Ditch everything or wait until retirement to open a bar: many people dream about it and take the plunge. So, how do you go about creating your own bar?
We take stock of the essential steps to follow to open this emblematic establishment while respecting the many regulations. Follow the guide!
First step: find an idea or a concept
First of all, before getting started, it is essential to think about the concept of your establishment. What would make customers stop by your place more? What do you want to bring out? What atmosphere do you want to create? At first glance, these are harmless questions that will make your bar a success.
You are not going to open a bookstore café like you would open a cocktail bar or a traditional pub. It’s up to you to clearly define your concept according to your affinities and the targeted clientele.
Therefore, it is crucial to start after having studied the local market, compared several locations, matured and weighed your decision.
The location of your bar is very important, especially whether you are located on a busy street or not. The location is not to be neglected because it is easier to make yourself known when the area you are in is conducive to going out.
Similarly, you need to work on the decoration and atmosphere of your bar. Don’t hesitate to ask your friends and family for their opinion and put yourself in the shoes of a customer: what are they looking for in a bar? Regularly the answer can be summed up in two words: conviviality and price.
Second step: drawing up a business plan
After having refined the concept of the bar you wish to create, it will be essential to study the viability of the project by setting a budget. To do so, you must set the prices of your card (don’t forget to take into account the VAT), establish the margins you want to generate, allocate a budget to the equipment, plan the salaries… Once all these elements are mastered and adjusted to the local market, you will know if your business is viable.
Knowing how to write a business plan is not an easy thing, it may be necessary to get help for this step. In any case you can start by using our business plan template for a free downloadable bar.
Third step: Comply with current regulations
After studying the concept and the viability of your idea, you must ensure that certain legal obligations are met. Indeed it is necessary to respect certain regulations to open a bar.
These regulations cover among others
– safety and hygiene standards ;
– mandatory displays that must be visible to all;
– obtaining the bar license (license IV) (after having followed the training to open a bar that allows to have the operating permit).
Attention, if you want to open a tobacco bar, you must also be approved by the General Directorate of the Tobacco and Matches Industrial Exploitation Service.
Fourth step: create a company, buy a company or go through leasing management?
When you open your bar you will have several options. Do you prefer to create your company and develop your concept on your own? Would you prefer to go through a lease management to test the ground before buying? Or buy an existing business? Let’s specify each of these possibilities.
– Open your bar by creating a company: this means that you start from scratch and that you will have everything to set up. You’ll have to choose your legal status, draw up your own articles of association, register the company, find an accountant, employ employees and manage your company so that it has an existence with the various institutions.
– Going through management leasing: if you are not familiar with this term, you should know that management leasing allows you to lease a business for a certain period of time through a contract. For example: the owner rents his bar for a certain period of time and the tenant is then considered the manager, i.e. the bar owner has no say in management decisions. Lease management is often a phase prior to the transfer of business. The tenant is then able to evaluate the profitability and potential of the bar before deciding to buy it back. No purchase or sale obligation is due following a management lease because neither the owner nor the lessee is obliged to sell or acquire the bar at the end of the management lease contract.
– Buying back an existing bar: if you find a good deal with an existing concept that comes close to what you wanted to do, you can buy the bar directly. With this solution you invest a lot, but it is a solution that is often seen as reassuring in that you are going to invest in something you can already visualize.
Fifth step: renting or buying your premises?
Whether you want to open a wine bar, a tapas bar or a night bar, you need to have premises. However, you don’t know how to set up yet? If you go through a lease management contract the question does not arise, but when this is not the case there are two possibilities available to you in terms of premises:
– Be a commercial lease holder, which implies that you are a tenant;
– Buying your premises, which requires a significant investment.
In reality, it is rarely a choice since opening a bar and buying premises are two very important investments. It is not common to have the financial means to make both investments at the same time. This is why it often happens that the opening of a bar is accompanied, at least at the beginning, by a rental of premises. However, nothing prevents you from buying your premises later if your bar’s business prospers and you have the means to do so.