Fast Casual + Beer/Wine • Counter Service • Minneapolis, Minnesota
Kova Ramen is a counter-service Japanese ramen concept with a beer and wine program targeting Minneapolis, Minnesota’s North Loop neighborhood. The concept benefits from an experienced ownership team with a combined 25+ years in the restaurant industry, a validated cuisine category with strong national demand, and a capital position that covers 82% of projected startup costs under the most likely scenario. The primary risk centers on the premium lease rates in North Loop, which elevate occupancy costs above the fast-casual benchmark.
The ownership group has committed $350,000 in capital, covering 82% of the $427,000 projected startup cost (most likely scenario). The $77,000 gap is within typical SBA financing range. An SBA loan pre-approval is currently in progress for $250,000, which would more than cover the remaining gap and provide additional operating reserve. See Section 9 for recommended funding structure.
Kova Ramen is positioned as a fast-casual Japanese ramen concept operating under a counter-service model. The brand is differentiated by house-made noodles produced daily on-site, a curated sake cocktail program, and extended late-night hours designed to capture an underserved daypart in the Minneapolis market.
| Brand Name | Kova Ramen |
| Cuisine | Japanese Ramen |
| Category | Fast Casual + Beer/Wine |
| Service Model | Counter Service |
| Alcohol Program | Beer & Wine (including sake) |
| Target Seating | 45 seats |
| Target Square Footage | 2,000 SF |
| Space Type | 2nd Generation Restaurant |
| Daypart | Hours | Est. Revenue Share | Avg Check |
|---|---|---|---|
| Lunch | 11:00 AM – 2:30 PM | 40% | $20 |
| Dinner | 5:00 PM – 9:00 PM | 45% | $28 |
| Late Night | 9:00 PM – 11:00 PM | 15% | $26 |
| Category | Item Count | Avg Price | Target Food Cost |
|---|---|---|---|
| Entrées / Ramen Bowls | 8 | $16.00 | 30% |
| Appetizers / Sides | 4 | $10.00 | 28% |
| Beverages / Sake & Beer | 8 | $12.00 | 22% |
The menu is anchored by the following signature offerings:
| Ownership Structure | Partnership (2 partners) |
| Owner-Operator | Full-Time |
| Experience Level | 8/10 — Experienced operator |
| Executive Chef (Partner) | 15 years Japanese cuisine experience — former sous chef at nationally recognized ramen program |
| FOH Manager | Hiring in progress — budgeted at $48,000/year |
The following market analysis evaluates the target trade area of North Loop, Minneapolis, Minnesota for a fast-casual Japanese ramen concept.
| Primary Market | Minneapolis, Minnesota |
| Target Neighborhood | North Loop |
| Setting | Urban |
| Traffic Driver | Foot Traffic |
| State Population | 5,737,915 |
| Metro Population | 3,690,000 |
| Median Household Income | $84,313 |
| Factor | Score | Assessment |
|---|---|---|
| Demand Evidence | 8/10 | Ramen is a proven, high-demand category nationally. Minneapolis has limited dedicated ramen shops relative to population, indicating unmet demand. Search interest and existing wait times at competitors validate the market. |
| Competition Level | 7/10 | Moderate competition. Three dedicated ramen concepts operate in the greater Minneapolis metro, but none in the North Loop. Adjacent competition from broader Asian fast-casual concepts exists but does not specialize in ramen. |
| Demographic Fit | 8/10 | North Loop skews young professional (25–44), with a median household income of $84,313 — well above the threshold for a $24 average check. High density of office workers and residents within walking distance. |
| Location Quality | 7/10 | North Loop is one of Minneapolis’s highest-traffic dining districts. Premium rents reflect strong foot traffic, office density, and residential growth. The neighborhood’s food-forward reputation aligns with the Kova Ramen brand. |
| Market Gap | 8/10 | No dedicated ramen-focused concept currently operates in North Loop. The neighborhood supports multiple Asian-adjacent restaurants but lacks a specialist ramen offering with house-made noodles and a beverage program. |
| Overall Market Score | 7.6/10 | Favorable Market |
5 direct and adjacent competitors have been identified in the greater Minneapolis market:
| Competitor | Concept Type | Avg Check | Relevance |
|---|---|---|---|
| Moto-i | Japanese Izakaya / Ramen | $30 | Direct |
| Ichiddo Ramen | Ramen Fast Casual | $18 | Direct |
| Zen Box Izakaya | Japanese Izakaya | $28 | Adjacent |
| Wakame Sushi & Asian | Pan-Asian Casual Dining | $25 | Indirect |
| United Noodles | Asian Grocery / Deli | $12 | Indirect |
Kova Ramen is positioned to fill a clear gap in the North Loop dining landscape by combining specialist ramen expertise with a neighborhood-accessible format. Unlike existing competitors, the concept focuses exclusively on ramen with visible, house-made noodle production, creating an experience and quality level that generalist Asian restaurants cannot match.
North Loop lease rates are among the highest in Minneapolis ($30+/SF/year). While the foot traffic justifies the premium, the ownership team should evaluate adjacent neighborhoods such as Northeast Minneapolis as fallback locations, where rents are 20–30% lower with comparable foot traffic density and a strong independent dining culture.
The following analysis compares restaurant startup and operating costs across 3 states to evaluate the optimal market for the Kova Ramen concept. The ownership team has indicated openness to alternative locations.
| Metric | Minnesota | Wisconsin | Colorado |
|---|---|---|---|
| Total Startup (Likely) | $427,000 | $348,000 | $441,000 |
| Annual Lease Cost (2,000 SF) | $60,000 | $44,000 | $64,000 |
| Annual Labor Cost (est.) | $297,000 | $234,000 | $312,000 |
| State + Local Tax Burden | 17.73% | 13.08% | 12.17% |
| Build-Out (2,000 SF) | $370,000 | $310,000 | $350,000 |
| Savings vs. Minnesota | — | -$79,000 (-18.5%) | +$14,000 (+3.3%) |
Minneapolis remains the strongest fit for the Kova Ramen concept given the ownership team’s local expertise, the executive chef’s established reputation, and the clear market gap in North Loop. The cost premium over Wisconsin is justified by higher revenue potential and brand-building advantages. If the North Loop proves cost-prohibitive at lease negotiation, Northeast Minneapolis offers a compelling fallback within the same metro at 20–30% lower rents.
The following startup budget models three cost scenarios for opening Kova Ramen in a 2,000 SF second-generation restaurant space in Minneapolis, Minnesota. All costs are based on Minnesota state-level data and fast-casual industry benchmarks.
| Category | Optimistic | Most Likely | Conservative |
|---|---|---|---|
| Lease Deposit & Prepaid Rent | $10,000 | $15,000 | $20,000 |
| Build-Out & Construction | $125,000 | $155,000 | $185,000 |
| Kitchen Equipment | $65,000 | $82,000 | $100,000 |
| Furniture, Fixtures & Décor | $18,000 | $25,000 | $35,000 |
| Technology & POS | $8,000 | $12,000 | $18,000 |
| Signage & Branding | $4,000 | $7,000 | $12,000 |
| Licenses & Permits | $3,500 | $5,200 | $7,000 |
| Liquor License & Bar Build | $5,000 | $8,500 | $12,000 |
| Professional Fees (Legal, Accounting, Architect) | $8,000 | $12,500 | $18,000 |
| Initial Inventory & Smallwares | $12,000 | $16,000 | $20,000 |
| Marketing & Pre-Opening | $6,000 | $12,000 | $18,000 |
| Working Capital (Pre-Revenue Reserve) | $72,000 | $47,000 | $31,000 |
| Contingency (7.5%) | $16,800 | $29,800 | $45,600 |
| TOTAL STARTUP COST | $353,300 | $427,000 | $501,600 |
Available capital of $350,000 covers 82% of the most likely startup cost. The $77,000 gap is within typical SBA financing range. The SBA pre-approval in progress for $250,000 would more than cover this gap, leaving $173,000 in additional operating reserve. See Section 9 for funding structure.
The following unit economics model projects the stabilized (Year 3) operating performance of Kova Ramen based on industry benchmarks for fast-casual + beer/wine concepts in Minnesota.
| Metric | Conservative | Most Likely | Optimistic |
|---|---|---|---|
| Average Check | $22 | $24 | $26 |
| Covers per Day | 113 | 135 | 158 |
| Seat Turns per Day | 2.5 | 3.0 | 3.5 |
| Operating Days/Year | 360 | ||
| Annual Revenue (Stabilized) | $895,000 | $1,166,000 | $1,478,000 |
| Line Item | Annual | Monthly | % of Revenue | Benchmark | Status |
|---|---|---|---|---|---|
| Total Revenue | $1,166,000 | $97,167 | 100.0% | — | — |
| Food Cost | $256,520 | $21,377 | 22.0% | 28–32% | Healthy |
| Beverage Cost | $58,300 | $4,858 | 5.0% | 5–7% | Healthy |
| Total COGS | $314,820 | $26,235 | 27.0% | — | — |
| Gross Profit | $851,180 | $70,932 | 73.0% | — | — |
| Labor (All-In) | $326,480 | $27,207 | 28.0% | 26–32% | Healthy |
| Prime Cost | $641,300 | $53,442 | 55.0% | 56–64% | Healthy |
| Occupancy | $93,280 | $7,773 | 8.0% | 6–10% | Healthy |
| Other Operating | $198,220 | $16,518 | 17.0% | 15–20% | — |
| Four-Wall Profit | $233,200 | $19,433 | 20.0% | 8–14% | Healthy |
| Monthly Fixed Costs | $24,291 |
| Contribution Margin per Cover | $13.20 |
| Break-Even Covers per Day | 61 |
| Break-Even Monthly Revenue | $48,800 |
| Break-Even as % of Capacity | 45% |
The concept reaches break-even at 45% of projected daily capacity, providing a substantial margin of safety. Even under the conservative scenario, the concept operates well above break-even at stabilization.
The following projections model three operating scenarios for Kova Ramen over a five-year horizon. Year 1 reflects a 12-month revenue ramp from opening. Years 2–5 apply growth rates consistent with fast-casual + beer/wine industry norms.
| Line Item | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Total Revenue | $932,000 | $1,096,000 | $1,166,000 | $1,201,000 | $1,225,000 |
| COGS | ($260,000) | ($296,000) | ($315,000) | ($324,000) | ($331,000) |
| Gross Profit | $672,000 | $800,000 | $851,000 | $877,000 | $894,000 |
| Labor | ($279,600) | ($307,000) | ($326,000) | ($336,000) | ($343,000) |
| Occupancy | ($88,000) | ($90,600) | ($93,300) | ($96,100) | ($99,000) |
| Other Operating | ($158,400) | ($186,300) | ($198,200) | ($204,200) | ($208,300) |
| Debt Service (SBA) | ($14,400) | ($14,400) | ($14,400) | ($14,400) | ($14,400) |
| Net Profit | ($38,400) | $105,700 | $132,100 | $146,300 | $171,300 |
| Net Margin | -4.1% | 9.6% | 11.3% | 12.2% | 14.0% |
| Month | Revenue | COGS | Labor | Fixed Costs | Net |
|---|---|---|---|---|---|
| Month 1 | $52,400 | ($14,700) | ($19,200) | ($24,300) | ($5,800) |
| Month 2 | $57,200 | ($16,000) | ($19,800) | ($24,300) | ($2,900) |
| Month 3 | $61,900 | ($17,300) | ($20,500) | ($24,300) | ($200) |
| Month 4 | $68,000 | ($19,000) | ($21,400) | ($24,300) | $3,300 |
| Month 5 | $74,100 | ($20,700) | ($22,200) | ($24,300) | $6,900 |
| Month 6 | $79,500 | ($22,300) | ($23,000) | ($24,300) | $9,900 |
| Month 7 | $84,500 | ($23,700) | ($23,700) | ($24,300) | $12,800 |
| Month 8 | $87,900 | ($24,600) | ($24,100) | ($24,300) | $14,900 |
| Month 9 | $89,300 | ($25,000) | ($24,400) | ($24,300) | $15,600 |
| Month 10 | $91,200 | ($25,500) | ($24,700) | ($24,300) | $16,700 |
| Month 11 | $93,100 | ($26,100) | ($25,000) | ($24,300) | $17,700 |
| Month 12 | $92,900 | ($26,000) | ($25,000) | ($24,300) | $17,600 |
| Year 1 Total | $932,000 | ($260,900) | ($273,000) | ($291,600) | $106,500 |
| Assumption | Conservative | Most Likely | Optimistic |
|---|---|---|---|
| Year 1 Revenue (Ramped) | $716,000 | $932,000 | $1,182,000 |
| Y2 Growth over Y1 Steady State | 5% | 7.5% | 10% |
| Y3 Growth | 3% | 4% | 5% |
| Y4 Growth | 2% | 3% | 4% |
| Y5 Growth | 1% | 2% | 3% |
| COGS Inflation | 3.5% | 3.0% | 2.5% |
| Lease Escalation | 3% annually | ||
The following analysis models the month-by-month cash position for Kova Ramen from pre-opening through the first 12 operating months, including all startup costs, operating cash flow, and debt service.
| Month | Revenue | Total Expenses | Net Cash Flow | Cumulative Cash |
|---|---|---|---|---|
| Pre-Opening | $0 | ($427,000) | ($427,000) | $173,000 |
| Month 1 | $52,400 | ($58,200) | ($5,800) | $167,200 |
| Month 2 | $57,200 | ($60,100) | ($2,900) | $164,300 |
| Month 3 | $61,900 | ($62,100) | ($200) | $164,100 |
| Month 4 | $68,000 | ($64,700) | $3,300 | $167,400 |
| Month 5 | $74,100 | ($67,200) | $6,900 | $174,300 |
| Month 6 | $79,500 | ($69,600) | $9,900 | $184,200 |
| Month 7 | $84,500 | ($71,700) | $12,800 | $197,000 |
| Month 8 | $87,900 | ($73,000) | $14,900 | $211,900 |
| Month 9 | $89,300 | ($73,700) | $15,600 | $227,500 |
| Month 10 | $91,200 | ($74,500) | $16,700 | $244,200 |
| Month 11 | $93,100 | ($75,400) | $17,700 | $261,900 |
| Month 12 | $92,900 | ($75,300) | $17,600 | $279,500 |
| Starting Cash (Post-Startup) | $173,000 |
| Lowest Cash Point | $164,100 (Month 3) |
| Months of Runway at Conservative | 18+ months |
| Cash-Positive Month (Likely) | Month 4 |
| Emergency Reserve Remaining | $164,100 |
The cash position remains strongly positive throughout the first 12 months under the most likely scenario, with a lowest point of $164,100 in Month 3. The SBA loan proceeds provide substantial working capital cushion, and the concept reaches cash-positive operations by Month 4. Even under the conservative scenario, the 18+ month runway provides ample time to reach stabilization.
The following funding package outlines the capital structure, sources and uses of funds, and debt service capacity for the Kova Ramen project.
| Source | Amount | % of Total | Status |
|---|---|---|---|
| Owner Equity (Cash) | $200,000 | 33.3% | Confirmed |
| SBA 7(a) Loan | $250,000 | 41.7% | In Progress |
| Investor Capital (Friends & Family) | $50,000 | 8.3% | Committed |
| Excess Reserve (Post-Startup) | $100,000 | 16.7% | Working Capital |
| Total Sources | $600,000 | 100% | — |
| Use | Amount | % of Total |
|---|---|---|
| Build-Out & Construction | $155,000 | 36.3% |
| Equipment & FF&E | $107,000 | 25.1% |
| Lease & Deposits | $15,000 | 3.5% |
| Licenses, Permits & Professional Fees | $17,700 | 4.1% |
| Liquor License & Bar Build | $8,500 | 2.0% |
| Initial Inventory & Supplies | $16,000 | 3.7% |
| Marketing & Pre-Opening | $12,000 | 2.8% |
| Working Capital Reserve | $47,000 | 11.0% |
| Contingency (7.5%) | $29,800 | 7.0% |
| Post-Startup Operating Reserve | $19,000 | 4.5% |
| Total Uses | $427,000 | 100% |
| Recommended Loan Amount | $250,000 |
| Loan Program | SBA 7(a) |
| Estimated Term | 10 years |
| Estimated Rate | Prime + 2.75% (10.25%) |
| Monthly Payment | $1,200 |
| Annual Debt Service | $14,400 |
| Scenario | Year 2 NOI | Annual Debt Service | DSCR | Status |
|---|---|---|---|---|
| Conservative | $67,000 | $14,400 | 4.65x | Qualifies |
| Most Likely | $120,100 | $14,400 | 8.34x | Qualifies |
| Optimistic | $188,000 | $14,400 | 13.06x | Qualifies |
The following roadmap outlines licensing, permitting, and regulatory requirements for opening a fast-casual restaurant in Minnesota. All costs and timelines are based on Minnesota state and Minneapolis local requirements.
| License/Permit | Issuing Authority | Est. Cost | Processing Time | Renewal |
|---|---|---|---|---|
| Business License | Minneapolis / Hennepin County | $150 | 1–2 weeks | Annual |
| Food Service License | MN Dept of Health | $450 | 3–4 weeks | Annual |
| Health Dept Inspection | Hennepin County Health Dept | $250 | 3–4 weeks | Annual + Spot Checks |
| Food Manager Certification | ServSafe / MN Program | $175 | 1–2 weeks | Every 5 years |
| Fire Dept Inspection | Minneapolis Fire Marshal | $200 | 1–2 weeks | Annual |
| Building Permit (Build-Out) | Minneapolis Building Dept | $1,500 | 4–6 weeks | One-Time |
| Sign Permit | Minneapolis Zoning | $300 | 2–4 weeks | One-Time |
| On-Sale Wine/Beer License | Minneapolis City Council / MN AGED | $750 | 6–10 weeks | Annual |
| Employer ID / State Tax Registration | IRS / MN Revenue | $0 | 1–2 weeks | N/A |
| Total Licensing Costs | — | $3,775 | — | — |
Minnesota does not allow tip credit — all employees must be paid the full state minimum wage of $11.13/hr regardless of tipped status. This is factored into the labor model in Section 6. Licensing requirements and costs change periodically. The ownership team should verify all requirements with Minnesota and Minneapolis authorities prior to lease execution.
The following timeline models the critical path from lease execution to grand opening for Kova Ramen, based on a second-generation restaurant space of approximately 2,000 SF in Minneapolis, Minnesota.
| Phase | Weeks | Duration | Key Milestones |
|---|---|---|---|
| 1. Pre-Construction | Weeks 1–3 | 3 weeks | Lease execution, architect plans finalized, permits filed, contractor selected and bidding |
| 2. Construction | Weeks 4–8 | 5 weeks | Selective demo, plumbing modifications, electrical upgrades, noodle station build-out, bar area, flooring, paint |
| 3. Equipment & FF&E | Weeks 8–10 | 2 weeks | Kitchen equipment delivery and install (ramen-specific: broth kettles, noodle maker), furniture, POS system, signage |
| 4. Inspections & Licensing | Weeks 10–12 | 2 weeks | Health inspection, fire inspection, final building inspection, certificate of occupancy, liquor license final approval |
| 5. Pre-Opening | Weeks 12–14 | 2 weeks | Staff hiring and training, menu testing, broth recipe calibration, soft opening (friends & family), systems check |
| Grand Opening | Week 14 — Target: Fall 2026 | ||
The following assessment identifies key risks to the Kova Ramen project, estimates their financial impact, and proposes mitigation strategies.
| Probability | High (Minnesota cold climate) |
| Financial Impact | $12,000–$18,000 / month (Jan–Feb trough) |
| Early Warning | Week-over-week revenue decline beginning November |
| Probability | Medium |
| Financial Impact | $8,000–$15,000 / month shortfall during Months 1–6 |
| Early Warning | Month 1 revenue below $45,000; Month 3 below $55,000 |
| Probability | Low–Medium (partner, but still a risk) |
| Financial Impact | $25,000–$40,000 replacement + 2–3 months revenue disruption |
| Early Warning | Partner dissatisfaction, disagreements on direction, reduced engagement |
| Probability | Medium (2nd gen space reduces risk) |
| Financial Impact | $15,000–$45,000 (10–30% of build-out budget) |
| Early Warning | Change orders during first 2 weeks of construction |
| Probability | Medium (ongoing industry trend) |
| Financial Impact | $8,000–$20,000 / year (1–2% margin compression) |
| Early Warning | Monthly food cost exceeding 30% for 2 consecutive months |
| Probability | Medium (strong market attracts competition) |
| Financial Impact | 5–15% revenue reduction ($58,000–$175,000 annually) |
| Early Warning | New ramen or Asian fast-casual lease signed within 1-mile radius |
| Risk | Probability | Impact | Severity | Mitigated? |
|---|---|---|---|---|
| Seasonal Revenue Volatility | High | $12K–$18K/mo | High | Yes — modeled in projections |
| Revenue Ramp Slower | Medium | $8K–$15K/mo | Medium | Yes — 18+ month runway |
| Key Employee Departure | Low–Medium | $25K–$40K | Medium | Partial — needs operating agreement |
| Construction Overrun | Medium | $15K–$45K | Medium | Yes — contingency included |
| Food Cost Inflation | Medium | $8K–$20K/yr | Low | Yes — commodity-stable ingredients |
| New Competitor Entry | Medium | $58K–$175K/yr | Low | Partial — first-mover advantage |
The following action items are prioritized by urgency, dependency chain, and financial impact. These represent the immediate next steps for the Kova Ramen project.
Establish Chen Restaurant Group LLC (or Kova Ramen LLC) with a comprehensive operating agreement covering equity splits, vesting schedules, decision rights, recipe IP assignment, and exit/buyout provisions between the two partners.
Finalize the SBA loan application with this Financial Blueprint as the supporting financial package. Target loan amount: $250,000. Include 5-year pro forma, use of funds schedule, and personal financial statements for both partners.
Retain a broker specializing in restaurant spaces in North Loop and Northeast Minneapolis. Identify 3–5 candidate 2nd-generation spaces in the 1,800–2,200 SF range. Verify hood system capacity and grease trap during each site visit.
Source and order commercial noodle machine (Yamato, Richmen, or equivalent). 4–6 week lead time requires early ordering. Evaluate both new and certified refurbished options.
Execute lease on selected space. Immediately submit Minneapolis on-sale wine/beer license application (6–10 week processing). Contact assigned council member’s office to confirm public hearing date.
Engage architect experienced in restaurant build-outs. Develop construction documents for the 2nd-gen space conversion. File building permits with Minneapolis Building Dept (4–6 week processing).
Get 3 bids from contractors experienced in restaurant build-outs. Negotiate fixed-price contract where possible. Begin construction once permits are approved.
Finalize all recipes with detailed cost cards. Calibrate tonkotsu broth recipe for commercial batch size. Test noodle formulations on commercial equipment. Establish target food cost of 30% on food, 22% on beverages.
Source suppliers for pork bones, flour (noodle-grade), miso, sake, and specialty Japanese ingredients. Negotiate pricing and delivery schedules. Establish backup suppliers for critical items.
Post and fill the FOH Manager role ($48,000/year budgeted). Begin recruiting for opening team: 4 line cooks, 3 counter staff, 1 dishwasher. Plan 2-week training program.
Build social media presence (Instagram, TikTok). Document noodle-making process for content. Invite local food bloggers and media for soft opening. Set up Google Business Profile and online ordering integration.
Execute 1-week friends & family soft opening. Test all kitchen systems, POS, and service flow at reduced capacity. Calibrate broth production schedule for daily service. Adjust staffing levels based on observed demand.
| # | Action | Target Date | Est. Cost | Status |
|---|---|---|---|---|
| 1 | Form LLC & Operating Agreement | Immediately | $1,500–$3,000 | ☐ |
| 2 | Complete SBA Pre-Approval | +2 weeks | $500 | ☐ |
| 3 | Engage RE Broker | +2 weeks | $0 | ☐ |
| 4 | Order Noodle Equipment | +4 weeks | $12,000–$18,000 | ☐ |
| 5 | Sign Lease + Liquor License | +6 weeks | $15,750 | ☐ |
| 6 | Hire Architect + Permits | +6 weeks | $8,000–$12,000 | ☐ |
| 7 | Select GC + Construction | +8 weeks | $155,000 | ☐ |
| 8 | Final Menu + Recipe Costing | +8 weeks | $2,000–$4,000 | ☐ |
| 9 | Vendor Relationships | +10 weeks | $0 | ☐ |
| 10 | Hire FOH Manager + Staff | -4 weeks from open | $2,000 | ☐ |
| 11 | Pre-Opening Marketing | -6 weeks from open | $12,000 | ☐ |
| 12 | Soft Opening | -1 week from open | $3,000–$5,000 | ☐ |