Startup: Costs of Starting a Bar

It’s been a while since I did a bar post, but it’s always there, so I’ve returned to it. Though this one is a bit more serious and focused in nature when dealing with the costs that one might incur when starting a bar. First off, bars can be a great business to own and run, but keep in mind that there are a lot of sacrifices to be made when starting one up.

Before we get to the financial side of it, let’s talk about the other cost that an interested bar owner must keep in mind: time. Yes, running a bar can be fun, but you’ll be spending lots of time at your business at the beginning. Even if you hope to be more hands-off as time goes on, at the beginning, don’t be surprised if you’re at work by 10am and home by 4am. If you have a family, it might affect how often you see them. Also, you might have to give up some of your weekends or even holidays for the business, so keep that in mind. Bars don’t just spring up and magically make money.

Alright, enough of my public service announcement. Back to costs: it all depends on the type of bar you’d like to run. Here are the classics: the neighborhood bar (think “Cheers”), sports bar (where you go to see the Super Bowl), specialty bar (this can include martini bars or even cigar bars), and club (how do you syllabicate the sounds you hear in a dance club?). Typically the costs for these bars will be made up by getting glasses, furniture, and fixtures. If you shop well, you may start around $21,000, but it can go up depending on how much you need.

There is an up-and-coming type of bar that needs to be discussed, and that’s the brewpub. This is an establishment that deals mostly in microbrews and, to make it even cooler, brew their own beer on the premises. Because of the extra equipment needed to start up a brewpub, the costs are much higher, between $100,000 up to even $1 million. This is getting more popular, but keep an eye of your costs here.

-Location: As in real estate, the location of your bar can make a big difference in your success. Costs can vary depending on how popular your location is, the size of the building, and whether you own or rent. If you rent, you might be looking at a cost between $125,000 and $550,000. Owners may get away with $175,000 to $850,000 depending on certain factors, or you could buy an existing building for as little potentially as $25,000.

-Licenses: All states have different costs for the business license, also permits depending on whether you’re selling beer and wine or liquor. All combined, the fees in the state of Florida are $75 to register, but they can vary obviously depending on laws of each county. Make sure you do your research on this too.

-Other Costs: Of course, you should have some money aside for staff, utilities, taxes, and sound equipment (it could be jukebox or it could be a whole stage if you want live music; also TV’s for a sports bar). And then when you get around to buying alcohol, you’ll need about $6,000 or more for that. When you go to buy the booze, here’s how you should divide our budget: 45% to beer, 40% to liquor, 5% to wine (unless you’re a wine bar), and 10% to mixers and other garnishes. Of course, then there’s advertising, but there are ways to do that for free for a while through social media and word of mouth.

I know that’s a lot to take in, but the more information you have, the better, and that’s what we try to do here. By the way, another great way to save money is to buy some quality used equipment, so make sure you remember our number because we can help you save lots of money.

One Fat Frog Restaurant Equipment

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