How to open a successful cocktail bar

10th February, 2015 by admin

It just so happens that the hottest cities in the world in terms of cocktail culture happen to be some of the most expensive to set up a bar. But, as Tom Aske writes, there are savvy ways in which some entrepreneurs are getting around this


Opening a world-class bar like Quinary in Hong Kong is not an easy feat

The hospitality industry is as strong as ever, with attention to detail, innovation and high quality produce being the focal point for new bar operators. The cocktail bar scene is no different, with an evolution over the past five years that is now leading to some industry experts predicting that bartenders will gain the same fame that chefs have enjoyed over the last 20 years.

It is no surprise then that some of the industry’s brightest stars are now progressing from bartender to bar owner – a trend that can only strengthen an already thriving industry.

There is however something innately terrifying about taking a leap of faith into self-employment; the unpredictability and unsettled nature of realising that success or failure is entirely dependent on one person.

Not only is your financial and personal security in the balance but you also have a team of people who depend on you. Ryan Chetiyawardana, owner of award-winning bar White Lyan, agrees: “At the beginning, and on-going, the hardest thing is the idea that you are responsible for people’s livelihoods.” This business is tough. The real question is what lies ahead and just how tough can it really be?

Quadrupled rents

The first hurdle that must be jumped is finding premises – something that has become increasingly difficult in recent years.

The licensed trade has evolved immeasurably over the past decade. In London particularly, the premiums placed on leases has quadrupled. In 2010, at the height of the recession, it was far easier to find an ailing business with the owner willing to throw you the keys at the first opportunity.

Fast-forward four years and as the economy strengthens, property prices are soaring and businesses that are still hemorrhaging money are now commanding lease premiums in excess of £80,000.

Assuming that a potential buyer can afford this extortionate rate, they will then often need to find three months’ rent deposit that is unlikely to fall short of £25,000. So, we are over £100,000 before we have even considered screwing in a light bulb or painting the walls. Then comes the rewiring, music system, plumbing, bar stations and cash-flow. Even then there are likely to be many unforeseen costs that can potentially slow or even stop the build process.

Chetiyawardana states: “Every site has its ghosts (sometimes literally) and lots of things will come out of the woodwork which inevitably have extra costs involved”.

2 Responses to “How to open a successful cocktail bar”

  1. Interesting! My friend is planning to put up one since we were in high school. I will definitely handing this article to him.

  2. Martin Fort says:

    There are some good points! But let me summarize it and add some more things that I believe are essential for opening a successful bar…

    1. Market Research (including location, competitors, beverage preferences, income)
    2. Define your goals and business strategy (bar concept, branding and marketing message)
    3. Design cost-effective cocktail & beverage program based on your target market.
    3. Start small and adapt (pay attention to feedback from your customers)
    4. Use different marketing strategies to promote your bar (word of mouth, online advertising, email marketing, bar promotions, blog)
    5. Keep track of all results (efficient bar inventory management, business goals, marketing strategies)

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