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[sunnythai]

Hi
Looking for general information on openning a small coffe shop.
Here a few detail:
Looking in buying a small franchise to sell coffee, myself and my thai wife would be owners, as probally it would be 51% her and 49% me.
My sister -in-law would work and manage the shop. We are thinking just a small booth or a corner booth to start with. Maybe in the future then we would rent a space and build a shop( like starbucks).
Looking for information on start-up of this bussiness.
Thanks for the info

[jerrylee]

sunnythai, on 2009-06-28 14:40:30, said:

Hi
Looking for general information on openning a small coffe shop.
Here a few detail:
Looking in buying a small franchise to sell coffee, myself and my thai wife would be owners, as probally it would be 51% her and 49% me.
My sister -in-law would work and manage the shop. We are thinking just a small booth or a corner booth to start with. Maybe in the future then we would rent a space and build a shop( like starbucks).
Looking for information on start-up of this bussiness.
Thanks for the info

It's good that you're not stuck with some spot in mind, or have to use that space for some reasons,
so if you can pick a new spot - then its about Location Location Location
and according to the asian book of business - best avoid all in-laws, only immediate family members.
Roast your beans on the premises if you can ...

thenagain, all these will be over-ruled by the majority shareholder?

[ThaiPauly]

Bear in mind you will need more than 2 Thais working for you to substantiate your work permit...it was 4-1 when I had my last business.

[sunnythai]

jerrylee, on 2009-06-28 18:02:52, said:

sunnythai, on 2009-06-28 14:40:30, said:

Hi
Looking for general information on openning a small coffe shop.
Here a few detail:
Looking in buying a small franchise to sell coffee, myself and my thai wife would be owners, as probally it would be 51% her and 49% me.
My sister -in-law would work and manage the shop. We are thinking just a small booth or a corner booth to start with. Maybe in the future then we would rent a space and build a shop( like starbucks).
Looking for information on start-up of this bussiness.
Thanks for the info

It's good that you're not stuck with some spot in mind, or have to use that space for some reasons,
so if you can pick a new spot - then its about Location Location Location
and according to the asian book of business - best avoid all in-laws, only immediate family members.
Roast your beans on the premises if you can ...

thenagain, all these will be over-ruled by the majority shareholder?

[indent] Thanks, yes I don't have a spot but was thinking somewhere close to a university or mall in or around bangkok. and the majority shareholder is my wife and me....no inlaw involve.


[/indent]

[sunnythai]

ThaiPauly, on 2009-07-03 03:58:43, said:

Bear in mind you will need more than 2 Thais working for you to substantiate your work permit...it was 4-1 when I had my last business.

I am not planning on working this just yet..........It will be managed by wife and sister-in-law........I will just go and have coffee...sometimes......

[madjbs]

He doesn't need 4 Thais working there if he is already on extension based on marriage. Only if he wants to get extensions based on the business.

[sportsman69]

[quote name='sunnythai' date='2009-06-28 14:40:30' post='2835944']
Hi
Looking for general information on openning a small coffe shop.
Here a few detail:
Looking in buying a small franchise to sell coffee, myself and my thai wife would be owners, as probally it would be 51% her and 49% me.
My sister -in-law would work and manage the shop. We are thinking just a small booth or a corner booth to start with. Maybe in the future then we would rent a space and build a shop( like starbucks).
Looking for information on start-up of this bussiness.
Thanks for the info
[/quote
Franchise you must be F***in Joking !!!
Just remember when you jump in the ocean you are no longer on top of the food chain.
You mention Starbucks, check their recent track record, you think you can do better? if so, go for it, balls and all. Hope I'm not speaking soon to someone with no nuts.
Don't want to predict the result, but I think you would be better off with a jug of hot water and a bag of Nescafe 3 in 1 at the entrance of the MRT.

[sunnythai]

madjbs, on 2009-07-03 16:09:31, said:

He doesn't need 4 Thais working there if he is already on extension based on marriage. Only if he wants to get extensions based on the business.

No not joking, just mention Starbucks as a reference.......you can start a small coffee shop for a couple thousand US dollars. I think that not too much to invest in Thailand. If it does not go well than you are only out that much. That usually what I send on a vacation.
But thanks for the input.

[raro]

madjbs, on 2009-07-03 14:09:31, said:

He doesn't need 4 Thais working there if he is already on extension based on marriage. Only if he wants to get extensions based on the business.

not any longer, I'm afraid. Same rules apply to non-immi O and B visas!

[RubbaJohnny]

4 low skill non coffee fluent Thais on minimum wage
It's a grind
Probably better investment buy your wife a nice present

[MegaRanter]

RubbaJohnny, on 2009-11-04 19:40:17, said:

4 low skill non coffee fluent Thais on minimum wage
It's a grind
Probably better investment buy your wife a nice present

You forgot to mention a  present for the sister in law too

[madjbs]

raro, on 2009-07-08 10:50:13, said:

madjbs, on 2009-07-03 14:09:31, said:

He doesn't need 4 Thais working there if he is already on extension based on marriage. Only if he wants to get extensions based on the business.

not any longer, I'm afraid. Same rules apply to non-immi O and B visas!

So the work permit regulations now require you to have the 4:1 ratio as well?

I can't find any info on this change of regulations, do you have a link?

[babuhavas]

Also consider,coffee business have very limited period of sale,in morning before work and late afternoon maximum till 4 or 5 pm.

i hope you got my point?

[LazyYogi]

He never said he was going to work in the shop, so he doesn't need a work permit.

If he doesn't need a work permit, there's no reason he needs to have 4 Thai employees. He just needs as many as it takes to run the shop.

It seemed clear to me that his partial ownership of this business is totally unconnected to his visa status.
He could have a type "O" visa based on marriage with a wad of money in the bank to get yearly extensions.

[skeech33]

2 scenarios.


lose medium amounts of money


lose large amounts


WhY? do people do things like this. all he doing is buying a job for sis in law.

[Nio]

sunnythai, on 2009-07-03 13:38:31, said:

ThaiPauly, on 2009-07-03 03:58:43, said:

Bear in mind you will need more than 2 Thais working for you to substantiate your work permit...it was 4-1 when I had my last business.

I am not planning on working this just yet..........It will be managed by wife and sister-in-law........I will just go and have coffee...sometimes......

Do you remotely realize in every nook and cranny in Thailand is a coffee shop? I would guess well over 10,000 of these.

Do you know why people write or develop business plans? Because these plans PROVE that crazy ideas that are not research with a thorough business plan FAIL.

Do you even have a clue how much it costs to make a cup of coffee? How much is the profit margin? How much you have budgeted for rent, utilities and labor.

You will probably find out, if you had a real business plan, that you need to sell like 300 cups a day to make any money. That is 300 X 30 days or 900 customers per month.

300 customers divided by 8 hours per day is 37.5 customers per hour or almost 1 customer every 2 minutes all day long. People so not drink coffee all day long friend.

PS farangs drink Starbucks. Ask yourself what percentage of the Thai population can afford to drink expensive coffee on a regular basis?

You are screwed right from the get go and it amazes me the number of people that want to start a business for their wife, girfriend, 3rd cousin etc. with absolutely no realistic plan or idea if it could even work

If you need a business to stay here, do yourself a favor and learn how to do a simple basic business plan.

It is very simple to do and will tell you right away the kind of information and numbers to see if the business will work before you waste all your money.

There many simple 101 Business Plans for Dummies on the internet for free.

Get the form and fill it out, you will be shocked at the amount of info you learn.

[mussen]

ThaiPauly, on 2009-07-03 03:58:43, said:

PS farangs drink Starbucks. Ask yourself what percentage of the Thai population can afford to drink expensive coffee on a regular basis?

Stupid comment, and nothing to do with the topic. Plenty of Thai's have enough money to drink Starbucks, the OP was only using Starbucks as a reference. There are huge profit margins in coffee, and a well run coffee shop can make very good money. Most coffee shops make shit coffee, here and overseas!

[Mossfinn]

Nio, on 2009-11-22 09:36:11, said:

PS farangs drink Starbucks. Ask yourself what percentage of the Thai population can afford to drink expensive coffee on a regular basis?

mussen, on 2009-11-26 09:51:10, said:

ThaiPauly, on 2009-07-03 03:58:43, said:

PS farangs drink Starbucks. Ask yourself what percentage of the Thai population can afford to drink expensive coffee on a regular basis?

Stupid comment, and nothing to do with the topic. Plenty of Thai's have enough money to drink Starbucks, the OP was only using Starbucks as a reference. There are huge profit margins in coffee, and a well run coffee shop can make very good money. Most coffee shops make shit coffee, here and overseas!

Musen,

Your quotes are incorrect, ThaiPauly did not make the quote you have attributed to him, Nio did.

[chiangmaibruce]

The OP didn't mention is he had done a thorough forum search before posting, but I'm guessing probably not. I only mention that because there have been (no surprise here) a few earlier threads on the same business idea. I remember one - maybe 6 months ago - by a young farang woman wanting to start a coffee shop or cafe in BKK and it generated a number of useful responses ... including from one or two who had already been there & done that. Hence I'd suggest search all sub-forums using key words like "start buy coffee shop cafe" or similar and see what you turn up. Don't forget to tick box "search thread titles only" to cut down on the chaff.

[filingaccount]

Oh ok... I'll chime in quickly.

Go to one of those Boncafe "How to operate a coffee shop" seminars at their concept shop on Ratchada. It's free.

However, the conclusion seems to be that the problem is that the market is very saturated at desirable areas and you will lose money if you decide to invest in only one location with nice decor etc. You can do it on a low budget, low cost, cheap selling price but it will not generate enough income to sustain a family. It might, at best, bring in a net profit of 5-7 k a month (without hiring staff). Boncafe will of course not tell you this, but will try and put a positive spin on the coffee market. They are after all in the business of selling coffee related products.

Besides, coffee raw materials in Thailand are surprisingly expensive.

[manjara]

As someone who has been through this process, I can give you a few pointers.

Starting a company will cost money (about 80-100k/year) that you can't afford, best do it in the wife's name as sole trader unless you need a WP / job to get non-O or business extension

Setting up a coffee shop that sells decent (e.g. CoffeeWorld) coffee is not that cheap. We did not do a franchise, which would cost more but they might package up the equipment needed better, so not sure which is best. But consider (for a 40m2 shop):
- Espresso machine (150,000-400,000 for a new one)
- Fitting out the shop with basic counter etc (150k - the specialist coffee shop builders were quoting more than 200k)
- Paper/Plastic Cups, spoons etc (minimum order 20k if you don't buy from a franchisee)
- Air con, fridge, cake display, till (near 100k)
- Furniture, plants etc (nearly 100k)
- Staff at 5-7k per month each, and you need to train them to use the machines etc
- misc kitchen equipement, coffee grinder etc (40k)

Location, as people have said previously is critical, I would say it needs to be in a place where a lot of people work. We were located near a school and in a big apartment block, but did not get as much trade as we expected and it was not constant through the day.
Excluding amortization and rent/electric costs, it will cost between 15-20 baht to make a coffee, so to support a shop you really need to sell at 40 or more. On a good day we would take in 3000-4000 baht, but overall we were only just about breaking even (minus the initial investment!)
I think we might have been able to generate some profit with a bit of marketing and some better processes to stop 'revenue leakage', but in the end, the thing that killed the shop was that the staff would just quit. No warning, no notice, they just wouldn't turn up one day and that was it, meaning that my wife was trying to run it alone with 2 kids under 4! (at the time). (One of the staff who just left was a family member!)

Luckily it wasn't something we were doing for a living, just as a hobby to see where it went, and I was only around part of the time as my work was primarily overseas.
It would have been nice if the Coffee Shop had made money, but unless you are completely on top of it and generating revenue of 100k/month on >40 baht coffees, it's unlikely that you will.

[simcity]

I open coffee shops in Melbourne Australia (Acland street / Southgate) , from 1988 – 1997 I made enough to set up myself and retired at 40, bought one of the freehold along the way.
Now it is overdone, nearly impossible to compete, every man and his dog open a coffee shop
SAME in Thailand, it is overdone, 15 year ago, you will have the opening but not now.
Coffee bean, milk are more expensive in Thailand, with rental and overhead, I do not see any profit, every street have carts selling espresso coffee (not good stuff but they are here)
Difficult market, Starbuck restructure his business and close 61 of it 84 shops in Australia..
I seeing few posts for coffee shop in Bangkok in thaivisa, if you do a search you will find them.

Follow manjara post for cost and advice, it is accurate

[terenceyeo]

Hi,

Thanks for your input.
Good info.

manjara, on 2010-01-29 14:51:52, said:

As someone who has been through this process, I can give you a few pointers.

Starting a company will cost money (about 80-100k/year) that you can't afford, best do it in the wife's name as sole trader unless you need a WP / job to get non-O or business extension

Setting up a coffee shop that sells decent (e.g. CoffeeWorld) coffee is not that cheap. We did not do a franchise, which would cost more but they might package up the equipment needed better, so not sure which is best. But consider (for a 40m2 shop):
- Espresso machine (150,000-400,000 for a new one)
- Fitting out the shop with basic counter etc (150k - the specialist coffee shop builders were quoting more than 200k)
- Paper/Plastic Cups, spoons etc (minimum order 20k if you don't buy from a franchisee)
- Air con, fridge, cake display, till (near 100k)
- Furniture, plants etc (nearly 100k)
- Staff at 5-7k per month each, and you need to train them to use the machines etc
- misc kitchen equipement, coffee grinder etc (40k)

Location, as people have said previously is critical, I would say it needs to be in a place where a lot of people work. We were located near a school and in a big apartment block, but did not get as much trade as we expected and it was not constant through the day.
Excluding amortization and rent/electric costs, it will cost between 15-20 baht to make a coffee, so to support a shop you really need to sell at 40 or more. On a good day we would take in 3000-4000 baht, but overall we were only just about breaking even (minus the initial investment!)
I think we might have been able to generate some profit with a bit of marketing and some better processes to stop 'revenue leakage', but in the end, the thing that killed the shop was that the staff would just quit. No warning, no notice, they just wouldn't turn up one day and that was it, meaning that my wife was trying to run it alone with 2 kids under 4! (at the time). (One of the staff who just left was a family member!)

Luckily it wasn't something we were doing for a living, just as a hobby to see where it went, and I was only around part of the time as my work was primarily overseas.
It would have been nice if the Coffee Shop had made money, but unless you are completely on top of it and generating revenue of 100k/month on >40 baht coffees, it's unlikely that you will.

[torrenova]

I agree with the comments about Bon Cafe and I know more than most about that company. However, do go to Bon Cafe's flagship in Pattaya (Naklua actually) and see how they have done things there as the set up is more wine bar and restaurant than coffee. Why ? because there just isn't enough money in coffee.

Sure you can set up meal deals and advertise but you have to get something else apart from the coffee that people are prepared to pay a premium for. If in Pattaya go to Carrefour and Coffee 94 I think it is on the corner downstairs. Great leather chairs and really nice high quality cakes. I used to go there not just for a coffee but for a coffee and a cake. If coffee only then I might not bother.

As someone very wisely mentioned, your trade is quite time specific for coffee only yet you pay rent 24/7/365. Could your concept and location stand up to dual use ? extending opening times to cater to a different market perhaps ?

[raro]

As you know apparently the ins and outs of Bon Cafe, you are also aware that the wine bar makes next to zil turnover, but is a hobby of the owner. Most sales come from coffee and cake and some of the bistro food. Add the fact that the shop doubles as a service center for their corporate business and a sales shop for the home use coffee makers, you start to understand the strategic significance of the shop.

I for one think the food is mediocre and overpriced. It is worth going for the cake, as it is really fantastic and only topped by the shop at Woodlands - which is high-end in quality and price.

I see no problems why a coffee shop would not yield results, just be different. Offer REAL cake and not that beer coaster with window glue pastry your average Thai coffee shop has on offer. Have some other drinks besides coffee on offer, milk-based drinks for instance.