Is an Online Coffee Business Profitable

Posted by Damian Roberti on

So if you are looking to create a coffee business online, I'm actually going to go over the step-by-step process and break down the numbers on how to create an e-commerce food business selling coffee and making $10,000 a month in sales. And don't get me wrong, this is not something that happens overnight, but it is definitely something that's doable and I'm going to break it down for you right now. All right, so it's Damian and welcome back to Marketing Food Online.

 

As I mentioned back in the introduction, I'm going to break down an online coffee business plan for you, break it down and show you how you can actually sell $10,000 a month in coffee. And I'm going to show you how you can do that through Amazon, eBay, and Etsy, and by tapping into your own website. I'm going to give you a few pointers on how this works and the different ways that you can either sell, resell, or even make your own coffee.

So before we do, as always, welcome to Marketing Food Online. I'm Damian Roberti, CEO and founder of Marketing Food Online. I am a food entrepreneur and have been for over 12 years. I've been in the food industry for about 30 plus years. IN some cases you may want to google , "successful online coffee business", "online coffee business for sale""

Unfortunately, I'll give you my age on that one, but yes, over 30 years, my wife and I have run and operated e-commerce food businesses, and we've created six-figure businesses with those online. So I've learned quite a bit over the past 12 years. So I wanted to bring that to you here on our YouTube channel. So I'm going to look really quickly. These are the four questions, by the way, that our subscribers had sent in that inspired me to actually go ahead and do this video and answer these questions and break it down for you. So the first question is, is selling coffee online profitable? We're going to cover how I can sell my coffee online and how much money can you make selling coffee on Amazon?

Is it  profitable to sell coffee on Amazon as well? So these are the four questions here, and we're going to dive into them. So, number one, you need to make sure, before you do anything, you need to make sure you're a legitimate business. What I mean by that is making sure that you're inspected, licensed, have your food business insurance, have all the business licenses from the city and county you're operating in, registered business with the state, and make sure you have an EIN number for your tax purposes with the IRS.

This is definitely not some advice I'm going to give you about selling coffee from your closet at your house and shipping it online over state lines, which is completely illegal and you cannot do that. So if you're dealing with food, make sure that you abide by all of those regulations. It's either the Department of Agriculture who will come in and inspect your facility or the health department, depending on how your business is set up.

 

So before you take any of the advice I'm going to give you on how to sell $10,000 a month, you need to make sure you're a legitimate business, okay? All right, let's get started. So there are three different ways that you could actually sell coffee and package it. Number one, you can either invest in and create your own coffee roasting business. Now this is the more expensive and, I would say, seriously expensive side of it. If you're looking to create a business selling coffee that you're roasting yourself and you want to make your own style of coffee, the amount of money that it would take to invest in that type of equipment is considerable. It is something you can do, but it would be well into the six figures for you to do that.

 

Or you can actually get a reseller license that'll allow you to buy an already made brand of coffee, buy it in bulk, warehouse it, and sell it and distribute it through your own website, okay? That would be stuff like, you know, Folgers, Maxwell House, the coffees that are already out there, Café Bustelo, Starbucks, etc. You can buy those and you can resell them. Okay? But the question is, how profitable is that? When you buy it in bulk, if you're able to get it at a wholesale price and you're getting large quantities of it, yes, you can definitely make it profitable.

 

Okay, if you go to the local grocery store and you try to flip it and make some money, the margins are going to be considerably smaller, and that won't reach the goal that I'm about to explain to you of $10,000 a month, okay. Finally, you can get a private label company to actually put your own label on it. You can get a company to actually put your logo and your label on their brand. They roast it, they package it, they do all the work, and you buy it from them and then sell it, but it's under your name, okay?

 

Now, in order for this to work, you need to sell $30. It needs to be your average sale price per transaction, or even per order on your own website, on Amazon, on eBay, or Etsy. Now, Damian, why is $30 so important? On average, it's around $34. That is the average price point for products that are sold on most coffee websites. Normally they do it by bundling packages or offering a discount on shipping, but you want to be around that $30 price point. You would only need to sell 11 transactions, guys, literally 11 sales a day, at $30 each, to reach a 300-plus dollar day. Times 30 days puts you at the $10,000 mark. That's it. It's pretty simple.

 

That is all you would need to do in order to reach that. Now, with that being said, the one thing you want to keep in mind, though, is that on the platforms you sell on, there are going to be fees. Now, what I recommend, as we mentioned before, is that it is profitable to sell coffee on Amazon. Yes, you could definitely do that, but you need to keep in mind that Amazon charges a transaction fee, okay? Also, if you're looking for any other additional fees for selling in the gourmet food category, please be aware that those fees will be incurred on each and every transaction.

So you want to make sure that you are bringing in around $30 for yourself after those fees, okay? So once you reach that, you're only needing to get 11 to 12 transactions a day. Should I just be on Amazon selling coffee, Damian? No, I personally recommend you be on as many websites as humanly possible because that's what we do. We have six websites and we are on eBay, we have Etsy, we have Amazon, and so on. Why would you want to be on all those platforms? Well, even though each platform does charge a fee, you want to be in places where as many people can find you as possible. Limiting your options to Amazon, while Amazon is a massive website, there are people who go to eBay who do not shop on Amazon. Also check out gogle for "is online coffee business profitable", "online coffee business plan", "coffee business opportunities", "coffee business ideas""

 

There are people who shop on Etsy who maybe don't like Amazon or even eBay. So, having your coffee online in front of these different avenues and these different customers on these different platforms is only going to increase your odds of selling only 11 packages a day at $30 a pop. So, if you're on all of them, I'd say you'll get anywhere from 30 to 40 transactions per day as you build your business, and you'll easily exceed $10,000 in gross sales per month for your coffee shop.So having yourself spread out on different platforms is a huge plus, okay? So let's dive into this. Once you've got your listing, what can I do to actually create that $30 transaction, Damian?

 

What can I do to actually make this work? Number one, variety. Make sure that you have a variety of coffees. Obviously, there are different types of roasts, there are different types of coffee beans, there are a ton of different flavored or infused coffees. The variety that you have is going to help you sell even more. If I started an online coffee business and I started selling, and I had maybe two types of coffee, the likelihood of me selling a lot is going to be very limited. The more variety you give your customers, the better off your business is to succeed and to reach that $30 transaction price point and that goal of 11 to 12 units, okay? As a result, variety is extremely important.Number two, you want to make sure that you can create bundles.

 

Bundles are gold mines. We do bundles all the time and it works very well. When you bundle several different types of coffee or even the same coffee with several different bags, 6 units, 12 units, and so on, what you do is actually increase that transaction. You make that per transaction cost go up. So like I mentioned, if you had 11 transactions at $30, or let's just say five transactions, and you cut that in half and you had 60, 70, or $80 on one transaction, you're already ahead of the game and you're towards your goal of $10,000 a month. You see what I'm saying? So you have an opportunity to create a bundle where the customer is also seeing the value in buying multiple bags or multiple coffees. You create a higher price point, so when they check out, they're spending 80, 90, maybe even a hundred dollars instead of just thirty. Okay? So bundles are very, very important to making this work. Next up, the idea of creating a coffee subscription business, okay?

You could sell this on Cratejoy, eBay, Etsy, or your own website.If you've created a food business, a website on Shopify or WooCommerce, or whatever it may be, you can definitely create and implement a subscription business. Why is that important, Damien? Well, because what you can do is create a subscription, so every month you have a reoccurring payment coming through for your coffee. As you get more and more customers, that $30 a day mark and goal is very attainable.

It's something that's very simple to do because you're going to have that constant customer paying every single month. And if you play it right, you can actually create bundle subscriptions where you've got three bags of your coffee going to a customer every single month. But let's just say it's around $40 to $50 for that one transaction. Again, you're already ahead of the game in that goal of getting $10,000 a month. So, coffee subscription, implement it, and start it as well.can sell individual units on Amazon of coffee.

Yes, you can sell individual units on eBay, but when you start, like on Cratejoy.com and check out down below in the description, I'll have a link to Cratejoy, you can look at that website. We use that for all of our candies and sweets and cookies and such, but you can create a "coffee subscription" business on Cratejoy that's reoccurring, okay? Next up, discounts. ""How much do online Coffee Businesses make"".

If you can, on your own website, you can create discounts or create some type of discount for shipping. If you can get a customer to pay $50, or a minimum of $75, or even $100, and you give them free shipping, that only encourages the customer to spend even more money with your website, okay? So that way you can also reach your goal faster. Again, at $30 per transaction and only 10 to 12 transactions a day, you're going to reach that much faster. Discounts, sales, and coupons are tremendous ways to drive even more sales, okay? Now, lastly, I want to talk about how you are going to promote this, Damian.

So I've got my websites, I'm selling my coffee, but I'm not getting a lot of traffic on social media. You don't need to be doing a bunch of Facebook ads, you don't need to be doing a bunch of Pinterest ads, or any of those things. Post consistently on Facebook, post consistently on Twitter, use hashtags within those social media, like # coffee, # Starbucks, # espresso. All of these different words with hashtags in front of them on social media platforms will only give your product more and more exposure, which will help you reach that goal of simply $300 a day. So when you break down the idea, it seems a little bit overwhelming at first, when you think,

"Well, $10,000 seems like a lot, but it's really not." Make those small goals reach your big goals by breaking it down by week and day.You only need to be making a certain amount of money a day and that achievement will get you to 10,000. Plus, at the end of the year, you're doing six figures. You're doing over 120, or $130,000 a year in coffee. And the great way to actually implement what we talked about is: is it profitable, again, to sell coffee on Amazon?

 

Yes, and it's also a great way to scale. If you want to scale your business, once you get on Amazon, eBay is great, trust me, and Etsy is fantastic too, but Amazon can scale any business dramatically in a shorter period of time, if you do it that way, okay? So you want to make the goal $30 a transaction, 10 to 12 transactions a day. You've already reached your goal of $10,000 a month. That's it, okay? Now, am I saying that this is going to be a simple, easy job to do? No, it's not any business, I can tell you and attest.

It's not something that's going to happen overnight and it takes a lot of work, but when you get it up and running and you get the momentum going, scaling it is much easier, okay? So if you have any more questions about this, definitely let me know down below in the comments, and I'll see you guys on our next call. Thanks for watching Marketing Food Online. And if you are looking to create your own food truck, start a home-based food business under the cottage food law, start a packaged food business, private label your own food products, sell on Amazon, get your own online store, or sell food online, remember to subscribe and check out these videos for more resources. Take care. ""How much does online coffee business make""

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