How to Start a Small Business Cafe

Starting a small cafe takes capital and planning, but it’s a satisfying way to make a living and be your own boss while cooking the food you love. Running a cafe takes an aptitude for business as well as a passion for feeding people.

Start With a Vision

Start the process of opening a cafe by clarifying your vision. Decide what type of food you want to prepare and what demographic of clientele you intend to serve. Think about your financial goals as well. Do you want your cafe to be a way to earn an adequate living or do you ultimately want to start a chain of profitable cafes? There are no right and wrong answers to these questions, but knowing what you want will help you chart a course of action to position yourself to achieve your goals.

Find a Location

Some people are savvy enough at marketing to attract a following wherever they happen to open a cafe. If you’re confident of your ability to connect with your neighborhood and get the word out, even in an out of the way location, cast a wide net in your property search. If you’re not particularly skilled or savvy at building a brand, look for a location where any restaurant or cafe is likely to succeed, such as an area with plenty of retail shops.

Either way, calculate your space needs by deciding how large a kitchen area you’ll need and how much seating you’d like to have. The size of your kitchen will depend on how many tables you’ll have and how much of your food you plan to make from scratch. Start looking at commercial real estate listings as soon as you begin planning, even if you aren’t anywhere near being ready to negotiate a lease. If you’re familiar with what is available, you’ll increase your chances of recognizing the right spot when you see it.

Seek Small Business Financing

Once you know the size of the space you want your cafe to occupy and what kind of food you want to serve, use this information to start calculating how much money you’ll need. Your build-out won’t happen overnight, so you’ll most likely have to pay some rent while you’re outfitting your location.

Create a kitchen plan and use it to craft a budget, including necessary equipment and construction costs such as putting in the plumbing, gas, electric, refrigeration and ventilation infrastructure your facility will need. Assess your personal financial picture and decide how much of your personal funds you can devote to the effort, and how much you’ll have to borrow. Check out the Small Business Administration website for information on grants and SBA-backed small business loans.

Buy or Hire Equipment 

Shop for equipment through new and used dealers, and on bulletin board websites such as Craigslist. Also look for restaurant equipment auctions in your area. If you have the budget, new equipment provides security because it comes with warranties and doesn’t already have wear and tear. Used equipment can be considerably less expensive, but adds an element of uncertainty. Buy used items that are unlikely to cost you painfully if they don’t work properly, like sinks. For items that are indispensable, such as refrigerators, buy new, if possible.

Get Above Board and Legal

Your cafe will need to be licensed with your local health department. Reach out to the agency before you get started with planning and construction, so you’ll build a compliant facility the first time around. You’ll most likely have to submit plans for approval before you get started, and then have a final inspection once your kitchen is built.