How Much Does It Cost to Start a Mobile Coffee Business?
Considering a mobile coffee business but not sure where to begin?
Setting up any business from scratch can be challenging. However, a mobile coffee business can be extremely profitable if you do it right.
The low start-up costs for a mobile coffee cart business is one of its greatest selling points—falling between $16,000 and $20,000. These do not require physical space to operate; you simply need the proper licensing paperwork for your county. To further cut down on start-up costs, invest only in the absolute essentials.
- Coffee cart
- Point-of-sale system
- Drip coffee maker or espresso machine (depending on the type of coffee you want to offer)
- Water pump for the coffee maker
- Coffee (obviously)
- Condiment organizer for sweeteners (like sugar and syrups)
- Serving items (cups, lids, stirrers, pitchers, etc.)
- Handwashing sink
- Refillable water jugs
Remember to factor in transportation and insurance costs, including employee wages—if you intend to have staff.
With coffee trucks, you can cater to a larger clientele and rack in more business. You can also explore add-ons such as food items and a wider variety of beverages. This mobile coffee business costs between $33,545 and $80,000 to start up.
Expenses involved in a coffee truck business are more complex and usually include the following:
- Food costs (baked goods, coffee, and drink ingredients)
- Business equipment (such as blenders, espresso machines, etc.)
- Training costs
- Payroll costs
- Point-of-sale system
- Event fees (to set up at concerts, fairs, etc.)
- Professional fees (for accountants, business consultants, attorneys, etc.)
- License and permits
- Income taxes
Other expenses are phone bills, advertising, business insurance, and repairs/maintenance for the truck and other business equipment. Ensure that your coffee truck business plan covers these.
5 Steps to Starting a Mobile Coffee Business
It’s important to thoroughly research a business endeavor before taking the leap. A mobile coffee business is highly profitable, and you should familiarize yourself with the start-up process to ensure a successful business.
Here’s a step-by-step guide to starting your mobile coffee business:
1. Learn the Legal Requirements for Your Location
These vary by state, county, and city. Your local Department of Environmental Services or Health Department will be able to provide you with information on which ones apply to your area. Food or drinks businesses require specific permits and licenses to operate within the law.
Some of the other areas with guidelines you’ll need to adhere to are:
- Mobile coffee business regulations in your city
- Safe food handling requirements
- Hygiene policies
- Commissary requirements (if any)
- Types of products you are permitted to sell (including display and storage options)
- Fresh water and water holding capacity
- Pre-approval inspection of coffee truck/van/cart
2. Carry Out Market Research
Starting a mobile coffee business requires a great deal of research into several facets of your business. You’ll want to consider your target market, their patterns, and their preferences. More importantly, why should they choose your business? What stands you out from the competition (if any) in the same area?
Make a list of locations with potentials in the area you’ll be operating in. These include business parks, tourist locations, outdoor events, farmers' markets, and more. Your business will be more successful in areas with a high amount of foot traffic.
Remember to keep an eye on what your competition is doing. Observe their lapses and plan to stand your business out by filling them.
Find out how much your essential supplies will cost. Compare prices for fully equipped carts or trucks against how much it’ll cost if you have to convert them yourself.
3. Determine Your Menu and Pricing
Your menu shows variations in your coffee offerings. If you are considering a mobile coffee truck, you’ll have more opportunities to include several add-ons and baked goods to go along with your beverages. However, even coffee carts can provide coffee options with different ingredients (depending on what your target market seems to enjoy) and simple snacks.
Your menu is your chance to be creative. Consider including a signature drink or food offering that stands you out from the competition. Your pricing would be based on competition and running costs.
4. Develop Your Business Plan
Your business plan outlines how you intend to reach your financial goals for your mobile coffee business.
This includes your budget, which should cover the following:
- Coffee cart/truck price
- Operational costs (for the first 1-2 months)
- Legal expenses (for permits and licenses)
- Initial stock costs (for the first 1-2 months)
- Marketing/sales promotion
5. Define Your Marketing/Sales Strategy
This doesn’t have to be elaborate when you are only starting out. You simply want to announce to your base that you are open for business.
A few ideas for a low-cost marketing strategy include:
- Direct marketing and sales
- Online directories (such as Google My Business)
- Social media
- Flyers and business cards
- Community events (like festivals and fairs)
- Loyalty rewards
Start Your Mobile Coffee Business with Confidence
Starting a mobile coffee business is a flexible alternative to opening a coffee shop. You can avoid the costs of maintaining a physical location and enjoy the benefits of being able to follow customer traffic.
With an abundance of opportunities to amass clientele and lower overhead costs, you can start planning towards a successful mobile coffee business by following this guide. This low-risk business venture is particularly appealing to anyone who is venturing into the retail industry for the first time.