How Much Does it Cost to Run a Bar?

moneyOnce you’ve opened a bar business and invested the required capital expenditure to start it up, you have to make sure that you can generate enough sales to pay the monthly expenses and make a profit after paying off all the costs.

The question of how much money is needed to operate a bar will totally depend on the size, location and concept of the outlet.

The two largest costs of running a bar are almost always the property’s rental and the human resource or staff costs.

Rental Costs

When it comes to rental expenses, this is directly correlated to where your bar is located and the amount of square footage that you have leased. Obviously, a bar situated in an up market building in a trendy area will be a lot more costly than one that is in a run down shop lot at the edge of town. This will determine the price per square foot of your rental. The other variable is the size of your premises, which is multiplied to the rate to produce the total amount to pay for rent.

For example, a premium 2000 square feet space in the center of town may cost $10 per square feet to rent per month, costing a total of $20,000 in monthly rental costs. At the same time, a cheaper place may cost $3 per square feet, where an equivalent 2000 square feet premise may only cost $6000 rental per month.

Staff Costs

As for staff salaries, this is also related to the size of the bar and also its concept. Needless to say, a bigger bar will need more people to run it and a more exclusive or thematic bar might require personnel with specialist skills who are likely to cost more than the average bartender in a sports bar.

Marketing & Promotions

After rental and HR, marketing and promotion costs are often the next most significant cost of operating a bar. Of course, this depends on the type of bar again, as a small pub may not spend as much on promotions, compared to a nightclub that is bringing in guest DJs and performers every other night.

Other Costs

Other than these major expenditures, utility bills and a range of smaller expenses make up most of the costs of running a bar from month to month.

, , ,

No comments yet.

Leave a Reply