Coffee Shop Feasibility Study in Washington

Many coffee loans, each one small

Washington has a large coffee record with modest tickets. The state's 277 SBA approvals for coffee shops and snack bars between FY2017 and FY2026, worth $76.8 million, rank it 7 of 53, while a location quotient of 1.25x tilts Washington's SBA lending toward coffee. The class also ranks 7 of 39 inside the state. The distinctive metric is the median loan of $175,000, just 0.73x the national coffee median. The loss figures below are not flagged as distinctive for this cell.

Banks and King County

The middle half of approvals runs from $70,000 to $337,500. SBA 7(a) carried 266 loans and SBA 504 only 11, and franchise concepts take 22.4% of loans. The 7(a) loans are held by several banks: KeyBank National Association and U.S. Bank, National Association hold 25 loans each, the first worth $6.5 million and the second $2.0 million, Columbia Bank holds 24, Banner Bank 22 and Washington Trust Bank 16. King County is the largest county with 108 approvals, followed by Pierce with 37, Spokane with 29 and Clark with 23. Approvals reached 44 in FY2026, a complete fiscal year, worth $21.3 million, the high point of the series.

Cancellations and charge-offs

A floor of 10.8% of Washington coffee approvals from FY2017 to FY2024 were cancelled, or 11.8% counting undisbursed loans. Charge-offs are heavier. Among the 94 Washington coffee loans disbursed from FY2017 to FY2021 approvals, 9.6% are charged off to date and 4.3% within five years. Both are floors, and neither is one of this cell's flagged metrics.

What the study must show

For lenders, small loans with a charge-off floor near this level mean the borrower's cash flow matters more than the collateral. A Washington coffee feasibility study has to show demand at the specific site, from commuter traffic, foot traffic and the density of other cafes and stands nearby. Cost should be tested line by line, since a small loan leaves little contingency for build-out overruns. Debt service coverage needs a downside case on ticket count and labour cost, and the owner's own hours should be priced. With loans this size, the appraisal is often of business value rather than property, and the study should support it with an honest sales forecast.

The class here is coffee shops and snack bars, and the record carries no coding caveat for this cell. Every rate printed on this page is a floor.