Profit analysis of Espresso Drinks

[Hulkster]

I'm looking to open up a gelateria/coffeeshop in the very near future. In order to keep my investors happy, I need to give them some idea that they will not lose their money. In order to do that, I need to figure out how much it will cost to produce all of our products. I have an analysis of drip coffee, tea and the gelato already done, but I can't seem to find enough information on espresso drinks to do them. If anyone has any information on how much espresso is required to brew one shot, I can get the ball rolling to figure that out as well. Additionally, if anyone has already done all of this work, I would greatly appreciate the information, as would my investors. Thanks in advance.

 

[editorbob]

8 gramms of espresso per shot.... our drinks are all a double shot, plus milk & paper. I've got a spread sheet at home where I enter my cost per pound for beans, plus cost per gallon for milk and my cost per case for cups & lids... out comes my COGS. COGS X 3 = sugested retail price, then I adjust the SRP to my market conditions. If you want, I'll look for the excel sheet and email it to you.

 

[celement]

don't forget

chocolates for mochas, syrups for flavored latte's, and you'll have it...don't really need a spread sheet its just simple math:

espresso typically runs 8 to 12 cents a shot depending on the quality \ price of the beans you buy.

milk here is 2.33 per gallon or 128 ounces

chocolate I pay almost a quarter for a typical 16 ounce drink - more for a 20 and 24 ounce...I break down the chocolate by the ounce just like the milk and watch for sales on them and stock up.

lid and cup

syrups...how much per bottle, I use 1883's, how many ounces in a bottle and is your shot 1 ounce - I vary this based on size of the drink.

 

[Jumpin Java Bean]

I've been Googling this topic this morning, and found a pretty good breakdown - adjust for your own variables.

It's from a user forum, so I don't even know how to credit the author, but the whole thread can be found at http://answers.google.com/answers/threadview?id=200279

I've quoted the part most relevant to us below:

To me, an ideal specialty coffee retail concept boils down to
expertise and margins. The cost of goods sold (COGS - operator's cost
of ingredients and products sold) on a sandwich or fine dessert is
60%, if you're careful, while the COGS on a latte is only 23%.
(Remember, as in golf, the lower the number, the better.)..."

There is an excellent chart of assumptions on costs:

Assumptions

Daily sales goal $1,000

Cost of coffee $7 per lb.

Shots of espresso per lb. of coffee 62 (11 cents per shot)

Cost of milk $3 per gal.; 128 fl. oz. per gal = 2 cents per oz. (9 oz.
per "Double-Tall Flavored $2.75" drink)

Flavored Syrup $3.60 per 24-oz. bottle (3/4 oz. per drink = 11 cents)

Single Shot 1 oz. of coffee by volume

Ounces of drip coffee per pound of coffee 360 (23 cents per 12-oz.
cup)

Food and non-coffee beverage markup 100% (50% margin)

Food shrinkage and supplies 10%

Hours of operation 14 (5:30 a.m. - 7:30 p.m.)


You will want to see the entire breakdown on costs and profits that
follow in this article. But just for example, $1,000 of espresso
drinks can gross $770 based on this analysis:

Double-shot flavored espresso-based drink (coffee 22 cents, milk 18
cents, syrup 11 cents, cup 6 cents, lid 3 cents, condiments/supplies 3
cents)

Retail $2.75
Number sold 365
Cost of goods 23%
Gross profit $770

 

[Hulkster]

wow...just what I was looking for...thanks

 

[ElPugDiablo]

Shots of espresso per lb. of coffee 62 (11 cents per shot)

Not disagreeing, but many shops elect to always pull double shots even if the order calls for a single espresso. So the break down could be different if you decided to go this route.

1 pound = 450 grams
2 shots + waste = 14 grams + 2 grams = 16 grams/shot
450 grams / 16 grams/shot = 28 shot
at $7.00 per pound, cost of espresso per order = $7/28 = $0.25

If you add constant espresso grind adjustment, your double espresso shots cost more like $0.26 to $0.27.

 

[LonghomeCoffee]

Since the COGS is 23% - what about the avg labor cost per drink - does anyone have any data on this?

 

[celement]

always pull doubles

Shots of espresso per lb. of coffee 62 (11 cents per shot)

Not disagreeing, but many shops elect to always pull double shots even if the order calls for a single espresso. So the break down could be different if you decided to go this route.

1 pound = 450 grams
2 shots + waste = 14 grams + 2 grams = 16 grams/shot
450 grams / 16 grams/shot = 28 shot
at $7.00 per pound, cost of espresso per order = $7/28 = $0.25

If you add constant espresso grind adjustment, your double espresso shots cost more like $0.26 to $0.27.

We always pull doubles but if we don't immediately use the extra shot it gets put into the cooler for cold drinks...its not lost so I wouldn't apply the cost of it too the single shot drink...

 

[Twitch]

Not sure if this is what you're really looking for or not, but It found it usefull.

http://www.specialty-coffee.com/Tools/c ... ulator.asp

 

[maxtcobb]

Hi Editorbob.

I am looking to start my own coffee shop, and am writing a business plan. Your excel spreadsheet looks like a great tool. Could you email it to me? (this site doesn't like me to put my email address so just remove the spaces here - max t cobb @ gmail . com)

Thanks!

 

[PinkRose]

Hi maxtcobb,

You dug up an old post from 2005. Editorbob hasn't visited the Coffee Forum since 2005!

I really doubt that he'll respond to your post.

Rose

 

[Jjwhites]

Hi,

8 gramms of espresso per shot.... our drinks are all a double shot, plus milk & paper. I've got a spread sheet at home where I enter my cost per pound for beans, plus cost per gallon for milk and my cost per case for cups & lids... out comes my COGS. COGS X 3 = sugested retail price, then I adjust the SRP to my market conditions. If you want, I'll look for the excel sheet and email it to you.

Would you mind sending me that spreadsheet?

thanks,

jimmy

 

[Jjwhites]

Thank you this was most helpful.

 

[Koffelover]

Thank you this was most helpful.

Hi, would you mind sharing the spreadsheet?

 

[Koffelover]

8 gramms of espresso per shot.... our drinks are all a double shot, plus milk & paper. I've got a spread sheet at home where I enter my cost per pound for beans, plus cost per gallon for milk and my cost per case for cups & lids... out comes my COGS. COGS X 3 = sugested retail price, then I adjust the SRP to my market conditions. If you want, I'll look for the excel sheet and email it to you.

Understand the the post is quite old, in case you still around, would you mind sharing the sheet?