Understanding The Ins And Outs Of A Coffee Franchise

Owning a coffee franchise can be a very rewarding experience, but before you sign on the dotted line and start serving hot cups of 'joe', there's certain things you need to know so you can make the right decision. If you go into buying a coffee franchise blindly, you could end up making a very costly mistake.

Step 1 is to get a reality check. You need to be honest with yourself about how much time you're going to put into your business. You need to understand your finances so you have a 'true number' of what you can spend on your franchise. It's also a good idea to write down your strengths and weaknesses in running a business so you can know how to delegate your time. The worst thing you can do is be too eager and jump right into a new business. Take your time, do your research and please seek professional council from franchise experts.

The attractive thing about owning a coffee franchise is the cash flow and profit margin. People are drinking coffee today like it's going out of style and they are happily paying upwards of $3 per cup. The real cost of the coffee is under $.25. The profit margins with coffee are HUGE! On the contrary, only making a few bucks per cup isn't going to get you a mansion in Beverly Hills. A Coffee franchise is 100% a volume business. You have to crank out thousands of cups per month to see any real income. Some of the most successful coffee franchises have drive-thrus which can make up to 70% of the revenues.

The real magic of a coffee franchise is the atmosphere. Let's be real here people don't come all the time to just drink the coffee. They want to hang out, conduct business, surf the web, sit back and relax or do whatever they want to do. The inside of the shops are designed specifically to induce relaxation and social gathering.

However, owning a coffee franchise is not all fun and games, especially from the start. First, the high start-up costs can be huge. Not only will you have to pay a hefty franchise fee, but then you have to get a location, you'll have to get equipment, you'll have inventory to get, fixed costs, variable costs, employee wages and on and on. On top of all that, don't forget about the royalty fees you have to pay that are calculated on gross revenues, not net profits.

Another consideration is that even if you have all the money to open the doors with all the costs, that still doesn't guarantee that you'll own a coffee franchise. You're going to have to have a considerable net worth, good credit history but what trumps all of that is you have to get approval from the company to buy a franchise from them. If they feel you're not a good fit, you won't get the franchise.

For information on a franchise with NO royalties, NO territory restrictions, NO mandatory advertising fees, NO building or office required, NO credit check, NO minimum net worth & is 100% scalable, visit the BizziBiz Franchise page or contact Gerek Allen to get more information.