INITIAL START-UP
COSTS
Start-up Loan (Principal + Interest)
$27,500
Furniture (incl. of co ee machine)
$8,000
Rent Deposit
$2,000
Utilities Deposit
$500
TOTAL (INITIAL STARTUP COST)
MONTHLY OPERATIONS
$38,000
COSTS Per MONTH
Rent
$2,000
Utilities
$500
Cup Purchase (5000/week) * 4
$1,800
Co ee Purchase (30lbs/week) * 4)
$720
Manager Salaries (2 working 42 hrs each) : 2 *
Yearly salary / 12 months
$8,320
Server Salaries (a total of 68 hrs weekly) * 4 *
Monthly salary
$4624
TOTAL (MONTHLY COST STARTING FROM
THE FIRST MONTH ITSELF)
$17,964
MONTHLY INCOME
INCOME EARNED
COFFEE sales : X number * $2.5
$Y
MONTHLY NET INCOME * : (INCOME BY COFFEE SALES - OPERATIONAL COSTS)
= (INCOME BY COFFEE SALES - $17,964)
=
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*once we have covered the initial start-up cost of $ 38,000 our monthly net income =
.
BREAK EVEN = FIXED COST / (PRICE PER UNIT - VARIABLE COST)
Variable Cost:
Cost of Cup = $ 0.09
Cost of co ee per cup : 18 grams (0.036 lb) = 0.036lb/cup * $6/lb = $ 0.216
=> Total = $ 0.306 per cup
Fixed Cost:
RENT + UTILITIES + SALARIES = $ 15,444
Break even (monthly) = $ 15,444 / ($2.5 - $0.306) = ~ 7039 units of co ee
HAVE NOT CONSIDERED THE FOLLOWING YET :
ADVERTISING AND PROMOTION : ?
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Anticipated number of co ee selling per week : ?