The bar-owning industry has a glamorous reputation. It is one of those unique life experiences you’ll get to experience when you decide to venture into the business. You have to get firsthand experience as a bar owner for you to get an idea of what it entails. While being an entrepreneur in this industry is rewarding, profitable, and enjoyable, some limitations come with it. Here, we discuss the pros and cons of owning a bar. Let’s get started.
Pros of owning a bar
1. It allows for creativity. While owning a bar, you get a creative license. It is an ideal place for a creative person as you will get the chance to explore something new every day for your customers. You will get to leave your customers wanting more when you create different trendy cocktails. You can up your creativity game by setting up weekly promos that are bound to set your bar apart from all the others. Furthermore, that funky name you have been dying to try can be registered as your bar’s name. After all, you get to be your boss, calling all the shots.
2. Owning a bar is cheaper compared to other businesses in the industry. Operating costs associated with owning a bar are cheaper when compared to run a traditional restaurant or eatery. You also deal with a limited menu and do not have to worry about food wastage when you lack customers
3. It is fun to own a bar. With the daily ups and downs associated with owning a bar, you get to have the adventure of a lifetime. You get to socialize with different customers who will keep you on your toes. Every day will present an exciting adventure as it is not a routine-filled business.
4. You are guaranteed high margin sales. When serving and selling the different brands of alcohol, be assured you are bound to get high profits. In addition to this, you will get a high net profit margin ceiling if your bar is popular. Keep in mind that successful bars in the market have a higher average annual return when compared to the stock market.
5. Flexible working environment. You are guaranteed conducive working terms and environment when you own a bar. You get to be your boss and all decisions about how to run the establishment will solely lie with you. Everything will be in your hand from the menu to staff employment, and from choosing the name of the bar to decoration types to use.
6. You get to provide a relaxing environment. Some patrons find bars to be a safe environment or neighborhood they can relax. As a bar owner, you get to provide such a positive environment for people.
7. As a bar owner, you get to earn a living doing what you love. Owning a bar means that you first saw it as a lucrative business venture. It is advantageous as you will get to do what you are passionate about and in a fun environment.
8. You will have a short payback period. It takes a shorter time to start earning money when running a bar.
Cons of owning a bar
1. Limited to no little time off. The major limitation of owning a bar is that you get to work when other people are off work, or rather off the clock. You will get to work on weekends, holidays, long nights, and even during your days off in case of emergencies.
The downside is that during big holidays like Thanksgiving and Christmas you may find yourself behind the bar counter working crazy shifts and trying to keep up with the traffic.
2. Dealing with drunk people can be stressful. Among the limitations of owning a bar, dealing with drunk people ranks high up on the list. You will meet over-intoxicated customers some of whom will be trouble magnets. Despite you having a bar to help people let loose and have a good time, you should be prepared on how to deal with stubborn customers. Some intoxicated customers may easily cross the line and end up becoming a liability to your business. It will beneficial for you if you take your staff on short training courses on how to manage rowdy crowds. You should also offer your bartenders refresher courses on safe serving so that they may be able to recognize when the customer has had too much to drink.
3. Strict rules and regulations in the industry. Bar owning is always accompanied by strict rules and regulations you have to adhere to. You have to register for the appropriate licenses and take into account the food and health safety regulations according to your state. Lastly, you have to adhere to the zoning laws to avoid lawsuits due to noise pollution.
4. High startup cost. The cost of starting and owning a bar is on the higher side. It requires a large up-front investment such that it can be a formidable barrier to entry for any entrepreneur. You will have to pay for licensing, a location or a place to rent, and at times equipment. Apart from this, when you want to have a high-end bar that is unique, you will have to remodel, refurbish and add extra features to attract the client you will also have to invest in a good sound system as good music gives a bar that extra vibe.
5. Stiff competition. Owning a bar comes with stiff competition as the market is saturated. You get to compete with other bar owners as well as establishments that offer food, entertainment, and drinks.
6. It needs dedication. Just like any other job, you will need to dedicate time and resources to making the business successful. You will have to organize schedules like bar cleaning and keep up to date with bar inventory. Furthermore, in case you have staff you have to know bookkeeping and balance sheet to successfully manage payrolls and expenses.
7. You will have to come up with a marketing plan. You will need to put more effort into developing a reliable marketing plan or a bar SEO. Throughout the business, you will need to consistently put effort.
8. Take note there is a high probability of bar failure. Bars are faced with a high-risk failure rate and limited business lifespan. As a bar owner, you have to make sure you stay on top of your game to avoid facing unplanned costs.