Should You Buy a Bar Right Now?

“We should buy a bar!” Many of us have said this at least once in our lives, seeing the opportunity to make some serious cash flow while working in a fun environment. While bar businesses can be quite lucrative, they’re also a lot of work, both in the planning and execution stages. Not to mention, they require continuous upkeep to stay clean and appealing, or else you risk setting a bad reputation, or worse, facing trouble from your local and state health departments.

Below we’ve outlined some other items a new business owner should consider.

Is Buying a Bar a Good Investment?

The pandemic undoubtedly slowed down business and contributed to a significant decline in the restaurant and bar industry employees. It’s best to assume that there could be directly and indirectly related hurdles that could impact your new small business.

That being said, not all hope is lost, especially if you’re ambitious and innovative. Specialty bars are having their moment as the latest two generations emerge — those of legal drinking age, that is. Their unique tastes are changing course for the bar industry. Appreciation for “craft” and “artisanal” food and beverages, sustainable practices, and unique experiences that coincide with social drinking are the new norms for today’s bar-related consumerism.

They are a popular target audience but certainly not the only one to appeal to. Classic neighborhood bars are still loved and appreciated by a slightly older customer base and even some Millennial and Gen-Z subgroups. To make sure you have repeat business for years to come, you should consider other ways to make your bar stand out, such as expanding your dining room, investing in comfortable bar stools and other seating, or securing good live music.

Finding the Right Bar For You

There are craft breweries, wine bars, sports bars, Main Street dive bars, arcade bars, even ax-throwing bars. Basically, any type of themed bar you can think of probably exists. So, how do you decide what’s right for you?

You can start by considering how you envision your bar to be. Do you want to go the specialty route, or does a more laidback local bar appeal to you?

Next, you’ll want to decide just how hands-on you’d like to be within your new business. For many, bar ownership is a lower-level commitment, but it requires active management at all times of operation. So, if you’re looking to be more of an absentee owner, you’ll want to consider just how much of your time is needed during the set-up, launch, and initial growth of your new business. How much will you be needed in the on- and off-seasons? For those looking to take a hands-off approach, a turnkey bar for sale or even a franchise could be a better route to go than starting your own bar.

The location of a bar is also tremendously important. Even with rideshare apps, the distance of a bar is a major factor in whether customers decide to go. Plus, its nearby surroundings can help or hurt you — i.e., whether you’re in a safe neighborhood or near other establishments.

Found a Bar For Sale? Here’s What To Do Next

Plan to do the following once you’ve identified a bar you’re interested in.

• Review financial documents such as income statements, current, and past cash flow, profit and loss summaries, etc.
• Define what permits they’ll transfer to the new owner, i.e., a full liquor license or a wine and beer license.
• Define what assets and liabilities are included in the sale. This should include all tangible items, such as bar cabinets, kegs, pool tables, jukeboxes, refrigeration units, other bar furniture, and intangible items. For a bar, this would most likely include goodwill and brand recognition.
• Consider whether the sales price seems reasonable. The current owner should have had a valuation done to prove what their bar is worth.
• Prepare your offer following all the necessary guidelines.

As this industry continues to grow, it may be time for you to move forward with your dream of becoming a bar owner. Sunbelt Business Brokers is here to help you tap into any great opportunities that hit the market. We have locations nationwide that specialize in bar and tavern purchases and can help you in every step of the buying process, from identifying opportunities to closing.

Get in touch with your local Sunbelt office for more information!