How to Open a Bar
Tips / 22.06.2023
In 2019 alone, there were nearly 50,000 bars and pubs across the UK. With this in mind, you may think you have a lot of competition but with the right game plan in place, you can succeed and compete effectively while bringing your unique bar concept to the public. If you are wondering about the intricacies of setting up a bar in the UK, this post is for you.
In this in-depth guide, we’ll walk you through some of the most important factors you need to consider in order to get your bar concept off the piece of paper as a concept and turn it into a real venue that your clientele and patrons will love. So, without further ado, let’s take a look at what you need to put in place before getting started and when considering opening a bar in the UK.
Table of Contents
- Do your market research
- Consider all necessary licenses and permits
- Research funding options
- Come up with a bar concept and brand
- Decide on your business model
- Choose the best location for your bar
- Write a business plan for your bar
- Find suppliers
- Buy equipment, furniture and supplies
- Create your menu
- Think about the staff you’ll need to hire
- Consider the economics of setting up a bar
- Marketing and social media
1. Do your market research
First things first. When you want to open a bar, the very first step you need to take is to do your market research. Market research is a broad term for what is known as studying the lay of the land. In other words, looking at opportunities for market penetration as well as analysing your competitors.
But where do you start? The answer is not as straightforward as you might think because it entails considering multiple factors simultaneously. For example, there are some streets in London lined with bar after bar and if you plan on opening in a similar location, you need to be as well-prepared as possible because you’ll face a lot of competition. With this point, therefore, you first need to look at your prospective location. Will you be operating in a busy restaurant and bar street? Will you be located somewhere where there is less competition but also less foot traffic? These are important questions to consider.
Another part of market research is studying your competition. Where are they located? What type of atmosphere do they offer – a more sophisticated venue for wine spritzers on a Friday night or a more laid-back pub venue that the average Joe can enjoy? Further to this, you need to study what they offer on their menus. Bars and pubs are generally known for their drinks and less so for their food menus.
So, you need to know what you’ll be offering and how that sets you apart from the rest. Will you be sourcing high-quality imported wines? Will you be creating mouth-watering cocktails? Or will craft beers be the focus of your offering? Being clear about this and then comparing what your competition is pricing for their products can also help you start off on the right foot.
Of course, you also need to study your target market. This is an essential part of market research when you are trying to figure out how to open a bar in the UK. Your target market is the demographic that you’ll be catering to. These could be students, working individuals, older people, a more sophisticated crowd and everything else in between. You need to be aware of what their interests are so that you can offer them something that they will like. If you don’t study your target demographic, you are, as they say, lost at sea and will be left floundering.
2. Consider all necessary licenses and permits
Now that the market research is out of the way, your job is nowhere nearly close to done yet. In fact, it’s just the beginning. This is because you’ll need to get all the right licenses and permits in place before opening day so that you are legally permitted to serve alcohol.
Speaking of alcohol, because it is a staple in practically every bar and pub across the UK, you need an alcohol licence, which you will need to obtain from your local authority. Costs for this can vary significantly and range from a few hundred to a few thousand pounds and will depend on a number of different factors, including the size of your venue, the alcohol served, etc.
Further to this step, you will also need to acquire building permits and licenses to play music or to open during certain hours such as from 22:00 until 05:00. If you are intending to host things like live events such as bringing in local musicians to perform at your bar, there’s a license for that, too. And of course, you’ll need a license to serve food. Even if it’s as basic as chips or other snacks.
Overall, without all the right licenses and permits in place, your bar business won’t be able to get off the ground because you won’t have the legal permissions to operate. Having them in place are part of the legal requirements for opening a bar in the UK. As such, these are essential to start acquiring from the get-go to ensure your bar doesn’t face any legal hiccups further down the road.
And in the event of legal hiccups, you need to be prepared. This means securing the right type of insurance for your bar including public liability, employers liability and other forms of insurance so that any potential future claims against your bar can be effectively dealt with.
3. Research funding options
Now for the question of how you’ll actually pay to set up a bar. Similar to restaurant businesses although not nearly as involved and as equipment-heavy, starting a bar can entail a significant financial investment. But where will you source the funds when you want to know how to open a bar? Luckily, there are a few options you can consider. These include:
- Acquiring funding from a lender such as a bank or a building society
- Getting investors involved in your supporting your bar project
- Self-funding through savings
- Getting equity on an existing home or on tangible, immovable assets
- Starting a partnership where your partner can help finance the bar project
- Local small business help schemes or grants offered by local municipalities
- And others.
4. Come up with a bar concept and brand
Next up when it comes to opening a bar in the UK is the matter of pinning down your bar concept and brand. The brand is the visual identity of your bar business and it needs to be completely consistent throughout the entire user experience. This means taking into consideration every light shade and every picture on your walls to ensure they align with the image and atmosphere you want to create for your patrons to enjoy.
You may wish to create a brand guidelines book that sets out what colours you will use for your logo (which should also appear on all your marketing materials including your website and flyers). You may also wish to determine what sort of feeling you want to invoke in your customers and try to create that atmosphere for them using the right interior styling options.
Once again – will you offer a more sophisticated bar venue or a more laid-back one? The interior needs to match your brand to the T and everything you do from your menu to your marketing (for more on this see below) will need to be consistent with your bar concept.
5. Decide on your business model
Another important aspect that relates to how to set up a bar in the UK, and an important one at that, is the issue of what business model you will be using. You can choose from a sole proprietorship, a partnership, an LLC corporation, etc.
Just bear in mind that each of these business “vehicles” come with its own sets of advantages and disadvantages. A sole proprietorship, for example, is a business model where the owner can fully enjoy all the profits they make from their bar business. On the other hand, this business model ties the owner’s personal and business liabilities together.
This means that in the event of a debtor seeking to reclaim payments, your personal and business finances will not be considered separate and you may have to dig in your own pockets to come up with the necessary funds to cover your debt or financial shortcomings. The opposite, however, is true for LLC corporations where the owner’s finances and the business finances are completely separate and one cannot in essence “touch” the other.
6. Choose the best location for your bar
With the business model out of the way, it’s time for location selection. You will have heard this a thousand times but it bears worth repeating again: location is everything. You need to be savvy with your choice of location by studying who your competition in your desired area is and what you’re up against.
Other important aspects to consider are the local community. Will they be attracted to your brand and bar concept? Will you be able to provide them with ease and convenience to reach you or will they have to travel out of their way just for a drink? Will your bar be located near convenient transportation routes and if not, will there be sufficient parking for your customers to gather?
In addition, it’s also a good idea to think broader when it comes to locations. For example, you may wish to locate your bar near current local attractions. If you are located near a night club, the chances of getting the pre-drinks crowd are higher. However, if you’re catering to a more sophisticated business clientele, you may wish to locate your bar where your clientele is at.
All of these questions must be considered and on top of this comes the aspect of the actual building that you will be using for your bar. Here, questions such as whether you’ll finance the purchase of the building or whether you’ll lease it need careful attention. If you plan on repurposing the building, do you have the budget and permissions for it?
7. Write a business plan for your bar
The business plan is your “road map” to success because this is where you end up putting everything down on paper and solidifying your bar concept while clarifying to potential investors that your bar business idea is worth supporting. For this reason, you need to take your time with the business plan for your bar because it will be a very detailed culmination of all the points raised in this article and more.
For example, apart from starting your business plan with an executive summary, you will also need to indicate:
- What the bar concept is
- Show that you have done thorough market research
- Indicate how you plan to staff and equip your bar premises
- Ensure that you have the right suppliers in place
- Provide financial projections and forecasts of anticipated earnings
- Indicate how you’ll carry out your marketing and advertising
- What insurance you’ll get and how much it will cost
- A SWOT analysis to show you’ve done your homework
- And multiple others.
8. Find suppliers
Bars go through a lot of alcohol because that is one of their sole purposes: to serve patrons alcoholic drinks while providing a pleasant and enjoyable atmosphere at the same time. With alcohol being so varied and diverse, you need to find suppliers which will help you save costs at the same time. This can be done through bulk deals and discounts on bulk purchases.
In addition to this, you need to make sure your suppliers will be able to stock your inventory items on time, every time. As such, reliability and reputation for a quality service should be other key considerations as opposed to looking for the cheapest option only.
9. Buy equipment, furniture and supplies
To start a bar is not as easy as meets the eye. But as mentioned earlier, if you have the right game plan, you can succeed. In the next step involved in how to open your own bar we consider the issues of buying equipment, furniture and supplies. Although we already spoke about finding suppliers above, this time, we are talking about other types of supplies. This will be all your furniture and glassware, tables and chairs, barstools, the bars and equipping them properly, adequate and professional cocktail mixers, the right types of kegs and cooling systems to support them.
Overall, although bars are not as tech-heavy as restaurants, you still need to put a lot of thought into planning the premises by writing out a list of all the items you’ll need to get it furnished and operational from A to Z, culminating in the smallest items such as the soap you might use in your restrooms to the point-of-sale (POS) terminals that you will use to help reduce queues and waiting times at the bar during peak hours.
10. Create your menu
Creating your menu will probably be the most fun yet the most complicated process of your entire bar creation process. The reason behind this is that when you think of how to start a pub or how to start a bar, the menu is going to be one of your biggest unique selling points. If you offer beer on tap, what will set you apart from other pubs or bars that offer the same? If you offer wines, what makes your selection better than your competition?
If you are going to be offering cocktails, you need to consider what makes yours special and you also need to ensure that they will, in fact, be liked by your patrons so that they keep coming for more. This is an intensive research process and using focus groups to test out new drinks or solidifying your findings of what drink types already work will be a good plan before you launch your bar.
And drinks are just one part of the equation. If you’re going to be offering tapas or small plates of food to go along with the drinks, your menu will need even more careful consideration than merely the drinks.
11. Think about the staff you’ll need to hire
Running a bar requires staffing it with the right people and ensuring that your staff is on the same page as you with regard to your expectations of the customer service that you want to offer your patrons. Some of the most common types of positions that need to be filled at bars include a bar manager, bartenders, barbacks, servers, hosts and/or hostesses and others.
Each of these members of staff needs thorough training and previous experience will be an advantage. You will also need to factor in their shifts and working hours in addition to the salaries you will pay them to compensate them for their efforts.
But further to this, you may need staff in your kitchen (if you offer food) and you may also need to hire staff to handle your social media accounts as well as your overall marketing efforts (for more on this, take a look below). You’d be surprised at how many people it takes to run a bar successfully and this is why staffing, recruitment and training are other aspects that require careful thought.
12. Consider the economics of setting up a bar
Setting up a bar requires studying your finances very carefully and making realistic projections for the bar’s success in the future. If you are wondering how much to open a bar in the UK, the short answer is that it varies from bar to bar. Some have bigger venues than others.
Meanwhile, many differentiate themselves in terms of location, atmosphere, and types of drinks (and food) served. As such, it’s difficult to pinpoint with certainty how much it will cost you to open a bar because there are so many external factors to consider.
13. Marketing and social media
The final but by no means least important aspect of opening a bar includes actually marketing your offering to your prospective patrons. Marketing should have a twofold purpose. The first is to attract patrons to your bar establishment once you launch. The second is to consider marketing so that you continuously get patrons through your doors and not just during your soft or even official opening.
For the initial launch of your bar concept, you’ll need to involve several marketing tactics at the same time. You’ll need a Google My Business listing to help local customers find you. You will also need a website where you showcase your drinks (and food) menu in the most attractive light possible so that you draw your customers in.
You will further need to create social media accounts for your bar on Facebook, Instagram and other platforms so that you remain relevant. However, there are also physical marketing materials and collateral such as flyers that you can hand out before the soft opening where you might offer discounts or an extended happy hour to draw in the crowds.
The same principles mentioned above will be involved in your continued marketing efforts. You will want to ensure you generate good and strong customer testimonials to help ensure your bar gets and retains a good reputation for being a quality establishment.
Consider taking out ads in local newspapers and publications to supplement your local marketing efforts, too. The more exposure you get right from the get go, the higher the chances of continued business success in the future. However, it’s a matter of ensuring consistency in your customer service and offering by being true to your brand throughout.
The bottom line
Although we’ve surely given you a lot of food for thought when it comes to how to open a pub in the UK, the work that remains to be done is quite impressive to say the least. Your to-do list will be extensive and it will help to ensure that you go through each item carefully and conscientiously so that you leave no stone unturned when it comes to your great bar concept idea.
By being as thorough as possible at each step of the process, you’re setting yourself up for success in the future. After all, if you want to invest in a bar, it’s not a short-term venture that you can just give up on after a couple of months. It will take hard work and dedication to ensure that you reach the peak of your success.