Do you want to start a drive thru coffee kiosk? If YES, here is a complete guide to starting a drive through coffee kiosk business with NO money and no experience plus a sample drive through coffee kiosk business plan template.
If you are looking to start a business that you do not want to be stressed out with, then you have to think of starting a drive through coffee kiosk business. Though it is simple to set up, but quite a lot needs to be done to ensure that your drive through coffee kiosk business does take flight within the period that you projected.
If you intend opening your drive through coffee kiosk business, then you must make out time to learn the art of preparing coffee alongside other soft skills – such as customer service, accounting and bargaining skills amongst others.
Starting a drive through coffee kiosk business also means that you have some plans in place. Plans like how you intend to compete in the market, how you intend to make your business known to the people as well as other important factors that must not be overlooked.
Before launching this type of business, it will pay you carry out your market research, economic and cost analysis and of course feasibility studies. If you get things right before launching your drive through coffee business, it will not take you long before you break even and start smiling to the bank.
So, if you have the desire to start your own drive through coffee kiosk business, all you need do is to read this article and you will be well equipped.
Steps to Starting a Drive Thru Coffee Kiosk Business
1. Understand the Industry
The Coffee and Snack Shops Industry that drive through coffee kiosk is a part of is composed of businesses that prepare or serve specialty snacks and non-alcoholic beverages including ice cream, frozen yogurt, cookies, donuts, bagels, coffee, juices, smoothies and sodas.
Purchases may be consumed on site, taken to go or delivered, but a drive through coffee kiosk is a kiosk that sells coffee to people who are on the go, busy people who are driving to work or on their way to a destination and they don’t have the luxury of time to stop by a coffee café or coffee bar.
There are different types of coffee drinks that you can find in a drive through coffee kiosk or coffee shop/coffee café/coffee bar, some of them are; cappuccino, espresso, iced coffee, decaffeinated coffee, alcoholic coffee (Irish Coffee and Brandy Coffee et al), filtered coffee, cold brew coffee, Turkish coffee, coffee with milk, coffee or espresso with whipped cream and flavored coffee et al.
In recent time, the Coffee and Snack Shops industry has been sustained by increased consumer spending, driven by higher disposable income and greater confidence in the overall economic outlook. As a matter of fact, the demand for coffee and snack shops increased at a faster rate than most segments in the food service related industry, as consumers increasingly seek convenience at an affordable price.
In addition, the industry has adjusted to the ever – changing consumer preferences, especially those relating to health and diet. Going forward, these trends are expected to continue shore up demand. As a result, major coffee shop chains will invest in expansion and international growth, strengthening the revenue generated in the industry.
The Coffee and Snack Shops Industry that drive through coffee kiosk business is a subset of is a thriving sector of the economy of the united states which generates well over billion annually from more than 55,664 registered coffee and snack shops (coffee kiosks inclusive) scattered all around the United States of America.
The industry is responsible for the direct employment of well over 686,007 people. Experts project The Coffee and Snack Shops Industry to grow at a 4.5 percent annual rate between 2011 and 2016. Starbucks and Dunkin’ Brands are the leaders in this industry; they have the lion share of the available market in the industry.
One good thing about this type of business is that drive through coffee shops/kiosks can be located in any part of town as long as there are people living or working there. Generally, coffee shops/kiosks are located at airports, sea ports, shopping malls, hotel lobby, railway stations, bus stations, campuses, hospital lobby, sport centers and in any public facilities.
The drive through coffee kiosks line of business will continue to blossom because people will not relent in drinking coffee. Despite the fact that the industry seems saturated, there is still room big enough to accommodate aspiring entrepreneurs who intend opening their own drive through coffee kiosks in the United States of America.
Some of the factors that encourage entrepreneurs to start their own drive through coffee kiosks business could be that the business is a thriving business and the business is easy to set-up and managed with minimal startup capital.
Over and above, the turnover for an average drive through coffee shop/coffee kiosk can be as high as 50% and above that is why entrepreneurs who intend making good money from a business with less struggle open their own drive through coffee shop or coffee kiosk; they either start their own drive through coffee shop business from the scratch or buy an existing and successful coffee franchise.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic composition of those who drink coffee cut across all genders and age groups; male and female, adults and children all drink coffee hence the demographic composition for the drive through coffee kiosks business is all encompassing.
The truth is that, when it comes to selling coffee, there is indeed a wide range of available customers. In essence, your target market can’t be restricted to just a group of people, but all those that resides around your drive through coffee kiosks and who have purchasing power.
So, if you are thinking of opening your own drive through coffee kiosks business then you should make your target demographics all encompassing. It should include corporate executives, business people, celebrities, military men and women, sports men and women, tourists and every adult in the neighborhood where your drive through coffee kiosks will be located.
3. Decide Which Niche to Concentrate On
It is important to state that there is no known niche area when it comes to the drive through coffee kiosk business. Every player in this line of business usually sells coffee beverages (cappuccino, espresso, iced coffee, decaffeinated coffee, alcoholic coffee (Irish Coffee and Brandy Coffee et al), filtered coffee, cold brew coffee, Turkish coffee, coffee with milk, coffee or espresso with whipped cream, and flavored coffee et al.), other beverages and snacks.
Drive through coffee kiosk business is a niche area in the coffee and snacks shops industry.
The Level of Competition in the Industry
The competition that exists in the coffee and snacks shop industry goes beyond competition amongst drive through coffee kiosks businesses in your location; you are expected to compete with coffee and snack shops, coffee cafés, coffee bars, mobile coffee trucks, fast food restaurants and any other outlets that also sell coffee.
So, it will be right to say the competition in the drive through coffee kiosks business is tough. The truth is that no matter the level of competition in an industry, if you brand and promote your products or business properly, you will always make headway in the industry.
Just ensure you stock your kiosk with varieties of coffee from different brands /producers and you know how to attract and reach out to your target market.
But over and above, there are several drive through coffee kiosks and snacks shops scattered all around the United States.
So, if you choose to start your own drive through coffee kiosks business in the United States, you will definitely meet stiff competitions amongst drive through coffee kiosks, coffee and snack shops, coffee cafés, coffee bars, mobile coffee trucks, fast food restaurants and any other outlets that also sell coffee.
Besides, there are larger drive through coffee kiosks and coffee and snacks shops that determine the trends in the industry and you should be ready to compete with them for customers.
4. Know Your Major Competitors in the Industry
These are some of the leading drive through coffee kiosks and coffee and snacks shops/brands in the United States of America and in the globe;
- Starbucks Coffee
- Dunkin’ Coffee
- Caribou Coffee
- The Little America Coffee Shop
- Erik’s DeliCafe
- Beans & Brews
- Fuel America Coffee Shop
- 101 Coffee Shop
- Harry’s Coffee Shop
- The Coffee Shop
- Barista Parlor
- Oddly Correct Coffee Bar
- Americas Cup Coffee Company
- Revolution Doughnuts & Coffee
- Cat Town Cafe
- Ultimo Coffee
- American Coffee House, LLC
- Rowster Coffee
- Classic Rock Coffee Co.
- Blue Bottle Coffee
If you are looking towards successfully launching a business and maximizing profits, then you need to ensure that you get your economic analysis right and try as much as possible to adopt best practices in the industry you choose to build a business in.
The drive through coffee kiosk business is not a Green business, as a matter of fact, you will come across several drive through coffee kiosks and coffee and snack shops when you drive through town.
So, if you are mapping out your economic analysis, you should carry out thorough market survey and costing of the amount required to rent a store or build a drive through kiosk, and the amount required to purchase coffee making machines/equipment, coffee supplies and also the running cost to successfully run the business.
Over and above, if you are considering starting a drive through coffee kiosk business, then your concern should not be limited to the cost of renting a store and purchasing coffee making machines/equipment, coffee supplies, but also on branding and on how to build a robust clientele base.
5. Decide Whether to Buy a Franchise or Start from Scratch
When it comes to starting a business of this nature, it will pay you to buy the franchise of a successful and well – established coffee and snack shop as against starting from the scratch. Even though it is relatively expensive buying the franchise of an established coffee and snack shop brand, but it will definitely pay you in the long run.
But if you truly want to build your own brand after you must have proved your worth in the coffee and snacks shops industry, then you might just want to start your own drive through coffee kiosk business from the scratch.
The truth is that it will pay you in the long run to start your drive through coffee kiosk business from the scratch. Starting from the scratch will afford you the opportunity to conduct thorough market survey and feasibility studies before choosing a location to launch the business.
Please note that most of the big and successful drive through coffee kiosk businesses and coffee cafés and bars around started from the scratch and they were able to build a solid business brand.
It takes dedication, hard work and determination to achieve business success and of course you can build your own drive through coffee kiosk business – brand to become a successful brand with corporate and individual clients from all across the city where your drive through coffee kiosk business is located and through the length and breadth of the United States of America and other countries of the world if you decide to go into opening chains of drive through coffee kiosk business and franchising.
6. Know the Possible Threats and Challenges You Will Face
If you decide to start your own drive through coffee kiosk business today, one of the major challenges you are going to face is the presence of well – established drive through coffee kiosk businesses, coffee and snack shops, coffee cafés, coffee bars, mobile coffee trucks, fast food restaurants and any other outlets that also sell coffee. The only way to avoid this challenge is to create your own market.
Some other challenges you are likely to face is economic downturn; if the economy is in bad shape, history has it those businesses such as drive through coffee kiosk business and the likes usually struggle to maintain their old customers or even welcome new customers.
Unfavorable government policies can also hamper the growth of your drive through coffee kiosk business. There is nothing you can do as regard these threats and challenges other than to stay positive that things will work well for you.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
You have the option of either choosing general partnership, limited liability company which is commonly called an LLC, or a sole proprietorship for a business such as drive through coffee kiosk business.
As a matter of fact, if your intention is to grow the business and have chains of drive through coffee kiosks across the United States of America and other countries of the world via franchising, then choosing sole proprietor is not an option for you.
Limited Liability Company, LLC or even general partnership will cut it for you. For example, Setting up an LLC protects you from personal liability. If anything goes wrong in the business, it is only the money that you invested into the limited liability company that will be at risk.
It is not so for sole proprietorships and general partnerships. Limited liability companies are simpler and more flexible to operate and you don’t need a board of directors, shareholders meetings and other managerial formalities.
These are some of the factors you should consider before choosing a legal entity for your drive through coffee kiosk business; limitation of personal liability, ease of transferability, admission of new owners, investors’ expectation and of course taxes.
If you take your time to critically study the various legal entities to use for your drive through coffee kiosk business with the ability to sell franchise and open chains of drive through coffee kiosks all across the United States of America, you will agree that limited liability company; an LLC is most suitable.
You can start this type of business as limited liability company (LLC) and in future convert it to a ‘C’ corporation or an ‘S’ corporation especially when you have the plans of going public.
Upgrading to a ‘C’ corporation or ‘S’ corporation will give you the opportunity to grow your drive through coffee kiosk business so as to compete with major players in the industry; you will be able to generate capital from venture capital firms, you will enjoy separate tax structure, and you can easily transfer ownership of the company; you will enjoy flexibility in ownership and in your management structures.
8. Choose a Catchy Business Name
When it comes to choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Usually it is the norm for people to follow the trend in the industry they intend operating from when naming their business.
If you are considering starting your own drive through coffee kiosk business, here are some catchy names that you can choose from;
- Corinthians Coffee®, LLC
- Monique Drive Through Coffee Kiosk, LLC
- Classic Peal Drive through Coffee Kiosk, Inc.
- Lindsay Holmes Coffee®, Inc.
- Holy Cross Coffee®, Inc.
- Mike Harry & Sons Drive Through Coffee Kiosk, Inc.
- Creamy Cups Coffee, Inc.
- The People’s Coffee Café, LLC
- Freetown Coffee Bar, Inc.
- Golden Mug Coffee Café, Inc.
9. Discuss with an Agent to Know the Best Insurance Policies for You
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your drive through coffee kiosk business.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own drive through coffee kiosk business in the United States of America;
- General insurance
- Health/Medical insurance
- Liability insurance
- Workers Compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
- Payment protection insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
If you are considering starting your own drive through coffee kiosk business, usually you may not have any need to file for intellectual property protection/trademark. This is because the nature of the business makes it possible for you to successfully run the business without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
But if you just want to protect your company’s logo and other documents or software that are unique to you or even jingles and media production concepts, then you can go ahead to file for intellectual property protection.
11. Get the Necessary Professional Certification
When it comes to operating a drive through coffee kiosk business, you do not need to have any formal training or special certification before you can be allowed to open and operate a drive through coffee kiosk business in the United States of America and in all countries of the world.
All you need is informal training that will expose you to the in and out of preparing coffee and effectively running the business. On the other hand, if you come across any form of certification that can aid you run your drive through coffee kiosk business, then by all means try and pursue such certification.
12. Get the Necessary Legal Documents You Need to Operate
The essence of having the necessary documentation in place before launching a business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations.
If you do, it won’t be too long before the long hand of the law catches up with you. These are some of the basic legal documents that you are expected to have in place if you want to legally run your own drive through coffee kiosk business in the United States of America;
- Certificate of Incorporation
- Business License
- Tax Payer’s ID / Tax Identification Number
- Foods and drinks handler certificate
- Health inspection Certificate
- Proof of district-issued food and drinks manager identification card
- Copy of license for the service support facility and/or a recent inspection report
- Business Plan
- Non – disclosure Agreement
- Employee Handbook
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Company Bylaws
- Memorandum of Understanding (MoU)
- Building License
- Franchise or Trademark License (optional)
13. Raise the Needed Startup Capital
Starting a drive through coffee kiosk business can be cost effective especially if you choose to start on a small scale by running a small drive through coffee kiosk business in a street corner. Securing a standard and well – positioned store/kiosk facility, purchasing coffee making machines/equipment and coffee supplies are part of what will consume a large chunk of your startup capital.
If you choose to start the business on a large scale, you would need to go source for fund to finance the business because it is expensive to start a standard large scale drive through coffee kiosk business. Here are some of the options you can explore when sourcing for startup capital for your drive through coffee kiosk business;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell of shares to interested investors
- Applying for Loan from your Bank
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your family members and your friends
14. Choose a Suitable Location for your Business
When it comes to choosing a location for your drive through coffee kiosk business, the rule of thumb is that, you should be guided by the demand for such products and easy access to wholesale purchasing of coffee supplies directly from the manufacturers or wholesale distributors.
Of course, if you are able to secure a central location for your drive through coffee kiosk business, it will give people easy access to locate your kiosk.
It cannot be overemphasized that the location you chose to open your drive through coffee kiosk business is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people with the required purchasing power and lifestyle.
If you make the mistake of renting or leasing a facility for your drive through coffee kiosk business in a not too visible or hidden location simply because it is cheap, then you must be prepared to spend more in promoting the business and perhaps giving direction to potential customers.
These are some of the key factors that you should consider before choosing a location for your drive through coffee kiosk business;
- The demography of the location
- The demand for coffee and snacks in the location
- The purchasing power of the residence of the location
- Accessibility of the location
- The number of coffee kiosks, coffee and snack shops, coffee cafés, coffee bars, mobile coffee trucks, fast food restaurants and any other outlets that also sell coffee in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
15. Hire Employees for your Technical and Manpower Needs
On the average, there are no special technology or equipment needed to run this type of business except for Espresso machine, Coffee maker, Coffee grinder, Food service equipment (microwave, toasters, dishwasher, refrigerator, blender, etc.), Storage hardware (bins, utensil rack, shelves, food case), Counter area equipment (counter top, sink, ice machine, etc.), Computers and receipt issuing machines, Sound System (For playing music), Point of Sale Machines (POS Machines), CCTV Cameras and Flat Screen TVs.
So also, you will definitely need computers/laptops, internet facility, telephone, fax machine and office furniture (chairs, tables, and shelves) amongst others and all these can be gotten as fairly used.
As regards leasing or outright purchase of a store facility, the choice is dependent on your financial standing, but to be on the safe side, it is advisable to start off with a short term rent/lease while test running the business in the location. If things work out as planned, then you go on a long term lease or outright purchase of the property but if not, then move on and source for other ideal location for such business.
When it comes to hiring employees for a standard drive through coffee kiosk business with more than one outlet, you should make plans to hire a competent Chief Executive Officer (you can occupy this role), Admin and Human Resources Manager, Merchandize Manager, Bartenders/Baristas, Coffee Kiosk Manager, Sales and Marketing Officer/Sales Girls and Sales Boys, Accounting Clerk, and Cleaners.
These are some of the key employees that you can work with. On the average, you will need a minimum of 5 to 10 key staff members to run a small scale but standard drive through coffee kiosk business.
The Service Delivery Process of the Business
When it comes to the business services process of a drive through coffee kiosk business, there are no hard and fast rule about it. Basically, it is the duty of the merchandize manager to help the store purchase coffee beans from different manufacturers and brand name.
They source for good purchasing deals and they also ensure that they only purchase at the right prices that will guarantee them good profits.
Once the drive through coffee kiosk business is in full operation, the coffee and snacks available are listed on their menu and the coffee makers prepare coffee based on customers demands. It is usually take away since it is a drive through coffee kiosk. Stocks are taken after the close of business every day and accounts are balanced.
It is important to state that a drive through coffee kiosk business may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated drive through coffee kiosk business process is not cast on stone.
16. Write a Marketing Plan Packed with ideas & Strategies
Generally, running a business requires that you should be proactive when it comes to marketing your goods or services. If you choose to launch a drive through coffee kiosk business, then you must go all out to employ strategies that will help you attract customers or else you will likely struggle with the business because there are well – known brands that determine the market direction for coffee and snack shops industry.
These are some of the marketing ideas and strategies that you can adopt for your drive through coffee kiosk business;
- Introduce your drive through coffee kiosk by sending introductory letters alongside your brochure to corporate organizations, car owners, taxi companies, transport companies, households, sports organizations, gyms, schools, socialites, celebrities and other key stakeholders throughout the city where your drive through coffee is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across.
- Create a basic website for your business so as to give your business an online presence
- Directly market your products
- Engage in road show in targeted communities from time to time to promote your drive through coffee kiosk business
- Join local drive through coffee kiosk business associations for industry trends and tips
- Provide discount days for your customers
- Advertise your business in community based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of Word of mouth marketing (referrals)
17. Work Out a Reasonable Pricing for your Services & Products
One key factor that will help you sell your coffee at rock bottom prices is to purchase your coffee supplies directly from the manufacturers in pretty large quantities. The truth is that the higher the quantity of items that you purchase directly from the manufacturers, the cheaper you tend to get them.
Another strategy that will help you retail your coffee at the right price is to ensure that you cut operational cost to the barest minimum, channel your efforts towards marketing and promoting your brand name. Aside from the fact that this strategy will help you save cost, it will also help you get the right pricing for your products.
You can also try as much as possible to work with independent contractors and marketers; with that, it will help you save cost for paying sales and marketing executives and also purchase.
18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
If your intention of starting a drive through coffee kiosk business is to grow the business beyond the city where you are going to be operating from to become a national and international brand by opening chains of drive through coffee kiosks and franchising, then you must be ready to spend money on promotion and advertisement of your brand.
No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and brand boosting cum promotion to continue to appeal to your target market. Your corporate identity has lot to do when it comes to building a profitable business.
Here are the platforms you can leverage on to boost your brand awareness and create corporate identity for your drive through coffee kiosk business;
- Place adverts on both print (newspapers and food magazines) and electronic media platforms
- Sponsor relevant community based events
- Leverage on the internet and social media platforms like; Instagram, Facebook, Twitter, YouTube, Google + et al to promote your drive through coffee kiosk business
- Install your Billboards in strategic locations all around your city or state
- Engage in roadshows from time to time in targeted neighborhoods to create awareness of your drive through coffee kiosk business
- Distribute your fliers and handbills in target areas
- Contact corporate organizations, car owners, taxi companies, transport companies, households, sports organizations, gyms, schools, socialites, celebrities and other key stake holders throughout the city where your drive through coffee is located informing them about your business and the products you retail
- List your drive through coffee kiosk business in local directories/yellow pages
- Advertise your drive through coffee kiosk business in your official website and employ strategies that will help you pull traffic to the site
- Position our Flexi Banners at strategic positions in the location where your drive through coffee kiosk business is located.
- Ensure that all your staff members wear your branded shirts and all your vehicles and trucks/vans are well branded with your company logo et al.