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How to Open a Bar

Kit Jenkin
21 May 2024

Hospitality businesses are some of the most popular businesses to start. Around 13,000 restaurants open every year in the US [1], and this number is expected to grow as the pandemic starts to ease. 

Opening a business like a bar can be an incredibly challenging task, but with the right attitude and preparation, it can be very rewarding and, with a little luck, lucrative as well.

This blog will take you through how to open a bar so that you can get your venture off on the right foot.  

Ask yourself why you’re opening a bar

There are lots of questions you should ask yourself before starting a business. One of the most important questions to ask is why you’re opening a bar in the first place. 

By asking yourself this question early on, it can help you crystalize exactly what kind of business you want to create. Do you want to start a business simply to make money? Do you have a particular love for the industry you’re going into?

Asking yourself why you want to open a bar could also help you save yourself some effort and stress if you’re getting into it for the wrong reasons. Opening a bar can be a big investment, and if you’re not willing to put in the work necessary to make it a success, then it won’t be worthwhile. 

Research licenses

If you’re opening a bar, you need to do a lot of research. You need to know everything involved in opening a bar, from what permits and licenses you will need, including alcohol licenses, food-handling licenses, music licenses, and more, which will depend on the rules and regulations of your local area. You will also need to research any land, building, or zoning permits you may need if you plan on making alterations to your location.  

Create a business structure

When creating any kind of company, whether it’s a laundromat, law firm, or bar. Every business has to choose whether they will be a sole proprietorship, a partnership, LLC, or corporation. 

Most businesses like bars tend to become LLCs or corporations. While it might be easier to become a sole proprietorship or partnership, the owners of these companies are personally liable for the debts for the business, and you may need to forfeit personal assets to cover a loss the business experiences. Therefore, if someone brings a lawsuit against the company, for example, the company is liable, and not you personally. 

You may wish to speak to a lawyer to figure out how to structure your company to achieve your goals. 

Find the right location

You know what they say: location, location, location. Picking the right location is perhaps the most important business decision you can make when opening a bar. 

The location of your bar can affect so many aspects of your business. Your location may affect:

  • Pricing: The type of location you choose will affect your pricing strategy. If, for example, your bar is located in an affluent area, you may be able to choose high prices. However, if you set up your bar on a student campus, you will probably need to charge lower prices. 
  • Customers: Just as the location will affect pricing, it will also affect your customers. Where you set up your bar will determine the type of people you serve, which will affect every aspect of your business. 
  • Marketing and personality: Your location will also help determine the type of marketing and brand personality you want to create for your bar. You may wish to create a bar with a casual, intimate atmosphere that would appeal to students if you’re setting up your bar on campus.  
  • Costs and utilities: Your location will also determine how much you’re likely to pay for rent and utilities. Locations with high foot traffic in popular areas will likely demand higher rents. 

Create a business plan

Without a business plan, it’s likely your business will falter. It’s easy, after all, for business owners to get caught up in the ins and outs of daily business activities and to lose sight of the big picture. Having a business plan written down will give you a reference point for when you need to make tough decisions. 

In creating a business plan, you want to give yourself a lot of flexibility. It’s important not to set too many ultra-precise goals, as the details of a business plan can change very easily. It can also help to align your business plan with your mission statement to ensure all your business goals are being met through your plan. 

Register your company name, brand, and products

In order to get your business on a good legal footing, you’ll need to register your company name with your local government, along with any trademarks that you intend to use. 

Once you choose a great bar name, it’s a good idea to do this as early as possible, even before you’ve made the decision to open your bar. This will be to ensure that your intended company and product names don’t clash with existing names. Most countries, states, or provinces have registers of existing business names. If your business name is similar to an existing, registered business name, you may be open to legal action.  

Secure funding

Without start-up funding, your bar may not get off the ground. You’ll want to research as many funding avenues as you can to ensure you have all the funding you need to make your business a success. 

There are lots of funding options available to new small business owners. Your local government may have funding available for new small businesses. You can also secure a small business loan from a financial institution like a bank. And of course, you can also seek investments from family and friends. 

Choose your decor

Choosing the right kind of decor can determine the type of bar you are, and thereby the type of customer you will attract. Refer back to your mission statement and chosen brand personality. What kind of bar do you want to be? When you decide this, it will be easier to decide what kind of decor you should go with. 

Don't limit yourself to what other bars do either, you can draw inspiration from lots of different things, like your local area, its history, your own personal interests, and more. 

Hire the right people

Without great employees, your bar will likely struggle. Great employees will take your bar from good to great. 

To find the right employees, you’ll need to come up with some great job descriptions. Sit down and figure out what you want out of every employee, from your bartender to your chef, and put it in the form of an engaging job ad. You can then post this job ad on one of the many job boards on the internet, like Monster or Indeed. You may also choose to work with recruitment agencies to help you find people if your initial searches become too difficult. 

Invest in the right tech

From the get-go, you’ll want to invest in all the right technology. Having the right tech in your bar can mean the difference between the owners running around like headless chickens and a smooth, seamless ordering system that increases your business’s efficiency. 

Epos Now’s dedicated Bar POS allows owners to manage every aspect of their business in one place, from email marketing campaigns and floor plans to staff rotas and ordering. 

  • View real-time business data from any internet-connected device, wherever you are
  • Leverage mobile ordering software to provide convenient at-table service
  • Use leading bar management software to track sales, stock, and margin data to get greater visibility 
  • Connect to over 100 smart business tools to boost efficiency and automate manual tasks
  • Train new staff quickly with our easy-to-learn POS
  • Create custom seating charts to match your bar’s floorplan
  • Offer digital free drink chips with a customer loyalty program

Learn more