You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your martini bar business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a martini bar business?
Your initial costs depend upon a number of factors, including location, local rules and regulations regarding a liquor license, the location you choose, and required renovations to the building. Depending upon your geographical location, a liquor license can cost anywhere from $15,000 to over $500,000. Once this has been obtained, you will need to make any necessary alterations to your new building, decorate, invest in a point-of-sale (POS) system, and stock the shelves with glassware and liquor. Start-up costs for a martini bar range from $100,000 to $1.5 million, with an average of $400,000. New investors are encouraged to over-capitalize, adding 20% to their initial budget.
What are the ongoing expenses for a martini bar business?
Payroll and inventory costs represent the greatest portion of a martini bar’s monthly budget. The establishment must be well-maintained and kept on a regular cleaning schedule. A strong marketing strategy will ensure a steady flow of business, and business insurance will protect your business should a loss or event occur.
Who is the target market?
James Bond’s infamous “shaken, not stirred" catchphrase helped put the martini on the map, earning it the title of America’s classic cocktail. While the “three martini lunch” was most prevalent among America’s wealthiest in the 1950s, drinkers of every age and profession now enjoy this clean and refreshing drink. Patrons of your martini bar will span every age group and social backgrounds. Their love of the cocktail and desire to patronize a unique bar is what will bring martini lovers to your bar.
How does a martini bar business make money?
A martini bar makes money from the sale of each martini. Many specialty bars now offer additional services, such as games, live entertainment, and/or food.
How much can you charge customers?
With mixology’s rise in popularity, customer’s have become accustomed to spending more than usual on a unique drink. A martini costs anywhere from $12 to $20, depending upon geographical location, ongoing expenses, and cost of ingredients.
How much profit can a martini bar business make?
While owning a bar can be quite lucrative, it can take several years to turn a profit. Successful owners report an average revenue of $1 million annually. Once expenses are deducted, this can yield a significant profit, particularly for entrepreneurs who keep detailed records and minimize ongoing expenses wherever possible.
How can you make your business more profitable?
Gain visibility in the community and maximize profits by hosting special events and/or live entertainment. Branded merchandise will help generate more revenue and ensure your business is advertised every time the item is worn. Additionally, a limited food menu will keep your patrons full and bellied up to the bar as long as possible.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your martini bar business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a martini bar business
With a diverse target market, your marketing strategy should cross several platforms. Traditional marketing strategies, such as radio, television, and printed advertisements will reach the older audience. Social media platforms such as Facebook, Twitter, and Instagram will help spread the word with the younger generations. Cocktail competitions are a unique way to gain visibility within the community, attracting the industry’s top mixologists.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
No amount of money spent on advertising will yield more than word of mouth. Surround yourself with a team that is devoted to delivering top-notch service and quality drinks. This, coupled with an environment that is both eccentric and welcoming, will help your martini bar gain a loyal following.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Martini Bar Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Owning a bar, regardless of its niche, requires dedication and hard work. The entrepreneur with a vision, drive, and a passion for serving the people of their community are best suited for this business venture.
What happens during a typical day at a martini bar business?
Contrary to popular belief, the martini bar owner’s day starts early. Before the bar opens, nightly reports are reviewed, accounting and other administrative duties are handled, inventory is counted, shelves are restocked, and supplies are ordered. The building must be cleaned and any maintenance issues are addressed. While the bar is making a name for itself within the community, marketing and advertising will also be an integral part of a bar owner’s day. Once the bar is open for the day, you and your staff will create cocktails, interact with customers, and handle any issues that might arise.
What are some skills and experiences that will help you build a successful martini bar business?
To set yourself up for success, it is imperative that you understand your strengths and weaknesses. If your strength is behind the bar making drinks, hire a bar manager with extensive experience to oversee the day-to-day activities. If accounting or marketing is your strength, make this your focus and hire professionals to do the rest. Regardless of your business model, strong interpersonal skills and a sound understanding of current and emerging business trends will ensure your martini bar draws in customers night after night.
What is the growth potential for a martini bar business?
The rise in popularity of mixology over the last decade offers a unique opportunity for the entrepreneur looking to enter the industry. Whether you envision growing on a local or national scale, a commitment to your vision, a unique atmosphere, and quality drinks will help you meet your growth goals.
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One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a martini bar business?
In many areas of the country, obtaining a liquor license is the most costly and difficult investment. Involvement in the community, including town hall meetings, can help speed up this process. Put yourself in their shoes, listen to the concerns, and be open and honest with what you are trying to accomplish.
The hospitality industry offers a rare glimpse at the outside world. You will encounter all walks of life and experience things you never dreamed of. Prepare for the worst, and plan for the best.
How and when to build a team
Due to the legalities that come with owning a bar, new business owners are encouraged to build a team of professionals from the start. This should include an attorney, accountant, and a qualified bar manager. Since your bartenders are the face of the company and will be concocting drinks for your patrons, you will want to hire individuals with strong interpersonal skills and a passion for mixology. A training manual and cocktail recipe book will ensure consistency and quality.