A kombucha drink bar is a small, informal restaurant where kombucha drinks are made and served to customers. Kombucha drink is an assortment of fermented, lightly effervescent sweetened black or green tea drinks that are intended as functional beverages because of the acclaimed health benefit and the drink is produced by fermenting tea using a “symbiotic ‘colony’ of bacteria and yeast” (SCOBY).
The most recent report available online shows that the global kombucha market size stood at USD 1.84 billion in 2019 and is projected to reach USD 10.45 billion by 2027, exhibiting a CAGR of 23.2% during the forecast period. In terms of value, the market is projected to reach USD 1.8 Billion by 2020, at a CAGR of 25.0% from 2015 to 2020.
North America is the largest market in the global kombucha market having accounted for a share of 39.4%. North America has witnessed the highest sale of kombucha beverages.
Steps on How to Start a Kombucha Business
Table of Content
Conduct Market Research
It is important to state that conducting market research before starting any business is key to the success of the business hence you must not open a Kombucha drink bar without conducting market research. Market research provides critical information about your market and your business landscape. It can tell you how your business is perceived by the customers and clients you want to reach.
It can help you determine who and where your customers are, and which customers are most likely to do business with you. In essence, thorough market research will help you understand how your target customers think to turn them into regular customers and brand advocates.
a. Who is the Target Market for Kombucha Drink Bar Business?
- Hard-core fitness fanatics or dieters
- Sportsmen and women
- Every adult and child in the neighborhood where your Kombucha drink bar will be located.
Please note that presently, the main target population for kombucha drinks in most markets is younger consumers.
b. Is Kombucha Drink Bar a Profitable Business?
Yes, the Kombucha drink bar business is very profitable. The global sales of kombucha drink are estimated to reach USD 10.45 billion by 2027.
c. Are There Existing Niches in the Industry?
Yes, there are existing niches when it comes to kombucha drink bars. Here are some of them;
- Brick and mortar kombucha drink bar (sit-down kombucha drink bar)
- Drive through Kombucha drink bar
- The Grab-and-Go Kombucha drink bar
- Mobile Kombucha drink bar (kombucha carts or kombucha trucks)
d. Who are the Major Competitors?
- Millennium Products, Inc.
- Kombucha Wonder Drink
- Brew Dr. Kombucha
- Craft Kombucha
- GT’s Enlightened Organic Raw Kombucha
- Lion Heart Kombucha
- Kevita Master Brew Kombucha
- Humm – Lemon Ginger Kombucha
- Live Kombucha Soda
- Reed’s Kombucha
- Unity Vibration
- High Country Kombucha
- Beyond Brewing Company
- Synergy Raw Kombucha
- G&T Aqua Kefir
- Suja Organic Kombucha
- Health Ade Kombucha
- Holy Kombucha Signature Brew
- Kirkland Kombucha
- Better Booch.
e. Are There County or State Regulations or Zoning Laws for Kombucha Drink Bar Business?
Yes, there are county and state regulations and zoning laws for Kombucha drink bars in the United States. Please note that the Food and Drug Administration (FDA) sets the federal Food Code, but it doesn’t oversee individual Kombucha drink bars. Instead, the various states use the Food Code as the basis for their own food codes. They may adopt its rules, interpret them differently or set their own rules.
Please note that in the United States, you are required to follow your state’s foodservice code. Visit the FDA website for a list of food service codes by state. Use this to find the state authority handling restaurants and bars and view the laws that apply in your state.
f. Is There a Franchise for Kombucha Drink Bar Business?
Yes, there are franchise opportunities for Kombucha drink bars. Here are some of them;
- Revel Kombucha Bar
- Tea Kombucha (This Life Matters Pvt Ltd Company).
g. What Do You Need to Start a Kombucha Drink Bar Business?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Shop facility
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Ingredient supply (yeast, sugar, and black tea et al)
- Startup Capital
Memorable Kombucha Business Names
- The Gallos© Kombucha Drink Bar, Inc.
- Green Tree® Kombucha Drink Bar, LLC
- Abel Monsi© Kombucha Drink Bar, Inc.
- Drink Solutions® Kombucha Drink Bar, Inc.
- Boris Benard™ Kombucha Drink Bar, Inc.
- El Pappy™ Kombucha Drink Bar, LLC.
- Go Green© Kombucha Drink Bar, LLC
- Rhodes Brothers© Kombucha Drink Bar, Inc.
- Over Cloud© Kombucha Drink Bar, Inc.
- Hackmen® Kombucha Drink Bar, LLC
- Royal Court® Kombucha Drink Bar, LLC
- Capital Street™ Kombucha Drink Bar, LLC
- Special Cups© Kombucha Drink Bar, Inc.
- John Harwood® Kombucha Drink Bar, Inc.
- White House™ Kombucha Drink Bar, Inc.
- Capitol Hill™ Kombucha Drink Bar, Inc.
- New Nile© Kombucha Drink Bar, Inc.
- Organic Team® Kombucha Drink Bar, LLC
- Overland Jhan™ Kombucha Drink Bar, Inc.
Register Your Business
a. What Type of Business Structure is Best for Kombucha Drink Bar?
The truth is that you have several options when it comes to the business structure for a Kombucha drink bar, but the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits. Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Kombucha Drink Bar Business?
- General Business License
- Health and Safety Permit
- Food and Drinks Handlers’ License
- Zonal Permits
- Signage Permit
- Operational State Facility Inspections
- A music license if you want to play recorded music in your bar
- A dumpster placement permit that specifies where you can put your dumpster outside your bar
d. What Type of Certification is Needed to Open a Kombucha Drink Bar Business?
You don’t need any certifications to open a Kombucha drink bar business.
e. What Documents are Needed to Open a Kombucha Drink Bar Business?
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering opening a Kombucha drink bar business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Kombucha Drink Bar Business?
To be truthful, the cost required to open a Kombucha drink bar may vary significantly. But starting a basic $9,000 bare bones 6 BBL semi-automatic Kombucha Brew House typically runs from $20,000 and a 9 BBL automatic (labor-saving) Kombucha Brew House goes for about $49,000.
b. What are the Costs Involved in Starting a Kombucha Drink Bar
- The total fee for registering the business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services totaling – $1,200.
- Marketing promotion expenses (2,000 flyers at $0.04 per copy) for the total amount of $80.
- The cost for hiring a business consultant (writing of business plans inclusive) – is $2,500.
- Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $2,400.
- The cost of accounting software, CRM software, and payroll software – $1,500
- The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of – $25,600.
- The cost for shop/facility remodeling – $15,000.
- Other start-up expenses including stationery – $500
- Phone and utility deposits will cost – ($2,500)
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $25,000
- The cost for start-up inventory – $16,027
- Storage hardware (bins, utensil rack, shelves, glasses case) – $3,720
- The cost for counter area equipment (countertop, sink, ice machine, etc.) – $6,000
- The cost for serving area equipment (glasses, flatware) – $3,000
- The cost for store equipment (cash register, security, ventilation, signage) – $3,150
- The cost for the purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – $8,000.
- The cost of launching an official website – $600
- The cost for our grand opening party – $3,000
- Miscellaneous – $2,500
c. What Factors Determine the Cost of Opening a Kombucha Drink Bar Business?
- The size of the Kombucha drink bar
- The choice of location
- The required licenses and permits
- The type of facility
- The cost for branding, promotion, and marketing of the Kombucha drink bar
- The cost for furnishing and equipping the Kombucha drink bar
- The cost of insurance
- The cost for registering the business
- Source of your supplies and ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms
- The cost for the grand opening of the Kombucha drink bar
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
In reality, it is not obligatory to build a new facility for your Kombucha drink bar, but if you have the required finance, it will pay you to build your facility. The truth is that building or reconstructing a facility will help you come up with a facility that will perfectly fit into your overall business goals and vision.
e. What are the Ongoing Expenses of a Kombucha Drink Bar Business?
- Ingredient supply (yeast, sugar, black tea, ice, disposable cups, and straws)
- Utility bills (internet subscriptions, phone bills, signage and software renewal fees et al)
- Salaries of employees
f. What is the Average Salary of your Staff?
- Shop Manager (Owner) – $45,000 Per Year
- Accountant – $30,630,000 Per Year
- Kombucha Makers and Servers – $27,100 Per Year
- Cleaners – $25,000 Per Year
- Security Guard -$24,000 Per Year
g. How Do You Get Funding to Start a Kombucha Drink Bar Business
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
El Pappy™ Kombucha Drink Bar, LLC is a neighborhood Kombucha drink bar that will be located in a fast-growing health-conscious community in Pearl City, Hawaii. We have been able to secure a one-year lease of a vacant shop within the city’s largest shopping mall. We are fortunate to secure a facility with an option of renewal for 5 years at a rate that is favorable to us.
b. Products and Service
- Different types and flavors of kombucha drinks.
- Tea and beverages
c. Mission Statement
Our mission is to establish a Kombucha drink bar that will make available different types and flavors of kombucha drink at every given time to our highly esteemed customers and a place where people can freely network and socialize.
To be amongst the top 5 leading kombucha drink bars in the United States of America before our 10th anniversary.
d. Goals and Objectives
The goals and objectives of a Kombucha drink bar business are to provide a retail outlet where patrons can go to buy and drink different types and flavors of kombucha drinks.
e. Organizational Structure
- Shop Manager (Owner)
- Kombucha Makers and Servers
- Security Guard
a. SWOT Analysis
- Ideal location for a Kombucha drink bar business
- Highly experienced employees and management
- Access to supplies and other ingredients
- Availability of different types and flavors of kombucha drinks.
- A reliable, clean, healthy, and efficient method of preparing kombucha drinks.
- Financial constraints may restrict the publicity and branding of the business
- Our new business will be competing with well-established Kombucha drink bars and smoothie franchises in the city.
- Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.
- A rise in the number of people who want to live healthier lives free from sickness
- Online market, new services, new technology, and of course the opening of new markets.
- The arrival of a new Kombucha drink bar within our market space
- Steady wage expenses
- Economic uncertainty
- Liability problems
- The U.S. Food and Drug Administration (FDA) could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
b. How Do Kombucha drink bars Make Money?
Kombucha drink bars make money by selling;
- Different types and flavors of kombucha drink
- Tea and beverages
c. Payment Options
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via mobile money transfer
d. Sales & Advertising Strategies
- Introduce your Kombucha drink bar business by sending introductory letters alongside your brochure to households, sports organizations, gyms, schools, and other key stakeholders throughout the city where your Kombucha drink bar business is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
- Create a basic website for your business to give your business an online presence
- Directly market your products.
- Join local Kombucha drink bar associations for industry trends and tips
- Provide discount days for your customers
- Advertise our business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word-of-mouth marketing (referrals)
a. How Much Should You Charge for your Product/Service?
Kombucha in boxes of 8 bottles sales for $13.99, which comes out to only $1.75 a bottle.
b. How Much Profit Do Kombucha drink bar Owners Make a Year?
It depends, but an available report shows that on average, a small to medium-sized Kombucha drink bar can earn anywhere from $45,000 to $100,000 for the shop owner.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the Kombucha drink bar
- The types and flavors of kombucha drinks and other products retailed in the shop
- The location the Kombucha drink bar is covering
- The management style of the Kombucha drink bar
- The business approach of the Kombucha drink bar
- The advertising and marketing strategies adopted by the Kombucha drink bar
- The number of years the Kombucha drink bar is in business
d. What is the Profit Margin of a Kombucha Drink Bar?
Averagely, the profit margin on kombucha drinks sits at 30 percent to 53 percent.
e. What is the Sales Forecast?
Below is the sales forecast for a Kombucha drink bar. It is based on the location of the business and other factors as it relates to such startups in the United States;
- First Fiscal Year: $220,000
- Second Fiscal Year: $350,000
- Third Fiscal Year: $400,000
Set Up your Shop
a. How Do You Choose a Perfect Location for Kombucha Drink Bar?
- The demography of the location especially as it relates to hard-core fitness fanatics or dieters and of course people that take kombucha regularly
- The demand for the kombucha drinks in the location
- The purchasing power of businesses and the residents of the location
- Accessibility of the location
- The number of Kombucha drink bars, tea and coffee cafés in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Open a Kombucha Drink Bar?
- Pearl City, Hawaii
- Honolulu, Hawaii
- Meridian, Idaho
- San Diego, California
- Portland, Oregon
- Green Bay, Wisconsin
- New York City, New York
- Tallahassee, Florida
- Dallas, Texas
- Los Angeles, California
- Rio Rancho, New Mexico
c. What Equipment is Needed to Operate a Kombucha Drink Bar?
- Storage shelves
- Storage containers
- Disposable cups and straws
- Receipt issuing machine and POS.
When it comes to hiring employees for a standard Kombucha drink bar, you should make plans to hire a competent shop manager (you can occupy this position), account clerk, kombucha makers, servers, cleaners, and security guard.
Launch the Business Proper
In recent times, no Kombucha drink bar opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party.
The bottom line is that with a proper launching of the Kombucha drink bar, you will be able to inform people in your city that your Kombucha drink bar is open for business.
a. What Makes a Kombucha Drink Bar Business Successful?
- Choose a good location and shop facility to launch the business
- Make sure your shop sells different flavors of kombucha drinks (give your customers options)
- Throw a grand party before officially opening the business
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your Kombucha drink bar business
- Leverage on all available online and offline platforms to promote your Kombucha drink bar business
b. What Happens During a Typical Day at a Kombucha Drink Bar?
- The shop is open for the day’s work
- The serving areas, chairs, and tables are properly arranged
- Walk-in customers are attended to
- Deliveries of orders are made
- Stocks are taken and reports are written and submitted to superior officers
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Kombucha Drink Bar Business?
- Excellent customer services skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining skill
- Work experience in a restaurant or bar environment
- Experience in managing people
- Experience in business administration
- Experience in identifying and making different types of kombucha drinks and tea.