How to Start a Bar Step by Step

Thinking about starting a bar? You’re not alone. Many people dream of owning a place where friends gather, drinks flow, and good times roll.

But before you dive in, you need to know what type of bar fits your vision. Different bars cater to different crowds and offer unique experiences.

Let’s explore the main types of bars you might consider.

Types of Bars

A bar is an establishment that serves alcoholic drinks. The type of bar you choose will define the atmosphere, clientele, and overall vibe of your place.

Brewpubs

Brewpubs serve their own craft beers. These establishments often brew beer on-site, offering a unique selection that you won’t find in other bars. Customers come for the fresh, locally-made beer and often stay for the relaxed, community-focused atmosphere. Brewpubs usually pair their beers with a menu of pub-style foods, enhancing the overall experience. If you’re passionate about brewing and want to share that passion with others, a brewpub might be the right choice for you.

Nightclubs

Nightclubs focus on music and dancing. These venues are all about high energy, loud music, and a lively crowd. Nightclubs often feature DJs, live bands, and dance floors designed to keep people moving all night long. The decor is usually modern and flashy, with lighting and sound systems that create an immersive experience. If you love the nightlife and want to create a space where people can dance and have fun, consider opening a nightclub.

Dive Bars

Dive bars offer a casual, unpretentious atmosphere. These bars are often characterized by their laid-back vibe, affordable drinks, and a no-frills approach. Dive bars attract a diverse crowd looking for a relaxed place to hang out without any pretense. The decor is usually simple, and the focus is on creating a welcoming environment where everyone feels at home. If you want to create a neighborhood spot where people can unwind and enjoy a drink without any fuss, a dive bar could be the way to go.

Speakeasies

Speakeasies are Prohibition-era themed bars. These establishments recreate the secretive, exclusive feel of the 1920s speakeasies, often with hidden entrances and vintage decor. The drinks menu typically features classic cocktails made with high-quality ingredients, and the atmosphere is intimate and sophisticated. Speakeasies appeal to customers looking for a unique, nostalgic experience. If you’re drawn to the glamour and mystery of the Prohibition era, opening a speakeasy might be your ideal path.

Each type of bar offers a different experience and attracts a different crowd. Think about what kind of atmosphere you want to create and who you want to attract. Your choice will shape every aspect of your bar, from the decor to the drinks menu to the overall vibe.

TIP: Get insights from other business owners on why start a business and learn from their experiences.

Benefits of Opening a Bar

Opening a bar is not just about serving drinks; it’s about creating a space where people can come together and enjoy themselves. But let’s be real, the journey comes with its own set of worries.

Be Your Own Boss

Opening a bar allows you to make all the decisions. You get to choose the concept that excites you, whether it’s a cozy neighborhood pub or a trendy cocktail lounge. You decide the menu, selecting the drinks and food that best represent your vision. Hiring and managing staff also falls under your control, giving you the chance to build a team that aligns with your values and goals. This level of autonomy can be incredibly rewarding, as you shape every aspect of your business.

TIP: Learn how to recruit bar staff efficiently to build a competent and reliable team.

Potential for High Profits

Alcohol sales often come with high profit margins. Drinks, especially cocktails and specialty beverages, can be sold at a significant markup. This potential for high profits makes the bar industry appealing. With effective management and a good understanding of your market, you can maximize these margins. Regular promotions and events can also drive sales, increasing your revenue. The key is to balance quality and cost, ensuring your customers feel they are getting value while you maintain healthy profits.

Social Aspect

Running a bar provides a unique opportunity to meet new people and build relationships. Your establishment can become a local hotspot where regulars feel at home and new patrons feel welcomed. This social environment fosters connections, both personal and professional. As the owner, you become a central figure in this community, creating a network that can support your business in various ways. Hosting events and themed nights can further enhance this social aspect, attracting diverse groups and keeping the atmosphere lively.

Creative Expression

A bar offers a platform for creative expression. You can develop unique drinks that showcase your creativity and stand out from the competition. The decor and ambiance of your bar also reflect your personal style, from the lighting and furniture to the music and overall vibe. Additionally, you can plan special events that highlight your creativity, such as themed parties, live performances, or mixology classes. This creative freedom not only makes your bar unique but also keeps it exciting for your customers.

Efficient Management

To manage a bar successfully, it’s essential to streamline operations and reduce administrative burdens. Tools like the Homebase mobile management app allow you to oversee your business on the go, ensuring flexibility and efficiency.

How to Create a Bar Business Plan

Creating a bar business plan is your roadmap to success. It helps you clarify your vision and provides a structured approach to making your bar a reality.

Describe Your Bar Concept and Target Market

Start by defining your bar concept. Are you opening a cozy brewpub, a vibrant nightclub, a laid-back dive bar, or a nostalgic speakeasy? Your concept sets the tone for everything else. Next, identify your target market. Who are your ideal customers? Consider their age, lifestyle, and preferences. For example, a speakeasy might attract an older, more sophisticated crowd, while a nightclub appeals to younger patrons looking for a lively night out.

Detail Your Drinks Menu and Pricing

Outline your drinks menu. Include a variety of options that align with your concept. For a brewpub, list your craft beers and any seasonal specials. A nightclub might focus on cocktails and premium spirits. Dive bars often feature affordable beers and simple mixed drinks. Speakeasies can offer classic cocktails with a modern twist. Pricing should reflect your target market and location. Competitive pricing attracts customers, but ensure your prices cover costs and generate profit.

Outline Your Marketing and Financial Strategies

Develop a marketing strategy to attract and retain customers. Use social media to promote your bar and engage with potential patrons. Plan special events like live music, trivia nights, or themed parties to draw in crowds. Collaborate with local businesses for cross-promotions. Financially, create a budget that includes all startup costs, such as renovations, equipment, and initial inventory. Forecast your monthly expenses and expected revenue. This helps you understand how much capital you need and when you can expect to break even.

Project Startup Costs and Revenue

List all startup costs in detail. Include expenses for leasing or purchasing a location, renovations, furniture, bar equipment, initial inventory, and marketing. Don’t forget to budget for permits and licenses. Estimate your monthly operating costs, including rent, utilities, staff salaries, and supplies. Project your revenue based on your pricing and expected customer volume. This projection helps you determine if your business is financially viable and guides you in securing funding from investors or lenders.

TIP: Efficiently create employee schedules to ensure smooth operations and cost management in your new bar.

Licenses and Permits Needed to Open a Bar

Navigating the legal landscape can be daunting, but understanding what you need helps you avoid costly mistakes.

Business License

A business license allows you to legally operate your bar within your city or county. You must apply through your local government office, providing details about your business structure, ownership, and location. Fees vary depending on your location and the size of your business. This license ensures your bar complies with local regulations and is recognized as a legitimate business entity.

Liquor License

A liquor license permits you to sell alcoholic beverages. The process to obtain this license can be lengthy and involves multiple steps. You must apply through your state’s Alcoholic Beverage Control (ABC) board. Requirements include background checks, public notices, and sometimes community approval. The type of liquor license you need depends on the kind of alcohol you plan to sell (beer, wine, spirits) and your bar’s operational hours. Fees and availability vary by state and locality.

Food Service License

If you plan to serve food, you need a food service license. This license ensures your bar meets health and safety standards for food preparation and handling. Apply through your local health department, which will inspect your kitchen and food storage areas. You must demonstrate that your facilities are clean and that staff follows proper food safety protocols. Regular inspections will follow to ensure ongoing compliance.

Music License

Playing music in your bar requires a music license. This license covers the rights to play copyrighted music, whether through a live band, DJ, or recorded playlist. Organizations like ASCAP, BMI, and SESAC issue these licenses. You may need to obtain licenses from multiple organizations to cover different music catalogs. Fees depend on your bar’s size, the type of music, and how often you play it.

Sign Permit

A sign permit allows you to display your bar’s signage. Local zoning laws regulate the size, type, and placement of signs. Apply through your city’s planning or zoning department. You must submit design plans and ensure your sign complies with local codes. This permit helps maintain the visual aesthetics of the community and ensures your signage is safe and appropriate for the area.

TIP: Automate timesheets to ensure compliance with labor laws and accurate payroll, which is critical for legal operations.

How to Find the Right Location for Your Bar

Choosing the right location is crucial for your bar’s success. It’s not just about finding a spot; it’s about finding the right spot.

Assess Demographics

Understanding the demographics of your potential location is key. Look at the age and income levels of local residents. A neighborhood with a younger population might be ideal for a trendy nightclub or a casual dive bar. On the other hand, an area with higher income levels might support a sophisticated speakeasy or a brewpub offering craft beers. Knowing who lives nearby helps tailor your bar’s concept to meet their preferences and spending habits.

Evaluate Accessibility

Accessibility can make or break your bar’s success. Ensure your location offers easy parking options. Ample parking encourages more customers to visit, especially those who might drive from surrounding areas. Additionally, consider proximity to public transit. Being near a bus stop or subway station makes it convenient for patrons who prefer not to drive, especially after a night of drinking. Accessibility impacts foot traffic and overall customer convenience.

Research Local Competition

Researching local competition provides insights into what already exists and what gaps you can fill. Visit other bars in the area to understand their offerings, customer base, and pricing. Identify what they do well and where they fall short. This research helps you find opportunities to differentiate your bar. Maybe there’s a lack of live music venues, or perhaps no one offers a particular type of craft beer. Differentiation attracts a unique crowd and reduces direct competition.

Consider Zoning Restrictions

Zoning laws dictate where you can legally operate a bar. Check with local zoning authorities to ensure your chosen location is zoned for a bar or nightlife establishment. Some areas have restrictions on noise levels, operating hours, or proximity to schools and churches. Understanding these regulations upfront prevents legal issues and costly relocations later. Confirming zoning compliance early in the process saves time and ensures your bar can operate without interruptions.

Essential Equipment for Opening a Bar

Opening a bar requires specific equipment to ensure smooth operations and a great customer experience. Here’s a detailed look at what you’ll need.

Bar Tools

Bar tools are the backbone of any bar. Shakers, jiggers, and strainers are just the beginning. Shakers help mix cocktails efficiently, while jiggers ensure precise measurements for consistent drinks. Strainers keep ice and other solids out of the final pour. Other essential tools include muddlers for crushing ingredients, bar spoons for stirring, and bottle openers for quick access to beverages. Having a well-stocked bar tool kit allows bartenders to work efficiently and keep customers happy.

Refrigeration

Proper refrigeration is vital for storing ingredients and keeping drinks cold. Coolers and freezers are necessary for maintaining the freshness of perishable items like fruits, juices, and garnishes. Under-counter coolers are convenient for storing frequently used items within easy reach. Freezers are essential for storing ice and frozen ingredients. Investing in high-quality refrigeration units ensures that your bar runs smoothly and that your drinks are always served at the right temperature.

Glassware

Glassware plays a significant role in the presentation of drinks. Different types of glasses are designed for specific beverages to enhance their flavors and aromas. Pint glasses are perfect for serving beer, while wine glasses come in various shapes to suit red, white, and sparkling wines. Cocktail glasses, such as martini glasses and highball glasses, are essential for mixed drinks. Stocking a variety of glassware ensures that you can serve any drink your customers order, enhancing their overall experience.

Draft Beer System

A draft beer system is a must-have for bars that serve beer. This system includes a keg cooler, CO2 tanks, and taps. The keg cooler keeps the beer at the optimal temperature, while CO2 tanks ensure the beer is properly carbonated. Taps allow for easy dispensing of beer, providing a fresh and crisp pour every time. A well-maintained draft beer system can attract beer enthusiasts and keep them coming back for more.

TIP: Integrate business tools to streamline bar operations and improve overall efficiency.

Investing in the right equipment sets the foundation for a successful bar. Each piece plays a crucial role in daily operations, ensuring that you can serve high-quality drinks efficiently and keep your customers satisfied.

5 Strategies for Marketing Your New Bar

Marketing can be a daunting task, but it’s essential to get the word out and attract customers to your new bar.

1. Develop Your Brand

Creating a unique bar name, logo, and aesthetic sets you apart from the competition. Your brand should reflect the atmosphere and experience you want to offer. Think about what makes your bar special. Is it the craft cocktails, the cozy ambiance, or the live music? Use these elements to shape your brand identity. A memorable name and eye-catching logo can attract attention and make your bar easily recognizable. Consistent branding across all touchpoints, from your signage to your social media profiles, reinforces your bar’s identity and helps build a loyal customer base.

2. Leverage Social Media

Promote your bar on Instagram and Facebook to reach a wider audience. Post high-quality photos of your drinks, events, and interior to showcase what makes your bar unique. Use stories and reels to give followers a behind-the-scenes look and create a sense of exclusivity. Engage with your audience by responding to comments and messages promptly. Run targeted ads to attract locals who might be interested in your bar. Share user-generated content, like photos and reviews from customers, to build trust and authenticity. Social media platforms also offer analytics tools to track your engagement and adjust your strategy accordingly.

3. Host Special Events

Plan trivia nights, live music, and tastings to draw in crowds and keep them coming back. Special events create buzz and give people a reason to visit your bar. Trivia nights can attract groups of friends looking for a fun evening out. Live music adds energy and entertainment, making your bar a destination for music lovers. Tastings, whether for wine, beer, or cocktails, offer a unique experience and can introduce customers to new favorites. Promote these events through your social media channels, email newsletters, and in-bar signage to maximize attendance. Regularly hosting events keeps your bar lively and gives customers something to look forward to.

4. Partner With Local Businesses

Cross-promote with nearby restaurants and shops to expand your reach. Partnering with local businesses can introduce your bar to new customers who might not have discovered it otherwise. Offer joint promotions, like discounts for customers who visit both establishments. Host collaborative events, such as a food and drink pairing night with a local restaurant. Display flyers or business cards for your partners in your bar, and ask them to do the same for you. Building relationships with other local businesses fosters a sense of community and can lead to mutually beneficial opportunities.

5. Implement a Loyalty Program

Reward repeat customers with discounts and perks to encourage them to return. A loyalty program can be as simple as a punch card offering a free drink after a certain number of visits or as sophisticated as a digital app tracking points for purchases. Offer exclusive deals, such as members-only happy hours or early access to event tickets. Recognize and appreciate your loyal customers by giving them personalized offers on their birthdays or anniversaries. A well-designed loyalty program not only incentivizes repeat business but also makes customers feel valued and appreciated, enhancing their overall experience at your bar.

TIP: Discover strategies to create a business plan that will guide you in crafting a comprehensive bar business plan.

Is Opening a Bar Right for You?

Opening a bar can be an exciting venture, but it’s important to assess whether it’s the right path for you. Start by evaluating your skills, experience, and passion. Do you have a background in hospitality or management? Have you worked in a bar or restaurant before? Your experience in the industry can provide valuable insights and help you navigate the challenges of running a bar. Passion is equally important; loving what you do can make the long hours and hard work more rewarding.

Next, consider the financial investment and risks. Opening a bar requires significant capital for leasing or purchasing a location, renovations, equipment, inventory, and initial staffing. Calculate your startup costs and ensure you have access to sufficient funds. Understand the risks involved, including fluctuating market conditions, competition, and the potential for slow business periods. A clear financial plan can help mitigate these risks and set realistic expectations.

Assess your ability to manage staff and operations. Running a bar involves hiring, training, and managing a team. Effective communication and leadership skills are crucial for maintaining a positive work environment and ensuring smooth operations. You’ll also need to handle scheduling, payroll, and conflict resolution. If you enjoy working with people and have strong organizational skills, you’ll be better equipped to manage these responsibilities. Ensure you comply with HR regulations to avoid legal issues and maintain a lawful operation.

Determine if the lifestyle aligns with your goals. Bar ownership often means working late nights, weekends, and holidays. Consider how this schedule will impact your personal life and whether you’re prepared for the demands. The social aspect of running a bar can be rewarding, but it also requires a high level of energy and commitment. Make sure the lifestyle fits with your long-term goals and personal circumstances.

TL;DR

• What: Opening a bar.
• So What: Success depends on type and planning.
• Pros & Cons: High profits vs. big investment and long hours.
• Bottom Line: Plan well and know your market.

Ready to take your bar to the next level? At Homebase, we make managing your team simple and efficient. Let’s make work easier—get started today.