Coffeehouse Business Plan

Dark Roast Java

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Executive Summary

The concept
Thanks primarily to Starbucks, within the past 20 years the coffeehouse has become a familiar feature of American life. Every day, millions of Americans stop for an espresso-based coffee drink. People who would not have dreamed of spending more than 50 cents for a cup of coffee a few years ago now gladly pay $3 to $5 for their cappuccino, mocha latte or vanilla ice blended drink.

The specialty-coffee business is growing at a healthy pace. During the past 20 years, there has not been a single year, despite war and recession, in which specialty coffee sales have not grown. In many years the increase has been in double digits. In addition, no coffeehouse chains have failed during this time, although the list of casualties in other industries is quite long.

Starbucks, The Coffee Bean, Peet's, Diedrich's and other major chains serve average quality drinks in establishments that have the same generic design appearance. Indeed, Starbucks and The Coffee Bean are often referred to as "fast food" coffeehouses due to their "cookie cutter" design. Now that Americans' coffee preferences have broadened and matured, many are asking for more from their coffeehouse.

A niche exists that has yet to be filled for a high-volume, upscale, quality-driven coffeehouse with a warm, inviting atmosphere. Dark Roast Java meets this need and fills this niche. We offer high-quality products in an upscale environment. Furthermore, our high-profile location in Pleasantville provides a mixed customer base that will maintain high levels of business in every season, at all times of the day, every day of the week.

Founders
Ned Powers-Sebastiane, founder of Dark Roast Java, has a long career as an entrepreneur and marketing executive. He is the founder of Powers-Sebastiane Advertising & Public Relations and Pan National Motor Tours. Co-owner Curt Yamaguchi has an intuitive understanding of the real estate market. As a highly successful real estate broker and investor he brings several key capabilities to the Dark Roast Java team, not the least of which is his ability to procure highly desirable locations for future stores.

Financials
The company anticipates rapid acceptance of the Dark Roast Java concept in Pleasantville, with revenues of $600,000+ in the first fiscal year, rising to more than $1,000,000+ in FY 2006. Net profit is projected to be approximately $99,000 in 2004, growing to an estimated $265,000 by 2006.

An advanced and expandable point-of-sale system
After carefully tracking the performance of the Pleasantville store through an expandable and highly detailed point-of-sale system, we will use this as a "blueprint" for expansion. For example, daily sales are tracked and analyzed by item, time period and cost of goods. Labor requirements are matched to projected in-store sales based upon past performance for maximum efficiency. Even after paying higher than average wages, we expect to allocate no more than 25% to labor costs.

This Business Plan only provides data on the Pleasantville coffeehouse.
Sources: US Census Bureau, Pleasantville Chamber of Commerce, Specialty Coffee Association of America.

• Make Dark Roast Java the number one destination for coffee in Pleasantville


• Sales of $600,000+ the first fiscal year, $750,000+ the second fiscal year and $1 million the third fiscal year


• Achieve a 15% net profit margin within the first year and 30% by FY3


• Achieve a total net profit of $150,000+ in FY1 and $200,000+ by FY3


• Be an active and vocal member of the community, and provide continual re-investment through participation in community activities such as the Chamber of Commerce and financial contributions to local charities and youth organizations


• Create a solid concept in the industry and track performance in order to begin expanding to other markets within six months

Our goal is to be the coffeehouse of choice for the local Pleasantville community, downtown business workers, tourists who visit the city, and students, by providing a higher quality experience than any competitor. As a result, we intend to create coffeehouses that quickly achieve profitability and sustain an attractive rate of return (20% or more annually) for our investors.

We also want to make our contribution to the welfare of the local community by supporting charitable and civic activities. We will support the farmers who grow our coffee by using Fair Trade, Sustainable Production and Organic products whenever possible.

Dark Roast Java also awards its business to as many local suppliers as possible, keeping the business in the community or, at the least, in the state.

The keys to our success will be:

• A superior-tasting product backed by a unique quality store


• A relaxing, upscale interior design


• Prime site selection with an upscale affluent population, year-round tourist activity, heavy pedestrian traffic by the site, a dynamic student population and a concentration of local businesses


• A market that exposes Dark Roast Java to high-profile "trend-setters" and "key influencers"


• Ongoing, aggressive marketing


• Highly trained and friendly staff


• Multiple revenue streams including gift items, gift baskets and coffee gift/frequency cards in addition to coffee, pastry, chocolates, tea, juice, water and soft drinks


• A dynamic website with online sales capability