How to set up a cafe business

Updated February 21, 2017

If you've fallen in love with the idea of creating a community of regulars who stop off frequently for a cup of joe and, on occasion, a decadent pastry or sandwich, a cafe business could be at the top of your business idea list. Dream big---even if your budget is small--because although setting up a cafe business will require you to follow licensing protocols for food service establishments, you'll make all of the creative decisions that determine the ambiance, fare and surprises you'll dish up to patrons looking for a gathering place to call their own.

Pair your instincts with the resources of a commercial real estate agent to select a location for your cafe business. Scout out the areas your budget can bear that have the highest traffic--in close proximity to shopping centres, train depots and office complexes--so you'll have the most concentrated universe of potential customers for your cafe

Come up with a clever name for your cafe business that's guaranteed to stick in the minds of passersby. Choose a name reminiscent of the neighbourhood, a clever play on signature foods or beverages on your menu or lend your own name to your cafe business if you love the idea of being at the centre of your brand. Go green (see link) and you'll attract plenty of tree-huggers.

Take care of the bureaucratic work required to establish your cafe business: file for licenses, permits, certificates and other credentials required by state and local authorities. Contact your state liquor board if you plan to serve beer, wine or a full complement of alcoholic beverages. Obtain quotes for contents and liability coverage from an insurance broker.

Create a business plan (see link) that includes a competitor analysis, a projected budget, marketing strategies, an advertising plan, plus equipment, supply and furnishings lists. Compile these materials into a resource package and use it to accompany loan applications when you approach lending institutions, venture capitalists and other resources for cash to fund your cafe business.

Choose a decorating theme that matches or supports the name you've given your cafe Cover your cafe walls with sun-splashed paint effects that resemble quaint European village walls, opt for a mix of white and ice cream colours so your small cafe looks bigger than it really is or scour resale shops and yard sales for eclectic memorabilia that, when hung on the walls, gives your cafe a charmingly cluttered ambiance.

Purchase food preparation, storage, cleaning and cooking equipment. Obtain cafe tables and chairs and a counter. Acquire large supplies of plates, glasses, utensils, serving platters, baskets, bowls, linens and industrial restaurant supplies necessary to provision your cafe

Hire staff with as much cafe experience as possible so they're ready for the first critical days following your debut. Run ads in local newspapers. Ask neighbouring retailers if you can place flyers on their shelves. Promote your cafe business by offering shoppers a free cup of coffee. Soon you'll be on your way to living that dream.

Things You'll Need

  • Location
  • Permits and licenses
  • Fixtures and furniture
  • Restaurant supplies
  • Insurance
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About the Author

Based in Chicago, Gail Cohen has been a professional writer for more than 30 years. She has authored and co-authored 14 books and penned hundreds of articles in consumer and trade publications, including the Illinois-based "Daily Herald" newspaper. Her newest book, "The Christmas Quilt," was published in December 2011.