How to Start a Coffee Shop in Texas
How to Start a Coffee Shop in Texas*
The Ultimate Guide to Start a Coffee Shop
Want to start a coffee shop in Texas? If so, then you are in luck. Texans love their coffee. From the Texas Panhandle to the Gulf, From East Texas to El Paso, coffee shop entrepreneurs will find a fertile landscape for coffee shop success.
The reasons why the state of Texas is a great place to start a coffee shop are based on:
- Steady population and economic growth
- Texas offers a business-friendly environment
- There are less per capita coffee shops compared to other competitive cities
According to the U.S. Census Bureau, Texas had the largest population increase of any state between 2010 and 2020, with an additional 4.2 million residents.
The growth of certain coffee-friendly industries, like big tech, large universities, and commuters who historically love coffee, make Texas a great opportunity for starting a coffee shop business.
In a recent study, Austin was named Texas's best “Coffee City.” But other cities fare well, too. San Antonio, Houston, Dallas, Plano, and El Paso—and everywhere in between—offer unique opportunities for retail coffee.
Further Reading: How to Start a Drive-Thru Stand in Texas
Coffee Shop Opportunities in Texas
Why Is Texas Great for Starting a Coffee Shop?
There are plenty of retail coffee opportunities in the state of Texas, from opening a coffee shop in San Antonio, a coffee truck in Austin, or a drive-thru coffee shop anywhere in between.
According to a 2021 report by the National Coffee Association, daily coffee consumption among Americans reached 62% in 2020, up from 57% in 2016.
Texas, with its large and diverse population, reflects this national trend, presenting ample opportunities for coffee shop owners to cater to a growing market.
In general, Texas is a great place to open a coffee business. It’s among the few states with no personal or corporate state income tax.
Texas has an incredibly diverse workforce, which makes it the 9th largest economy in the world. The state is projected to be among the top states that will open a business in the U.S. People need coffee with all those jobs!
Lower taxes and infrastructure investment make Texas a top place to open a coffee business. With its open roads and highways, Texas is a perfect place to start a drive-thru coffee stand or a mobile coffee business.
Room for Retail Coffee Growth in Texas
Texas has nearly 7,000 coffee shops, according to IBISWorld. While this might seem like a lot, it actually means there is plenty of room for growth. Even though Texas has thousands of coffee shops, currently, no Texan city ranks in the top ten in the highest coffee shops per capita in the U.S. That means in every major city and small town, there are coffee business opportunities!
Start a Coffee Shop Business in Texas
A Strong Drive-Thru Coffee Stand Opportunity
Texans love coffee and cars. This highly dependent car culture means that there are plenty of opportunities to start a drive-thru coffee stand business in the state. Drive-thru coffee stands offer convenience and cater to a large population with plenty of cars and many hours per week commuting to work and school.
When it comes to Texas, we know:
- Texans drive everywhere
- There is a love of drive-thru businesses
- Texans love coffee
- Lower competition (when compared to other states)
- Low personal state taxes
- Projected economic growth
Of course, before choosing where to set up shop, each neighborhood and coffee business location must be individually analyzed and studied to determine if opening a coffee business is suitable. However, due to Texas' size, high rate of cars per capita, and love of convenience, opening a drive-thru coffee stand may be a viable coffee shop concept to consider.
Start Your Texas Coffee Shop Business
Step 1: Decide on a coffee business concept
There are plenty of great coffee shop concepts that would work in Texas. Pick something that works for your customers at your location and does well against the competition. But most importantly, pick a concept that inspires you and motivates you to be the best coffee shop owner you can be.
Step 2: Determine your coffee menu
Texans have a diversity of tastes, wants, and needs. Understanding who your target market is will help you decide what type of coffee menu you’ll be offering. First, come up with a simple menu, and then grow it out from there.
Step 3: Develop your coffee brand
Like elsewhere, coffee drinkers in Texas value reputable brands, including their coffee! After you know what concept you are aiming for in the coffee shop menu you will offer, you’ll be able to get a good handle on what type of coffee brand to start and will resonate with your customers.
Step 4: Write a coffee shop business plan
Texans don’t like to waste money. Writing all of your thoughts down in a business plan will forge your plan of action. Articulating all your plans can help you save money.
Step 5: Determine your budget
One of the centerpieces of your coffee shop planning is determining your budget. While costs are typically less expensive in Texas than elsewhere in the country, your costs can still run away from you without a proper budget.
Step 6: Secure your funding
After determining your coffee shop budget, you’ll want to determine your coffee shop funding mix. This will help you understand HOW and WHERE you will get your money.
Step 7: Establish your business entity
Early in the process of setting up your coffee shop in Texas, you will need to set up your business with the Texas Secretary of State’s office. You’ll have a variety of business structures to choose from, though many independent coffee shop owners enjoy the benefits of forming an LLC.
Step 8: Find a great location
Texas is a big state. There are lots of potentially great locations for your coffee business. You’ll want to choose a coffee shop location that works best for you in several important ways. Consider reading two posts:
Step 9: Choose your coffee equipment
Picking your coffee equipment will be based on your menu. Now that you’ve secured a coffee shop location and are working on the coffee shop build-out, you’ll want to pick commercial equipment that will optimize your operation.
Step 10: Choose your coffee beans (inventory)
Your coffee shop’s success is ultimately based on whether customers love your customer service and your coffee. Explore local coffee roasters who provide wholesale coffee beans. We explore this topic in our post, How to Choose a Wholesale Coffee Roaster.
Step 11: Hire and train your baristas
Training your employees is a big part of your success. Offering your staff regular barista training will save you money on the back end – offering better service products, less waste, and improved employee morale. Whether you hire a coffee trailer or offer to pay for online barista training courses, you'll get more than what you pay for.
Step 12: Host your grand opening
Everything in Texas is big! Consider having a coffee shop grand opening that creates a buzz, energizes new customers, and draws awareness from your neighbors and likely customers.
How to Start a Coffee Shop in Texas
Texas Business Links
Texas Business Structure Setup
Where to set up a Coffee Shop Business in Texas
Register Your Business in Texas
Where to register your business in Texas
Texas Food Handler's Information
Texas Food Handler's Info
Buying an Existing Texas Coffee Shop?
If you are buying an existing coffee shop in Texas. You should consider obtaining a “Certificate of No Tax Due.” In Texas, this is usually done through the Comptroller's Office: Texas Comptroller Office
Texas Licenses and Permits
Permits and Licenses Needed to Start a Coffee Shop in Texas
Start a Mobile Coffee Shop in Texas
How to Start a Coffee Truck in TX
Coffee Shop Startups
Requirements to Start a Coffee Shop in Texas
Once you're ready to make your business office, you must structure your coffee business.
You likely create an LLC for your coffee shop through the Texas Secretary of State's office or a similar office that handles business formations.
There are a lot of benefits to forming an LLC or a corporation. It generally protects you from personal liability in an unfortunate event, accident, or negligence. Further, it will help you apply for your EIN, open a business banking account, and other essential business activities.
In addition, doing business in Texas means acquiring various permits and licenses at the state and local levels.
A few of the coffee shop requirements are below:
- Business formation (LLC or Corporation)
- EIN (Employee Identification Number)
- City Business License
- State Reseller's License
- Fire Department Occupancy Permit
- County Health Department Permit
- Building's Department
- Food Handler's Permit
There may also be other permits and licenses that you'll have to have, so be sure to check.
Further Reading: Requirements to Open a Coffee Shop
Start Your Coffee Shop in Texas
How Do You Start a TX Coffee Shop?
Research
Texas is much larger than many countries. Therefore, you must honor the need to do the necessary research for your specific location. Every Texas region and county produces its own challenges and opportunities. Explore the existing competition, target market, and needs of the community.
Develop Your Concept
Developing your coffee shop concept specifically tailored to your target market will be one of the most important things you want to focus on. Start with the basics: Do you want to open a brick-and-mortar coffee shop? Are you interested in setting up a mobile coffee business, or do you want to start a drive-thru coffee shop?
If you want to spend less money, you might consider starting a coffee cart or an online coffee business.
Your concept choice depends on several factors, including your budget, existing competition, and figuring out where your interests and passions lie.
Plan Your Coffee Budget
Setting up a coffee shop in Texas can vary in cost. Certainly, larger cities or trendy neighborhoods will increase real estate costs and higher labor costs. Therefore, you will want to thoughtfully develop your coffee shop budget based on your concept, location, menu, equipment needs, and design and layout.
Write a Business Plan
Before starting your coffee shop in Texas, you need to have a plan. So, I’d recommend writing a business plan and getting all of your thoughts down on paper. If you need help getting your business plan started, consider reading our post, How to Write Your Coffee Shop Business Plan.
Develop an Action Plan
After you’ve developed your Texas-based coffee shop – including the concept, menu, and written business plan – you’ll want to create an action plan. Your coffee shop action plan will detail your first steps with a timeline.
Explore Local Coffee Roasters
Exploring local roasters in Texas is a lot of fun. Get out there and meet coffee roasters you might want to work with. Discover new coffee roasting profiles and determine what kind of roasts you would like to serve in your coffee shop.
Further Reading: How to Open a Coffee Shop Successfully
Start a Coffee Shop Business:
Your Dream, Your Idea, Your Success
At Coffee Shop Startups, we aim to help every aspiring coffee shop owner take their business idea to the next level.
You might need help with the initial research on how to start your coffee shop business.
For others, you will need help strengthening your coffee shop business plan. Some of you may want to know how to design your coffee shop to help you avoid costly fines or remodeling modifications. As a new coffee shop owner, you might need help hiring, choosing coffee equipment, or searching for the perfect coffee business location.
There's certainly plenty to cover. That's okay; that's why we're here!
We are so excited to bring you unprecedented in-depth information in our Complete Coffee Shop Startups Kit.
Start Planning. Order Today.
The Complete Coffee Shop Startup Kit
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*Please note: The Complete Coffee Shop Startups Kit is not necessarily state-specific. Further research will often be required for your specific region.
