SBA 7(a) Coffee Shop Feasibility Study in New Jersey

Zero charge-offs to date in a franchise-heavy market

What sets New Jersey coffee shops and snack bars apart under SBA 7(a) is repayment: the 72 loans funded from FY2017 through FY2021 carry a charged-off share of 0.00%, now and at five years. That is a floor, since open loans can still fail. The wider record covers 241 loans and $67.8 million gross, a median of $180,000 that is 0.80x the national figure, and typical loans from $50,000 to $371,000. The state is 10 in the national order, and coffee is 8 of 39 inside New Jersey, and franchise brands hold 44.0%.

TD Bank and the counties

TD Bank, National Association has 66 loans worth $3.7 million, many small loans in a state where most checks are modest. Wilmington Savings Fund Society FSB has 14 loans worth $5.1 million, The Huntington National Bank 13 worth $2.6 million, Provident Bank 12 worth $3.7 million and Manufacturers and Traders Trust Company 11 worth $1.3 million. These come from SBA's holder field and imply nothing about a bank's own criteria. Bergen County leads with 37 loans, then Ocean with 23, Monmouth 21, Hudson 18, Essex 17, Camden and Morris 15 each, Middlesex and Union 13 each, and Burlington 12. Volume was lowest in FY2021 at 10 and highest in FY2023 at 40.

Cancellations

Cancellations take 16.0% at a minimum from the FY2017 to FY2024 group, and 16.6% at most. That is a sizeable share of deals that do not reach funding; the charge-off record, not the cancellation share, is what sets this cell apart.

What a New Jersey coffee shop study has to test

The study should first establish whether trade comes from commuters or neighbors. It should count the people passing at the morning peak, the train stations and offices near the site, and the cafes, chains and bakeries already within a short walk or drive. Rent differs by site, so the forecast needs to support sales per square foot that cover the lease and still pay debt. Compare build-out, equipment and opening inventory with a $180,000 median. If a franchise is involved, put its fees, required remodel schedule and territory in the model, and look at what happens if sales run below the system average. Given the cancellation floor, set out how lease, permits and approvals will be finished before funding. The business, not the building, supplies the value an appraiser tests.