Bubble Tea Business Plan Template
If you want to start a bubble tea shop or expand your current bubble tea store, you need a business plan.
The following Bubble Tea business plan template gives you the key elements to include in a winning Bubble Tea business plan. In addition to this template, a solid plan will also include market research to help you better understand the bubble tea market, your competitive advantage and your specific target market. It will also help you craft your bubble tea marketing plan and a strong financial plan.
Bubble Tea Business Plan Example
Below is a bubble tea business plan example with each of the key sections to help you write a bubble tea business plan for your own company.
I. Executive Summary
Business Overview
[Company Name] is a new bubble tea shop located in [Location]. We serve the widest selection of bubble tea drinks that can be found in the [Location] area. Customers can choose from milk tea, green milk tea, iced tea, and other drinks and customize each one with our long list of flavors and add-ons. We aim to be the #1 bubble tea shop in the city by offering the best selection of high quality bubble tea drinks and providing the best customer service in the industry.
[Company Name] is led by [Founder’s Name]. [Founder’s Name] was raised in Taiwan and immigrated to the U.S. in 2015. She longed to drink authentic bubble tea and was disappointed in the quality and lack of options available in [Location]. She decided to open up her own bubble tea shop to introduce the residents of [Location] to high-quality, authentic bubble tea.
Products Served
At [Company Name], we pride ourselves on offering the largest menu of bubble tea in the area. We serve milk tea, green milk tea, coconut milk tea, iced tea, and tea smoothies. We also offer about twenty different flavor options for each drink type, including hazelnut, vanilla, and strawberry, and have several other add-ons and customizations to choose from.
Customer Focus
[Company Name] will primarily serve the residents who live within a two-mile radius of our bubble tea shop. The demographics of these customers are as follows:
- 50,123 residents
- 2,182 commuters
- Average income of $65,700
- 38.9% married
- 52.3% in Management/Professional occupations
- Median age: 39 years
We are located in an outdoor shopping center, so we will also serve any pedestrians who come by for a drink while they shop.
Management Team
[Company Name] is led by [Founder’s Name]. [Founder’s Name] was raised in Taiwan and immigrated to the U.S. in 2015. She longed to drink authentic bubble tea and was disappointed in the quality and lack of options available in [Location]. Her disappointment inspired her to create her own bubble tea shop that serves truly authentic bubble tea and a large assortment of flavors and customizations.
Success Factors
[Company Name] is uniquely qualified to succeed due to the following reasons:
- There is very little competition as [Location] is home to very few bubble tea shops.
- Our bubble tea shop is located in an outdoor shopping center which has a high volume of traffic on a daily basis. We will be in a convenient location for numerous passersby each day.
- The bubble tea shop business is a proven business and has succeeded in communities throughout the United States.
Financial Highlights
[Company Name] is currently seeking $420,000 to launch. Specifically, these funds will be used as follows:
- Store design/build: $200,000
- Inventory and supplies: $50,000
- Equipment: $50,000
- Working capital: $120,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Top line projections over the next five years are as follows:
| Financial Summary | FY 1 | FY 2 | FY 3 | FY 4 | FY 5 |
|---|---|---|---|---|---|
| Revenue | $560,401 | $782,152 | $1,069,331 | $1,379,434 | $1,699,644 |
| Total Expenses | $328,233 | $391,429 | $552,149 | $696,577 | $776,687 |
| EBITDA | $232,168 | $390,722 | $517,182 | $682,858 | $922,956 |
| Depreciation | $7,000 | $7,000 | $7,000 | $7,000 | $7,000 |
| EBIT | $225,168 | $383,722 | $510,182 | $675,858 | $915,956 |
| Interest | $6,016 | $5,264 | $4,512 | $3,760 | $3,008 |
| Pre Tax Income | $219,152 | $378,458 | $505,670 | $672,098 | $912,948 |
| Income Tax Expense | $76,703 | $132,460 | $176,985 | $235,234 | $319,532 |
| Net Income | $142,449 | $245,998 | $328,686 | $436,864 | $593,416 |
| Net Profit Margin | 25% | 31% | 31% | 32% | 35% |
II. Company Overview
Who is [Company Name]?
[Company Name] is a new bubble tea shop located in [Location]. We serve the widest selection of bubble tea drinks that can be found in the [Location] area. Customers can choose from milk tea, green milk tea, iced tea, and other drinks and customize each one with our long list of flavors and add-ons. We aim to be the #1 bubble tea shop in the city by offering the best selection of high quality bubble tea drinks and providing the best customer service in the industry.
We will offer a comfortable and welcoming environment for customers to order bubble tea and relax for a while. We also offer mobile ordering for customers who need bubble tea on the go. Our shop will be located in a busy shopping center, so many customers will either want to relax after hours of shopping or take their drink to their next destination.
[Company Name] is led by [Founder’s Name]. [Founder’s Name] was raised in Taiwan and immigrated to the U.S. in 2015. She longed to drink authentic bubble tea and was disappointed in the quality and lack of options available in [Location]. She decided to open up her own bubble tea shop to introduce the residents of [Location] to high-quality, authentic bubble tea.
[Company Name]’s History
[Founder’s Name] incorporated [Company Name] on [Date of Incorporation] as an S-Corporation. She has been primarily running the operations of the business from her home but has found a potential retail location to turn into a bubble tea shop. Once the lease is approved, all operations will run from there.
Since incorporation, the company has achieved the following milestones:
- Found a retail location and signed a Letter of Intent to lease it
- Developed the company’s name, logo, and website located at [website]
- Created the menu
- Determined equipment and initial inventory needed
- Began recruiting key employees
[Company Name]’s Products/Services
We offer an extensive menu of bubble tea drinks, flavors, and add-ons to appeal to all customers. Some of the drinks we sell include:
- Milk tea
- Green milk tea
- Tea smoothies
- Fruit tea
- Coconut milk tea
- Iced tea
Customers can choose flavors and other add-ons to their drinks. Some of the flavors we offer include:
- Vanilla
- Hazelnut
- Banana
- Strawberry
- Blueberry
- Orange
- Watermelon
- Coconut
- Chocolate
III. Industry Analysis
Bubble tea has become extremely popular in Western countries in recent years. Customers can’t get enough of these drinks’ unique formulation, endless customizations, and delicious taste. The industry’s popularity is also helped by the increase in health-conscious individuals and increasing social media influences. Bubble tea’s many customizations and unique look make it the perfect drink to show off on Instagram or other social media platforms. This makes bubble tea a commonly discussed topic on social media, which keeps customers coming back for more.
According to Fortune Business Insights, the global bubble tea market size was valued at $2.29 billion in 2022 and is projected to grow to $4.08 billion by 2030 at a CAGR of 7.51%. This is significant growth, especially for a drink industry, which shows just how popular these drinks are. This growth is not expected to stall anytime soon, making this the perfect time to run a bubble tea business.
IV. Customer Analysis
Demographic Profile of Target Market
[Company Name] will serve the community residents of [Location] and its surrounding areas. Since we are located in a shopping center, we will particularly target shoppers who walk by our shop as they travel from store to store.
The area residents and commuters we serve are affluent and have the disposable income to purchase high-quality bubble tea drinks as they shop and go about their day.
Customer Segmentation
We will primarily target the following three customer segments:
- Tea lovers: Bubble tea is the perfect drink for someone who wants a bit of sugar and caffeine without the coffee. We offer multiple tea options and flavors, ensuring that every tea lover who walks through our door has the means to create their ideal drink.
- Shoppers: We are located in a prime location in the middle of a busy outdoor shopping center. Therefore, we expect many of our customers to be shoppers who pass by while heading to their next store.
- Young adults: Young adults in their 20s and 30s tend to be the biggest demographic for bubble tea shops. Therefore, we expect many of our customers to be in the 18-35 age demographic.
V. Competitive Analysis
Direct & Indirect Competitors
The following bubble tea shops are located within a ten-mile radius of [Company Name], thus providing either direct or indirect competition for customers:
Bubble Tea Heaven
Established in 1995, Tea Heaven is a small bit of heaven for those needing a break from all the hustle and bustle of downtown life. It offers a nice selection of tea drinks, including regular milk tea, green milk tea, and iced teas. The shop also provides a very cozy and calm atmosphere, making it a little slice of heaven for bubble tea lovers.
Though we expect Bubble Tea Heaven to continue to thrive, its menu is far more limited than the menu we are currently developing. They only offer a few types of drinks and only about half of the customizations. [Company Name] will offer a much greater variety so that all kinds of bubble tea lovers will be able to create their perfect drink.
Boba Café
Boba Café has been a popular location for bubble tea for decades. It is a small location that offers a drive-through and limited seating indoors. The small staff take hundreds of orders every day through the drive-through, mobile ordering, and orders placed in the cafe. They offer a long list of customizations so every customer can find something they will enjoy.
While Boba Café will continue to thrive, it is a small location that doesn’t offer much seating. The company expects customers to be in and out, taking their drinks on the go. Customers looking to relax and enjoy their drinks at the café will enjoy themselves more by frequenting [Company Name].
Bubble Tea House
Bubble Tea House is a popular bubble tea shop located on the other side of [Location]. It offers everything you could want from a bubble tea shop: multiple types of milk teas along with a countless number of flavors and customizations. The tea house also serves regular tea and offers a relaxing environment for customers to enjoy their drinks.
We expect Bubble Tea House to continue to be popular. However, they are located far from [Company Name], so we don’t expect them to be a significant competitor.
Competitive Advantage
[Company Name] enjoys several advantages over its competitors. These advantages include:
- Location: [Company Name] will be located in a high-traffic area that is easy for residents to access. The location is in a busy shopping center that receives thousands of visitors on a daily basis.
- Pricing: We offer high-quality bubble tea drinks for a moderate and competitive price.
- Variety: We offer the largest variety of bubble tea drinks, add-ons, and customizations in the [Location] area.
VI. Marketing Plan
The [Company Name] Brand
The [Company Name] brand will focus on the company’s unique value proposition:
- High-quality bubble tea drinks
- Long list of flavors, add-ons, and other customizations
- Convenient location
- Moderate pricing
- Mobile order options
- Cozy and welcoming atmosphere
- Excellent customer service
Promotions Strategy
[Company Name] expects its target market to be residents living within a two-mile radius. [Company Name]’s promotion strategy to reach these potential customers includes:
Website/SEO
[Company Name] will develop a professional website that displays all the bubble tea products and customizations that we offer. It will also invest in SEO so that the company’s website will appear at the top of search engine results.
Social Media
[Founder’s Name] will create the company’s social media accounts and invest in ads on all social media platforms. The company will use targeted marketing to appeal to our target demographics.
Advertising
[Company Name] will initially advertise in local newspapers and sponsor community events in order to gain awareness.
Sampling
[Company Name] employees will initially give free bubble tea samples to passersby to allow them to taste the quality of our products and learn about us.
Pre-Opening Events
Before opening the shop, [Company Name] will organize pre-opening events designed for prospective customers, local merchants, and press contacts. These events will create buzz and awareness for [Company Name] in the area.
Direct Mail
[Company Name] will blanket neighborhoods surrounding its locations with direct mail pieces. These pieces will provide general information on [Company Name], offer discounts, and/or provide other inducements for people to frequent the bubble tea shop.
Pricing Strategy
[Company Name] pricing will be moderate, so customers feel they receive great value when patronizing the bubble tea shop.
VII. Operations Plan
Functional Roles
In order to execute [Company Name]’s business model, the company needs to perform many functions, including the following:
Administrative Functions
- Bookkeeping
- Marketing
- Website maintenance
- Hiring and training staff
- Sourcing and storing products and ingredients
Service Functions
- Customer service
- Payment processing/cashiering
- Drink preparation
- Mobile order fulfillment
- Maintenance functions
Milestones
The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:
| Date | Milestone |
|---|---|
| [Date 1] | Finalize lease agreement |
| [Date 2] | Design and build out [Company Name] |
| [Date 3] | Hire and train initial staff |
| [Date 4] | Kickoff of promotional campaign |
| [Date 5] | Launch [Company Name] |
| [Date 6] | Reach break-even |
VIII. Management Team
Management Team Members
[Company Name] is led by [Founder’s Name]. [Founder’s Name] was raised in Taiwan and immigrated to the U.S. in 2015. She has loved bubble tea since childhood and was excited to see some bubble tea shops in the United States. However, she found the quality lacking and noticed that most shops had very few flavors or add-ons to choose from. Her disappointment inspired her to create her own bubble tea shop that serves truly authentic bubble tea and a large assortment of flavors and customizations.
[Founder’s Name] conducted considerable research on authentic recipes of bubble tea that she drank back in Taiwan. After researching recipes and doing a market analysis on her target demographic, she found a location and is ready to lease it and start her business.
Though [Founder’s Name] has never run a business before, she has worked as a manager in a local café, so she understands the management aspects of running a similar business. She will hire an administrative assistant and other staff to help her run the other aspects of the company.
Hiring Plan
[Founder] will serve as the Owner and Store Manager. In order to launch the tea shop, we need to hire the following personnel:
- Team Members (3 to start)
- Assistant Manager (1 to start)
- Administrative Staff (1 to start)
IX. Financial Plan
Revenue and Cost Drivers
[Company Name]’s revenues will come from the sale of bubble tea and other tea drinks.
The major costs for the company will be drink supply costs, salaries of the staff, and rent for a small but prime location. In the initial years, the company’s marketing spending will be high as it establishes itself in the market.
Capital Requirements and Use of Funds
[Company Name] is currently seeking $420,000 to launch. Specifically, these funds will be used as follows:
- Store design/build: $200,000
- Inventory and supplies: $50,000
- Equipment: $50,000
- Working capital: $120,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Key Assumptions
The following table reflects the key revenue and cost assumptions made in the financial model:
| Number of customers per day | Per location |
|---|---|
| FY 1 | 100 |
| FY 2 | 150 |
| FY 3 | 180 |
| FY 4 | 220 |
| FY 5 | 300 |
5 Year Annual Income Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
| Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
| Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
| Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
| Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
| Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
| Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
| EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
| EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
| Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
| PRE-TAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
| Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
| Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
| NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
| Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
| Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
| Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
| Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
| Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
| TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
| Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
| Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
| Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
| Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
| CASH FLOW FROM INVESTMENTS | |||||
| Investment | ($246,450) | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 |
| Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| SUMMARY | |||||
| Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
| Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
| Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
