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by mschwar99 5743 days ago
I helped run a large, high volume college bar for around 8 years and then opened and operated my own venture (with partners) for a year or so.

Much of the details of your venture will depend entirely on its location. Sticking to advice that will apply no matter where you are:

If you have to equip the place from scratch and need to do it on the cheap, find restaurant auctions around your location. Restaurant and bar equipment depreciates at a sickening rate, and they go out of business frequently. You can save well over 70% off of catalog for six month old equipment.

Find a local insurance agent and get to know them very well. Don't ever, ever skimp on liability insurance.

In my experience far and away most important aspect of operating a bar is the staff that you employ. Obviously they need to be as trustworthy as possible - employee theft is a constant. Much like fighting illegal downloads you will be fighting to minimize it rather than abolishing it. The theft will rarely be in the form of removing money from the register till, but rather in the form of unpaid product.

The larger reason that your hires will be important though is because hiring the right people is the most effective form of marketing that you can possibly do. Hiring a staff of well connected, social butterfly waitresses, door guys, and bartenders has an infinitely higher ROI than any print or radio marketing that you can do.

Additionally, good employees are perhaps the most important differentiating factor for your business. Unless you are a multi-million dollar Vegas-style theme joint, your business is a commodity. There are already twenty other businesses just like yours. Having employees that are both good at their jobs and eager to establish relationships with your patrons will be key in converting customers to repeat customers.

Could type all day, but the last thing that I would add is that as with any new business you will struggle to gain traction. When marketing I always tended to look at my job as one of disrupting traffic patterns. Potential patrons already had their favorite bar and a list of five others on a short list. My job was to get myself on that list, and in order to do that I would have to offer an awfully compelling reason to get them to disrupt their patterns.

I would usually use either a heavy loss leader (really cheap drinks) on a typically low revenue night or high profile events (big name band / DJ, fight night, etc). Once I had ac customer in the door and I provide a well executed experience it becomes a numbers play much like PPC advertising in the web world. 50% of the people that tried me out will be back someday, I made it on to the short list of 10% of the new customers, 5% wind up being new regulars.

2 comments

How'd you handle the issue of employee theft? I'm a heavy drinker, friendly, and I tip well, so generally at the end of the night my tab comes out to 50% or less of what it should be.

As a consumer I've seen this handled differently at many places, so I'm wondering what worked for you. I've had bartenders who I knew were just not ringing up my drinks, bartenders who had me on the comp list, bartenders who'd mix up a jug of free shots at the beginning of the night, bartenders who'd ring my drunks as staff/girlfriend drinks, etc etc. One of my current bars has a friend-of-the-bar/in-the-biz program, and I get a percentage off of all my drinks. As a consumer, it's the method I prefer the most, because even when I show up on the wrong night or one of my regular bartenders has the day off, I still get some sort of discount at the end of the night, even if my tab isn't missing the beer or two it usually is.

I'm asking because I realize two things: 1) even though I always bring people in with me who wouldn't have gone to that particular bar without me, the bar is definitely losing potential profit on me individually. My stool could be taken up by some guy off the street who's paying full price for everything. 2) I tend to follow bartenders like hairdressers. I really don't care where I'm getting my hair cut or where I'm drinking my beer. I care that everyone knows my name, that my first drink is on the bar before I sit down, and that I feel like I'm getting a deal at the end of the night. I have left bars never to return when a favorite bartender got fired or quit.

To prevent this there are surveillance cameras that insert the cash receipt data onto the video. They also save key frames with every transaction so you can later jump directly to them.

For instance: http://www.eaglevision1.com/Text-Inserter1.htm

Furnish us with the Brand & Model number of your register. We will make the proper interface cable to connect your register to our system.

Terrible website, but these guys know what's really important in a business.

I agree, the page is atrocious!
Good info, thanks for sharing. I do have one question that stands out as a paradox to me ...

You mention hiring well-connected, social butterfly types. Can't doing this increase your risk/amount of theft? In other words, if many of your patrons are socially connected to your staff, aren't they more likely to expect/get free drinks?

I don't think social people are inherently nepotistic. In fact, I consider the expectation of ongoing free anything to be a primary characteristic of anti-social individuals.

That said, if you identify one person that appears to be a social hub, giving them free drinks might be good for business. YMMV!

The cost of those drinks to a bar is ridiculously low for one. Secondly, have you ever consistently gotten more than a few free drinks, even when you are "friends" with the waiter/waitress/bartender? The good ones are fantastic at enticing people in by irregularly giving out a free drink here and there. It instills goodwill, hardly costs a cent, and makes loyal as hell patrons.