How to Start a Juice Bar Business. Cost of Opening a Juice Bar
August 27, 2018 • 13 minutes
Yep, to be healthy is on-trend all year round. What could be healthier than a glass of freshly squeezed juice? During a hot summer, your place represents heaven on earth with its fresh, cold drinks, while in the winter it’s more like a vitamin recharge point. Another edge is that despite reasonable startup investments, competition is quite low too. If you are opening a bar on a prime site with high foot traffic, you’ll see strong demand. The big plus is that you can gradually enter additional positions and expand your range to increase profits.
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1. Decide on the type of juice bars
In general, there are two types of juice bar locations: the small cafe type (permanent) and the street food type (mobile). Anyway, a juice bar is a small place and the concept implies a wide range of drinks and a couple food items, so both these types are pretty similar. When there are cakes, chocolate, coffee, a juice bar turns into a slightly different type of business.
A mobile truck is the perfect business idea for summer. The main thing is that it is supplied with electricity for the juicers and refrigerators. Though earlier we said that to start a juice bar business is a good idea all year round, we didn’t mean a kiosk in the open air. That type is definitely seasonal unless you are based in a hot country where warm weather is the regular thing. Instead we'd suggest you to think about how to open a juice bar in a shopping mall. There it can operate all year round and be in demand regardless the season.
2. Write a business plan for a juice bar
How to start a juice bar? Every foodservice location needs a business plan and a good strategy, especially if you are going to open a juice bar using investor funds or a loan. It is quite possible to create a business plan for a juice bar yourself.
A working business plan should include:
- Competition research;
- Prospects for development
- Investment and monthly expenses predictions
- Profitability and payback calculation
3. Find the right location for a juice bar
For juice bar cart sales, location means everything! As mentioned previously, a juice bar fits two location types: permanent and mobile. In the first case, there is no need to purchase a cart and deal with unexpected rain. And with a business at a permanent location, you can build development strategies and predict how many ingredients you’ll need on a day-to-day basis.
Owning a mobile cart, you are not usually bothered with utilities and the monthly rent, and you can always move to another place tomorrow if sales aren’t good today. There are pros and cons for both location types, so the decision depends on your preferences and expectations.
Together with every restaurant, bar, and cafe, a juice bar needs to be located in a crowded place with high foot traffic. First, you need to start by defining your target audience. Freshly squeezed juices and smoothies are quite pricey, so don’t target people who can’t afford your product.
You can lease a 4–8 square meter kiosk in a shopping mall, maybe in an airport or a massive health club. People would love a glass of fresh juice during a shopping session or after a workout, so starting your own juice bar in a gym is a pretty good idea.
To develop your brand and recognition you could take part in local exhibitions, food and music festivals, sports events, and fairs. This way you’ll get a stable income, and payback will depend solely on the quality of the service you provide and the initial investments.
Do research to figure out if there are direct competitors in your area and in the city in general. Since the product is highly specific, two juice bars in one shopping mall are still okay, but two bars beside each other could be a problem.
Sharing a target audience you will lose customers and income, and one of the two businesses will fail one way or another. If you are ready to fight for your place in the sun by providing high-quality products and service, you should give this location a try! But if this is your first business, then it's better not to take chances; instead, open a juice bar in an area with low competition.
4. Create a menu for a juice bar
A juice bar menu depends, in the first place, on the concept. The base stays the same (fresh juice and smoothies) while the unique part depends on you and your imagination. To expand the range, you can add milkshakes, tea, coffee, fresh lemonade, new mixes and unique combinations. And who knows, maybe you will become the founder of a new trend in the world of juices and run a successful franchise providing franchise POS system with a unique menu!
The introduction of any of these positions will entail additional investments: equipment, staff training, storage and product supply. It is better to start with the base to recoup the investment, and then expand gradually in a specific direction.
Watch your customers and ask what else they would like to try and what is missing from the menu. Maybe people want you to offer pastries, coffee or ice cream, etc.
For example, vegetable salads and fruit desserts are good options for business centers, while pastries, ice cream, and frozen yogurt are more suitable for mobile trucks and kiosks. You need to think through the menu before developing the business plan. Incidentally, not doing this is one of the commonest mistakes restaurant owners make.
First of all the menu affects the list of equipment, suppliers, and staff. For example, some vegetables must be thoroughly washed and peeled, which can be hard to do in tight space in a shopping mall. Alternatively, you can order ready-peeled vegetables from alternative suppliers. The sale of coffee entails buying a coffee machine and hiring a barista; pastries mean baking yourself or buying products from local or home bakeries, purchasing a couple of new showcases, etc.
5. Buy equipment for a juice bar business
Probably the largest share of your startup expenses will account for basic equipment. Let’s see just exactly what you need:
- Multifunctional juicer
- Citrus juicer
- Automatic fruit and vegetable peeler
- Refrigerators
- Cash register/point of sale
- Bar counter
- Showcase
- Blender
- Shaker
- Ice machine
- Closet to store inventory
As for the juice pos system for a bar, you might prefer to have something compact and not requiring heavy investments from the start. Mobile POS is the perfect decision for this case. From the operations point of view, juice bars have a lot in common with small coffee shops or food trucks. Solutions popular among those types of businesses most probably will provide all the required features at a good price.
6. Hire juice bar staff
Compared with a large restaurant, in our case everything is pretty clear: you need at least two people. Usually, fresh juice bar working hours will coincide with shopping mall or business center working hours (this depends on exactly where your juice bar is located).
Nevertheless, hiring staff is as responsible a task as the choice of equipment. First of all, employees affect a juice bar’s average check, that is to say, its revenue. No matter how amazing the bar location is, if employees are slow and surly, no one will come back to you ever again. It won’t come as a surprise if we say that you need polite, nice people, who can establish contact with your customers.
As a rule, the juice bar target audience consists of people following a healthy lifestyle. They often come with kids and as you know, younger customers must be approached with delicacy.
When hiring staff, there is no need to look for special skills. Juice bar equipment is not the hardest thing to use, so it should be enough to explain once or twice to a new employee how things work. A person should be able to learn fast and start working as soon as possible. Don’t forget to motivate and encourage your employees to do their best, and apply disciplinary measures if needed.
7. Develop a marketing strategy for a juice bar
In most cases, people buy fresh juice spontaneously instead of planning in advance (as happens with booking a table in a restaurant); this makes it difficult to implement a complex marketing strategy. But there are a few things you can still do:
- Come up with a catchy name.
- Design a bright, attention-grabbing sign.
- Create a logo that looks equally cool on employee uniforms, cups, and the counter.
- Diversify the menu and create your own unique positions.
- Create and promote an Instagram account.
- Offer special deals and run these campaigns right in your POS system.
Juice bar marketing ideas
- Provide branded packaging.
- Add a special menu for kids.
- Expand the menu by adding coffee, tea, lemonade, ice cream, frozen yogurt, healthy pastries, green salads, etc.
- Open a couple more juice bars around the city.
8. Consider pros and cons of opening a juice bar business
Before we describe the pros and cons of starting a juice bar business, let’s figure out what it depends on:
- right location;
- effective financial planning;
- marketing idea you are going to employ.
Juice bar pros:
- Fast payback. Experience has shown that within a year it is possible to get full payback on your initial investments and reach a stable profit.
- High profitability. With a relatively low initial investment (rent and equipment), profitability is pretty high.
- Constant demand. As we’ve mentioned before, juices and smoothies are for cooling down a bit in summer, and for vitamins in winter. To be clear: we are not talking about a seasonal mobile kiosk here.
Juice bar cons:
- Freshly squeezed juice and smoothies are quite expensive. If you compare fresh drinks with packaged juices, their cost is much higher. And sometimes people pay attention not to the benefit of the product, but to its price.
- There are always a few risks: rises in the cost of ingredients, unreliable suppliers, reduced demand, and bad location choice.
9. Calculate how much does it cost to open a juice bar business
The total juice bar start up costs would make about $20,000. To help you understand how much money you need when opening a juice bar business and what you'll have to spend it, we have compiled a list of the approximate costs of a juice bar in a shopping mall. But remember, all costs will be individual to each case.
Juice bar start up costs:
Multifunctional juicer
$300–1500 per item
Citrus juicer
$200–300 per item
Automatic fruit and vegetable peeler
$50–100 per item
Refrigerator
$1000–1500 per item
Blenders and shakers
$200–400 per item
Ice maker
$2000–3000 per item
Point of sale hardware (iPad or Android tablet, credit card reader, printer, cash drawer)
$1000–1500
Point of sale software
$20–60 per month
Disposable tableware
$500–1000 per month
Rent
$1000–2500 per month
Ingredient supply (fruit, vegetables, milk)
$3000–5000
2 employee salaries
$7.50–9.00 per hour
$2500–3000
Total
$11,500–20,000
You might consider the cost of opening a juice bar to be comparatively low. However, you should remember that life is full of surprises and some unexpected expenses may occur. Therefore, it's a good idea to have up to thirty percent more money to cover them.
10. Forecast your juice bar profitability
Juice bar markups are 300–500% and that’s totally OK! The income from beverage sales should be at least double the cost of the ingredients. Otherwise, you won't be able to achieve profits and get your investments back as soon as you wanted.
On average, a juice bar sells about 20 liters of juice per day. Of course, this is a pretty average figure, which depends on the day of the week and the foot traffic around the kiosk.
Let’s say you need to spend $3–4 to make a liter of fresh juice and then sell it for $13–20. Sure, this is a big gap between cost and final price. But this always depends on ingredients and extras like chia seeds, proteins, etc. For example, a 16 oz. glass of fresh green juice can cost $6 while a matcha green smoothie is about $10. You'll have to constantly monitor wholesale prices for ingredients and look for suppliers that will help you raise your margins.
As a result we have:
$260 (revenue per day) − $60 (initial cost) = $200 (daily income)
$200 × 30 days = $6000 income per month.
Taking into account salaries and rent, a juice bar will usually pay off in about 6–12 months depending on location, price range, assortment and a lot of other individual features.
It will take up to six months to reach daily sales of 20 liters of juice, or at least this is an average value. For example, a kiosk in a shopping center can sell 30–40 liters per day on a weekend and barely 10 liters on a weekday.
That's why many entrepreneurs add extra items to the menu: tea, coffee, ice cream, fruit desserts, etc., to increase the average check and ensure a more stable daily income. And if you're looking for Utak alternatives, make sure to read more about Poster!
