Start a Bar – What You Need to Open you own Bar

When starting a bar, there are several things that should not be overlooked. We will explain the prerequisites for opening a bar, how you can estimate the costs for it, and provide a practical checklist for the foundation of a bar.

The prerequisites for founding a Bar

The First Steps in establishing a Bar

The first step towards setting up your bar leads to the local business registration office.

There, you will apply for a business license. This step should be taken very quickly, as it will still be some time before you can sell your first drinks.

• The business registration office automatically notifies all relevant authorities.
• This includes the tax office, which sends a questionnaire for tax registration.
• The Chamber of Commerce (or equivalent organization in your country) informs about mandatory contributions and also offers training on food law and hygiene.
• This provides you with a proof of food service instruction, which is necessary for applying for a liquor license and restaurant concession.
• Registration of the business with the Professional Association for Food and Hospitality (or the equivalent body in your country), which provides accident insurance for you and your employees.
• If necessary, obtaining permits for renovations and modifications at the bar from the Building Regulations Office (or the equivalent authority in your country).

Set up a bar: all costs & fees

• Startup costs (consulting, fees, licenses)
• Rent including utilities
• Living expenses
• Labor costs
• Cost of goods purchased
• Royalties for music rights (similar to GEMA) / Broadcasting fees (such as SKY)
• Advertising
• Contributions to the Professional Association for Food and Hospitality (or equivalent)
• Insurances
• Taxes
• Possible loan payments and interest
• Restaurant license (varies depending on the size of the bar)

Essential for Starting a Bar: The Bar Business Plan

To even qualify for a loan, you need a solid business plan. In it, you should describe:

• What your concept and offerings look like. In other words: What kind of bar do you want to open, and what makes it unique? What are you offering, and at what prices?
• What your target audience looks like. Who do you want to reach? Do they share common interests?
• What the competition looks like. Are there other bars nearby, and how do you differentiate yourself from them?
• How you envision your marketing. What strategies do you have for customer acquisition and retention? How will you promote your venue?
• Where your bar will be located. What do the premises look like? Is the bar visibly accessible, and is the target audience easily reachable?
• What motivation and suitability you bring. What drives you? What do you bring to the table to successfully manage the bar?
• Which legal structure you choose. For instance, are you establishing a limited liability company (LLC) or a sole proprietorship? Why have you chosen this legal form?
• What your finances look like. What are your expenses? How will revenues evolve? When will the bar start making profits? How will you bridge the time until then? What is the capital requirement, and what does the financing look like?

Conclusion: The right planning, let get the set up of your own bar sucessfully

When starting a bar, you should under no circumstances neglect legal matters such as the bar license, hygiene regulations or the Youth Protection Act. In the worst case scenario, you could end up with a premature closure despite careful planning. You should also consider all costs, not just the investment costs. Rent, fixed costs, fees and similar things will also be incurred.

Avoid drinking along with your guests, dismissing an outdoor area as unimportant or signing up to binding contracts. Use our checklist as a guide so that you don’t forget any important details when set up your own bar.