Starting a café in India can be a rewarding venture, but it requires careful planning, particularly when it comes to budgeting. Below are some key budget planning ideas to consider:
1. Initial Capital Investment
- Location Costs: Location is crucial for a café. Costs will vary depending on whether you choose to rent, lease, or buy. In urban areas, rents can be higher, but visibility is key. Estimate ₹50,000–₹2,00,000 per month for rent in a mid-tier city.
- Café Interior & Setup:
- Furniture: Comfortable seating, tables, counter space, etc. Budget ₹1,00,000–₹5,00,000 depending on the size and theme.
- Décor & Ambiance: Lighting, wall art, and other aesthetic touches. Set aside ₹50,000–₹1,50,000.
- Renovation: If the location requires structural work, plumbing, or electrical setup, budget ₹1,00,000–₹3,00,000.
2. Licenses and Permits
Acquiring proper licenses is essential:
- Food License (FSSAI): ₹2,000–₹5,000.
- Health Trade License: ₹500–₹3,000.
- Shops & Establishment License: ₹1,000–₹10,000.
- GST Registration: Free (but ensure compliance).
- Music License: ₹10,000–₹20,000 (if you plan on playing music).
3. Equipment Costs
Investing in good-quality equipment is essential for efficiency and product quality. Estimated budget:
- Coffee Machines: ₹50,000–₹2,00,000.
- Grinders, Blenders, Juicers: ₹30,000–₹1,00,000.
- Refrigerators & Freezers: ₹50,000–₹1,50,000.
- Ovens & Baking Equipment: ₹50,000–₹2,00,000 (if serving baked goods).
- POS Systems & Billing Software: ₹10,000–₹30,000.
4. Staffing Costs
Staff expenses can be a significant recurring cost:
- Baristas/Cooks: ₹12,000–₹25,000 per month per person (depending on their experience).
- Cleaning & Maintenance Staff: ₹8,000–₹15,000 per month.
- Manager/Cashier: ₹15,000–₹25,000 per month. Consider having 3–6 staff members to start, based on your café’s size and customer flow.
5. Inventory and Supplies
Monthly recurring costs for ingredients:
- Coffee Beans, Tea, Milk: ₹15,000–₹50,000 per month.
- Snacks, Bakery Items: ₹10,000–₹30,000 per month.
- Packaging (for takeaways): ₹5,000–₹15,000 per month.
- Cleaning Supplies: ₹3,000–₹7,000 per month.
6. Marketing and Promotion
Marketing is crucial, especially in the initial stages of building brand awareness:
- Social Media Marketing: ₹10,000–₹30,000 per month.
- Flyers, Banners, Local Ads: ₹5,000–₹20,000.
- Opening Promotions/Discounts: Budget for promotional giveaways or events, ₹10,000–₹30,000.
7. Miscellaneous Costs
- Electricity & Water: ₹10,000–₹25,000 per month.
- Internet & Phone: ₹2,000–₹5,000 per month.
- Insurance: ₹5,000–₹20,000 per year (for fire, liability, etc.).
8. Contingency Fund
Always have a contingency fund to cover unexpected expenses such as repairs, equipment failure, or unplanned operational issues. Allocate 10–15% of the total budget.
Sample Budget Breakdown for a Mid-sized Café:
| Category | Estimated Cost (₹) |
|---|---|
| Rent (6 months advance) | ₹3,00,000–₹10,00,000 |
| Café Setup (interiors, furniture) | ₹2,00,000–₹6,00,000 |
| Equipment | ₹2,00,000–₹5,00,000 |
| Licenses & Permits | ₹20,000–₹50,000 |
| Staffing (3-6 months) | ₹3,00,000–₹6,00,000 |
| Inventory (initial stock) | ₹50,000–₹1,00,000 |
| Marketing & Promotion | ₹50,000–₹1,00,000 |
| Miscellaneous (utilities, etc.) | ₹50,000–₹1,00,000 |
| Contingency Fund | ₹1,00,000–₹2,00,000 |
Total Estimated Initial Budget: ₹10,00,000–₹30,00,000
Tips:
- Start Small: Begin with a smaller space and a limited menu to reduce costs.
- Negotiate Leases: Try to negotiate lower rents or rent-free periods.
- Cloud Kitchen: Consider starting as a cloud café (without seating) to save on space and overhead costs.
Would you like specific insights into any of these areas or assistance with financial projections? You can schedule a free call advice from our Experts.