Hey folks, I'm currently looking at a great location for a shop I want to open in my town. The place is 3000 sq. ft. and the asked rent is $2500 p/month. It's located 1 block from the downtown business district, a corner lot with easy access and great parking. It is also situated perfectly for a drive thru window.

Just not sure how to gauge whether the size is too big or not. How would I begin to project traffic? Based on someone's business plan I saw on bX where they mentioned that US census data stated that 17% of Americans visit a specialty coffee spot every day. So i figured it this way. My town has a population of approximately 55,000-60,000 but we'll figure conservatively at 55,000. So if I take 17% of 55,000 that is around 9300. If I project getting just 2.75% of that population coming to my shop, that'd give me *255* people a day. Is that doable? I don't know. I asked a local shop owner who's been around for about 10 years (shop is just alright at best) how many people a day come through his place and he said about 200.
So what do you think about what I've told you? I've attached some pictures for you to check out as well.

Thanks

Views: 150

Attachments:

Reply to This

Replies to This Discussion

Are you opening a coffee shop or a garage... depending on where you're at maybe you could sell Vespas and Italian motorcycles. I think that for it to be an appealing coffee shop you will need a lot of exterior updates your construction budget could really quickly get out of control. Without though study I couldn't give you an opinion but at first blush I'd say you have some pretty big obstacles with that location.
My initial thought would be "Too big." Will they subdivide?

I think that space would have other problems as well. Unless you have some SERIOUS renovation, and a few other thriving businesses next to you, I would pass.

But as a general rule for large(r) spaces:
If the location is great...Negotiate shop lease rate based on needed space... say 1500 to 2000 max. Negotiate the remainder as "storage" for a significantly lower rate... say $4 psf. Or you can continue and look for something else. Heating and maintaining a large space is costly. If the cost of THAT space will produce greater profit than a smaller, less costly space, then it could be good. All you can do is run the numbers assuming a worst case scenario and go from there. It needs to be a smokin' deal to be worth it if you ask me.
What is the traffic count on that side of the road and is it on the way to work in the morning? Morning traffic? What is the demographic makeup of the town. Is this an area of town where someone would walk in for a drink or are you thinking mainly drive thru?
I believe the traffic count is close to 5000 cars a day around that location. For people that live near that location it would be on the way to work yes but it's not on the way for everyone in town. There may some walk up traffic during the day from surrounding businesses but in the small town south most people drive everywhere.

The median age of people living in Conway, AR was 27.3. We have 2 small liberal arts colleges and the 2nd largest University in Arkansas with between 13,000 and 14,000 students. Thirty-six percent of Conway residents hold a baccalaureate degree. The racial makeup of the city was 84.0% White, 12.1% Black or African American, 0.36% Native American, 1.25% Asian, 0.03% Pacific Islander, 0.98% from other races, and 1.23% from two or more races. 3.47% of the population were Hispanic or Latino of any race.

Hope that gives you a good picture of the demographic makeup of our town.

comforteagle1965 said:
What is the traffic count on that side of the road and is it on the way to work in the morning? Morning traffic? What is the demographic makeup of the town. Is this an area of town where someone would walk in for a drink or are you thinking mainly drive thru?
It is hard to say without knowing the area but If I were to make a gut choice given what you have said I would say the space is to much. If you feel it is in a great part of town you may draw a lot of walk up sit down but It's still larger than I would be comfortable with. Can you take part of the space?

Jon Mitchell said:
I believe the traffic count is close to 5000 cars a day around that location. For people that live near that location it would be on the way to work yes but it's not on the way for everyone in town. There may some walk up traffic during the day from surrounding businesses but in the small town south most people drive everywhere.

The median age of people living in Conway, AR was 27.3. We have 2 small liberal arts colleges and the 2nd largest University in Arkansas with between 13,000 and 14,000 students. Thirty-six percent of Conway residents hold a baccalaureate degree. The racial makeup of the city was 84.0% White, 12.1% Black or African American, 0.36% Native American, 1.25% Asian, 0.03% Pacific Islander, 0.98% from other races, and 1.23% from two or more races. 3.47% of the population were Hispanic or Latino of any race.

Hope that gives you a good picture of the demographic makeup of our town.

comforteagle1965 said:
What is the traffic count on that side of the road and is it on the way to work in the morning? Morning traffic? What is the demographic makeup of the town. Is this an area of town where someone would walk in for a drink or are you thinking mainly drive thru?
Depends on what you want to do with the space and what the budget is... If you have the money to drop into this place to renovate the outside (it needs serious renovation to have appeal as a cafe), do some landscaping, a patio, maybe an outdoor stage(?) get rid of those overhead doors and all of the lifts that are probably still present. Is all 3000 sq ft going to be devoted to seating? If this happens are you going to put in a restaurant and offer more than just beverages? Just sell coffee? What about roasting in shop? That's some killer storage and roasting space if you want to do both. How about a music venue? Would the demographic support it? What are you in walking distance of? Are the colleges within walking distance? How many other shops are in the area? What are those shops doing that you would do differently? What is going to make people want to come to your mammoth shop and not the one that they currently go to?

I manage a shop that has three floors that are each 3800 sq ft. The shop has been set up as a cafe/bar/restaurant with the entire theme surrounded by live music every night and some days. It's a ton of work, but when everyone is focused on their specific aspect of the place it runs well and makes money. One floor has storage, offices, our food prep room, our walk in, and our dish washing station. The main floor houses the cafe, the bar and the kitchen. The top floor is only about 1/3 used (small loft and the rest is attic we hope to expand into some day down the road).

In order to make this place function it takes a large staff of very hard workers, an extensive amount of advertising and the fact that we have over 40,000 students within walking distance. Even then, we really don't turn a huge profit (we are only just into our second year, though). We looked around and realized there wasn't anything like what we wanted to do in the area and decided to go for it, but at a huge risk and with a massive cost.

Large spaces are doable, but do you really want to do it?

-bry
Definitely would NOT want to remove the bay doors that roll up. That gives the place a cool urban/industrial feel and also allows me to bring the outside in whenever the weather is nice. Most everyone I talk to locally about this place and others in the industry love those doors. The lifts are already gone from inside the place so it's basically a "blank canvas" inside that requires some paint, stained concrete floors and a few other things to be ready to go. I appreciate the thoughts and opinions on this (after all I did ask right) but I think it's sometimes hard for others to get my vision without me going into detail about it and really painting a mental image for everyone.

The feel I'm going for is industrial/loft like. So the exposed beams in the ceiling, concrete floors, cendar block walls, etc... really lend to this feel. The the bay doors that roll up really allow me to give people the feel of eating outside when the weather is nice but still being under a roof. The location of the place is perfect for a drive thru window so I think that would keep business steady during non-peak hours. Yes, we'd serve food as well but to the point of being "full blown restaurant".

Thanks for the thoughts, opinions, suggestions.

Bryan Wray said:
Depends on what you want to do with the space and what the budget is... If you have the money to drop into this place to renovate the outside (it needs serious renovation to have appeal as a cafe), do some landscaping, a patio, maybe an outdoor stage(?) get rid of those overhead doors and all of the lifts that are probably still present. Is all 3000 sq ft going to be devoted to seating? If this happens are you going to put in a restaurant and offer more than just beverages? Just sell coffee? What about roasting in shop? That's some killer storage and roasting space if you want to do both. How about a music venue? Would the demographic support it? What are you in walking distance of? Are the colleges within walking distance? How many other shops are in the area? What are those shops doing that you would do differently? What is going to make people want to come to your mammoth shop and not the one that they currently go to?

I manage a shop that has three floors that are each 3800 sq ft. The shop has been set up as a cafe/bar/restaurant with the entire theme surrounded by live music every night and some days. It's a ton of work, but when everyone is focused on their specific aspect of the place it runs well and makes money. One floor has storage, offices, our food prep room, our walk in, and our dish washing station. The main floor houses the cafe, the bar and the kitchen. The top floor is only about 1/3 used (small loft and the rest is attic we hope to expand into some day down the road).

In order to make this place function it takes a large staff of very hard workers, an extensive amount of advertising and the fact that we have over 40,000 students within walking distance. Even then, we really don't turn a huge profit (we are only just into our second year, though). We looked around and realized there wasn't anything like what we wanted to do in the area and decided to go for it, but at a huge risk and with a massive cost.

Large spaces are doable, but do you really want to do it?

-bry
For a coffee shop that did light food as well, with your 255 guess at daily tickets, 1000-1500 sf is a your usual recommended size. Your description of what you intend to do with the space seems to meet this definition.

I think if you look at the responses here, you'll see that they are telling you that you need to do something else too to make the excess space work for you. If you do not intend or have the means to do this, the space is too big. What happens if you run your numbers assuming you'll get to 200/day at the 6 month mark (given the existing owner's stated customer traffic)?

Please don't chalk this feedback up to the group not getting your concept - we have really good imaginations. You've heard from people that run and work successful shops in a variety of markets. I hope you seriously consider what they have to say.

Good luck.
Brady -

What would "something else" be exactly?

Brady said:
For a coffee shop that did light food as well, with your 255 guess at daily tickets, 1000-1500 sf is a your usual recommended size. Your description of what you intend to do with the space seems to meet this definition.

I think if you look at the responses here, you'll see that they are telling you that you need to do something else too to make the excess space work for you. If you do not intend or have the means to do this, the space is too big. What happens if you run your numbers assuming you'll get to 200/day at the 6 month mark (given the existing owner's stated customer traffic)?

Please don't chalk this feedback up to the group not getting your concept - we have really good imaginations. You've heard from people that run and work successful shops in a variety of markets. I hope you seriously consider what they have to say.

Good luck.
Jon Mitchell said:
Brady -

What would "something else" be exactly?


I think there were lots of neat ideas, especially in Bryan's email. Music venue, full-on restaurant, roastery.

Depending on how you structured your business and lease you might also consider subleasing to something like: a used bookstore, record store, bakery, bike shop, organic deli, etc. Something that would compliment your business without taking anything away or adding to your operational complexity. Something that actually gave you a business benefit would be nice - like having a standalone bakery attached.

If this wasn't appealing or possible, then at least take John's suggestion of trying to negotiate a lower rent for half of the space. If the commercial real estate market there is anything like it is in the rest of the country, incoming tenants are in a reasonably good negotiating position.

Lots of possibilities here.
Thanks Brady, great suggestions.


Brady said:
Jon Mitchell said:
Brady -

What would "something else" be exactly?


I think there were lots of neat ideas, especially in Bryan's email. Music venue, full-on restaurant, roastery.

Depending on how you structured your business and lease you might also consider subleasing to something like: a used bookstore, record store, bakery, bike shop, organic deli, etc. Something that would compliment your business without taking anything away or adding to your operational complexity. Something that actually gave you a business benefit would be nice - like having a standalone bakery attached.

If this wasn't appealing or possible, then at least take John's suggestion of trying to negotiate a lower rent for half of the space. If the commercial real estate market there is anything like it is in the rest of the country, incoming tenants are in a reasonably good negotiating position.

Lots of possibilities here.
yep, that is pretty big. Big spaces tend to feel empty even if you have a decent amount people hanging around. You want to portray a popular spot, so it can't feel like a ghost town. That does look like a great spot, and I like th doors, but it is f-ing huge. So you need to fill the extra space with somthing, or convince the qner to turn it into 2 or 3 units. If you had the main door and the first 1 or 2 bays, and the owner could make more profit off of his/her space, then I would say go for it.

You have the right demographic to make a specialty shop work, start small then grow.

Reply to Discussion

RSS

Barista Exchange Partners

Barista Exchange Friends

Keep Barista Exchange Free

Are you enjoying Barista Exchange? Is it helping you promote your business and helping you network in this great industry? Donate today to keep it free to all members. Supporters can join the "Supporters Group" with a donation. Thanks!

Clicky Web Analytics

© 2021   Created by Matt Milletto.   Powered by

Badges  |  Report an Issue  |  Terms of Service