Opening a sandwich bar/Coffee bar

[OctoberMoon]

I'm aware this is not an AIBU, but i've posted on two other more relevant sections on the board and there's no traffic!

In the very, very early planning stage of hoping to eventually open a sandwich/coffee bar. After some information and advice if anyone here either runs one, works in one or knows a bit about it?

I have about 15k available to start me off (This is not a loan and won't need paying back to anyone) My idea is slightly different than a standard sandwich/coffee place but don't want to divulge too much info incase i'm outed.

In terms of staff, i'd be there running it as much as childcare would allow. I have 2 family members who are already in catering (and have the relevant food hygiene certificates required) who are hoping to get on board and work alongside me.

The questions I want to know the answers to will probably make me come across as extremely naive and lazy! I'm aware I could find the answers to these questions myself through market research etc, and I will, but i'm hoping those in the know may help me out a little? As I say, I am in the very early planning stages. The questions I want to know the answer to are -

Could my staff be self employed, responsible for their own tax and NI? Or do I need to be their employer?

I'm aware that location is the deciding factor as to whether this fails or succeeds. I'm thinking being close to other businesses/schools would be my best bet? Any tips of what I should look for in terms of location?

I want to start pricing equipment, is there a wholesale place that anyone could recommend? What's the best way to source produce in bulk?

Where can I find out more about what regulations I need to follow to open one? And more info on what qualifications or courses are needed in order to be able to safely work with food?

Any other info you can provide or any hints/tips would be greatly appreciated.

Oh and i'll have to try and make it AIBU, so am I being unreasonable and bloody stupid to think that this could work and make me a fairly decent living?

OP, you might want to look at the boston tea party chain.

I am not being negative - it is possible to make a success of this kind of venture. Ime though it takes longer than two years to break even, let alone make a profit.

Might be worth reading the post at the link

thestartuptoolkit.com/blog/2011/10/the_coffeeshop_fallacy/

To quote:

Lots of people think they want to start a coffeeshop. They likely don’t. That’s like buying a minimum wage job for two hundred grand. What they want is to be a customer and sit in a cafe, drink coffee, be nice to people, and possibly curate an art gallery.

We’re good at recognising when we receive pleasure from consuming a certain good or service. But then we extrapolate incorrectly to the conclusion that owning said business will deliver even more pleasure.

You can’t be in love with a particular idea or business. You have to be in love with the idea of running a business.

The margins in the food and drink industry are high but since the products are low cost and the labor/set up costs are so high, it's still almost impossible to make a profit. It's a graveyard for most entrepreneurs and 15k is not even close to enough money to set it up. Please do more research before doing it!

Good post, lime.

OP, if you like creating recipes etc then maybe look into self publishing on amazon - that should be a fairly low outlay which you can do alongside a day Job (maybe a day job in cafe management!)

I recall hearing Jamie Oliver say that in two weeks he could give someone the skills to make a decent living for life. He was talking about opening a fish and chip shop. OK, say what you like about Jamie Oliver, but he's a rich fucker.

The fish and chip shop in our village is has been going for years and years. The food is excellent and people come from miles around and queue down the street. The two ladies who run it are very glamorous, drive flash sports cars and chat about their expensive holidays. OK it's not hipster or cutting edge, but it's a bloody good business.

Thinking about it, they are open 15, maybe twenty hours a week, chippy tea hours only. They close when they are on holiday. They must make at least £100 an hour, probably much more.

£100 ph * 20.

£2,000 minus raw materials, rent, rates, gas...

Divide by 2.

They're hobbyists with another income, own the building outright and/or it's all on the never-never.

Gosh you did get the rough end if the stick here OP didn't you?

You were here doing a bit of research yet you got jumped on for not doing research!

Well I say good luck, follow your dreams, I hope you succeed and if you don't well at least you damn well tried which is not something alot of other folk can say.

Also a retail park near me has a van on it, I was told it is rented from the company who own the plot and not the council so this is something you may want to explore then at least you aren't dealing with the council.

If OP is prepared to take a 80-90% chance she'll lose the lot and will be comforted to think she tried, that's fine.

Lots of people with lots more senior experience than OP have tried to go it alone and failed. I think she's got some pretty good advice.

Massa, agree they may well own the building.

The advice on this thread and almost entirely been helpful and realistic.

Would it have been better if everyone had posted 'what a great idea, I'd love to run a cafe, you can make a fortune. But £15k won't go far, so why not talk to the bank about remortgaging your house for extra capital, you can't lose' .

Tinkly, the 2 chippies that I know (well enough to know what they take) are taking probably £300-500 per hour when they're open. I don't know about anywhere else, but a fish supper round here costs the best part of a tenner.
However, these are places that have been open for an age and many others have opened and closed in the same time. They are also completely fantastic at what they do and have a clientele who will pay £6-8 for a piece of fish.

"Follow your dreams" and "at least you tried" are cold comfort when you've lost your life savings and landed in a load of debt, plus you've worked yourself into the ground for years, for nothing.

Sorry for not being more optimistic, but I've watched an old colleague sink every last penny into his cafe and he's still taking on debt up to the hilt to try and keep it going four years later. Plus working 16 hour days 6 days a week in frankly ungratifying work.

Looks bloody miserable to me.

Massa, even at £100 an hour, they will be making £100000 a year. At £300 an hour, as quoted by gobby, £300000 a year . The chippy I am referring to is in a little village in Lancashire, tiny premises, rent and rates aren't going to be massive. I reckon they make a decent amount of money for 20 hours a week.

Mind you, if I was setting up a business I'd do a course and open a barbers. A few tiny little places near us are always busy, very quick turnover of clients, they must make about £60 an hour per chair very easily. Less grief than a hairdressers too I'd imagine.

greysimmonds.co.uk are good for catering equipment they offer leasing and rental options. You could start smaller with sandwich rounds. We have a company called bagelery who come to our office daily with bagels and salads etc to buy. You can also order platters etc for meetings.

Business rates are sky high and vary hugely by zone in each town check carefully!

Posh food out of a van is booming in London. I'm thinking in particular some fancy burger establishments (MeatVan?? Am I making that up...?) take up 'residencies' in markets (exmouth market seems to attract them) - but also go on tour - and pitch up at festivals - or wherever has a buzz. They tweet their locations - and people follow them as slavishly as they would a restaurant. I presume they also have the option of hanging up their aprons for a few weeks a year - since their overheads must be lower.

Why not come for a long weekend in London to investigate? I'm not hip enough to know many more specifics - but the modus operandi seems to be to have a very focussed offering (eg burgers only or steaks only or paella only - I even saw a Mac'n'cheese van) - and to deliver that offering with Hipster Quotient turned up to MAXXXX. So think lots of chat about provenance (which is probably 50% BS) - and some whacky variations - and very on-message serving staff - plus a big social media presence.

On takings of £100k in a fish and chip shop, close to £20k will go straight to the VAT man (or woman), as if over the threshold, VAT is chargeable on sales, but hardly anything can be reclaimed as most of the raw materials are not subject to VAT.

Likely, if it was my business, I'd go for Flat Rate Vat, then the rate would be 12.5%. I'd pay myself minimum wage and dividends too.

Which category for restaurants?

www.hmrc.gov.uk/manuals/frsmanual/frs7300.htm

There will always be people who will tell you how not to do something.

1. Surround yourself with people who will tell you how to do things, will help you do things rather than bitch and walk away, and stay positive.
2. Promote LIKE FUCK...all the time.
3. be nice, encouraging and welcoming to the competition and nice to your suppliers and customers ALL THE TIME (don't be gullible, be openfrank and friendly) being nice gets you a good reputation.
4. Did I say promote like fuck? Also get together with businesses near you that are like you and CLUSTER PROMOTE LIKE FUCK.
5. Second space - be a great place to hang out
6. Get to know the abilities and context of your customers and introduce a few to each other.
7. go round personally to lunchtime places and introduce and ask new customer s to bring a pal nexttime.
8. make sure the coffeeis excellent.
9. contact councils, universities and community groups for funding.. and ask then to meet there.

I think its possible to make something work but make sure your market knows of you. I've seen so many cafés open and put all their energy into the cafe and not promoted and wondered why nothing happened. If you are in an A1 location great if secondary and not a brand name work hard on promo, FB offers etc.

As for staff. Keep it tight and think about apprenticeship perhaps? Train them to fuck as hoping isn't a business strategy!

Good luck and stay healthy! Ask All your contacts to join in, promote and hang out. Most people love getting a new business to work! :)
Be prepared for a three year 'in' and watch out for the dip in year 2 when rates and tax catch up with you. ..

I own a mobile cafe and find this to be a much better business model than a brick and mortar cafe - much much much lower overheads! I have a permenant pitch in a country park and get regular trade just like a normal cafe but don't have the business rates, council tax etc that goes with a building.

I bought all of my equipment new, I felt much more comfortable doing so as I had had some bad experience with 2nd hand before.

Feel free to PM me OP as I'm fairly clued up on all the regulations and laws you have to know about (and there are a lot of them!!) plus can pass on some words of wisdom re mistakes I've made!

If Costa/Starbucks/Caffe nero haven't already opened up on the site you are interested in then the site isn't worth having anyway.

Lots of overheads and risk, small margins. Good way to lose 15k IMO, especially as you clearly haven't done even the most basic of research.

Don't think you have to do posh coffees, A small menu and a great location are the best staring points. What is your USP?
Do the maths, do the research, test your wares.
Everyone needs feeding, but what exactly is up to clever research.
Enrol on a business course and never ever forget to SWAT, daily.
McDonald's has made a small loss this year, think outside the box, what do customers really want?
The general public is either price savvy or has very discerning taste buds, can you find a middle ground?
Very doable, but not without the groundwork.

That's a bit like saying you can't run a small newsagent because WHSmith aren't in the site. Costa et.al pay 80,000 plus pa rent plus similar rates so they are a different proposition.

On a 7k rent site you might need to sell 1k average a week. Probably less. Costa will be aiming for 10,000-20k pw plus. You can still borrow their tricks!