Selling This Instead of Coffee: The Real Revenue Behind 2000-Won Coffee | Reporter Hong Seong-yong | Maeil Business Special
An independent exercise, not a statement by the video creator or verification of every claim in the video.
Including Owner Labor Changes the Break-Even Sales Target
In an independent example, coffee sells for KRW 2,000 and variable costs for ingredients, cups and payment fees total KRW 800 per cup, leaving contribution of KRW 1,200. Monthly rent, employee payroll and other fixed costs of KRW 6,000,000 require 5,000 cups, or about 167 per day across 30 operating days. A separate benchmark adding KRW 3,000,000 for the owner’s monthly labor requires KRW 9,000,000 of contribution, or 7,500 cups and 250 per day. The difference is whether owner labor is included; selling 250 cups daily does not establish recovery of startup investment. Avoid adding owner labor again if it is already in payroll, and adapt the calculation to the actual menu mix, additional staffing and operating days.
Check for yourself
- Does the calculation use contribution after variable costs rather than revenue?
- Where are owner compensation, borrowing interest and equipment replacement reflected?
- Could sales withstand another nearby opening while still covering fixed costs?
Limits of application
This independent example does not estimate an actual brand’s costs, royalties or returns. It assumes one product and constant unit costs, fixed expenses and operating days, omitting tax, depreciation, interest and recovery of initial investment. Supply revenue is not itself headquarters net profit, and this calculation alone does not determine whether to open a store.
- What to look for
- View the same coffee price from customer, franchisee and headquarters perspectives, examining incentives around fees, equipment, supplies and recurring sales.
- Why it matters
- Avoid inferring profit by directly comparing headquarters revenue with average store sales, and assess viability through startup investment, contribution per cup, fixed costs and owner labor.
Timeline
3 segmentsThe central explanation distinguishes franchise fees, equipment and supply revenue at headquarters from retail sales at stores. One-off opening revenue can coexist with recurring revenue linked to existing stores’ sales volumes, so coffee sales are not irrelevant and adding stores alone is not sufficient. Prospective owners, urban density and coffee demand are explanatory factors proposed by the speaker, rather than proof that this model works exclusively in Korea.
