How To Open A Bar In NYC And NY State
Opening a bar in NYC, or for that matter anywhere in NY stated, can be very lucrative. However, there are a few caveats and things to watch out for. Rezzonator Services has processed literally hundreds of successful bar licenses. Working hand in hand with so many bar owners for such a long time has given our experts incredible experience in what works and what doesn’t. In this article we will pass some of that experience onto you.
Location, Location, Location
Fact is that location is one of the most important aspects of opening a bar. But what you may not know is that location is important not only for getting customers, but also for licensing (which will be discussed later).
From the customer point of view, you want to be located in a very convenient area. One that is accessible by foot traffic or has easy to use parking. The last thing you want is to make it hard for people to get to your location. Also, a good location can just provide customers. For example if you’re around a crowded area then some of that foot traffic will spill onto your location. This is great for bars that are just starting out and need to build their clientele.
If you have a location it’s important to understand that it may affect your application. Especially in NYC, locations are subject to many regulations and issues wich must be resolved. It would be great if you could just settle on a location and get to work. Unfortunately NY State and NY City regulations make that almost impossible. This is why we always advise clients to contact us with their particular situation as early as possible in the bar opening process.
Another issue that comes up with a location is landlord. At Rezzonator Services we’ve seen this happen so many times: A great location and a landlord that makes working that location a living hell. As always we recommend getting in touch with us as early as possible to try and avoid problems.
One important factor to consider is the type of crowd that frequents your area. Are the people that spend time in the area you plant to operate a bar type of crowd? For example, if your area is frequented by a lot of soccer moms then you probably won’t have that much of a customer base for your bar. Another thing to consider in your crowd analysis is how much money do they have to spend? Look at all these variables and try to figure out what your potential custmer looks like. If you have a lot of office workers in your area, you can usually rest assured they’ll have money to spend at your bar, but if they leave the area right after work, then it’s pointless. It’s hard to build a bar crowd if people leave the area as soon as work finishes. This brings us to another very important point.
What is the time-window for potential bar customers. Sure bar customers are usually night owls but even so, it helps to identify time windows. Are they early night owls that frequent bars from 6pm to 9pm before retiring for the evening, or late night owls that arrive at the bar at 12am? In some situations you may have day time customers. This can happen, for example, in resort type bars where getting a drink in the middle of the day is normal (think bar in a tourist hotel). This is a great segue into our next point.
To succeed with your bar venture you must analyze client drinking habits. This will help you create a bar that stands out. Now you may think “We’ll it’s a bar so I’ll have everything”. Experience shows that’s not always feasible nor profitable. And even if you have “everything” it’s a great idea to understand what draws your crowd in and push that to the front. Paying attention to your potential clients and what they prefer is essential. Not only for attracting customers but also for being profitable.
First see what general category of drink they prefer. Is it beer, wine or hard liquor. Once you get that, drill deeper and find out more information. If they prefer wine, are they usually ‘wine connseurs’ or just ‘wine by the glass’ people? If they’re beer people then look at what they prefer. Is it imported, domestic, by the bottle, by tap.
Sure you can have all those drinks, but what comes next seprates the successful bar owner from the ‘wannabe’.
Once you get a good idea of what they want start crunching the numbers. How much does it cost to get that drink wholesale and what kind of markup is acceptable for your customers. This will tell you what’s profitable and what’s not. Profitability can be achieved in 3 ways:
a) by moving a lot of merchandise at lower margins. Example: huge quantities of beer on tap, where profits may not be great but they add up because of the amount of beer sold.
b) by focusing on select merchandise at higher prices. Example: Quality wine or liquor with higher margins where you can move less merchandise and make more profit per drink.
c) a combination of the above.
This subject is very deep but we’ll try to give you a quick overview. Let’s be honest: Due to the legislations governing NY State and NYC the bar licensing process is very complex.
As described above, location is taken into account. But your license may be impacted by things that are beyond your control. Outside of history of location, even before you were there, there is history of licensing that was done at the location. You may be subject to the 200 and 500 feet rules which govern your situation.
But it doesn’t stop there, as personal history of owners is also analyzed and greatly affects applications.
On top of that, inside New York City (5 boros included), there are other specific protocols which must be followed. The license will be affected by the community (community board) and other problems that stem from previous licenses and the area itself.
Call us with your particualar situation if you’re ready to license your bar.
The fact is that a bar is a highly profitable endeavor if it’s done right. The points discussed above should not prevent you from seeking a bar license. An Axios report suggests that the bar and restaurant industry are heating up with many eagerly anticipated debuts and fun pop-ups. This indicates a thriving market and potential profitability for new entrants..
It may seem like hard work but it’s worth it. As always, Rezzonator Services is here to help.