Very often, individuals and even partners starting a new coffee shop leave stable long-term employment with predictable salaries in unrelated fields to become their own boss. It is tempting for the new owner acting in favor of their new business to reinvest 100% of all available capital, including their own salaries back into the fledgling business. Even though this concept is well intended, we recommend that you will be doing your business a greater service by ensuring that your own personal financial worries are set aside when you come to work. Drawing at least a minimal salary for yourself that satisfies you and your family’s basic needs will ultimately be far better not only for you, but also for your business.
By paying yourself a salary - even when times are tight - you will retain the ability to make smart business decisions in the true best interest of your business, rather than fold to the pressures of short term hardships under the stress of immediate personal financial concerns. All of us have been in the situation of regretting a decision that seemed satisfy our urgent immediate needs, but may have sacrificed some benefit for our future; in the context of your business, having a clear head, free of personal financial worries can help you to avoid financially damaging or potentially fatal mistakes.
For many good reasons that you should discuss with your licensed attorney and accountant, every retail coffee shop should be established as its own legal entity separate and distinct from you.
The coffee shop may be yours, but it is not you - this may seem obvious and even comically unnecessary at a first glance, but trust us that this distinction can be lost by the best and brightest working under extreme stress for long hours in the sole and total pursuit of a goal.
Never lose sight of the fact that the business is a vehicle intended to reward you for your acceptance of financial risk and your intelligent hard work. Even in the event you are independently wealthy or otherwise comfortable in your own personal financial wants, consider paying yourself minimum wage for the hours you work in order to create the mental separation between owner and business.
Have fun with your coffee shop, design it, manage it and personalize it as your own - just be careful to not lose your identity to the business, as this will only create problems for you and inhibit your ability to make potentially difficult but necessary decisions for the good of both owner and business.