To wonder how easy it is to make a living being a cafe owner?

[spanishwife]

I have a great job, but it's not my 'dream job'. I earn a really decent salary and happy day to day. My real dream and passion however would be to own a cafe/brunch spot. I live in a small, vibrant city in Europe and I think it would work well here, but I have no idea about the financial side of things. I have a decent amount I could bung in to set up, buy equipment and furniture, pay the necessary set up fees, do some training etc. I would probably hire an additional person to do clearing up and waiting tables/serving and I would do that also, as well as cooking/baking.

Does anyone have an idea of the kind of money you can make from this kind of business?

This is the first step on a long road of research, but don't have anyone to ask in RL!

Thanks in advance.

Surely getting examples from the UK, where taxes/business rates/overaturation of big brands isn't going to tell you if you are going to make money in a little cafe in Genoa or wherever?

I think you would be best off talking to people in the local area.

I do know people who have recently pulled out of the fast food business in a town in the UK due to huge changes in business rates that they could not have foreseen from the council, also changes in rent and available hours opening. It just made their previous business model, which was very good, unviable. So, they no longer work in that council district and have relocated elsewhere.

I think this is more locally driven than you think. That said, and I have other relatives in the hospitality industry in a couple of European countries, all say it is hard, really hard to make money and that's why they often end up employing relatives/cheap labour and working exceptionally long hours.

I help run a charity coffee shop. Busy. Takes £1200-£1500 a day. Yearly pure profit about £20,000.
I think you have to really give your customers what they want and that might not be what you want to sell. Increasing profits is very very hard.

Heuschrecke

You do know the UK is European country, right?

@Orchiddingme Mumsnet isn't exclusively UK and of course I would take that into account. Where I live the culture isn't too far from the UK and prices of goods aren't either. Rent is much cheaper however.

How about opening a vegan/vegetarian cafe? It could be your USP?

The answer to that question is the same as how long is a piece of string!
Some businesses will make money, a few will make a lot but the majority will barely break even.
One of the fastest ways to loose money is to open a cafe of restaurant. It is stressful and very hard work.

@7to25 thank you very much, very helpful comment.

This was what I was looking for really - just lots of examples of this kind of maths just to get a base idea from a wide array of businesses.

But you've basically asked the question 'how long is a piece of string' with no information about what type of string it is, where it is or what colour the string is.

There will be cafe owners making a loss
There will be cafe owners making a small profit, but probably less than NMW when the time and effort they put in is fully accounted for
There will be cafe owners making a decent income
There will be cafe owners making an absolutely fortune.

But it is well known that many cafes fail in the first year or two, with the owners losing a lot of money.

So the odds aren't good and anyone saying, well I make £10, 20, 50, 100k pa as a cafe owner is absolutely meaningless to your situation.

Honestly, don't do it. You would work harder, make less money, and have much more stress in your life. The only way it would really pay is if you have a concept you want to develop and hopefully expand, then maybe sell...but I think (like many of us) you have a lovely daydream of a cool cafe with amazing food through which you could express your creative side, which is not being fulfilled by the day job. If you were stacking shelves I'd say go for it, but if you have a well paid job you actually like? No way.

A good profit margin for a cafe is 10%, does that help?

I think you've missed my point about Europe/UK- it's not about similar cultures, it's about business rates in a very specific local area. These are set in England often by local councils who have opinions on things like are there too many similar cafes close by, is there alcohol licensing, will a charity cafe open up next to you on lower rates and take all your customers.

This isn't something generic, it's specific to the location/business environment.

Yearly pure profit about £20,000.

Have staff and management salaries been paid? Bearing in mind OPs business would not be a charity.

This was what I was looking for really - just lots of examples of this kind of maths just to get a base idea from a wide array of businesses

Well you're probably looking in the wrong place, as even if you did get answers, you have no idea of the circumstances of those businesses or if the answers are truthful.

£1200-1500 per day takings with £20k annual profit for a charity cafe.

How many days is it open, and how long each day?

Are the staff paid or are they volunteers, with it being a charity and all?

What are the prices like - are they high because people are less price sensitive because it is a charity donation?

How much did the cafe cost to fit out, decorate etc? Maintenance costs?

What is the local competition and what are the overheads. What sort of food and drink do they sell? Lots and lots of unknowns that make 7to25s answer possibly totally irrelevant to you.

Lets say this cafe takes £1400 per day and is open 6 days per week, 50 weeks of the year, that's £420k pa, for a profit of £20k, or less than 5%. Doesn't sound like much to me.

There are a few independent cafes local to us and what makes them work is the fact that they serve breakfast, brunch, lunch, afternoon tea and dinner. Plus tea, coffee, cakes etc.

So basically they are open from 7am- 11pm. One that’s very recently opened is very busy and popular which is down to a very nice, expensive, interior design and extremely quick and friendly service. It’s not particularly cheap but I envisage it will do well.

So not really possible as a one woman band with a bit of extra help.

Another cafe I’ve used is a shared premesis. In the daytime one guy runs it and in the evening it’s a completely separate bistro with a different name. This seems a great way of getting maximum use from equipment etc.

"You do know the UK is European country, right?" Of course I do, DerelictWreck, I'm not that stupid

However, the OP's OP (and her subsequent post, admittedly after mine) very much implied that she doesn't live in the UK/British Isles etc - but somewhere on mainland Europe.

7to25 what does the cafe sell most of during the day, to get to 2K per day, and who are the clientele and is the cafe within a charity shop and is it in a village or town centre or city high street or other? Just being nosy/interested!

OP so many factors. Where I grew up in North London 2 cafes opened up in local parks, did trendy food and made an absolute killing by all accounts.

So when cafes close down, where do they sell the machines etc they invested in?

Tawdry, yes. This is the amount left after everything.

We spend a lot of time in Brighton which as well as the resident population and the 40,000+ university students also hosts over 11million visitors a year so there is no shortage of customers for every level of cafe/bar/restaurant. I am constantly amazed at how quickly some close after opening. It seems to be a very risky business.

I can't say too much!
Main profit is from tea, then coffee and our USP is filled rolls made fresh on site. Good take away sales. All profits spent off site.

Sorry
This is with employees paid at living wage so it is a commercial operation very much in line with a high street cafe. Hence why I commented initially.

Opening hours 9-4 though may expand to 8-4 but we gave to look at takings during that breakfasts hours and see if it is worth it.

There is similar thread at the moment about the poster thinking about opening a shop. I posted on it just a minute or to ago so I have copied my post across for you to read. My business is not a cafe its a garage, there have been three local cafe's near us open, one successfully for about a year or so now, the other two bombed quite badly. the three of them were all open at on three different occasions so weren't in competition with each other. but the post I used on the other thread is below, which will give you my views based on my experience:-

It can't harm to try op, but have you thought about the costs involved in just setting up the shop, that's before you have even started making money. Would you be working all the hours yourself? If not you will need to find, train, retain and pay staff. Many new start ups can take a while to turn a profit and on some occasions owners take a minimal wage for a while until the finances of the business settle.
If you do have staff, they will have statutory rights, as the business owner you have none and if anything goes wrong, you need to step up.

I can understand you questioning your current working environment, but there are pro's and con's on both sides and try not to just see the benefits of working for yourself. Depending on your life style and the business you run the pros and cons can vary quite a bit. The money you can make, staff retention and demand for your service can also vary dramatically and what seems to be a good idea may not actually work.

Sorry OP but I have done both, currently running my own garage and have done so successfully for the last 9 years, I can enjoy the benefits but truthfully, if I could go back to being an employee with the knowledge I have now of running a business I would do it at the drop of a hat, I now long to be employed. Why? I am now sick of the responsibility, not having the right to leave, sick pay etc, having to constantly worry that our fortune may turn, having to deal with staff. The list goes on I'm worn out.
I have even on occasion came from my sick bed to cover a staff member calling in sick and also had to take my toddler in to.

God I do make it sound bleak!!!!

The grass isn't always greener.

Good luck though with what ever you choose to do, either way.

I have a former colleague who set up a restaurant in London (turned into a small chain then he sold out). I know he made a decent profit when he sold out but don't know how much he made year on year before selling. I remember chatting to him once about how he decided where to open and it seemed to be a question of balancing the rent against footfall at different times of day. For example, he said a City location would not work for him because rents are high and most of his takings would need to come from the lunch trade only (i.e. he would not expect to get many customers in the evening for his type of restaurant), so he would have too few hours of business to be able to cover the rent.

So he was focused on areas where there would be significant lunch and evening business, outside the very highest rent areas, with sufficient other restaurants that there would be lots of people around but without current competition for his particular type of restaurant.

As with anything i think it is possible to make a profit if you get your location, USP and price point right. There is a café near me that is extremely popular and gets away with charging ridiculous prices for pastries. It gets away with it because it aimed at a particular demographic with cash to spend and convinced them somehow it was the place to go. There are other normally priced cafes in the area which are perfectly nice so it is not just a case of being able to charge a lot through lack of completion. But it somehow got a real buzz going and it is always busy and people are happy to pay the high prices.

I think the overheads are pretty steep given high street rents & rates. I’m not sure you’d make enough. Looking at other replies, it seems i’m not alone in that.