Profit and Loss Advice - Cafe

Civil Eng

Hello all,

Some background: I've had an ambition for many years to open a Café. Throughout that period I've done a lot of research into how to make this ambition a reality. All of that research is now feeding into my business plan.

However, one element of the business plan that I'm having difficulty with at the minute is the Profit and Loss Statement - specifically I'm having difficulty in forecasting revenue.

I know forecasting revenue is not an exact science but I would be grateful to posters for advice on revenue forecasting. Tips, techniques, strategies, methods, would be very helpful.

Many thanks,

Voltex

Revenue/footfall of similar business in the area or of a similar demographic in another area.
You would probably want to test the price elasticity of coffee in the area as well. As a big coffee drinker, @€;1.80 Ill buy coffee even if its [EMAIL="muck...@€2.00..youll"]muck...@€;2.00..youll[/EMAIL] have to have good coffee..@ €2.40..youd wanna be doing something really special!!

Civil Eng

Difficult to ascertain the revenue of similar businesses as most are not limited companies therefore don't make any form of accounts available to the public through CRO. But I do understand where you're coming from.

The only way of 'scientifically' taking a view on footfall would be to observe a similar business 9 to 5 and count?

Markcheese

Work out roughly what gross profit you need to cover your expenses(including your wage) , then how much sales you need to gain that level of gross profit.. (you need to take more than this ..).
Try to break that down into number of customers /average sales ...
Can your business/staffing accommodate that level of sales (remember most trade will be done at peak hours,)
Good luck ...
If you've never worked in a cafe try to talk to someone who has locally and get a ball park of their takings... Compare their location to yours ... After that pick a number....

Civil Eng

I've gone down the route of calculating cost and hence a figure of sales to breakeven. The sales figure that drops out of the equation, I believe, is eminently achievable but I would like to validate it through another method.

scwazrh

I would try to keep it very simple and spend my time sooner than my money . For footfall at your possible location I would pick 3 or 4 different two hour periods in a week and stand with a clipboard on the footpath and mark the number of people passing. This could be a busy weekend , weekday morn , weekday afternoon and what you think is a peak time.

Then do the same near a competitor on a similar street / footfall area and see what percentage of footfall tend to use the cafe .Based on those figures you should be able to very roughly estimate potential sales.

As with all research , stay on the side of caution , so if you think you'll get 100 customers a day work you're figures on 80 customers a day but aim to get 120 / day .

Civil Eng

Or I could park my car outside my preferred location or competitor location - with my GoPro mounted inside the windscreen and record a full day of footfall?

I could analyse the footage later.

scwazrh

Civil Eng wrote: »

Or I could park my car outside my preferred location or competitor location - with my GoPro mounted inside the windscreen and record a full day of footfall?

I could analyse the footage later.

Now you're sucking Diesel !!!

Civil Eng

Anyone else out there have advice?

Voltex

Civil Eng wrote: »

Anyone else out there have advice?

Is you potential site in the middle of a town? Is there a local chamber of commerce that may have activity info for the area?

Civil Eng

Voltex wrote: »

Is you potential site in the middle of a town? Is there a local chamber of commerce that may have activity info for the area?

Yes, the site is smack bang in the middle of town. Unsure whether there is a chamber of commerce but there is a decent amount of commercial activity in the town.

YellowSheep

Hi OP.

Give me a PM. I have specific forecast templates written for cats and restaurants which than feed into a p&l and an EBITA result.

Cheers Oliver

jimmii

YellowSheep wrote: »

Hi OP.

I have specific forecast templates written for cats and restaurants which than feed into a p&l and an EBITA result.

Cheers Oliver

That first one sounds interesting! I assume all the formulas in it are purrfect.

joejobrien

YellowSheep wrote: »

Hi OP.

Give me a PM. I have specific forecast templates written for cats and restaurants which than feed into a p&l and an EBITA result.

Cheers Oliver

Do you have templates for other businesss or just cafe/resturant?
Thanks,
joe

YellowSheep

joejobrien wrote: »

Do you have templates for other businesss or just cafe/resturant?
Thanks,
joe

Just hospitality business. But surely if you let me know what are you looking for, one could be changed to suit your needs.

KarrieF

Hi Oliver,

Could I trouble you for a copy of that file please? I have put together my business plan, and am meeting with local enterprise board next week, but this might add another level of detail to my plan. I will PM if its ok with you.

Thanks in advance
Karrie