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 Post subject: The Bar Business
PostPosted: Fri Oct 19, 2007 12:24 pm 
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Location: Fort Collins Colorado USA
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Typically with this economy in any town America the percentage of bars in the black is dismal in comparison to the bars in the red. In this post I will try to explain why and challenge some unexperienced and outlandish statements made in other threads.  
My experience consists of many years as various officer positions in the VFW and trying to maintain a balance between the bar (club) and still retaining the dignity and rules of the post. These balances were constantly changing as more and more old vets were passing and the crowd was more civilian and younger.Trying to keep a small bar afloat takes a lot of advantages before opening. Also we had a small liquor business for a few years and I still know some of the distributors A few years ago the Bud delivery guy confided in me there were only two bars in Greeley in the red One was where my best buddy had KJ"D there for five years FRI SAT SUN. So I am not writing this post out of guesses but by years of hard experience. I have also serviced many bars professionally as vendor tech or league organizer. I am very familiar with all types of bars and clubs and know what works.
Here are some of the disadvantages of a small bar. Quantity discount.. If I remember right our first beer discount was 25 cases Many cannot buy that quantity with one shot. Believe it or not the discount liquor stores were selling 12 packs cheaper than we were paying the distributor for. Co law states that a bar cannot buy more than 1/5 of booze from a local liquor store Dont even think about buying beer They will close you down in a minute. Any bar has to comply with federal state and local laws or face the proposition of losing their license.
Any businees depends upon volume Years and years ago on the dairy farm one had to have a herd of 50 cows. Now it is in the hundreds. Any business is the same way A bar with 150 cap has a daily struggle with profit. I sure dont see a 45 cap bar surviving.
Typical rent here for an average bar in good location (strip mall, shopping center) is $1500-2500. Utilities running big coolers and such is not cheap. Certified bartenders and mngrs do not work for minimum wage. Price of drinks and whether or not you are charging for coffee or cokes is insignificent.  What is important is the average size of crowd from opening until close. Any bar has their daytime regulars which I observed while servcing bars They were selling food stamps and were sippers although most were there daily. Next you had the happy hour big crowd however less profit due to twofers. Good bars after the happy hour crowd leaves are approaching the black It is easy to tell for the daytime bartender x'es out and the evening shift puts their drawer in the cash register.
Then the evening crowd starts drifting in.
Now as  KJ I have made statements in other threads If I dont x a Grand then I am not doing my job. Here is the arithmetic. Our poorest times are lets say 25 people buying 2 beers an hour  ($125) Another 25 buying mixed drinks at $7/hr ($175) Thats $300/hr. Even if the late crowd doesnt come in for 4 hrs thats $1200 dollars. I dont feel ashamed of charging $150 Now the small bar I'm in now serves good food until 10p Also Sat we have ladies night 1/2 price beer and well drinks. Here I expect $2500+ x my time I'm alreadty working on a pay raise. The owner is not a typical bar owner and he gives us full rein on entertainment. When the x is a constant $2500 I will want $250/night and he knows it.
For those not totally familiar with the bar business or any other business for that matter I hope this puts some light on the subject.
Ps Yesterday on the farm the mngr called me about the Halloween sat We have  a Rockies Sereis game starting at 6 ????

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