The profit margin of a cafe in the US is between 80-100% according to some of the Google search results.

What's the figure in KL?

As I only drink kopi-o made at home, my price is 25 sen for coffee powder and boiled water.

What's your costs?

Rental, salary, water electric, daily cost.
now cafe open by youngster, must lingkup within 6 month because cannot cover the rental ( depend location )

That is only possible if you only count ingredient costs

As a business operation as a whole, it won't be so high. Should be anywhere between 10-30%. Which is the typical margin for F&B

Just remember a simple fact, if margin is really high, its easy for a competitor to undercut you.

i think gross is around 60-70%

Highest cost is rental
Second is staff wages

Thats why can charge RM48 for full English breakfast and RM 15 for tea

Gross vs Nett

F&B always >60/70% as i know

This post has been edited by intensecooling: Nov 4 2022, 09:51 AM

A lot of /k seem to think profit margin is:-

Selling Price/Ingredients cost.

I've been seeing a lot of post such as , I make myself big breakfast only cost rm10, outside selling rm30.
Roti canai cost is only rm0.30 worth of flour, but selling rm1.20
They don't seem to understand the cost structure and don't really understand overhead such as rental, labour makes up a big chunk of the cost.

Where can possible 80% margin

If possible I'm sure other restaurants will happy to steal customer from you with so called 60% margin

And let the margin wars begin

rental 10k per month
wages another 15k-20k per month (depends on kitchen)
assume both u and spouse working full time in cafe la

This post has been edited by spacelion: Nov 4 2022, 10:00 AM

absolutely correct... so many people think "i make kaya toast only 80cents why atas kopitiam can sell 5RM?!"

real life example here for you.

opened a Juice shop for the past 6 months as my side income.

Cost in general:
Rental 6k
Manpower 5k
Raw material 3k

Gross per month in general: 20k-25k

this is not including how much i've put into my renovation (80k)

So nice to do or not you decide yourself. but generally i feel its a pain in the ass. as its a side income i have nothing to complain. but as a main primary job, wouldnt suggest doing it for me PERSONALLY.

They say macam so easy. Ask them try to sell RM18 on a semi fancy restaurant setting lor... So many overhead cost that can bamboozled you in so many ways

But some also legit. I pay RM30 for baked beans, scrambled egg, hashbrowns, processed ham and bread, Vege, mushroom? Come on... I rather chose other things to eat

Depend a lot on volume

If highly dense area , sure can profit

can

/k style margin is calculated using Selling Cost/Ingredient cost . They assume rental , worker wages, electricity , is free.

Side income means u are not there to manage/work?

learn to roast, brew a good coffee. if your coffee really power, customers keep coming despite the slight expensive price.

these are the stuffs i pantang eat for english breakfast. hashbrown homemade ok la, if buy from frozen store, no la... felt being chop. i buy 9pcs @ RM1x, air fry it, makan till syok

thing is people go to fancy cafe not purely for the food.

people want to see and be seen in their fancy outfit. also instagram.

people spend who spend above what is necessary (base cost) is because they spend for emotional satisfaction

some hipster cafe wont lingkup as i know a few of them open in those industrial lot but still many people go on weekends and etc

There's hidden lost which is u don't know . Waste coffee bean, milk, perishable vege . Staff curi eat.

for a restaurant business

profit from foods is not high

they make the highest earning from drinks

Things is the fancy photo, sometime I look at the food so many processed ingredients also turn off for me.

Yup... If I'm gonna pay big money like RM30, at least give some passion and not use too much canned or frozen items...

If not I just eat RM22 sourdough avocado...

Tommy le baker selling nice sandwiches for RM18++... That gooding place to go for me

i think /k no heard what is profit and loss, i don't know F/B margin is how much, let say is around 50-60 %, but after minus overhead cost( include asset depreciation), net profit only 5-10%, really kek... buat macam anjing baru dapat peanut.

Sendiri made espresso latte cost around rm3-rm4 in raw material.
Can go as low as rm2 if you go for cheap robusta bean.

Don't understand the logic behind RM12 for a cup of Americano.

The cafe plague (charging RM30-40 for a dish of english breakfast) needs to stop.

This post has been edited by Juggerballz: Nov 4 2022, 10:53 AM

It's Ok-ish I guess.

I have dealings with some small time cafe owners in rather strategic locations (Bangsar, Kuchai Lama, Pucheong, Uptown, SS15) and based on accounts that I have access to, I observe that most have an average RM4000+ monthly net profit. It's not that much really.

However, I'm sure those really good or reputable ones will be raking in moarrrr.

This post has been edited by Mr Mercedes: Nov 4 2022, 11:00 AM

jgn lupa kos wang perlindungan dekat gangster kawasan. 1-5% at least

33% after deducted everything.

You try to come out with your own costing then you know d. Imported Machinery. Imported Beans. Maintenance. Overhead costs. You sure can sell RM5 per cup. Can you even sustain? Kek.

Don't forget electricity n water, those commercial rates are killers

Banker told me , the easiest way to burn your money is open a cafe.

Just a bit what I learned from one of the owner who recently closed down his cafe.

According to him, its been tiring few years for him coz there's so many competitors nowadays and he has had to move his cafe location a few times due to various reasons e.g. covid, gangster.

in the end now, he said better go back to corporate life and that's what he did.

It currently costs about RM1.80 per cup of high grade coffee. Source: cafe owner.

overhead leh ??.. u need overhead cost for operation,..

u also need to project how many cups u gonna sell daily,.. if 100 cups per day rm5 profits, rm500 / day can cover cost,..

This post has been edited by Cincai lar: Nov 4 2022, 11:31 AM

only RM1.80? I expected higher. What about those single origin beans?

bruh they also think earning 20k is normal

then ask themselves show their payslip its not even 20k

what do you expect

This post has been edited by Knnbuccb: Nov 4 2022, 12:09 PM

huh so little only, fk it might as well be an office drone worker

last time i heard my small town kopitiam corner lot, those taukeh do drinks and then rent out space for stalls can rake in 20k -30k per month
pretty sure their overheard wont be high like those atas cafe, dont think their overhead is even 10k. main bulk is rental, which i heard was going for like 7k a month (that was what pizza hoot paid for a similar shoplot )

they just rent out space and make drinks, those drinks cheapo one.... little bit of tea leaves can make one big jug of tea and serve into many cups... worker also hire foreigners...

This post has been edited by Knnbuccb: Nov 4 2022, 12:16 PM

How many here actually runs business?

upfront capital for renovation and regulatory fees also mahal one. if you ended up with crazy bloodsucking landlord who snuck in one-sided contracts (eg: like hidden fees for whatever reason) you will also kena. my fren spent 200k on a food cafe but tutup about 8 months later.

overhead cost tak kira you die wor

After factoring in rental cost, staff cost, increases raw material cost, utility cost, you'll be lucky to breakeven

No

Location is the most important thing

Heavy footfall is very important

Otherwise your cafe is an afterthought

The best location is with captive market like office Ground floor

How much u expect to pay if you have volume

The price in your mind is for 200g 1kg or 20kg bulk

Just curious, maybe I'm paying too much or too little for my bulk haha

Impossible 80% la..

My profit around 30% - 60% only

Then also got ppl say experience, mahai...

They might just eat grass outside

Coffee machine Rm20-Rm30k
Barista/waiter/ - 10k/month
Renovation 50-80k
Electricity/Water/Internet 1k-2k

Shop rental RM5k-10K/month

Misc Wastage (broken stuff, expired goods, aircond service etc) Rm500/month

This post has been edited by Drian: Nov 4 2022, 01:59 PM

Few decades ago, CoG meant center of gravity to me. Now CoG means cost of goods. But you should aim for 38-40%.

I thought machines are mostly rented, tied to contract? no?

Most likely, but that makes it more expensive per month.

1k/month for coffee machine rental alone.

How to explain when the cafe charge you RM 4 for a glass of water, when there are sundry shops nearby selling RM 1 per bottle?


Food price all above RM 30. Yet there are nearby competitors and yours quite full everyday.

T20 area?

yeap. i dont step into the place ever. used to go help out for fun on sat/sun. but busy now. i purely take the profit 100% as the sole owner

They don't have the same costs. For sundry shops, water is an item used to draw in people so they buy more stuff. Go in for Rm1 water, also buy some bread/snacks. The renovation, equipment and staffing costs are different as well.

Generally, the RM4 is to deter you from ordering water, and to order drinks. If anything, you can use that as a benchmark as to what "profit" each drink makes. The price of the water would definietly be more than the profit of the other drinks.

got aircon can charge more, boss say today got open aircon