Entertainment, Hospitality

Opening Up A New Bar Business Or Bar And Restaurant

Open Your Dream Business

For people looking to start a new career, owning a bar business appears to be fun and glamorous: You buy a bar, and you’ll meet many different people every day. The work is lively and entertaining; People love when there’s a new bar opening. There is always music playing, you get great tips, and you make a lot of money. Everybody’s happy. But make no mistake, opening a bar business is not for the faint-hearted. It is probably one of the most challenging businesses to run, partly because, well, long hours, late nights, and working during the weekends to begin. The bar business is not a spur-of-the-moment indulgence; you need a solid plan and good support from family or a trusted partner.

Get Some Bar Restaurant Experience

The bar business is not for everyone, and it will be vital that you have some experience with selling alcoholic beverages, brand names, how to pour, what they taste like, cocktails, what kind of combinations go best, and so forth. Plus, people who consume alcohol are also fussy about their drinks. Just investing a ton of money with no bar experience will lead to a bar business’s quick demise. Someone in your management team should know something about the bar business to dive into this tricky industry. Several online courses on the bar business are available, but the best way to acquire knowledge and experience is to work for another bar. This will provide you with practical experience; you will eventually become familiar with the sale of alcoholic drinks and understand the type of people who frequent bars and their needs.

Here are some online courses for the bar/restaurant industry

Buying A Bar Business

If you want to know more about the bar business, do some research:

Check out some local sports bars to determine why they are always busy.
Talk to owners of failed bars and determine what happened. This way, you can avoid the same mistakes they made.
Be alert about what is trending in the bar industry.

The more legwork you put into your company’s research, the more likely you will encounter fewer problems in the future.

My Bar Concept

There has to be a plan. A bar project without solid planning will fold up as quickly as it starts. Writing down your short and long-term goals will help set up your bar business and help it flourish for years to come.

Unlike other businesses, a bar business is dynamic. Simply put, trends will change. It would help if you were ready to keep up with the flow. You can update a solid plan over time to your advantage.

You guessed right; we are talking about your bar concept. When we speak to most bar owners about what inspired them to own a bar, their responses vary, but they all share one thing in common: spoiler alert. It is not all about money. Most bar owners want to offer their guests an authentic and enjoyable experience, create unforgettable memories for their customers, and make a buck.

Build Your Own Bar

There are at least a dozen varieties of establishments, and you will want to figure out what kind of bar you wish to open well in advance, depending on your local area’s demographics. Some common types of bars include:

Hotel bars are simple and have a universal design. They cater to tourists, serve upscale American cuisine, and are usually open in the evenings.
College bars tend to cater to the younger crowd. These joints tend to be busy and crowded, and the music or TVs can sometimes be too loud to hear anything else. Beer is the most common beverage consumed at college bars.
Neighborhood bars: This no-frills joint caters to a loyal neighborhood clientele. It may serve food and have a dartboard and a pool table.
Specialty bars tend to be located in the inner cities or near major hotels. They tend to serve business people and corporate clients. Specialty bars usually cater to significant events like business functions and conventions.
Sports bars cater to people of all ages and are very popular. They serve many types of food, offer PPV, and are busy all year round. However, you will need to invest in several large-screen TVs, satellite services, and state-of-the-art stereo equipment. Finally, invest in video games and pool tables to occupy the customers when nothing is exciting on TV.
Exotic bars: Usually found in the inner city and cater to tourists. They usually offer expensive thrills and late-night novelties. Usually, they are a little more costly than other bars.
The Irish pub is a casual establishment that offers everything Irish, including food, entertainment, and alcohol. They do function as a neighborhood bar and cater chiefly to middle-aged individuals.
Beer and Wine Only Bar: This bar is gaining popularity since the licensing is relatively easy and affordable. A significant advantage of a beer and wine bar is that it’s the only bar people tend to consume beer more than any other alcoholic beverage- meaning there will never be a shortage of customers.
A cigar bar is a joint where customers can smoke in a dedicated area and enjoy drinking concurrently. These bars sometimes require bookings and tend to have regular customers.
Nightclubs are establishments where large groups of people meet for entertainment purposes. There is usually loud dance music, food, and fancy cocktails. Lounges tend to have more live music. They are a hit with young people.

Bar Business Plan

Are you planning a partnership or sole proprietorship? In the case that you have partners, make sure everybody agrees on the vision for the future of the business. Try to develop a relatable bar name in line with the concept you have in mind.

The Bar business is one of the most complex ventures in the business world and has multiple components that need to function for your business to succeed. Your business plan can help you understand many aspects of bar ownership and also anticipate future problems. Your goal should contain the following elements:

What is the start-up cost for a bar Business?
What will I name my bar?
Where will I open my bar?
How big will my bar be?
How many people will I employ?
What permits and licenses are required to run a bar business?
What are the negatives of having a bar business?
How much profit will I make?
What menu will I serve?
How will I finance my Bar Business?
How will COVID affect my bar business?
What kind of bar did I want to own?
Should I build a bar from scratch or buy an existing one?

Here are some websites that can assist with your business plan

Create A Legal Entity To Become A Bar Owner

If you want to protect yourself and your assets from litigation, creating a legal entity that may include an LLC or a corporation is essential. When people drink too much alcohol, they can become belligerent, rowdy, and aggressive. Physical confrontations are not uncommon in the bar business. Hence, your business can be sued if someone falls or gets hurt while in your bar.

Check out these few companies that can assist you in getting your LLC started.

Here are a few government links you might want to visit

IRS Website

This site by the IRS is a must-see when beginning your LLC

Bar restaurant Liquor Licenses And Permits

Obtain an EIN
Register for state and federal taxes
Open a dedicated bank account
Get workers’ compensation insurance if you hire more than two people.

Before signing contracts to build or open a new bar, visit the local Chamber of Commerce. Many townships have too many bars; sometimes, new bars are not permitted to open. Plus, many local residential communities do not want too many bars in their area. So it would help if you got to know your local zoning laws. Thirdly, obtaining a liquor license is a painful and lengthy process, and your application might be rejected in the end. Consequently, most entrepreneurs who want to run a bar business buy an existing bar and liquor license.

Liquor License Requirement In Each State

Oklahoma

Build Your Own Bar Business

Besides your liquor license, each jurisdiction has requirements and permits you need to obtain. All told, be prepared to pay for a minimum of 8-15 licenses for food, safety, health, fire, music, entertainment, wine bar, full bar, sanitation, etc. And each of these permits restricts the time of operation, type of employees, etc. So you will need a lawyer to review each license to ensure you do not break any rules. If the city confiscates your liquor license, it is nearly impossible to get it back.

The costs to obtain all the licenses/permits for operating a bar are not insignificant and may range from $1,000-$7,000. The liquor license alone can cost anywhere from $800-$1,500. These licenses and permits will also need renewal each year or so. Since the licensing process is long, it is vital to start the application process months in advance.

Getting A Loan – Buying A Bar

Getting a loan for a bar is not easy. With many businesses failing, lenders are reluctant to offer large loans to companies. Besides, you will need to have an excellent credit rating, no personal debts, and at least a 20% down payment to qualify for a loan. Other options include:

Crowdfunding.
Finding a venture capitalist.
Borrow from friends and family if you cannot get a loan from a bank or a private lender.

Here are a few of your funding options for your bar

Small Business Administration

The Small Business Administration, SBA has a program to fund new startups and is worth a look

Cost To Open A Bar

Some startup costs for a small bar include the following:

Licensing fees $5K-$10K
Refurbishing $20K-$50K
Rent $4K-$15K
Design and renovations $25K-$50K
Employee salaries $9K-$25K
Furniture $10K-$25K
Supplies $5K-$15K
Appliances $15K-$50K
Raw ingredients for food $3K-$5K
Legal services $500-$1,200
Accounting $500
Marketing $500
Utilities $500-$1,000
Miscellaneous $20K
Emergency funds of $25K

You will need an annual gross income of $150K-$300K for a small bar. This is the bare minimum, and a lot depends on the rent and number of employees. Plus, there is a significant cost for interior design. In large cities, your start-up costs can be as high as $400K.

Why Do Most Bar Businesses Fail?

There are several reasons for bar business failure, including:

The absence of a business plan.
Inadequate finances to meet unexpected costs.
Buying too much unnecessary equipment
No experience running a bar
Unconventional behavior (e.g., drinking alcohol with customers, serving alcohol to minors, remaining open despite zoning laws)
Exhaustion due to long work hours

Are Bars Profitable?

Your profit margin depends on the bar’s size, the number of regular customers, and sales volume. Most bars make sufficient gross income, but net profit can be more moderate because overhead tends to be very high (e.g., high rent, insurance, licensing fees, employee salaries). Many small bars have revenues between $25K-$40K a month and take home about 15-20% as net profit.

How Should I Market My Bar?

Create a website. Communicate what type of bar it is, your services, hours, location, and contact information. Keep the website active with photos and short texts, and regularly make special announcements.
Make a flyer and distribute it to the local community.
Be active on social media.
Offer discounts on meals on certain days
Offer complimentary appetizers to the first 50 customers.
Have a happy hour with specials on food and drinks
Post discounted deals on sites like LivingSocial and Groupon.
Join forces with other businesses in the area by exchanging posters and flyers. For example, you can have pizza delivery flyers on your tables, and the pizza restaurant can post your business cards.

My Bars Domain Name -Bar Restaurant Websites

The domain name protects your bar’s website address on the internet. You can register a domain name with any hosting company. Some of the common domain registrars include:

Here is a list of options for building a regular website.

Here is a list of drag-and-drop page builders for WordPress.

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Hiring Staff For My Bar Or Restaurant

The bar business is associated with a high staff turnover for various reasons. Thus, it would help if you were extra careful when selecting workers. Your employees must share your vision and dedication. The employee needs to be motivated, creative, excited to come to work, and, most importantly, have a friendly and easy-going attitude. You may need to go through an employment agency to help get the best workers for your bar. Another option is to contact a bartending school and ask if they have any suitable candidates. Once you have the right employees, the onus is on you to retain them. This means communicating with them, showing appreciation, and rewarding them regularly.

Staffing agencies that you may want to use:

My Bar Location

Have you ever had a good time at the bar, and just when the fun was getting started, neighbors call in the cops, right? That’s what happens when you pick the wrong location for your bar. Here is how to avoid that.

Don’t consider opening a noisy bar in a neighborhood with families.
Ask your local government about local restrictions.
Stick to the vicinity of your target market (remember, this narrows down to your initial concept).

Also, how accessible is your location? We don’t want customers drinking, missing the turn home, or ending up in a haunted forest. Consider the security of parking their cars overnight and quickly getting a taxi or Uber home if they so wish.

Now that you have a location in mind, is it affordable? How expensive is leasing or buying in that location? We don’t want the rent to eat into your profits too much. Picking an area with expensive rent and a lack of business traffic is not the best move.

Here is a list of some popular commercial real estate companies:

Buy An Existing Bar Vs Build Your Own Bar

While building or developing a bar from scratch is tempting, it is essential to know that many local councils are reluctant to permit such a venture. The reason is that there are already too many bars in most cities; plus, bars also tend to attract a specific clientele, which tends to cause trouble in adjacent neighborhoods. Also, getting a liquor license for a new bar is a challenging and expensive ordeal. The best recommendation is to buy an existing bar, which is not only cost-effective but will also relieve the headache of getting all the licenses and permits.

However, before you buy an existing bar, you need to do the following:

Find out the reason why the owner is selling the bar
Ensure that the bar has a central location, is visible, and has ample free parking.
Ask an accountant to review the finances and tax filings from the past two years.
Do a thorough background check on the seller and the business to ensure no other hidden agendas.
Visit the bar several times at different hours and days to determine how busy it is, the peak busy periods, and the area’s general traffic. It would help if you also observed the staff and their customer interaction. You will not need to hire and train new staff if the staff are lovely.
Speak to other individuals in the neighborhood about the bar
Check out Yelp and other online reviews about the bar.

Here is a list of services advertising businesses for sale

Bar And Restaurant Menu

Once you decide on the type of bar, then you need to plan a relevant menu. Remember, bars can be bustling, so your menu should be concise and straightforward. Offering an exhaustive menu will only lead to more work and confusion. Foods that do well in a bar include sandwiches, burgers, fries, pizza bar or pizza pub, appetizers, wings, garlic bread, etc. These foods go with all types of restaurants and do not require much work. However, if running a college bar, don’t make a menu that only offers Chinese or Irish food.

Here are a few websites that can help in the design of your menu

Bar And Restaurant Supplies

Bar supplies come from wholesale manufacturers. You will need to know what type of beverages and food you plan on selling. Creating a stable relationship with a wholesaler is critical. These vendors frequently provide sales tips and promotion ideas, offer discounts, and help with marketing.

Here are some Online Restaurant Supply Companies

Bar Design Layout

After deciding the type of bar you prefer, you need to create a suitable design. For example, if you have decided to open a College Bar, you should stick to a college bar menu and decor. College individuals usually prefer loud music, American fast food, and beer specials. In any case, you want to provide a unique and unforgettable experience so that the customer will return.

When redesigning an existing bar, heed the following:

Survey employees and customers if the place needs a makeover
If the preexisting bar is functioning okay, then do not overdo the redesign as it may turn away the regular customers
If you are going to be keeping the same name and the bar has been running fine, avoid making drastic changes
Only make changes that improve the bar

Here are some companies that design bars & restaurants

Bar POS System

There are dozens of Bar POS systems on the market that can help safeguard against theft, make ordering easy, and speed up the workflow between the kitchen and the bar. Some POS systems are hand-held, allowing the server to take orders from anywhere. Besides, these systems also enable the customer to pay, sign, and tip on the device.

Time-based pricing. If you have happy hours, you also need a time-based POS to reset your portable device daily. The latest POS systems permit the server to swipe the customer’s credit card securely and verify the card’s authenticity.

There are also POS systems that can immediately change the drink’s price. For example, if you sell wine by the glass or bottle or have happy hour specials in the afternoon, the latest cloud-based POS software enables you to make those changes with fewer clicks. Hence, it is worth investing in a POS system that is comprehensive, portable, and secure.

Bar Restaurant Accounting

You obviously can’t be the bartender, waiter, and dishwasher simultaneously. As an investor or manager, you’ll need to update your software for your point of sale systems to keep you abreast of all activities in the bar.

By keeping thorough records, you can easily decide when to restock. Keep track of how the bar is doing from your laptop or phone with the installed software. Track payments and expenditures easily.

Bar Restaurant Interior Design

If a customer leaves the comfort of their homes for the bar, at the very least, the bar should look and feel more exciting than their sitting room. A sense of style and elegance is perfect, and comfort must be at the top of your list.

Decide on an affordable interior decorator, and a tried and tested concept that fits your local area. The setup of a restaurant should be distinct from that of your bar. Staring at a beer mug for hours is tiresome! Keeping customers engaged and active depends on the fun devices and equipment available to them.

Television- Some people believe football or soccer is a matter of life and death. I wouldn’t say I like that attitude. I can assure them it is much more serious than that.”

― Bill Shankly

Football lovers will have a fit in a bar without a TV to watch their games.

It turns out not football alone, but even the local news will do magic for the ambiance.

Sound system– Yes, please; subtle music will lighten the mood. Music from a good system with quality sound goes well with any decor.

Pool tables– A standard bar activity popular with both young and old clients.

Washrooms and toilets– A dirty bathroom will keep clients away as much as a nice bathroom will make people feel welcome and happy.

Kitchen– Adding food to a bar experience can tip the scales for hungry customers. If not, snacks might do the trick.

Bartending Equipment – Used Bar Equipment

Absinthe spoon
Bar blade
Bar cooler
Bar mats
Bar spoons
Bar towels
Blender
Can opener
Cap catcher
Carafe
Chopping board
Citrus squeezers
Clothespins
Cocktail picks
Cocktail shakers
Cocktail strainers
Corkscrew
Foil cutter
Fridge
Fruit tray
Funnel
Garnishing tools
Glasses
Glass rack
Glass rimmer
Glasswasher
Ice bucket
Ice maker
Ice molds
Ice tongs
Jiggers
Jug
Juicer
Lighter
Liquor shelves
Matches
Mulder
Napkins
Pots
Pour spout
Soda gun
Speed opener
Straw caddy
Wine cooler
Wine key
Wine stopper

Bar Restaurant Furniture

Barstools
Couches
Parasols
Tables
Pool tables
Video games
Dartboard
Back bar mirror
Benches
Patio Furniture
Booths
Appliances
Flat-screen TVs
Audio and Stereo system
Kegs
Kegerator
Mini fridge
Brandy warmer
Wine Dispensing bag
Mixology set