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Student Worksheet

Coffee Counter Math Lab

A Money Club worksheet for understanding price, cost, margin, profit, hooks, and repeat demand.

Pairs with

Financial Literacy for Young Entrepreneurs

Goal

Design a simple coffee counter and run the business math yourself.

Big question

Does each sale make the system stronger or weaker?

Interactive Worksheet

Overview

Retail price is what comes in.

Cost of Goods Sold, or COGS, is what goes out to make the product.

Gross margin is what is left before operating expenses.

Product Retail Price Cost of Goods Sold Gross Margin $ Gross Margin %
Coffee $2.00 $0.75 $1.25 62.5%

Gross margin is retail price minus COGS.

$2.00 - $0.75 = $1.25

Gross margin percentage is gross margin divided by retail price.

$1.25 / $2.00 = 62.5%

A good target is 40%+ gross margin.

The goal is to end with about 20% net margin, money in your pocket after operating expenses.

Below that, the business may not be worth the time.

Net Margin

Net profit is the true profit.

It is the money left after you pay for the product and the costs of running the business.

Here is an example for 1,000 coffees sold.

Product Retail Price Units Sold Revenue Total COGS Gross Margin $ Gross Margin % Operating Expenses Net Profit Net Margin %
Coffee $2.00 1,000 $2,000 $750 $1,250 62.5% $850 $400 20%

Design Your Drink

Now build your own drink. The calculator will follow you and update as your choices change.

Choose a drink to start with its base COGS.

This is what the customer pays.

What goes into the drink?

Design the Offer

A good offer connects the drink, the customer, the moment, and the reason to buy.

Test the Business

Now test what happens if you sell more than one drink. The calculator uses these numbers to show net profit.

Examples: signs, table, equipment, waste, payment fees, transport, labour.

Hooks, Upsells, and Repeat Demand

A hook gets someone interested. An upsell increases the order. Repeat demand makes the customer come back.

Decision Test

Use the numbers and the offer to decide whether the business system gets stronger or weaker.

Is the gross margin strong enough?
Is the net margin strong enough?

Example: Fresh iced coffee for students after school, cheaper than Starbucks and ready in 30 seconds.

What would make the business stronger?

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TURN THE LESSON INTO PRACTICE

Read the module

Review the lesson that introduces the coffee counter, gross margin, net margin, hooks, and repeat demand.

Read the Module
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