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AU Business Analysis

Cafe ROI & Business Analysis Calculator

Stress-test a cafe purchase against Australian industry benchmarks.

Cafes are one of the most popular small businesses bought in Australia — and one of the most over-paid for. Use this calculator to check rent, wage and COGS ratios against ATO and IBISWorld benchmarks before you sign.

Wages % of revenue
30–38%
Typical range
Rent % of revenue
8–12%
Typical range
COGS % of revenue
25–35%
Typical range
Net margin %
8–15%
Healthy band

Sources: ATO Small Business Benchmarks — Cafés and Coffee Shops · IBISWorld — Cafés and Coffee Shops in Australia

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1

Business Details

2

Revenue

3

Annual Expenses

4

Purchase & Loan

5

Owner Details

Owner salary already in expenses?
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6

Scenario Testing

Sales Drop0%
Rent Increase0%
Wage Increase0%
Interest Rate Rise0pp
Live Analysis

Cafe

Cafe · benchmarks: Australian industry data

HealthyLow Risk
Net Profit
$56,900
Margin 8.4%
EBITDA
$131,900
Before owner & loans
ROI
17.8%
Payback 5.6 yrs
DSCR
2.89
Debt cover ratio
Monthly Repayment
$3,801
$45,609 p.a.
Cashflow After Loan
$11,291
Break-even Revenue
$659,249
$12,678/week
Owner Earnings
$131,900
Profit + replacement salary

Investment Risk Score

100/100
Low Risk

Higher score = safer investment

Revenue Breakdown

  • COGS28.7%
  • Wages33.8%
  • Rent11.5%
  • Other17.7%
  • Net Profit8.4%

Industry Benchmarks · Cafe

vs Australian averages
Wage RatioHealthy
33.8%
Benchmark: 30%–38%
Rent RatioHealthy
11.5%
Benchmark: 8%–12%
COGS RatioHealthy
28.7%
Benchmark: 25%–35%
Net MarginHealthy
8.4%
Benchmark: 8%–15%

Loan Repayment Projection

Outstanding balance over loan term

Insights

Strengths
  • • Net margin 8.4% is within healthy range for Cafe.
  • • DSCR of 2.89 indicates comfortable loan serviceability.
Weaknesses
  • No major weaknesses detected.
Red Flags
  • No red flags.
Buyer Questions
  • • Can you provide 3 years of tax returns and BAS statements?
  • • What is the remaining lease term and rent review schedule?
  • • Are there any key staff dependencies or pending resignations?
  • • How transferable are supplier and franchise agreements?
  • • Why is the current owner selling?
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General information only. This calculator provides general information only and does not take into account your personal circumstances, financial situation, objectives, taxation position, or business needs. Please seek independent professional advice before making financial or business decisions.

What makes a healthy Cafe business?

A healthy independent café in Australia typically turns over $400k–$1.2M per year, with 30–38% going to wages and 25–35% to food and beverage COGS. Anything outside those bands usually signals either an under-staffed owner-operator scenario or a structural problem.

Rent above 12% of revenue is the single biggest killer of café profitability. Brokers will tell you 'good location' justifies high rent — the numbers rarely agree.

Most cafés sell for 1.5–2.5× SDE (Seller's Discretionary Earnings). Premium sites with long leases and trained baristas can fetch up to 3×, but anything above that needs an exceptional reason.

Typical asking-price multiple

1.5× – 2.5× SDE (Seller's Discretionary Earnings). Premium high-street cafés with 5+ year leases may reach 3× SDE.

Red flags
  • • Rent + outgoings exceed 12% of revenue
  • • Wages above 38% (indicates owner is not on the floor)
  • • Lease has less than 3 years remaining without options
  • • Coffee supplier contract locks in above-market beans
  • • Owner can't produce 3 years of POS Z-reports
Green flags
  • • Strong morning trade (60%+ of daily revenue before 11am)
  • • Diversified revenue: catering, wholesale beans, weekends
  • • Trained baristas willing to stay post-settlement
  • • Lease term 5+ years with option to renew
Key due-diligence questions
  • 1. Can I see daily POS Z-reports for the last 24 months?
  • 2. What's the current coffee supplier agreement (price/kg, exclusivity, term)?
  • 3. How many staff are on the books vs. cash-in-hand?
  • 4. What's the rent review cycle and CPI cap?
  • 5. Are weekend trading days included in the average?

Frequently asked questions