Coffee Shop Feasibility Study in Georgia

Georgia's coffee lending is franchise lending

Most Georgia coffee and snack bar loans finance a brand. Franchised concepts account for 59.5% of the state's 269 SBA approvals in the class from FY2017 to FY2026, which together came to $124.1 million. At $350,000, the median Georgia coffee loan runs 1.46x the class median nationwide, yet our distinctness screen does not flag it, since it must also stand apart from Georgia's median across all classes and does not. Georgia ranks 9 of 53 among states; with a location quotient of 1.11x, coffee carries a touch more weight in Georgia lending than nationwide, and it holds 9 of 39 by count among Georgia's classes.

Rapid growth, 7(a) almost alone

Approvals climbed from 10 in FY2017 to 34 in FY2024, 51 in FY2025 and 54 in FY2026, the last year worth $24.0 million. SBA 7(a) carried 258 loans and SBA 504 only 11, with Capital Partners Certified Development Company holding 5 of the 504 loans. The Huntington National Bank is the leading 7(a) holder with 40 loans worth $14.4 million. Newtek Bank, National Association holds 17 and Newtek Small Business Finance, LLC 10, United Community Bank has 14 worth $10.6 million, and Wells Fargo Bank National Association holds 13 worth just $898,700. Half the approvals sit between $170,000 and $550,000. Fulton County leads with 41, Gwinnett has 34, Cobb 27 and DeKalb 25.

Outcomes so far

Both outcome floors sit below the class nationally. A minimum of 9.8% of the Georgia coffee loans approved over FY2017 to FY2024 were cancelled before funding; the 10.4% ceiling adds loans still undisbursed. Of 70 loans funded in FY2017 to FY2021, 5.7% have reached charge-off and 2.9% did so within five years of approval. The recent surge in approvals is too young to have been tested, so these rates describe an earlier, smaller book.

The franchise share changes what a Georgia study must test. A brand brings a format, a supply chain and royalty and marketing fees, so the study has to show that the specific site can reach the unit volumes the system's disclosure implies, not just that the concept works elsewhere. Demand should be judged on morning traffic, access from the commuting side of the road, drive-through stacking where the format needs it, and the other brands within a short drive. Cost covers build-out to the franchisor's standard and equipment. Debt service coverage must hold after royalties at a realistic first-year sales level, with a case for slower growth in a market where approvals have risen fast. If a Georgia operator is buying the pad as well, an appraiser will value a small single-tenant building, and the study should support the lease or occupancy cost that value implies.

These figures cover coffee shops and snack bars together under one code, and the lender names are the current holders of each loan as SBA reports them.