CRITICAL RISKS

Finding capital investor or kick starter

When starting the business the service may encounter investment problems the service needs certain
equipment to operate like coffee maker, espresso machines and thermostats and utility bags. in order to
meet these requirements need investors and entrepreneurs needs investors and the entrepreneurs
needs to investigate and research potential items and equipments for use.

New competitors
If the service becomes successful others may want to do the same service so the entrepreneurs needs to
keep on advancing innovation the service over tie and has to be planned for the future with the growing
demand the service has to keep up and meet the demands of the future customer.

There are also the potential of bankruptcy if the newly formed rival becomes dominant over the service
may have to dissolve so entrepreneurs should get prepared.
Risk of low demand
Before we start our service we have to so a thorough understanding of the business and potential
customers as well as demand for coffees service. The business may encounter a spike un demand when
there is a test coming and a decline when there is a less students on campus and on the weekends, so
our business should so a rough estimates of the inflammation of demand.

Quality
The quality of the coffee we provide controls our success I the market. The quality of the coffee grounds
to the quality of the coffee brewing process should be carefully monitored and controlled although we
have to do some compromises to balance the affordability of the student to the quality we provide. And
resource usage as to be considered when providing the resource. Transportations system has to be
ready when delivering coffee.

Health issues
Due to the fact that some peoples are at risk of different health problems such as diabetes, blood
pressure, and heart problems etc. although we are sure that our product is very qualified, peoples with
some risk of health problems cant consume this product. Besides that some peoples with normal health
condition may not consume our services due to health concerns.
Appendices
Appendix A: capital equipment list

Table A:

Capital equipment
item number New/used Expected life cost
Coffee grinder 5 new 0 2500
Shelving 4 new - 3000
Cups 12 doz new - 800
espresso 3 used - 2400
Oven 2 new - 1000
chairs 45 used - 5000

Appendix B: START-UP EXPENSES

Table B:

EXPENSES AMOUNT OF MONEY

Total cost of equipment 14,700
Account fee 17,000
Advertising 3400
Insurance 1000 per month
Bond -
-
-

Appendix C: income statement projection

Table c

EXPENSES Jan feb mar april ma june julay au sep oct nov de total
y g c
Electric utility 200 2400
Gas utility 500 6000
Water utility 250 3000
Labor 4000 48,000
Insurance 83.3 1000
Telephone 780 9360
Equipment repair 399 4788
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