How to Open a Coffee Shop | Inc Authority
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How to Open a Coffee Shop

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If you’re like millions of other Americans, you begin your day with a cup of coffee. It’s no wonder then that the coffee industry is forecast to grow a staggering 67% by 2022.

But America’s obsession with coffee shops goes beyond its ritual offerings of diverse cups of joe. They’re great places of discussion, of reunions with old friends and people we love, and thanks to the rise of remote work, a location to call your office as well.

All these things combined make starting a coffee shop a fantastic idea for the coffee-loving entrepreneur.

So, want to know how to open a coffee shop? Here are four things you must do beforehand.

1. Form an LLC

Want to learn how to start a coffee business? In the age of freelancing and side-hustles, it’s easy to think you can start a new business free and clear without incorporating. But if you want to legitimize your business and protect yourself from lawsuits, incorporating is the best decision you could ever make.

As a freelancer/solopreneur there is no separation between your business and personal assets. That means if you’re ever targeted by a lawsuit (and lawyers love targeting small business owners), you risk losing EVERYTHING—your savings, home, retirement, and other personal property.

By forming an LLC or Corporation, you protect your personal assets and safeguard yourself from being personally liable for debts incurred.

As if that’s not enough, incorporation also comes with a ton of perks including tax savings, privacy, brand protection, and access to business funding.

So, if you’re trying to figure out how to open a coffee shop, place forming an LLC at the top of your to-do list.

Our entity-setup service is 100% free.
We’ll waive our service charges, labor costs, and overhead. You only pay the state fees and postage, which are mandatory regardless of who incorporates for you. Start now for free!

2. Get the proper licenses and insurance

Because the food and drinks industry is highly regulated, there are a number of key insurance policies and licenses that you must have in place before you open.

Matter of fact, you’re prohibited from running a coffee shop business in the States if you don’t have the basic insurance coverage and licenses for your business. These are as follows:

  • -Business and liability insurance
  • -Foods and drinks handler certificate
  • Health inspection Certificate
  • -Proof of district-issued food and drinks manager identification card
  • -Food purchase record storage and record-keeping (If you are also involved in the sale of snacks)
  • -Depot, commissary, or service support facility meets vending unit operation -needs
  • -Copy of license for the service support facility and/or a recent inspection report
  • -Fire certificate
  • -Kitchen insurance
  • -Certificate of Incorporation
  • -Business License

So, whether you’re looking to start a local, small coffee shop or rival the likes of Starbucks, you’ll need to have these items in place.

3. Write a Business Plan

It will be a lot of work, but writing out your coffee shop business plan will help you stay on track to meet business goals. This is important because with so many moving parts, trying to figure out how to open a coffee business can be overwhelming, making it easy to get off track.

If done correctly, your business plan will act as a management tool, identifying potential challenges, and providing you with strategies for growth.

Not to mention, business plans are required if you ever want to get funding. Lenders want to see established strategies, required allocated resources, attention to business finances, and projected growth before they give you anything. 

Your business plan should include the following:

  • -Mission, Vision & Objections of the venture
  • -The Company (its legal description, history, and current situation/location)
  • -Products & Services (offered and planned)
  • -External Environment (the industry status, the economy, legal/regulatory)
  • -Overall Market (including analysis of the competition, size, growth, demographics, etc.)
  • -Target Market (the specific customer segments your firm has or plans on pursuing)
  • -Analysis of Strengths, Weaknesses, Opportunities, and Threats/Risks
  • -Sales & Marketing Strategy (including promotion, pricing, distribution, forecasts)
  • -Management Team & Advisors (one of the most crucial areas for influencing funding)
  • -Operational Plan (including equipment, labor/personnel, and production/service process)
  • -Implementation Plan
  • -Financials & Exit/Payback Strategy (to show how investors/lenders will get their return)

Understanding how to start a coffee shop is easy when you have a plan of action. Taking the time to write a business plan now will save you a lot of trouble and headaches down the line.

4. Get Funding

It’s estimated that small businesses cost around $80,000 to start. So, unless you have that much money to spare, you’re going to need to get funding.

But because every business has different needs, not every financial solution is good for every company. That’s why it’s important to consider your coffee shop’s unique vision, mission, target customers, financial situation, and business plan. Doing so will ensure you find the right financial solution for your business.

Most business owners opt for alternative loans like the ones offered by the Small Business Association (SBA). Here are a few of the different types of SBA loans.

  • -Traditional term loans
  • -Small Business Administration loans
  • -Business lines of credit
  • -Business credit cards
  • -Grants
  • -Short-term loans

It’s best to speak to a business funding expert before you decide as they can help you figure out which one is best for you. Just remember, like any business, successful coffee shops open with lots of extra cash on hand. This money is needed to buy supplies as well as cover overhead costs.


If you dream of owning a coffee shop, taking the time to learn how to open a coffee shop will go a long way in ensuring your success. Lucky for you, you don’t have to go at it alone.

Here at Inc Authority we not only help entrepreneurs form LLCs, we help them put together strong business plans, get the funding they need, and more!

So, if you want a team of business experts in your corner, helping you every step of the way, contact us today to get started!

Incorporating is the most powerful thing you can do to legitimize your startup. And at, our setup LLC services are 100% free. Always. So, don’t wait. Form your new LLC today and enjoy the protection due to you and your business under the law.

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