For much of the population, coffee represents more than a favorite beverage; it is a cherished part of daily life. The day-after-day demand for a delicious cup of joe continues to grow yearly. In fact, according to the National Coffee Organization (NCA), 66% of Americans drink coffee daily, more than any other drink, including tap water. As the demand for delicious brewed coffee beverages continues to flourish, so does the popularity of owning a coffee cart on wheels.
A coffee cart business on wheels is a mobile, small-scale business that serves coffee and espresso beverages to customers in various locations. Traveling coffee businesses are run from a main food cart: coffee trikes, a pull or pushcart, or a portable coffee kiosk. Data from Mordor Intelligence projects that the coffee market size will continue at a compound annual growth rate of 4.65% from 2022-2027. With the demand for coffee-based drinks at an all-time high, starting a coffee cart on wheels is a highly desirable and financially responsible business choice for most entrepreneurs.
Advantages of Starting a Mobile Coffee Cart
The statistics for coffee all point to the same conclusion, the market is booming. Now is the perfect time to start a coffee cart business, from the lower startup costs to the high-profit potential. Let’s explore some of the top benefits of creating a coffee cart business on wheels:
Low Startup Cost
Opening a coffee cart on wheels has relatively low startup costs compared to most businesses. It is estimated that a coffee business on wheels can be up and running with as little as $5000.00.
Flexibility/Mobility
Running a coffee cart on wheels allows owners to stay mobile and be flexible about where they sell, what time they operate, and what products they offer. Carts can be open full-time, part-time, or mostly during weekends or special events. It is easy for a coffee cart business to fit around someone’s way of life instead of the other way around.
Opportunities to Reach a Variety of Customers
Since coffee trikes or coffee carts are mobile, owners can take their business wherever the customers are. Coffee cart businesses aren’t limited to serving one type of customer or a certain kind of venue. Creating customized menus and products for different locations and event needs can maximize sales and increase profit margins.
Innovation and Creativity
Some of the most profitable and popular food businesses fill a niche while highlighting creativity and innovation. Owning a coffee cart on wheels offers unlimited potential for taking a creative idea and turning it into big profits. You can even add subscription boxes to the list of services and goods you provide, allowing your customers to enjoy some light reading while savoring their coffee.
Potential for High Profits
Espresso-based and coffee-based drinks offer some of the mobile food industry’s most impressive gross profit margins. With potential gross profit margins reaching up to 90%, few other products can compete with the potential for high profits found in a coffee cart on wheels.
Coffee Cart Business Quick Start Guide
Like all business ventures, taking the first steps towards owning a coffee cart business begins with a plan. Here’s a step-by-step guide to creating a successful coffee business on wheels:
Scouting Out Locations
Finding suitable locations to set up a cart is imperative for the success of any business, especially a mobile coffee cart. Start with research of potential sites in local areas like university campuses, stadiums, farmers’ markets, outdoor concerts, and business parks, to name a few. Food carts are the perfect opportunity to test different locations for profitability without committing.
Follow All Legal Requirements
Understanding the local legal requirements for a business on wheels is one of the most essential steps in the process. Potential business owners should contact the local Health Department or Department of Environmental Services to find out what is required for each city, county, and state where the business will operate. Skipping out on the required permits and licenses will not only cause a company to be shut down, losing profits during that time but also losing profits from massive fees.
Creating a Business Plan
Starting a business with a comprehensive business plan is like creating a map that will lead the company to the future they want to have. Planning out a business on wheels starts with creating a budget for getting started and a budget for operational costs. It will also include the vision, goals, competition research, and objectives for the business’s long-term success.
Choosing the Best Equipment
Each type of mobile coffee business will require equipment that will be the base of the operation. Equipment like the coffee cart, brewing machines, solar panels, and refrigeration/freezer should be a top-budget priority. Purchasing high-quality gear from the beginning is important because it will save time and money and help owners avoid lost profits from faulty equipment issues.
Creating a Custom Menu
Since mobile coffee carts offer limited space, an efficient menu is a requirement for maximizing profits. Focusing on a smaller menu of high-quality, desirable options is a smart way to give customers a high-quality product that will stay within the budget.
Setting Product Pricing
Setting the ideal price for mobile food products is traditionally done by food cost percentage or factor menu pricing.
- Pricing by food-cost percentage is the most popular option and determines price based on a simple formula:
Food cost ÷ target food cost percentage = menu price
- Pricing by factor menu pricing uses a factor that will represent the food-cost percentage:
100 ÷ target food-cost percentage = pricing factor
Food cost x pricing factor = menu price
Define The Marketing Strategy
Marketing is the lifeblood of any business and should not be ignored. Beginning a business on wheels with a well-planned marketing strategy is vital for brand recognition and profitability. Companies can no longer count on word of mouth to reach their full potential. Integrate various marketing types into the strategy, such as community events, newspapers, tv, radio, online directories, social media, and influencers.
Start Venturing Towards Your Coffee Cart Business
Coffee cart businesses are an excellent way for anyone who dreams of running a business to break into entrepreneurship. The low startup costs, flexible schedule, and potential for enormous profit margins offer potential business owners a unique opportunity to provide a beloved product to the customer while building an empire for years to come.