Starting a business can be an exciting and rewarding venture. However, it requires careful planning and strategizing to ensure its success. One crucial aspect of this planning process is creating a comprehensive and clear business plan. This holds true for any type of business, including a bar business.
A bar business plan is a written document that outlines the goals, strategies and financial projections for starting and operating a bar establishment. It serves as a roadmap for your team, guiding you through the various stages of setting up and managing your bar business.
How to create a bar business plan in 6 steps
Writing a comprehensive and clear business plan is crucial when starting a bar business. It provides a roadmap for success and helps entrepreneurs make informed decisions. A well-structured bar business plan typically consists of six main parts:
01. Executive summary
The executive summary is an overview of your bar business plan. It should concisely summarize the key points and highlight the most important aspects of your business. This section is typically written last, but it appears at the beginning of the plan.
To write a clear executive summary for a bar business, include the following elements:
Brief description of your bar concept and its unique selling proposition
Overview of your target market and the demand for your services
Summary of your financial projections, including revenue and profit estimates
Outline of your marketing and advertising strategies
Mention of any key partnerships or collaborations
Example of an executive summary
“XYZ Bar is a trendy, upscale establishment located in the heart of downtown. Our mission is to provide an unforgettable experience for our patrons by offering innovative cocktails, live entertainment and a vibrant atmosphere. With a focus on quality ingredients and exceptional customer service, we aim to become the go-to destination for young professionals seeking a sophisticated nightlife experience. Our projected revenue for the first year is $1 million, with an expected profit margin of 20%. We will implement targeted marketing campaigns through social media platforms and collaborate with local influencers to build brand awareness. XYZ Bar has secured partnerships with renowned mixologists, ensuring our beverage offerings are second to none.”
02. Business and domain names
Choosing the right business name for your bar is essential for building brand awareness and trust among your target audience. The name should reflect your bar's concept and resonate with your target market. To generate name ideas, you can use a business name generator—or specifically a restaurant name generator—for inspiration.
When selecting a domain name for your bar business, keep it short, memorable and easy to spell. Include relevant keywords where possible and avoid hyphens or numbers. Make sure that the name is available and can be registered—follow the necessary steps for registering your business.
03. Market analysis and research
Including a market analysis and research section in your bar business plan is crucial for understanding the competitive environment and developing effective business strategies. Conduct thorough market research to identify your target market, their preferences and the demand for your services. Analyze your competitors to understand their strengths, weaknesses and pricing strategies.
Key elements to include in this section:
Overview of the target market demographics and psychographics
Analysis of competitors, including their offerings and pricing
Description of your unique selling proposition and how you differentiate from competitors
Outline of your marketing strategies, such as social media marketing, partnerships and events
04. Operations plan
The operations plan outlines the logistical aspects of running your bar business. It includes details about the location, premises, equipment and staffing needs.
In this section, address the location of your bar and why it was chosen. This can include details about the premises including its layout and design. Then, incorporate necessary equipment and furnishings. You’ll also want to include staffing requirements, such as the number of employees, including their roles and responsibilities.
05. Marketing and advertising plan
The marketing and advertising plan outlines your strategies for promoting your bar business and attracting customers. It should include a mix of online and offline marketing tactics that are most effective for reaching your target audience. An effective way to market your bar business could be through social media marketing, a strategy that worked for Strathcona Spirits,
Our primary focus has always been social media—we use Instagram, Twitter, and Facebook. The main thing for us, on social media, our website, and even the experience in the shop, is to be as inclusive as possible. Keeping the language of our spirits as simple as we can. Being transparent with our barrel routine and how things are aged. Using terms that are unnecessary, or trying to overcomplicate things, excludes people, and we would never want to do that. Our spirits are for everyone. Andrea Shubert, Co-founder Strathcona Spirits.
You can consider also including here an overview of your branding strategy, including your logo, colors and tone of voice. If you don’t have a logo yet, check Wix’s restaurant logo maker for inspiration.
Then, think about which marketing strategies to lead with. You can additionally consider traditional marketing tactics—such as print ads, radio spots or billboards—if applicable.
06. Financial plan
The financial plan is a pivotal aspect of a business plan, offering a detailed roadmap of how the bar business will be funded, its projected revenue and expenses, and the anticipated time frame for achieving profitability. This section provides stakeholders with crucial insights into the financial feasibility and sustainability of the bar business. It will likely include:
Startup costs and funding sources: Starting a bar business involves various upfront costs that need to be accurately estimated for proper financial planning. These costs encompass elements like lease or purchase of the premises, renovation and interior design, licensing and permits, furniture and fixtures, bar equipment, initial inventory, marketing and staff training. Funding for these startup costs can come from a combination of sources, including personal savings, business loans, grants or investments from partners or stakeholders.
Revenue projections: Revenue projections provide a forecast of the expected income over a specific period, typically the first few years of the bar's operation. These projections should be based on careful market research, competitor analysis and realistic expectations.
Operating expenses: Operating expenses encompass costs associated with running the bar business on a day-to-day basis. These include rent or mortgage payments, utilities, staff salaries, marketing and advertising expenses, maintenance and repairs, supplies, insurance and other overhead costs.
Profit and loss projection: The profit and loss projection, also known as the income statement, provides an overview of the business's revenue, expenses and net profit or loss over a specific period. It offers insights into the financial health of the bar business and its potential profitability.
Timeframe for profitability: The timeframe for achieving profitability in a bar business can vary significantly based on factors such as location, target market, marketing strategies and operational efficiency. Typically, bars aim to reach profitability within the first year or two of operation.
Break-even analysis: The break-even point is the level of revenue at which the bar business covers all its expenses, resulting in zero net profit or loss. This is a critical milestone as it indicates the point at which the business starts generating profits.
Example of a break-even analysis calculation:
Fixed costs (annual): total fixed costs (rent, utilities, salaries, etc.)
Average revenue per month: estimate average revenue generated per month
Break-even point: fixed costs / average revenue per month
Bar business plan templates
To help you get started, here are two draft business plans for hypothetical bar businesses. Customize these templates according to your specific concept, target market and goals—and create a plan that’s all your own.
Bar business plan template #1: upscale cocktail lounge
The Upscale Cocktail Lounge is a sophisticated bar concept located in the heart of a bustling city. Our mission is to provide an elevated drinking experience through expertly crafted cocktails, a curated selection of spirits, and a refined ambiance. With a target market of young professionals seeking upscale socializing environments, we aim to become the go-to destination for after-work drinks and weekend gatherings. Our projected revenue for the first year is $1.5 million, with an expected profit margin of 25%. We will implement marketing strategies targeting our ideal customers through social media platforms and collaborate with local influencers to build brand awareness.
Company name and domain name
The company name for this upscale cocktail lounge is "Elevate Lounge." The domain name chosen is www.elevatelounge.com, which reflects the concept's goal of providing an elevated experience to its customers.
Marketing analysis and research
Target market: Young professionals aged 25-40 with disposable income seeking upscale socializing experiences.
Competitors: Analyze other upscale cocktail lounges in the area, their offerings, pricing and target demographics.
Unique selling proposition: Highlight the unique features of Elevate Lounge that set it apart from competitors, such as signature cocktails or exclusive partnerships.
Marketing strategies: Develop a comprehensive marketing plan that includes social media marketing, influencer collaborations and hosting exclusive events to attract the target audience.
Location: Choose a prime location in the city center with high foot traffic and proximity to other upscale establishments.
Premises: Design a sleek and modern interior with comfortable seating arrangements and a well-stocked bar.
Equipment: List the necessary equipment for the bar, including high-quality glassware, cocktail-making tools and refrigeration units.
Staffing: Determine the number of bartenders, servers and support staff required to provide excellent service to customers.
Operating hours: Set operating hours based on customer demand and local regulations.
Marketing and advertising plan
Target audience: Define the target audience more specifically, such as young professionals in specific industries or neighborhoods.
Branding strategy: Develop a unique brand identity with a logo, color scheme and tone of voice that aligns with the upscale nature of the lounge.
Social media marketing: Utilize platforms like Instagram and Facebook to showcase the ambiance, signature cocktails and upcoming events.
Influencer partnerships: Collaborate with local influencers who resonate with the target audience to promote Elevate Lounge through sponsored posts or event appearances.
Exclusive events: Organize special events like mixology workshops or live music nights to attract new customers and create buzz around the lounge.
The financial plan outlines how Elevate Lounge will be funded initially and its timeframe for reaching profitability. It includes projected revenue, expenses and cash flow for the first year, as well as a break-even analysis. Additionally, it should address potential funding sources, such as personal investment, loans or partnerships.
Bar business plan template #2: neighborhood sports bar
The Neighborhood Sports Bar is a casual bar concept located in a residential area with a strong sense of community. Our mission is to create a welcoming environment where locals can gather to watch sports, enjoy good food and drinks and socialize. With a target market of sports enthusiasts and neighborhood residents, we aim to become the go-to spot for game nights and community events. Our projected revenue for the first year is $800,000, with an expected profit margin of 15%. We will implement marketing strategies targeting the local community through direct mail campaigns, partnerships with local sports teams and hosting trivia nights.
Company name and domain name
The company name for this neighborhood sports bar is "The Game Zone." The domain name chosen is www.thegamezonebar.com, which reflects the bar's focus on providing a space for sports enthusiasts to gather and enjoy their favorite games.
Market analysis and research
Target market: Sports enthusiasts of all ages residing in the local neighborhood.
Competitors: Analyze other sports bars in the area, their offerings, pricing and target demographics.
Unique selling proposition: Highlight the unique features of The Game Zone, such as multiple large screens for game viewing or a menu featuring specialty burgers named after local sports teams.
Marketing strategies: Develop a comprehensive marketing plan that includes direct mail campaigns targeting local residents, partnerships with local sports teams for cross-promotion and hosting regular trivia nights or game-watching parties.
Location: Choose a location in close proximity to the target neighborhood and easily accessible for residents.
Premises: Design a casual and comfortable interior with ample seating, multiple large screens for game viewing and a well-stocked bar.
Equipment: List the necessary equipment for the bar, including audiovisual systems, kitchen appliances and draft beer systems.
Staffing: Determine the number of bartenders, servers, kitchen staff and support staff required to provide excellent service during peak hours.
Operating hours: Set operating hours based on game schedules and customer demand.
Marketing and advertising plan
Target audience: Define the target audience more specifically, such as sports enthusiasts in a specific age range or fans of particular sports teams.
Branding strategy: Develop a brand identity that reflects the casual and community-focused nature of The Game Zone.
Direct mail campaigns: Send targeted direct mail campaigns to local residents to promote special offers, game nights or trivia events.
Sports team partnerships: Collaborate with local sports teams to offer exclusive discounts or host pre-game events for fans.
Trivia nights and game-watching parties: Organize regular trivia nights or game-watching parties to attract customers during popular sporting events.
The financial plan outlines how The Game Zone will be funded initially and its timeframe for reaching profitability. It includes projected revenue, expenses and cash flow for the first year, as well as a break-even analysis. Additionally, it should address potential funding sources, such as personal investment, loans or partnerships.
Why create a bar business plan? Top benefits to consider
Creating a business plan is important for several reasons. First and foremost, it provides a clear vision and direction for the new venture. Beyond this, it helps you to:
Attract funding: A well-crafted business plan is essential for attracting investors and securing funding for your bar business. Potential investors and lenders want to see a clear and comprehensive plan that demonstrates the viability and potential profitability of your venture. By showcasing your market research, financial projections and growth strategies, you can instill confidence in investors and increase your chances of raising money for your business.
Outline resource requirements: One of the primary benefits of writing a business plan is gaining a thorough understanding of the resources, supplies and staff required to start and operate your bar business. By conducting detailed research and analysis, you can identify the necessary equipment, licenses, permits and staffing needs.
Plan more strategically: A business plan provides a roadmap for success by outlining your goals, strategies and tactics. It helps you define your target market, understand customer preferences, and develop effective marketing strategies.
Identify potential challenges: Writing a business plan forces you to consider potential challenges and risks that may arise during the course of your bar business. By conducting a thorough SWOT (strengths, weaknesses, opportunities, threats) analysis, you can identify potential obstacles and develop contingency plans to mitigate them.
Monitor progress: A business plan serves as a benchmark for measuring your bar business's performance. By regularly reviewing your financial projections, sales targets and marketing strategies, you can track your progress and make necessary adjustments.
Enhance collaboration and communication: A comprehensive business plan serves as a communication tool for stakeholders, employees and potential partners. It clearly conveys your vision, mission, and objectives to all parties involved. Additionally, it facilitates collaboration by providing a shared understanding of the business's direction and goals. This enhanced communication fosters teamwork and alignment among all stakeholders.