Coffee shops seem like the perfect choice when looking at low-cost franchise opportunities. This is because you may have the thought of a quaint and trendy spot where people come to drink overpriced beverages and enjoy the ambiance you have created. Unfortunately this is not usually the way that things play out with these low-cost franchise opportunities.
The Over-Saturation of the Industry
There is no denying that coffee shops have flooded the market over the last 10 years. It seems that you can’t go more than a mile without seeing a Starbucks or other coffee shop. Even though there is a great need for coffee, in most areas there are so many coffee shops that you may find that it is difficult to get the business you need. Also, there is a big movement of people going away from chain coffee shops and instead of visiting locally owned stores. While this is excellent for the local communities, it is not good for franchise owners who want to make more money with their business.
Branding is Another Issue for This Industry
When considering coffee shops for your low-cost franchise opportunities, your first thought may be Starbucks because they are the best-known coffee shop. There are two problems with this. One, Starbucks franchises on a very limited basis, meaning that it is extremely difficult to get a franchise, even if you already own successful franchises. Two, even if you do get approved for a franchise, this is by no means going to be low cost.
It is also worth noting that it is very hard to find low-cost franchise opportunities with coffee shops. Even brands that are not as well known, such as Xpresso Delight, have initial costs that come out to several hundred thousand dollars.
The Conclusion on the Coffee Industry
Coffee shops are businesses that are not going out of business any time soon. Unfortunately for people looking for low-cost franchise opportunities, this simply is not a good option. If you have a dream of owning your own coffee shop, you are better starting your own or buying a small, local coffee shop than trying to find low-cost franchise opportunities within this sector simply because of the connotation of unique coffee shops. However, even startups will have their issues so make sure you know what you are doing and have the capital to keep you going while you establish the coffee shop.