considering coffeeshop

[opebo]

Guys, very near my house a coffee-shop I sometimes visit is now available - for rent about $175/month, with a kind of entry fee of about $700.  It has an espresso machine and some furniture.. good location but small and no parking..

So.. I'm trying to decide whether to do something with it.. it is temptingly cheap, but one only makes about 20-25 baht  profit on each drink here.  Trying to think of other things to do with a small shop..

[Franzl]

As a replacement for your "academic" career or just to earn some extra Baht?

[John Dibble]

Based on all I know about you, I seriously doubt you have the motivation to run a business for an extended period of time. I imagine that whatever novelty you are deriving from this idea would be spent quite quickly for you. Unless you're going to hire a manager to do the work for you, which would cut further into what meager profits you would make, you probably shouldn't bother.

[opebo]

As a replacement for your "academic" career or just to earn some extra Baht?

Oh, obviously just for a little sideline!  My god, I'd never make enough to live on from a coffee shop here.  It would just be a little extra.

[opebo]

Based on all I know about you, I seriously doubt you have the motivation to run a business for an extended period of time. I imagine that whatever novelty you are deriving from this idea would be spent quite quickly for you. Unless you're going to hire a manager to do the work for you, which would cut further into what meager profits you would make, you probably shouldn't bother.

Obviously any work to be done there would have to be done by a Thai staff - it would be illegal for me to do it.  I'm here strictly as an expert, visa-wise (they don't want foreigners doing work a Thai could do).

I figure I'd have to sell about 30 drinks per say to comfortably break even with a little safety margin, including two staff.

[Grumpier Than Uncle Joe]

Based on all I know about you, I seriously doubt you have the motivation to run a business for an extended period of time. I imagine that whatever novelty you are deriving from this idea would be spent quite quickly for you. Unless you're going to hire a manager to do the work for you, which would cut further into what meager profits you would make, you probably shouldn't bother.

Obviously any work to be done there would have to be done by a Thai staff - it would be illegal for me to do it.  I'm here strictly as an expert, visa-wise (they don't want foreigners doing work a Thai could do).

I figure I'd have to sell about 30 drinks per say to comfortably break even with a little safety margin, including two staff.

If your Thai staff would do the work you can offer extra services, no?  

[Franzl]

Based on all I know about you, I seriously doubt you have the motivation to run a business for an extended period of time. I imagine that whatever novelty you are deriving from this idea would be spent quite quickly for you. Unless you're going to hire a manager to do the work for you, which would cut further into what meager profits you would make, you probably shouldn't bother.

Obviously any work to be done there would have to be done by a Thai staff - it would be illegal for me to do it.  I'm here strictly as an expert, visa-wise (they don't want foreigners doing work a Thai could do).

I figure I'd have to sell about 30 drinks per say to comfortably break even with a little safety margin, including two staff.

That shouldn't be too hard, right?

[opebo]

If your Thai staff would do the work you can offer extra services, no? 

Haha, no not too likely - the town I live in really isn't that kind of town.

I figure I'd have to sell about 30 drinks per day to comfortably break even with a little safety margin, including two staff.

That shouldn't be too hard, right?

No, I don't think so.

[John Dibble]

Based on all I know about you, I seriously doubt you have the motivation to run a business for an extended period of time. I imagine that whatever novelty you are deriving from this idea would be spent quite quickly for you. Unless you're going to hire a manager to do the work for you, which would cut further into what meager profits you would make, you probably shouldn't bother.

Obviously any work to be done there would have to be done by a Thai staff - it would be illegal for me to do it.  I'm here strictly as an expert, visa-wise (they don't want foreigners doing work a Thai could do).

I figure I'd have to sell about 30 drinks per say to comfortably break even with a little safety margin, including two staff.

I'm sure there are differences in how businesses are regulated there, but I still don't think you get that you'd still have to put in quite a bit of effort to keep the shop running.

Aside form 30 drinks per day and two employees, what else have you considered in your business plan? Have you asked yourself any of the following questions:

Do you know how often you'd be expected to pay taxes to the government, or even what taxes you'd be expected to pay?
Do you know which suppliers you need to contact to keep your shop stocked with the necessary materials and how much do those materials cost?
Are there any health regulations you need to be aware of?
What will you do when one or both of your two employees is too sick to work or quits suddenly?
How often will you come in to the shop to make sure your employees are managing things well in your absence?

There's probably more you should be thinking about, but don't think just because you've got others running the shop that you won't be doing any work.

[opebo]

Do you know how often you'd be expected to pay taxes to the government, or even what taxes you'd be expected to pay?

Well, I know that income taxes here are about 5%, maybe up to 10% for the rich (I think the very tip-top part of my own income is taxed at that 10% rate, so that I average about 6% tax overall).  There may be a value added tax, but as far as I know (and I have observed) there is no record keeping in smaller shops, and they don't seem to pay any tax.  Just checked, now editing - VAT doesn't apply at below about 2 million baht/year revenue, so like $60,000 dollars, far more than this shop would do.
 

Do you know which suppliers you need to contact to keep your shop stocked with the necessary materials and how much do those materials cost?

Yeah, of course - that's how I arrived at the per-drink profit and thus the number-of-drinks-per-day-to-break-even figure.  I know several people who own coffee shops here (there are soooo many), and they filled me in precisely on what they pay.

Are there any health regulations you need to be aware of?
What will you do when one or both of your two employees is too sick to work or quits suddenly?
How often will you come in to the shop to make sure your employees are managing things well in your absence?

There are no health regulations in Thailand, you make a good point about the possibility of a sick or departing employee (and Thais are famous for leaving for greener pastures, as there is virtually no unemployment here), lastly, I would probably drop in once a day - realistically I couldn't do more as I'm too busy.

[LastVoter]

Wouldn't a bar establishment be more consistent with your goals?

[opebo]

Wouldn't a bar establishment be more consistent with your goals?

No, not really.  I don't like to mix business and pleasure.  Also I don't drink, nor pick up girls in bars.

[© tweed]

transitioning into the petit bourgeoisie.

[justfollowingtheelections]

I have thought of doing this for a long time, but coffeeshops are simply not profitable.  People order a cup of coffee and then they sit down for hours doing their homework.

[opebo]

I have thought of doing this for a long time, but coffeeshops are simply not profitable.  People order a cup of coffee and then they sit down for hours doing their homework.

Haha, no one does any work here, but yes, the individual purchases are too small to make any worthwhile money.

[John Dibble]

I have thought of doing this for a long time, but coffeeshops are simply not profitable.  People order a cup of coffee and then they sit down for hours doing their homework.

Haha, no one does any work here, but yes, the individual purchases are too small to make any worthwhile money.

Consider also selling overpriced biscotti, muffins, or other baked goods to go with the coffee.

[opebo]

Consider also selling overpriced biscotti, muffins, or other baked goods to go with the coffee.

That's a good point.  Most business people here say they make more money from selling food than coffee.  Ice cream is very big in coffee shops here as well, and is of course fairly easy to deal with.

[Grumpier Than Uncle Joe]

What is maximum loss if it flops?  If you can handle that number, give it a shot.  If not, don't. 

[opebo]

What is maximum loss if it flops?  If you can handle that number, give it a shot.  If not, don't. 

Oh as I understand it, it is very small - just the $175/month rent and the deposit (probably the same amount), and the $700 she is wanting for her coffee machine and a few furnishings (cups I guess).

[Grumpier Than Uncle Joe]

What is maximum loss if it flops?  If you can handle that number, give it a shot.  If not, don't. 

Oh as I understand it, it is very small - just the $175/month rent and the deposit (probably the same amount), and the $700 she is wanting for her coffee machine and a few furnishings (cups I guess).

Then go for it.......it will take some time to figure out what the demand is for current products and products not offered, but you'll figure it out.

[Starbucks Union Thug HokeyPuck]

You definitely should pick up the coffeeshop, opebo.  Could be a popular spot for your students if you should desire it to be. 

[Simfan34]

You definitely should pick up the coffeeshop, opebo.  Could be a popular spot for your students if you should desire it to be. 

I like this idea... I have an aunt who does the same thing in Ethiopia but instead of students it's the ministry of education.

[opebo]

You definitely should pick up the coffeeshop, opebo.  Could be a popular spot for your students if you should desire it to be. 

I like this idea... I have an aunt who does the same thing in Ethiopia but instead of students it's the ministry of education.

Your aunt owns the ministry of education?