You don’t have to be rich to make money, you just have to be practical. If you are smart about buying a business, instead of emotional, then the investment you make will be LOW RISK.
The costs involved in buying a café are limited only by the amount of money you have or can borrow. But just because you have access to a lot of money does not mean you have to spend it all. Conversely, just because you don’t have much money doesn’t mean you can’t own a business and financially set yourself up for life.
People talk about start up costs all the time, they say that small businesses do not start profiting until after 12 or more months, and that many businesses close shop within 2 years. I’m sure all of that can be true, but just because ‘they say’ it doesn’t mean you have to follow what ‘they say’. If you are smart in your decisions then you will succeed.
So, how much does it cost to buy a café?
That value is entirely up to you. However, this is the decision making process I went through to buy my own café:
-When I first started looking it seemed that the average price of cafes was from $75k-$200k. Obviously at the time I didn’t have $200K!
-I looked at all the $75k cafes and compared them to each other. I also compared them to the cafes that advertised at $150k. When I compared the weekly takings, hours open, and items included (fridges, coffee machine, tables, etc), there really wasn’t much difference between the $75k cafes and the cafes selling for more than $150K.
-When I looked at the $75k cafes I knew that was their ‘asking price’ and so I if I was going to make an offer I would start lower, for example $50k.
-I looked at the few cafes that were selling for $50k and realised there wasn’t much difference in the cafes selling for $50k versus $75k, so I went through the whole comparison process again.
-I wrote a list of what I wanted. I wanted a functioning kitchen, a coffee machine, clean safe structure. I wanted to be able to open the door on the day of settlement and run the café from day one. This meant I did not want to buy a business that needed redecorating or structural improvements.
-I continued to compare the cafes and their prices, looking at the lower prices instead of the higher.
What did I achieve from this process of comparison?
Instead of paying top dollar for a café that had already peaked, I found a cheap café that ticked everything on the list of what I wanted.
Instead of paying $150k for a café, I only paid $18k!
My café for only $18k had everything I needed (coffee machine, chairs, kitchen, etc) to open the door on day one and profit. I earned a living from the café and eventually sold it at the same price as other top dollar cafes.
What did I learn from this experience?
-Just because we are told to spend a certain amount on something, does not mean that is the amount we should spend.
-By being smart about the purchase, and not emotional, I made a LOW RISK purchase.