Coffee Shop Feasibility Study in Missouri

Missouri coffee: clean closings, heavier losses

Missouri's coffee and snack bar record pairs a clean path to closing with a heavier loss record. Of the approvals dated FY2017 through FY2024, 8.1% or more were cancelled, and the ceiling is also 8.1%, so nearly every Missouri commitment from that window has either funded or been cancelled already. The credit side is weaker: of 43 Missouri loans disbursed in FY2017 through FY2021, 9.3% are now charged off, and 7.0% failed inside the first five years. With only 43 Missouri loans in that cohort, still repaying, both rates are floors that a few more defaults would push higher.

None of those floors, nor the median, is distant enough from Missouri's overall SBA book, or from coffee lending nationally, to pass our margin; they describe the cell rather than set it apart. The median Missouri loan was $270,000, 1.13x the class median nationwide, with an interquartile band stretching from $130,000 to $582,900. Missouri ranks 20 of 53 for the class, coffee holds the 7 of 39 place in Missouri's class ranking, and a 0.97x location quotient matches the national weight closely. Approvals total 133, worth $59.1 million.

A franchise-heavy Missouri book, and recent growth

Franchise units take 47.4% of Missouri coffee loans. SBA 7(a) carries 127 approvals and SBA 504 only 6, so few Missouri cafe owners have used the 504 route to buy a building. The Huntington National Bank holds 12 loans worth $6.3 million; The Central Trust Bank holds 10 worth $976,000, a book of small loans; United Community Bank and OakStar Bank hold 8 each, and The Bank of Missouri 5. Volume jumped in FY2025 to 29 approvals worth $19.9 million, followed by 18 in FY2026, so a large part of the Missouri book has not yet been tested by time.

Testing a Missouri coffee project

A feasibility study has to address the charge-off floor directly. That means testing sales against nearby competition, morning and drive-through traffic, and the ticket the local market will pay, then running the payment test at a slower ramp than the plan assumes. Jackson County holds 20 approvals, Saint Louis County 16, Saint Charles 12, and Greene and Jasper 9 each. Cost work should include franchise fees and required equipment at current pricing where a brand is involved. With the recent surge in approvals, the study should also show why this site will hold share against newer units opened in the same counties. If Missouri real estate is financed, its appraised value should stand independent of the cafe. The figures describe SBA loans only.