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Denver Coffee Shop, heavy traffic, drive thru, only $75K
Denver Coffee Shop, Heavy Drive by Traffic, Drive thru, only $75K
Well Known Coffee Franchise Store
Parker Rd in South Denver, Colorado
2013's revenues were $280K. The 2014 revenues were $268K. The store has absentee owners.
The owners, husband and wife, bought the store when it was growing and profitable in August 2010 but she was offered a job by an old boss that was too good to turn down and he was in a car accident and his health will not allow him to work in the store. They have not spent any time in the store for three years which increased costs by hiring employees to do their jobs, have neglected the stores upkeep, and have spent no money on advertising all of which resulted in a drop in both revenues and profits.
The store currently has a solid customer base which will help an owner become profitable again quickly. The owners really enjoyed working there because of the daily conversations and new friendships that are part of owning a coffee shop. They know that the new owner will enjoy working at the store. It is a fun business to own and capable of making a new owner some very good money. It is a very positive work environment for either an individual or for a family business.
The location is near the corner of one of Denver’s busiest intersections(Parker Rd and Arapahoe Rd), has a drive thru, and the franchise comes with its own exclusive area in south Denver. The employees are loyal and passionate about what they do and to the business. Plus, this business will not change the day after a new buyer becomes involved and can only be improved. The owners don’t have relationships with any customers anymore.
The estimated original build out is over $376,800. The franchisor’s website estimates that the cost to start a new franchise runs between $187,300 for a small location up to $376,800 for a large location. The franchisor considers 1,100 square feet small and 1,300 square feet big. This franchise is 1,560 square feet not including a 200 square foot patio(that they don’t pay extra rent for) and a drive thru. It is estimated that the original value of the stores equipment(not landlords) is $128,225 plus the leasehold improvements are substantial. You could not start a franchised coffee shop for less than their sales price. This is a great deal at $65,000.
It is a turnkey operation. The have all supplies delivered in the middle of the night just waiting for them when the employees arrive in the morning. The milk, coffee supplies, and bakery goods are all automatically delivered. The employees know what to do and there are 3 security cameras that the owner can look at any time from a smartphone or computer. The franchisor even has their own repair people that you can call if need be. They basically don’t have to do anything except periodically buy tp, napkins, cleaning products, and paper towels.
Location: Northeastern corner of Parker and Arapahoe Roads, CO
Sales Price: $65,000 sales price. The non-disclosure agreement link is: http://companybroker.com/buyer-profile-jeff.htm If it is blue you should be able to click on it, if not please cut and paste that to a URL line(browser) and it will give you the NDA. Please fill it out and send it back to automatically request the Full Sales Package containing a detailed data room with financials and a Comprehensive Video on the entire operation and a full interview with the owner by clicking on the secure web link to the Confidentiality Agreement (CA). If you have any questions or comments on the CA please email me at firstname.lastname@example.org. Thank you.
The store is currently a well-known franchise but the buyer will be under no obligation to continue that relationship. The cost to transfer the franchise is $12,500, which is half of the $25,000 a new franchisee would pay and it does come with training classes included. The owner may help with this cost also. The classes include learning the history, product orientation, in-depth coffee classes, in-depth teas, specialty drinks, and smoothies classes, franchise training, ongoing support, and a visit to a working franchised store. The owners like the franchisor and its products but bought the store from a friend and don’t know the coffee business at all. They have no idea if it should stay this franchise or not. The franchisor uses the world’s finest coffee roast analyzers, the Agtron system, and offers a full line of choices including organic from some of the best coffee beans in the world. They also use an ecology friendly water decaffeination process called the Swiss Water process for their decaffeinated coffees. It removes 99.9% of the caffeine which is better than most of their competition. The franchisor also uses Aspen Bakery and has a fantastic breakfast burrito that is very popular.
The owners are trustworthy people whom are a married. Right after buying the store, he had a car accident resulting in 3 back surgeries that left him unable to work at the store and she was offered a large salary at a previous job that was too good to turn down. The barista was promoted to store manager with no experience as a manager. She is a great employee and they believe she will stay either as a barista or manager depending on the new owner’s needs.
There store has both walk in and drive thru sources of revenue along with a nice patio with a southern open exposure. They have one of only two franchises with a drive thru which makes up almost 50% of the sales. The store is in a great location at the end of a very long area of diversified shopping including a grocery store, several big name chain retailers, a movie theater, and a gas station less than a block away. It is just off of and visible from a very high traffic street(Parker Rd) with ample parking and surrounded by other retailers.
Marketing, Advertising, and Growth Potential: The store has done no pro-active marketing for almost 3 years. They have written a letter that is in the data room describing 19 different changes that a hands on owner should consider to improve revenues and earnings. Examples include adding a fireplace, making the patio pet friendly, and a customer loyalty program. They have let the store get run down as you will see from the broken sign right over the front door. They believe that store will return to profitability very quickly with a new owner making a few changes. The company does have a some customer emails but stopped collecting them 3 years ago and have not used them for any marketing campaigns. They do not do specials or discounts to bring in new customers. They have no advertising other than the franchisor itself. In addition the area is primed for growth over the next few years with the towns plans for expansion. They also have not taken advantage of the merchandising opportunities that are available especially around the holidays and have very high profit margins. They also could use a lighted sign on the back of the building. All of the other tenants in that strip mall have one. The new owner should also expand the merchandise, they only carry only a minimum of merchandise on one stand which can be changed per the season.
Competition: There are two other stores that sell fresh coffee in their area. A Starbucks in the grocery store and an Einstein Bagels on their block both of which have been there since they bought the store. Neither are new and neither have a drive thru. Their location does most of their business over Saturday and Sundays and they know they need to establish a customer loyalty program to get more commuters to use them during the week. The drive through is a great advantage for commuters. They also feel that their patio is helpful(Starbucks doesn’t have one).
Employees: The employees love what they do. The company employs 6 employees. They have 3 long-term employees and little turnover. This is a business that ownership can be comfortable leaving for vacations or to spend time with family based on the established systems, procedures, experienced personnel, security cameras, and the industry specific computerized point of sales system which is multi-functional. The manager makes $10.75 per hour plus tips, and the other employees makes between $8.00 and $8.25 per hour plus tips.
Retail Store Lease: The current retail store has 4 months remaining with the landlord. The lease is transferable and has a 5 year extension available. It potentially could be good timing to negotiate a new lease with the landlord but the new owner doesn’t have to. They pay $32 a square foot and believe the new owner could negotiate that down a little. There is also a sign for the nail salon right in front of their patio that should be moved and could be part of the negotiations which may have a small positive impact on revenues. They have had no vandalism, graffiti, loitering, or other issues with their location.
The owners will help with a transition of the business which will not take much. They will offer full warranties, indemnifications, and further states there have not been any legal or other issues of any kind nor are the owners aware of any items pending. This is a rewarding, fun, and positive business and industry and could be an ideal fit for the right individual or family to acquire.
Plus, Colorado is the best State in the country to own a business. Colorado is THE "#1" fastest growing and strongest economies in the United States, per Money.MSN.com and Business Insider in 2014 articles. The Money.MSN.com article ranks all 50 states by eight economic measures including GDP growth, housing prices, job creation and exports and Colorado came out number one.
Thank you for your consideration.
Jeff Chapman Eisnaugle
Company Broker Group, LLC.