Estimated inventory cost: Let’s assume a month’s worth of inventory is about $1,000 - $2,000 depending on our menu size and sales volume.
2. Labor Costs
• We will need to pay wages to our baristas and any additional staff. Labor costs typically make up a large portion of a food truck or trailer’s operating expenses.
• Estimated labor costs: For example, if we have 1-2 employees working full-time, our labor costs might range from $2,000 to $5,000 per month (depending on our location and wage rates).
3. Lease and Equipment Financing (if applicable)
• If we’re leasing our trailer or equipment, we’ll need to cover those payments until we have sufficient cash flow to cover them.
• Estimated lease payments: Depending on our trailer cost and any loan repayments, this could range from $500 to $3,000 per month.
4. Utilities and Other Overhead
• This includes electricity (for brewing equipment), water, gas, trash removal, etc.
• Estimated monthly utilities: This can range from $200 to $500 per month depending on our location and how often we operate.
5. Marketing and Advertising
• We’ll likely need an initial marketing budget to attract customers (flyers, online ads, social media, etc.).
• Estimated marketing costs: A typical initial budget could range from $200 to $500 to cover initial marketing and promotion costs. This will mostly be used to buy signs to put up around the trailer when it is parked. We will not need to pay much for traditional advertising.
6. Miscellaneous Operating Costs
• Items like disposable cups, napkins, cleaning supplies, and other miscellaneous items should also be factored in.
• Estimated operating costs: Around $300 to $500 per month.
Estimating Total Working Capital Needs
Let’s calculate a range of working capital for 1-2 months of operations:
Expense Category Estimated Cost (per month)
Inventory (e.g., coffee beans, milk) $1,000 to $2,000
Labor $2,000 to $5,000
Trailer Lease / Financing $500 to $3,000
Utilities and Overhead $200 to $500
Marketing & Advertising $200 to $500
Miscellaneous Costs $300 to $500
Estimated Total Working Capital:
• Low-end estimate: $4,700 (for 1 month of operations)
• High-end estimate: $11,500 (for 2 months of operations)
What Does This Mean for Our Business?
• For the first 1-2 months of operations, we should plan to have at least $4,700 to $11,500 in working capital to cover inventory, labor, equipment payments, utilities, and other operational costs.
• Cash Flow Considerations: It’s important to consider that our business might not break even immediately. Sales can fluctuate, especially in the early months, so having a solid cushion of working capital will help ensure we can cover your expenses even if you experience slower sales.
How to Adjust Working Capital Based on Your Business:
• Smaller Operations: If we plan on operating with fewer staff or a smaller menu, our working capital needs could be at the lower end of the range.
• Larger or Busy Operations: If we’re targeting high-traffic areas or expect higher sales volume, we may need to increase our working capital cushion to account for higher inventory and labor costs.
Conclusion:
To operate our coffee trailer smoothly for the first 1-2 months, having working capital between $4,700 and $11,500 should give us enough buffer to cover our operating expenses and help manage cash flow. If our sales are steady and we’re able to reinvest profits back into the business, our need for external working capital may decrease over time.
To cover our startup and operational expenses for the first year, we'll likely need anywhere between $78,900 to $219,000 depending on the scale and scope of our operation. It's always safer to overestimate our working capital needs in the early stages, as we might face unexpected delays or lower-than-expected sales until our coffee trailer becomes established.
What’s next?
Steps to take now:
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