1. Profit Per Cup: Your Revenue Starts Here

The foundation of a coffee shop’s profitability begins with the sale of each individual cup. While it may seem like a modest transaction, coffee offers some of the highest gross margins in the food and beverage industry. A standard cup of coffee in the UK typically sells for between £2.50 and £3.50, depending on factors like portion size, product quality, and regional pricing. The Cost of Goods Sold (COGS) for that same cup, covering essentials like beans, milk, takeaway cups, lids, and even stirrers, generally falls between £0.70 and £1.00.

That leaves a gross profit margin of around £1.50 to £2.50 per cup, or approximately 60% to 70%. This is before accounting for any overheads or staffing costs, which are deducted from the final net profit. However, this high-margin product gives cafés an excellent base from which to build sustainable income. By offering add-ons such as premium syrups, plant-based milk, or baked goods, you can further increase your average transaction value and enhance overall profitability.

2. Weekly Sales: Scaling Daily Profits into Real Revenue

When multiplied across consistent daily customer traffic, the profit from each cup of coffee can generate impressive weekly revenue figures. For example, let’s assume your coffee shop sells an average of 200 cups per day, with an average selling price of £3.00. Over the course of a week, this equates to 1,400 cups sold. Multiply this by your average gross profit of £2.00 per cup, and you’re looking at approximately £2,800 in weekly gross profit, with a total weekly revenue of £4,200.

These figures can vary depending on location, foot traffic, competition, and menu variety. However, in busy urban or high-street settings, reaching this level of sales is entirely feasible with the right marketing, customer service, and product offering. Additionally, implementing loyalty programs, offering seasonal promotions, or extending opening hours can further increase your weekly customer count and average spend per visit.

3. Monthly and Annual Profit Estimates

When weekly figures are scaled across the month and year, they highlight the long-term revenue potential of a successful coffee business. Continuing with the same example, a weekly gross profit of £2,800 equates to approximately £11,200 per month and £134,400 annually, before expenses. These numbers underscore the potential of the coffee shop model when supported by efficient operations and consistent customer engagement.

Of course, it's important to remember that these are gross profit figures and do not yet account for operational costs like rent, wages, utilities, or inventory replenishment. Still, having a high-volume, high-margin product like coffee gives you a strong advantage. Effective management of these costs will determine your net profit, and ultimately, how much money ends up in your pocket at the end of the year.

4. Operating Costs: What Will Eat Into Your Profits?

While gross profits from coffee sales can be strong, operating expenses will significantly impact your actual take-home earnings. These costs can vary widely based on your shop’s size, location, staffing levels, and the scope of your product offering.

Here are some common operating costs to plan for:

• Rent: Prime locations come with a price. Expect to pay between £1,500 and £3,000 per month, depending on whether you're based in a high-traffic urban area or a quieter suburban spot.

• Wages: Staffing is one of your largest monthly expenses. Hiring trained baristas, part-time staff, and potentially a manager could cost between £8,000 and £12,000 per month.

• Utilities: Gas, electricity, and water can total around £300 to £600 per month, though this can fluctuate seasonally.

• Insurance & Licensing: Business insurance and licenses usually range from £100 to £300 monthly.

• Marketing & Advertising: Whether you're using social media ads, loyalty apps, or printed flyers, allocate at least £200 to £500 per month for visibility and customer acquisition.

• Inventory (non-coffee items): Milk, pastries, cleaning supplies, and seasonal items can cost £1,000 to £2,000 monthly.

After deducting all of these expenses, net profit margins for well-run coffee shops typically fall between 10% and 20%. Smart inventory control, energy-efficient equipment, and staff scheduling optimisation can all help increase your bottom line.

5. How EP Finance Can Help Your Coffee Shop Succeed

Whether you're just beginning your coffee journey or looking to expand to a second or third location, access to the right funding can make all the difference. At EP Finance, we understand the specific needs of hospitality businesses and provide tailored financial solutions designed to support your goals at every stage.

Our funding services include:

• Equipment Finance: Spread the cost of commercial coffee machines, grinders, blenders, refrigeration, and furniture without straining your cash reserves.

• Working Capital Loans: Get the liquidity you need to cover wages, rent, inventory purchases, or marketing expenses during quieter trading periods.

• Merchant Cash Advances: Ideal for coffee shops with consistent card sales, these offer fast access to funds based on your future revenue.

• Business Growth Loans: Whether you're adding a kitchen, launching a second site, or developing an online ordering system, we can help you secure the funds to scale confidently.

By working with EP Finance, you can access competitive rates and expert guidance, ensuring your financial setup supports your long-term success.

Brew Up Your Business Success

While coffee shops have excellent profit potential, your success will ultimately depend on more than just selling lattes. Understanding your margins, managing operational costs, and securing the right financing are all critical to building a profitable and sustainable business.

At EP Finance, we’re here to help you make it happen. Our team has years of experience helping entrepreneurs in the hospitality industry unlock funding and growth opportunities. Contact us today for a no-obligation consultation and take the next step toward opening - or expanding - your coffee shop with confidence.