Discussion in 'Business, Careers & Education' started by MarkI, Jan 17, 2012.
There are a lot of wealthy people that own bars and clubs. Especially in DC as you need deep connections for the liquor boards. From my perspective they have a ton of experience plus silent investors. This isn't something you raid your 401k to do. However, I know the guys at this dive bar I frequent that had nothing apart from experience and some industry connections and managed to turn a profit from their ridiculous friday night specials and have since opened up a nicer/gourmet spot. All within 3 years or so of opening the business and all having been nothing more than bartenders at other spots.
From what I've seen from them, it's certainly doable. Location counts (deadzone between cap hill and downtown dc), niche (one cut rate cheap ass beer on fridays, shit food for a rowdy crowd with money to spend - cap hill staffers, agency staff, cops), experienced staff (no free shots except for super regs and rarely). The owners (at least one) are always around manning one of the bars.
^ This doesn't work for me. If I open a bar, yeah I want my partners to know the business through and through (fuck no I'm not bartending), and one of them keeping a close eye on the place. Otherwise I'm the guy creeping the clientele telling them I own the joint.
PS - Not sure why I quoted you AC, but having previewed my post and seen your quote, any one know why buffalo billiards closed down? Place was always packed. I assume it was the landlord. Anyway I haven't been by lately but heard through the grapevine.
My father and brother own a bar together. The place makes them a decent amount of money, but it's basically a hillbilly type of place where there are a few regulars that go there just about every day starting at noon. During evenings they'll do special promotions like karaoke night, live music by local bands, satellite poker tournaments for the WSOP, billiards tournaments, etc. so the evenings can get pretty busy, especially on the weekends. But, you can't just open the doors and expect people to come. If you want to open a bar, I recommend buying a place that's already in operation and then adding your touches.
WHAT??????!?!??!?!?!?!? I was there last Saturday night for the NFL divisional playoff games and the UFC PPV. Place was standing-room only. It's huge and makes money hand over fist. I can't believe that the shutdown is permanent.
Don't expect to make money off it. I know two people who own/run bars - the first owns/runs an irish pub in the fancy part of downtown here. He literally has to watch and time all the pours of the bartenders to see who's overpouring/etc. because the margins are so thin. The other person owns a restaurant/bar and has to do the same damn thing, even though his drinks are 2x the price of the guy's at the Irish pub.
Its not really a "fun" life if you're not into it.
Maybe it wasn't. I haven't been there in ages but a friend a few weeks ago took a peek and said it was closed. Maybe it was temporary. No idea.
It's not closed.
An especially applicable show would be Bar Rescue on Spike TV. I had the idea in the back of my head as a kick-back project to make a few bucks after retirement, but seems a lot more work than I thought.
I think so. These machines are all over French Canada from what I understand. I'm not a big fan of them. If you want a serious cocktail program, do not use these. However, it really isn't that hard to track liquor usage on a nightly basis. Just track the amount at start and finish and you can find the drinks served in the POS machines.
I have an idea that would lower cost and increase the margins for an on premise account. Most bars do not have room for large amounts of booze. So this prevents them from buying in bulk and receiving the tiered price drops. A climate controlled storage space would solve this problem. Just track pricing for your bulk spirits and wine on a monthly bases. If a deal comes along that is really sweet, take a huge drop and sit on it. I'm not sure of the legality of storing booze off site. At most the storage unit will cost you $100 bucks a month. Very easy to lower your costs more than $100/month.
The successful joints seem to have an attention to detail. They also don't panic if things aren't going well. The owners pay attention to the level of service, quality of goods, purchasing, cleanliness, and any other thing imaginable. Little things like making sure your menu hasn't fallen down in that little exterior menu display. Have a consistent concept, don't try 10 different things. Don't start trying a bunch of new things if business isn't going that well. Most new places also don't market themselves well. The owner is focused inwardly on the management and day-to-day operations and doesn't try and bring new people in. Those reality TV shows that rescue failing businesses usually do a marketing push. Just go out and hit the streets once a week. Pass out flyers, visit other local businesses. Just hit the streets and hustle.
Good post, Bhowie.
I think what often makes the difference between success and failure is how hands on the owner is. One of my hang outs is now four years old. The guy that opened it was early 30s then. He lived and breathed that place. Constantly marketing, doing charity events, etc. On the floor/at the door every single night for the first couple of years. Super attention to detail, trained his staff well, good (but not outstanding) wine and cocktail program with aggressive pricing on wine, generous to regulars. He opened another place, across town, about 18 months ago and it is also doing well. Same formula.
I think part of the failure rate is due to folks getting into it without the thought that this is an all encompassing beast for at least the first few years.
This can be the beginning of the end, unfortunately. I've seen a lot of great places run into trouble when the owner starts spreading himself too thin.
Not saying this has to be the case, two is usually quite manageable, but going from two to three to four etc. is when the skill set goes from hands-on bar owner with attention to detail goes to corporate people manager. The two skills are very different. Many struggle.
Hope this doesn't lead to a decline at your regular haunt, Peeb.
Bhowie is absolutely correct. My parents were restaurateurs (still are in fact) and they were working from 8am to 11pm at night every day. The basic ground rules for a well-run place are:
1. No one touches the till except for the boss/senior management.
2. Every entrance, exit, till and kitchen nook and cranny is covered by CCTV.
3. Everyone gets the same price for everything, no exceptions.
4. The owner must either be in the head of the kitchen and have number two as head of the front staff, or vice versa. There is no such thing as managing off site.
5. There must be no wastage whatsoever. You must never buy more than what you forecast can sell in the next two-three days. This keeps quality up and helps you keep a lid on costs.
6. The owner must open and close the place themselves. That means doing all the prep work for the day at least an hour before staff walk into the door, making sure all surfaces are cleaned to a spit shined finish and resolving all the books for the day after closing.
7. The owner must be able to do every single job and train up staff themselves. This is where experience in the industry separates the goers from the pretenders.
8. Maintain absolute discipline. In the kitchen and out front the staff must obey every order from you without question. Both front and back ends should be run like the military. Do not be afraid to fire people on the spot for insubordination.
Those are the basics that they used to survive in the business for two decades and are completely separate from marketing, product differentiation and interior design.
I disagree with much of this as being the only way and/or "basic ground rules." I'm not saying these will lead to failure but I don't think they are "must do" for success. Some of the points are good though.
yeah, plus one.
not really busting your chops, nereis, as it's obviously a formula that's worked for your family and I congratulate them (and you) on their success. But it's not the only way to do it, necessarily.
They weren't a formula to success (that's due to product differentiation/good chefs, marketing and client service) but really more of an indication as to what a good owner should be doing just to have a chance at not failing in the first year. When Gordon Ramsay's restaurants fail it's an indication that the industry is cutthroat and anything you do to reduce ongoing costs and hence, shorten the time to which you can begin having positive cashflow is quite necessary. I agree that too many people open a restaurant/bar for the wrong reasons, like many other small businesses. Often they have aspirations to work together with friends and family. My father lost a good friend when negotiations to buy out his half of the business went sour.
Unfortunately, opening a place where we would like to go to does not necessarily result in a successful business venture. For example, my ideal bar would deal exclusively in spirits and chill your drinks with whiskey stones. But we need to sell tap beer and wine or else we would paint ourselves into a corner by not providing the options that people expect to be able to get at a bar.
While not having at least a hand in day-to-day operations won't necessarily kill you if you have very experienced staff (poaching good managers from existing restaurants is difficult without connections), HR-wise discipline among front end staff (high school and college aged kids who think they're too good for the job) and kitchen (if not you or a family member, then prone to constantly asking for pay raises despite wastage) is difficult to maintain. People have a tendency to slack off when they're not being monitored, and sometimes even when a CCTV camera is pointed right at them. Naturally, this results in the situation where people start to only go on the nights where the proprietor is present.
As my parents got older they no longer had the energy to maintain that sort of lifestyle and so started to hand off duties to more experienced staff. What happened was that they began preparations for closing up half an hour to an hour before official closing time, were overgenerous on the drinks and were prone to lapses on cleaning duties. In the end they just realised that they weren't prepared to let what they'd spent over a decade creating go like that and went back to spending long hours there.
Long story short, it's a tough business to survive in, let alone make money. It's a game of 'not losing money' more often than not, especially in this economy. The number one thing I can say is that experience either in the kitchen or operations would limit the downside risk the most. Good luck with the venture!
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