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How to Start a Bar/Club

Calling your bar an operation fits because of how much operating it takes to keep it running. Someone will have to mind the store every minute your doors are open and some minutes when they aren't, and your place will need some sort of monitoring during the off-hours to prevent vandalism or break-ins.

Many compare running your own business to raising a child. If true, then a smooth-running, problem-free, profit-making bar compares to parenting a happy, well-adjusted, self-assured teenager preparing for adulthood. But don't worry, the bumps in the road hold the best lessons. And as with parenting, you succeed with consistency and concern instead of rigidity and blame.

The Road to Success
The groundwork you lay to operate your bar includes the systems you use to track liquor and food. How much does the customer owe the server/bartender, and in turn, how much do they owe you? Also, what liquor and food do you sell the most? The systems you choose depend on the type and size of bar you have.

In most bars, only the bartenders and servers handle money. Cashiers or takeout staff may also have cash-handling responsibilities. Factors to consider when choosing an accounting system include the level of sales you expect, both from alcohol and food, and the efficiency needed for your staff to operate at its full potential. Also, look for holes that your accounting system might leave open for theft at all levels, not just servers and bartenders. No one thinks they are hiring a thief. Many people who might steal if the opportunity arose do not consider themselves thieves, either, so they don't come off as such.

If you use the cash-and-carry system, where the drink is ordered by the server verbally and then paid for before the bartender or server rings it up, you might find many "forgot to ring it up" drinks, as well as a few given away for free. It is the nature of the system. If your inventory controls are so tight that you will notice when too much has been used, or if your manager, who shares in the profits anyway, is your bartender, then you can use this system without much fear.

Finding Your Perfect Location
Your choice of location will depend on how you want your bar to look, what you want your bar to contribute to the community, and the kind of clientele you want to patronize it. Then you need to decide whether you want to buy the location or sign a lease. Again, that depends on your budget. Finally, you need to figure out how to fuse your concept with both your name and your location to your best advantage.

People who know this industry well have polar opinions on the concept of location. Some owners and experts we talked to put enormous importance on the bar's location while others refuted its significance altogether. It all depends on what you want your bar to be and what your strengths are as an owner. If you want your bar to get impulsive neighborhood traffic in a particular area, then you should be closest, and most obvious, to them. If you'd rather spend the time and money saved by more affordable real estate to develop your establishment's concept and create your own buzz and destination, your actual location won't matter so much.

You should consider factors such as safety, parking, accessibility to customers--even the history of the site--when choosing a location.

Your Bar: The Place to Be
The word "location" can refer to two different things--what area your bar is in (downtown, uptown, suburbs, etc.) and where you are in relation to your customers. Are you on their way home from work? Or do they have to make it a point to get to you?

Michael O'Harro, a National Bar & Restaurant Management Association board member, explains how he took a bar location nobody wanted in Virginia and made it work. "It was in an alley," he says. "It was a 15-foot-wide alley, and we were 128 feet away from the street. No one would go up the alley--[people] were afraid of it. So the building sat empty for 50 years. But the bar at the end of the alley was spending $20,000 a month in rent, while my rent was $500. I figured I had $19,500 to put toward marketing per month. I made the alley fun and chic. In the alley, I put down Astroturf that I purchased from a football stadium. I had signs, lights and banners. It became the alley. Nobody knew it was there, and then all of a sudden it was the hottest alley in town."

On the other hand, you can have an incredible spot and still not be successful. For example, if you are lucky enough to have the only sports bar right outside your town's athletic coliseum, you should be rolling in cash at least during every in-season homestand. But if your staff is stealing from you, operating procedures are badly managed, or your service isn't up to par, you could quickly find yourself out of business--grade-A location and all.

Naming Your Bar
When it comes to naming a bar, experts generally fall into two major schools of thought. The first says your bar is your dream--your hard work--so you should name it anything you want. The second approach to naming says your moniker is the first and greatest form of advertising for your drinking establishment. A name like Bill's Bar & Tavern doesn't really tell the public anything about your business, but The Haystack, Romp and 3rd & Vine give customers something to connect you to. You wouldn't consider going to bar called Romp if you just wanted a quiet drink. Likewise, you wouldn't travel up and down 4th Street looking for a place called 3rd & Vine.

O'Harro advises that your name should exemplify your concept. "First, I would try to figure out what my concept is going to be," he says. "Sports bar? Discotheque? High energy? Low energy? Singles bar? What exactly am I going to be? Then, what's the name of this business going to be? I would do tremendous research to try to come up with a name that literally fits with the concept."

When coming up with different names, don't stop until you love at least three. In your brainstorming sessions, keep these three questions in mind:

  1. How well does the name fit the concept you want to create?
  2. What types of customers will the name attract?
  3. What will people expect based on the name?
     

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