This is a tough question because it depends on so many factors, like your life goal ambitions, whether you want to make money fast, or are you willing to wait patiently, do you have money to invest or not.
Also, what is the location that you have envisioned for your coffee shop, is there much competition nearby, is there foot traffic or not?
There are just so many factors that I believe someone can’t say if it is worth it or not without analyzing all the details behind it.
It is not a question to be taken lightly. One would not want to warn someone off opening a coffee shop nor embarking them.
My goal is to give my honest opinion based on my own experience and enrich it with what experts and studies are saying, so you can make your mind.
Based on my own experience:
It is worth it to open a coffee shop if you have enough money to hold for at least a year without making a profit, if you are passionate about coffee and serving people, and not afraid of persistently coping with good and bad days.
Let us discuss this furthermore as well as compare with what others have said.
What experts are saying
The Good
Colin Harmon (2016) from the book What I know about running coffee shops says” It is a wonderful way to make a living. The social aspect of the job is incredible and getting to meet such a wide variety of people daily is something I’m really grateful for”
John Richardson and Hugh Gilmartin, The Coffee Boys (2010) say “Owning a coffee shop genuinely is one of the most rewarding jobs in the world. You can, if you manage it correctly, create a business that is rewarding both financially and from a satisfaction basis”
The Bad
However, these two authors also mention in their books:
John Richardson and Hugh Gilmartin say, “The dream may not be what you had envisioned. It will, without a shadow of doubt, involve a number of lows as well as highs so you cannot go into it unless you really want it and you have your eyes wide open”.
Colin Harmon says: “I have seen the reality of running a coffee shop turn from a dream to a nightmare on many occasions, and it can leave a person broke, exhausted and without any options”.
Bruce Hidgon (2016) in his thesis dissertation called “Strategies Independent Coffee Shop Owners Require to Survive Beyond Five Years”, mentions the following:
“According to the US Small Business Administration (2015), only 50% of small businesses survive the first 5 years, while only 33% survive beyond the first 10 years.”
So as you can see, there are always two sides to every coin.
Let us discuss now about pros and cons about opening up a coffee shop
Pros about owning a coffee shop
The following is a list of pros about opening a coffee shop
- The lesser percentage survives after 10 years
- In my experience, it is at least a year to get to break-even point if not more
- You must have a persistent, resilient personality
- Your service and products will be judged every single day in a both good and bad way
- You must search for perfection but be okay not to be perfect
- It is not a quick, get rich scheme
- You will probably work more hours than a day job, with less income, at least during the first years
- You and only you are responsible for the success or failure of your coffee shop
- Coffee has a high margin but at a low price point of sale, so it is tough to survive on just coffee
Cons about owning a coffee shop
However, there are other pros to having your coffee shop.
- You get to meet lots of amazing people from customers to suppliers
- You get to provide real value and experiences for others
- You learn lots of new skills like managing people, accounting and finances, coffee
- You can develop a new passion
- You get to be your boss
- You can manage your own time
- You get to have a place where the community can integrate, where family and friends feel proud to go
- You can build a business that reflects your personality and core values
- You have the satisfaction of knowing you are creating jobs for others
So with all this being said, this is why my answer to the question “Is it worth to own a coffee shop?” is: it depends.
It depends on what?
So with all this being said, this is why my answer to the question “Is it worth it to own a coffee shop?” is: it depends.
Depends on what?
- On your life goals
- On your finances
- On your passion for coffee and serving people
- On your life circumstances
- On the location available for the coffee shop
- On the timing
- On your personality
Your life goals
The first question to ask your self is how you envision your life.
Owning a business has great rewards, but at least at the beginning can mean lots of hours invested with not so much in return.
Are you willing to wait and transit through the learning curve? Or do you envision a more relaxed job for your self? There is nothing wrong with either option, and it just depends on what you want.
Your finances
Do you need money fast? If this is the case, a coffee shop will not be the answer. Or can you wait at least a year without any profit and maybe even losing money? Do you have debts or are free of debt? Would you require a loan or not.
It will not be the same circumstances for someone who is hight in debt to acquire another loan to set up a coffee shop then for someone free of debt or even has savings.
The financial burden of been high in debt can make the journey much more difficult. It does not mean you should not do it, but analyze when is the most appropriate time.
When you have a day job, you most likely receive a paycheck every month, no matter what. With your own business, this is just not guaranteed.
On your passion for coffee and serving people
Having a passion for coffee and serving people will help the business be successful.
Do you enjoy serving others or not so much? Your business will thrive around having happy customers. Is this something you see yourself doing?
Some customers can be rough, and you may feel like no matter what you do, some people will never be happy. However, others will appreciate what you do and become loyal customers. Do you envision yourself serving people, dealing with unsatisfied customers no matter what?
On your life circumstances
Opportunities show up at a particular time and may never come back if not taken.
What are your life circumstances? Is this something you must do soon or lose out on the opportunity? Or, can you afford to first work at another coffee shop to get a sense of how running one is?
For me, this is by far one of the best pieces of advice someone gave me and did not do follow, again, because of my life circumstances. If you can do it, it will help you decide whether it is worth it to have a coffee shop. And it will also give you a lot of experience to run your coffee shop if you choose to do so.
On the location available for the coffee shop
I believe location is one of the most critical variables for whether a coffee shop will be successful.
The location usually influences the number of customers that will enter your coffee shop. Still, also, a coffee shop in a busy area will often have higher rent to pay and more competition. So it is a balance of factors.
If you are far away from the traffic, your coffee shop will have a tougher time attracting people inside. Still, it may benefit from a lower rent and can offer higher quality and service at a more moderate pace to a lesser volume of people. So it can mean fewer people but better served.
On your personality
Having your own business is not for everyone. And there is nothing wrong with it.
Being an entrepreneur involves having lots and lots of perseverance, resilience. You may feel overwhelmed all the time, especially at the beginning. It is not easy. So it is humble to accept that this is not for everyone, and that is okay.
On the other hand, some people do not see themselves working for others, which is also okay.
There is no right or wrong, there just is. The important thing is to analyze on which side you are or if you have a little bit of both.
You may also be interested in reading:
Is a coffee shop a good investment?
How to open a coffee shop with little money
References
Hidgon, Bruce. 2016. Strategies Independent Coffee Shop Owners Require to Survive Beyond Five Years. Doctoral Study, Walden University. Obtained at https://scholarworks.waldenu.edu/cgi/viewcontent.cgi?referer=https://scholar.google.com/&httpsredir=1&article=3071&context=dissertations
Richardson, Johnn; Gilmartin, H. 2010. The Coffee Boy’s Step by Step Guide To Setting Up and Managing Your Own Coffee Bar: How to Open a Coffee Bar that Actually Lasts and Makes Money. How To Books LTD. United Kingdom.
Harmon, Colin. 2018. What I Know About Running a Coffee Shops. Progressive Coffee Ltd .