Do these objectives sound realistic in the start of a business? -

Im doing a business plan for my class and was wondering if these figures are realistic in the first and second year in business. Within a year of being opened our objectives for Late Night Latte are to acquire a fair amount of repeat customers from the University of New Mexico and surrounding businesses in the area. We anticipate 70 percent of our customers will return more than once during the year. Also we hope to make $15,000 to $20,000 the first year and have some profit. Another objective is to meet almost all of our target market��s needs. In the second year of operation we hope to make $25,000 to $30,000, increase profit and payoff some of the expenses that were accumulated in the development of the company.

Is 15k-20k gross or net? If it s net that would be high but reasonable, if that s gross then your company will fail before its profitable. To create a more accurate picture of what you will make, do some research to figure out how many daily customers your competition has. Hell, give dunkin donuts or starbucks a call and ask how many they have-- it s for school, they ll tell you. Multiply that by 365 and that s your 2 year goal. 1st year goal could be 60% of that.How much will it cost to run the business, how much does it cost to make one cup of coffee and how much will you sell it for, how many cups must you sell to break even then how many must you sell to meet your goals?If it costs starbucks $2.00 to make a cup of coffee and they sell 900 per day at $4.00 each then they have $1800 profit. Minus worker salary ($8/hr * 12 hrs *4 workers = 384) so we re down to $1416 profit. 30 days in a month with rent at $2600 which we divide by that 30=86.76 cents. So $1416-86.76= $1329.24 profit. * 365= $485,172.6 profit per year. Natrually this would be in a major metro area with an already established company with massive customer base. You must make at least $471 in profit via cups of coffee to be profitable in this scenario which is 236 cups of coffee in 12 hours per day. Doable? absolutely. Every cup over that is $2 profit; to make $20k profit you need to sell 264 cups per day ($20,000/$2 (profit/cup)/365(figure out cups/day)+236(cups to break even)=264 cups)o.O that was fun. If you have any questions feel free to shoot me an email (Patrick@KeenerInvesting.com)