When people talk about investing in a bar, they often think about bars of gold. Well, that’s not what I’m going to be talking about here. We’re on the subject of a bar, the public place of drink and merriment. (You may also know it as a pub.)
Bars are becoming popular investment spots. And if you love bars, then you should definitely be looking into it. It can be a successful venture… but you need to be sure you don’t make any mistakes.
Don’t confuse passion with ability
So you’re an investor who loves your local bar. Maybe you’ve been going there every week or two for the last ten years. You know the faces, the names. (The theme tune to Cheers comes to mind.) You know the prices of all the drinks and all the snacks off by heart. You love this place like you would a home. But this doesn’t mean you’d be much good at owning it, right?
When you invest in a bar, you’re investing in a business. And the chances are you’re going to have to run that business. Don’t just assume that this is going to be an easy task simply because you’re passionate and you know the bar inside out. This is a mistake a lot of investors make. They have the passion, so they think it will all come naturally. Wrong: you have to have the intimate knowledge and ability to run the place well.
A business approach
If you’re going to invest in it, then you’re going to need the business to grow. After all, that’s how you’re going to start making some profit. And if you’re investor, then I’m going to assume that it’s not a leap of logic for me to assume that you’re quite into making some profit!
Beloved bars aren’t always growers. The people who own them are usually making a tidy profit and have been doing so for a while. They like what they do and probably started earning the back the money they spent starting the place up quite some time ago. As an investor in the business, you’re going to want to take things further. This can be done more subtly than many people realize. Introducing more food to the menu will attract local people and visitors looking for somewhere to eat. Increasing the bar’s Internet presence with a service like The Social Savior will help you with exposure.
The risk of expansion
One of the things that people love about certain bars is simply that they don’t change. They love the familiarity of the place. They love that there’s a consistent amount of people there at any given time throughout the week. This could very well be why you love this given bar.
This is why you have to be careful when it comes to building on this business. You could risk alienating your most loyal customers. And those loyal customers could potentially be most of the people that frequent the place. Of course, if a place needs sprucing up, then it needs sprucing up. But be careful about decisions involving big changes.