How to Buy an Existing Drive-Thru Coffee Stand Business

How to Buy an Existing Drive-Thru Coffee Stand Business

Buying a Drive-Thru Coffee Stand Business

There are many great ways to start a drive-thru coffee stand. Depending on your estimated coffee business budget, you'll likely explore various coffee shop ideas and settle on a concept that suits you. There is simply no shortage of coffee concepts! 

Typically, there are three general ways to start a drive-thru coffee business. These include:

• Investing in a coffee franchise
• Starting a coffee drive-thru shop from scratch
• Buying an existing coffee stand business

These options may contain advantages and disadvantages. This post will discuss elements you will want to consider when buying an existing independent drive-thru coffee stand.

No doubt, buying an existing drive-thru coffee stand business can be an affordable, faster, and easier way to enter the retail coffee market – if it's done right.

Indeed, depending on where you live, you may or may not have the option to buy an existing drive-thru coffee stand. They simply might not exist, or there may be none currently for sale. This may mean you must set up a new coffee stand from scratch. And that's okay, too. Additionally, you may also consider starting a coffee truck. However, in this post, we'll focus on drive-thru coffee businesses.

Now, you may have already Googled the term:

“Coffee Stands for Sale Near Me”

This is a common Google query.

It may produce recent drive-thru coffee stand ads that may pique your interest. Alternatively, a quick search on websites like Craigslist for terms like “coffee stand for sale” will probably expose a variety of drive-thru purchasing options that you have available in your region.

While there may be some great opportunities, be cautious of the wayside coffee stand business being sold on Craigslist or other online advertisement boards. After all, many bad deals are out there waiting for the unsuspecting new owner.

To avoid a drive-thru coffee stand business disaster, it's essential to research what's available. However, you will want to be careful and take your time.

Despite our sincere word of caution, however, there may be a few diamonds out there.

By understanding your business's vision, you can avoid many common mistakes made when purchasing an existing drive-thru coffee stand.

This is why it's essential to write your coffee shop business plan first to understand what you want and what type of coffee stand you will need. 

There are clear advantages and disadvantages to starting a coffee business from scratch versus buying an existing drive-thru coffee stand. You will want to understand all of them as they pertain to you and your specific situation. Knowing what you want always makes you a much better negotiator. 

How to Buy an Existing Drive-Thru Coffee Stand Business

How should you prepare to buy a drive-thru coffee stand business?

Before purchasing a drive-thru coffee stand business, you should:

• First, be patient – don't jump at the first drive-thru coffee shop you see.
• Ask questions diligently – the more you know, the better decision you will make.
• Never compromise –  when it comes to getting the answers you need.

Drive-thru coffee stands come and go on the market, so be patient. The more deliberate you are with getting the answers you need, the more prepared you will be. Use the available data to move forward—or not—before taking over an existing drive-thru coffee stand business. You will avoid a potential disaster by being diligent with your questions, getting the answers you need, and being patient.

Further Reading: How to Buy a Coffee Truck

How to Buy an Existing Drive-Thru Coffee Stand

You don't want to buy a failing drive-thru coffee business.

Sinking thousands of dollars into a coffee stand business, which was poorly run, poorly built, poorly maintained, and poorly branded, only to have to spend thousands more to get it up and running efficiently.

Remember that a coffee business requires multiple parts to run smoothly– all of which must function before you pour your first coffee beverage.

When presented with a drive-thru coffee shop for sale, should you buy it?

This article proposes several essential questions to answer before buying an existing drive-thru coffee shop business. Since each location and drive-thru coffee stand business is different, you may need to develop other questions about yourself and your situation.

Having the answers before signing a property lease or spending any significant money may require some thought, research, and planning.

This investment in time, research, and diligence will help you avoid making a poor choice.

We know that emotions can play a big role in buying a coffee drive-thru stand (or any business). You aim to recognize this fact and then do all you can to avoid basing your decision on emotions.

We recommend obtaining hard data to analyze whether the drive-thru coffee stand is worth your money, time, and emotional investment.

The hard data helps remove the emotional factors that lead to future hardship and money loss. So, again, try to remove all emotion from the decision-making process, and you will fare much better as you move forward.

Buy an Existing Drive-Thru Coffee Stand Business

Buying an independent drive-thru coffee stand or a franchise is another option to jump into the retail coffee business.

How to Buy a Drive-Thru Coffee Business Step #1

Write a Business Plan for Your Drive-Thru Coffee Stand

A well-written business plan for your drive-thru coffee business is vital before you launch.

Within the plan, you will want to detail how you will obtain your drive-thru stand. For example, you will want to write that you intend to buy an existing drive-thru coffee shop, or if you cannot find an existing drive-thru coffee shop business to your liking, you will either build one, rent, or purchase a used one.

You will want to have a general idea of your drive-thru coffee stand budget – and determine what you can and cannot afford before entering into negotiations for your business.

How to Buy a Drive-Thru Coffee Business Step #2

Determine What is For Sale

When buying a drive-thru coffee stand, you want to determine what exactly is for sale. Unfortunately, many ads featuring drive-thru coffee stands for sale are posted with various pictures and vague language. Commonly, they may include a general price and location.

There may or may not be any mention of the coffee equipment and other important items essential for running your business. In addition, the actual condition of the structure, the plumbing, the electrical work needed, or the current ownership may also be vague.

You should also ask for essential information, such as: 

• What's the condition of the existing coffee equipment?
• What are the lease terms?
• What are the daily sales numbers?

Additionally, you will want to determine if the business has any existing debt that could come back to haunt you if you purchase the business outright. 

Buy a Drive-Thru Coffee Stand

How to Buy a Drive-Thru Coffee Business Step #3

What’s The Property Lease Situation

You must know the existing lease details. Many coffee stand businesses will find it convenient to leave after a few years in business when their property lease is up or coming due.

Find out how much time is left on the actual property lease, who owns the property, and whether they are willing to re-negotiate a property lease that works for you. Make sure you read the existing lease. Don't take anyone at their word. Read the signed lease yourself!

Please note: You should consider investing in our Complete Coffee Shop Startup Kit, which has an audio interview on signing your property lease for your coffee business.

Your property leases can either sink your business or make it easier for you to be profitable. Your lease contains many provisions regarding what you can or cannot do at your business, including additional investments or remodels. It includes items such as electricity, water, plumbing, and trash disposal.

Other items can be included in your property lease, such as signposting requirements, exterior lighting, and outdoor seating. Your property lease can also limit what's on your coffee menu board, your hours of operation, your bathroom access, and security.

Knowing the terms of the existing lease will give you the best indication of what kind of experience your business will start with.

Current Rental Terms for Your Drive-Thru Coffee Shop?

While the monthly rent is important to your monthly budget, you should know how the leasing terms will develop or unfold over time.

For example, your rent may be $1000 a month and increase to $1250 a month in the second year, and $1700 a month in the third year, and so on. Will this be sustainable for you?

While this may not be your specific situation, the fact is that you need to know the conditions and terms of the existing lease that is currently in use – and how it will unfold year over year.

The property lease may often not be renegotiated until the lease expires. Therefore, if you purchase a coffee stand business during the middle of an existing lease, you likely will be required to operate under the terms of the previous property lease negotiation.

When reviewing the terms of your property lease, you will want to examine everything that is allowed, including items not explicitly stated. For example, some property owners may restrict the types of food or beverages that can be served or limit the use of outdoor signs or seating areas. This could be detrimental to your drive-thru coffee stand business.

Additionally, it is essential to understand basic questions beforehand. For example, will you be responsible for food waste and recycling? Are there any restrictions on remodeling a pre-existing facility or structure? Are there extra security or pest control charges within a specific business district or property area?

While some of these may not be specifically a part of the lease, you may still need to adhere to a business district's jurisdiction and subsequent regulations.

How to Buy a Drive-Thru Coffee Business Step #4

Your Drive-Thru Coffee Stand Commercial Commissary

Your drive-thru coffee stand may need a commercial commissary. 

Every drive-thru coffee stand needs the space and facilities to satisfy commissary functions. But unfortunately, we’re not aware of one municipal or zoning area in the United States that does not require a commissary (or something like a commissary) to meet the health department’s code requirements.

Speaking of the health department, many drive-thru coffee stands struggle to obtain the necessary permits to open due to structural challenges. Therefore, a commercial commissary may be required.  

As a result, if you buy a “stand-alone” drive-thru coffee business structure from someone who currently has it in storage, ensure you have sufficient space, plumbing, and other necessary equipment to properly serve your coffee and beverages.

If a commercial commissary is needed, where will it be located? Will that be part of the lease, or will you need a separate lease with the same property owner or a different one?

Highly Recommended: Our Complete Coffee Shop Startup Kit also includes a detailed discussion with a health department representative, which is valuable for any new coffee business owner to hear.

How to Buy a Drive-Thru Coffee Business Step #5

Look at Existing Vendor or Service Contracts

This may sound obvious, but your drive-thru coffee stand business requires you to sell items to your customers to generate revenue.

Unless you plan to make everything “in-house,” you must decide on vendors to work with. Unfortunately, many coffee stand owners wait until the last minute to decide which vendors to choose from. The vendors you work with will be crucial partners in the success of your drive-thru coffee stand. Overall, your relationships with them will impact your products and services, and thus your reputation and the smooth operation of your business.

More importantly, the vendors that you work with impact your bottom line. Therefore, thoroughly examining what you'll be getting yourself into is crucial!

While most vendor and service contracts are flexible or reasonable, some may not be. And you don’t want to be bound by existing or carry-over contracts that may limit your menu options.

Before purchasing the drive-thru coffee stand, find out (and get proof in writing) that no outstanding vendor or service contracts are tied to the existing coffee stand business.

For example, are you responsible for paying interest or payments on any equipment tied to current vendor contracts or obligations? Are you committed to serving a specific coffee roast or ordering a set quantity of product each week or month? Do you owe any money or taxes?

Takeaway points:

• Do your own research with potential vendors first.
• Understand which contracts will transfer over (and their details)
• Assess whether existing contracts fit with your business concept

How to Buy a Drive-Thru Coffee Business Step #6

Determine Your Permits

When buying a drive-thru coffee stand business, you need to determine the status of the existing licenses and permits. Are they transferable in your area? Have there been any infractions or issues regarding permitting this particular business?

Each city and county has its own rules, regulations, taxes, level of enforcement, and procedures, so they will become partners as you begin to take over the coffee stand business.

My recommendation is that you make a few phone calls before purchasing an existing coffee stand.

Some of the things you can find out are whether the current owner has had any compliance challenges. Or whether upcoming changes to a business district or new rules can impact your taxes, your signs, or any other business activity.

How to Buy a Drive-Thru Coffee Business Step #7

Study Existing Profit & Loss Statements

If your business negotiation is transparent, the seller of the drive-thru coffee stand should be willing to share the last year (or two) of P&Ls (Profit or Loss Statements). These financial documents essentially inform the reader of the amount being spent, the amount being earned, and the difference between them. Obtaining accurate P&L statements is essential, yet it is often overlooked.

If your drive-thru coffee stand business costs you $6K to maintain and operate monthly, but your P&Ls show only a $500 profit ($6,500), you must consider whether the business is worth purchasing. Can you cover your personal labor expenses and pay off any business-related interest with these margins?

Again, we recommend that you:

• Take a look at the receipts for a given period.
• Analyze existing financials
• Count customers for at least three business days to ensure you have a decent customer base.

How to Buy a Drive-Thru Coffee Business Step #8

Count Customers Before Buying Your Coffee Shop

While P&Ls (Profit & Loss Statements) are important to see and analyze, you should not merely depend on them. In fact, you should also consider counting customers. Counting customers is essential in your “due diligence” process. We offer resources on the best practices of counting customers in our Coffee Shop Startups blog.

Counting customers lets you see (and quantify) firsthand what your sales outlook entails. In addition to providing you with valuable and actionable information, you can also examine who your customers will be, what they are interested in purchasing, and how long they will stay. This, of course, only matters if you intend to operate on the same site.

If you intend to operate your drive-thru coffee stand business on the same site, counting customers can help you determine if you have a viable coffee stand business.

Choosing The Best Drive-Thru Location

Check Out the Surrounding Area and Do Your Market Research

Let's say you found a promising drive-thru coffee stand business and have done the initial research. So far, things look great. But as you drive away from your future drive-thru coffee stand, you notice a “Proposed Land Action” sign near the location.

You stop and read the proposed notice, which reads that the area will be turned into a freeway on-ramp. How will this construction impact your coffee stand business? While it may be beneficial in the long term, all traffic would be diverted elsewhere for the next two years.

Consider another scenario: the notice sign states that a big-box store or nearby strip mall will be converted into a condo project. How would that impact your sales – before, during, and after the construction is completed?

Construction and changes in nearby businesses can impact your drive-thru coffee business, too. Checking out the area you plan to invest in is critical for any business, especially coffee businesses, sensitive to the community's conditions.  

Take time to get to know your potential neighbors and customers by talking to local businesses, researching any demographic data, and working with other large organizations (such as churches, schools, etc.).

What do customers think of the drive-thru coffee stand?

Many drive-thru coffee stand postings on Craigslist do not include their business names. This may be for fear of notifying employees or for some other reason. Often, this makes researching a coffee business challenging before approaching the coffee stand owner.

My recommendation is to call first, get the business's name, and check out the online reviews and social media accounts before visiting the place for yourself.

What is being said about them? Do they have a loyal following? Are there any negative reviews? Will you have to climb out of a dark hole when it comes to the coffee stand's existing reputation?

Don't be mistaken: there is significant value in an existing business's good name or goodwill within a community. But conversely, a damaged reputation (even if very slight) can have an impact on your bottom line. In fact, “goodwill” is often a valuable factor in a business negotiation.

Perhaps consider being a customer before meeting with the owner and determining the quality of customer service for yourself.

Buying a Drive-Thru Coffee Stand

How to Buy a Drive-Thru Coffee Business Step #8

Determine Why The Coffee Shop Owner is Selling

Why is the drive-thru coffee stand owner selling their business? This is a good question and needs to be understood thoroughly. Beware of coffee shop owners who have just set up their espresso business only to sell it within a year or two simply because they “lost interest” or they are “suddenly retiring.”

Retirement can be seen a decade or so down the road, so getting into a coffee stand business only to retire after 7 months in business may not present a full, honest picture. Are they leaving because the coffee business isn't making a profit? Are they leaving because of health code violations? Or… are they really simply moving on to a different chapter of their lives?

Determining why someone is leaving their business and why they are seeking someone to replace them is crucial to understanding.

• Who are the competitors?
• Who will your customers be?
• How are other similar coffee shops and coffee stands performing in your area?
• What are other factors that exist in your area that may impact your business?
• Which vendors are available to work with?

How to Buy a Drive-Thru Coffee Business Step #9

Get The Knowledge You Need

Certainly, opening a drive-thru coffee stand business can be a worthwhile and profitable venture if it aligns with your vision.

Examining all aspects of the existing coffee business will help ensure that you don’t lose money over the deal. Get all the information you need before taking the plunge.

While nothing is 100% foolproof, taking steps to minimize your risk exposure will ultimately benefit you in the long run.

That is why we believe that regardless if you feel confident in your upcoming purchase, you should consider listening to the experts and coffee veterans in our coffee shop startup guide.

It will not only increase your knowledge base but help you review many of the important aspects of a coffee drive-thru stand that should not be overlooked.

Recommendation: Pinch Yourself If You Start Seeing Stars!

Okay, you found a great-looking coffee stand. Right now, everything is looking dreamy. The coffee stand is “perfect,” the location is “perfect,” and the financing looks “perfect.”

But…don't empty your bank account just yet.

Remember to take the emotional aspects out of the purchase before you buy it. Instead, your concern is, will your coffee stand turn a profit? And when?  A good barometer for that answer is how the coffee stand is currently doing.

This is our recommendation: Have someone who genuinely cares about you pinch you. Then, take a step back, breathe, and revisit your business plan.

Go through it with someone. Ask your friend to play devil’s advocate and then sleep on it for a few days. If you've heard the “other side” and have had a few days to get over your infatuation state of mind, and you still feel positive about it, then it may be a good time to take the next step.

How to Buy a Drive-Thru Coffee Business Step #10

Back Away From Pressure Tactics

Starting a coffee business can be a life-changing venture. It can also be very costly too. The more time you spend planning and understanding your core business, the more you will save, prosper, and profit.

So, don’t respond to the business owner's added pressure to buy the business. Every good business owner knows you need time to review the information you have collected and crunch the numbers.

Again, don’t respond to pressure tactics! Just because the current owner wants to “retire” by a particular date or “leave the country” by this coming Sunday doesn’t mean you need to rush into making a purchase.

A common tactic sellers use is to tell you (or a prospective buyer) that they have other serious people waiting. They will inform you that you need to decide by 6 pm tonight, or they will proceed with another buyer. If you haven’t had a reasonable time to review the business and documentation, simply skip this “great opportunity.” You will be glad you did!

Buying a Drive-Thru Coffee Stand

Buying a Drive-Thru Coffee Stand Business By Itself?

Many businesses or coffee stand owners may be selling only the coffee stand itself. They might be storing the coffee stand in the warehouse or their backyard. The only thing for sale is the business shell. Remember, you still need to find a permanent location, coffee stand equipment, inventory, and negotiate storage.

Consider all of these points before spending thousands on only the “shell” of the drive-thru coffee stand business. Next, examine the physical integrity of the coffee stand. Does the stand require plumbing, electrical installation, or repair? Will it need painting, insulation, or other work? Finally, will it meet the building code standards for your state?

This is critical because you could purchase a stand for $10,000, only for it to fail to meet the basic requirements of your state or county building code. Before making a purchase, check with your local building department. Make a phone call or pay a visit to your building department before purchasing the coffee stand.

How to Buy a Drive-Thru Coffee Stand Business

As you can see, there are a few key factors to consider when purchasing an existing drive-thru coffee stand business.  Let us summarize how to buy a drive-thru coffee business in the list below:

• Determine what is for sale exactly.
• Have all the existing lease details.
• How will you solve your commissary requirements?
• Are there any existing vendor service contracts?
• What are the current zoning requirements?
• See the profit or loss statements.
• Count existing customers.
• What are the community's opinions of the drive-thru coffee stand?
• Why is the customer selling their drive-thru coffee stand?
• Avoid pressure tactics from the owner.

Buying a turnkey drive-thru coffee stand business has plenty of benefits, but choosing the right one with all the elements discussed will be important before you write out a check or transfer funds. 

Are You Ready To Get Started?

How to Start a Drive-thru Coffee Shop

Coffee Shop Startups

Based in Seattle, Washington, USA, Coffee Shop Startups is dedicated to providing you with the most relevant information on how to start a coffee shop business successfully. Over the last 11 years, we've helped thousands of aspiring coffee business owners worldwide. We harness the experience, wisdom, and knowledge of many successful coffee shop owners to help you increase your chances of success and profits. We support business owners who want to start a coffee business by providing them with valuable information on starting their coffee business successfully.