An Asian grocery wins customers on what the chain supermarket doesn't stock: bok choy and Thai basil, a wall of noodles and sauces, rice by the 25-pound bag, freezers full of dumplings and fish balls, a meat and seafood counter, and often a hot deli with roast duck and char siu. Each department keeps a different share: rice keeps little and brings people in, groceries keep about 30 cents of each dollar, and the hot deli keeps the most. The plan turns on the freezers and coolers, which are a big share of the build-out and the power bill, on buying from Asian distributors a truck ride away, and on shrink in the produce. The plan below works in departments per $100 of sales. In the example, an Omaha Asian grocery starts with $282,000, ends its first year about $31,200 behind before the owner's pay while sales build, and makes about $3,200 a month at full speed. Below is each part of the plan, the first year month by month, the startup budget, and a free template.
The short version
- Describe the store in a paragraph: the neighborhood, the communities it serves, what's missing nearby, the goals.
- Cost a few items: distributor price, the card fee, the shelf price.
- Plan sales by department per $100: produce, groceries, rice, frozen, meat and seafood, hot deli.
- Rice brings people in and keeps little; the hot deli keeps the most.
- Freezers and coolers are a large share of the build-out and the power bill.
- A hot deli needs its own food service permit and a hood.
- TaroStack makes the deli's roast meats batches from stock and keeps dates on the frozen foods. More below.
Part 1: the business description
Golden Lotus Market, a made-up Asian grocery in Omaha, Nebraska, writes:
Golden Lotus Market is a 4,000-square-foot Asian grocery in Omaha with fresh Asian vegetables, groceries from Chinese, Korean, Vietnamese and Filipino brands, rice in 25- and 50-pound bags, a long freezer aisle, a meat and seafood counter, and a hot deli with roast duck, char siu and bao. In its first year it aims to reach $89,000 of sales a month.
Part 2: what an item costs
| Item | Cost | Card fee | Total cost | Price | Cost share |
|---|---|---|---|---|---|
| Bok choy, per lb | $0.95 | $0.05 | $1.00 | $1.99 | 50.3% |
| Frozen pork dumplings, 2 lb bag | $5.80 | $0.25 | $6.05 | $9.99 | 60.6% |
| Jasmine rice, 25 lb bag | $19.50 | $0.62 | $20.12 | $24.99 | 80.5% |
| Roast duck, half | $6.50 | $0.40 | $6.90 | $15.99 | 43.2% |
| Soy sauce, 500 ml | $2.10 | $0.09 | $2.19 | $3.49 | 62.8% |
The roast duck is half a duck at $5.20 and $1.30 of marinade and gas. The department costs in Part 4 run higher than these items, because they carry shrink: wilted greens, duck left at close, freezer burn. How margins differ by department is in grocery store profit margins by department.
Part 3: suppliers, the freezers and the deli
Groceries and frozen foods come weekly by truck from Asian distributors in Chicago and Kansas City; produce twice a week from a wholesaler; meat and seafood from inspected suppliers. Buying from U.S. distributors means they, not the store, handle the import rules, in fsvp requirements. Frozen deliveries are checked on arrival and logged, in food receiving log template. The hot deli needs a food service permit, a hood and hot holding; what's left at close is recorded.
Part 4: what each category earns
| Category | Sales | Variable cost | Contribution | Margin | Hundreds a month at full speed |
|---|---|---|---|---|---|
| Produce | $100.00 | $64.00 | $36.00 | 36% | 150 |
| Groceries: noodles, sauces, snacks | $100.00 | $70.00 | $30.00 | 30% | 330 |
| Rice in bags | $100.00 | $82.00 | $18.00 | 18% | 80 |
| Frozen foods | $100.00 | $68.00 | $32.00 | 32% | 150 |
| Meat and seafood counter | $100.00 | $70.00 | $30.00 | 30% | 120 |
| Hot deli | $100.00 | $45.00 | $55.00 | 55% | 60 |
At full speed the business sells $89,000 a month and keeps $28,440, 32%; groceries brings $9,900 of it.
Part 5: the first year, month by month
Fixed costs are $25,200 every month: rent ($6,000), wages ($13,500), utilities, mostly the freezers ($3,200), equipment upkeep ($600), insurance ($500), register and software ($300), ads ($300), and other costs ($800). Sales start at half of full speed:
| Month | Sales | Profit | Cash, year to date |
|---|---|---|---|
| 1 | $44,500 | −$10,980 | −$10,980 |
| 2 | $49,900 | −$9,248 | −$20,228 |
| 3 | $55,200 | −$7,571 | −$27,799 |
| 4 | $60,500 | −$5,857 | −$33,656 |
| 5 | $65,800 | −$4,180 | −$37,836 |
| 6 | $71,200 | −$2,448 | −$40,284 |
| 7 | $75,800 | −$977 | −$41,261 |
| 8 | $79,300 | $135 | −$41,126 |
| 9 | $82,900 | $1,302 | −$39,824 |
| 10 | $85,500 | $2,128 | −$37,696 |
| 11 | $89,000 | $3,240 | −$34,456 |
| 12 | $89,000 | $3,240 | −$31,216 |
The year's sales are $848,600, and the business ends it $31,216 behind, before the owner's pay. It breaks even at about $78,860 of sales a month, in the eighth month. The lowest cash point, −$41,261 in month 7, is covered by the $45,000 of working cash with about $3,700 to spare. Lunar New Year, the Mid-Autumn Festival and the year-end holidays bring the busiest weeks; the plan spreads them as monthly averages, so order the mooncakes and the holiday stock early.
Part 6: the startup budget
| Item | Example |
|---|---|
| Opening inventory | $70,000 |
| Build-out | $45,000 |
| Freezers and coolers | $40,000 |
| Hot deli kitchen and hood | $30,000 |
| Meat and seafood case | $15,000 |
| Shelving | $14,000 |
| Lease deposit and first month | $12,000 |
| Register | $4,000 |
| Signs | $4,000 |
| Licenses and permits | $3,000 |
| Working cash | $45,000 |
| Total to start | $282,000 |
The $237,000 before working cash is earned back in about six years at full speed. A general small grocery is in small grocery store business plan, and a Mexican grocery with a carnicería in mexican grocery store business plan.
Get the template
Download the Asian grocery store business plan workbook. Four sheets: your categories, each per $100 of sales with its variable cost and hundreds a month at full speed; the first year, month by month, with sales ramping up, profit, cash, the first profitable month, the lowest cash point and whether the working cash covers it; your fixed costs; and the startup budget. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The plan uses one shrink allowance per department. The deli roasts a different count of ducks each day, the dumplings come in five brands with five dates, and what went to the dumpster on Monday is a guess by Friday.
How TaroStack does it
TaroStack makes the deli's roast meats batches from stock, keeps dates on the frozen foods, and records shrink by reason.
The deli's batches. Roast duck and char siu are recipes: a batch takes the ducks or pork and the marinade off stock, costs what it used, and gets a lot of its own with a date.
Dates, oldest first. Frozen and chilled foods keep their dates, the oldest goes first, and an alert comes before a date runs out.
Shrink with a reason. Every adjustment carries its reason, expired, spoiled, damaged or lost, reported by reason, item and site.
| The job | Notebook | In TaroStack |
|---|---|---|
| What a roast duck cost | Guessed | The batch's cost from what it used |
| Dumplings near their date | Found in the freezer | An alert before the date |
| Shrink by department | One plugged-in number | By reason, item and site |
Recipes, batches, lots, expiry and losses by reason are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.