M3A2: Cost Drivers

Business Idea

For my business idea, I have chosen to venture into the coffee business by starting my own coffee shop. Many of the working and studying societies have an 87% chance of using coffee or going to coffee shops either for brief meetings, study points or meet up points making it likely for them to purchase coffee as the main commodity. (Knight, Knight, Mitchell & Zepp, 2004) Due to the busy schedules students and the working class have, coffee shops end up the main spot for having a quick and pocket friendly breakfast. The benefits of coffee to act as stimulant has also become a major influence since it can be used by students when it comes to overnight studies. Thus, this has made it favorable for it being my business idea since there is a gap that I can tap in turn earning profits at a very favorable state.

Start – Up

For my coffee shop I will use the tall bar sets we used to have in our country house and with some of the unique furniture I will use to decorate and adorn the coffee shop by giving it a modern vintage appearance. I will also use earth colors to match to the vintage art work and tall bar set up in a coffee shop. I have opted for a unique look since in this generation and time, social media has been a major marketing factor thus, creating a social, easy on the eye and artistic coffee shop I will be able to attract many more clients. I will use some of the savings I have as well as involve my parents to my business idea with the aim of attaining a small loan to add on to my savings. With a starting capital of $ 1,000 I will be ready to set up my business. (Accounting, 2015)

Products and Costs

In my coffee shop business, I will also offer other commodities with an aim of offering a large variety of snacks and drinks to my client’s coffee being the main commodity. I will allocate the cost of my commodities as seen below;

Revenue per Item

Above I have drafted the percentage revenue I will be aiming to attain in all the items on a monthly basis. In a day I will be aiming at attaining the following sales;

References

Accounting, F. (2015). ACCA.

Knight, C. A., Knight, I., Mitchell, D. C., & Zepp, J. E. (2004). Beverage caffeine intake in US

consumers and subpopulations of interest: estimates from the Share of Intake Panel

survey. Food and Chemical Toxicology, 42(12), 1923-1930.