2 answers
serenity
Student
Rock Hill, South Carolina
1
Question
Updated
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What are the pros and cons to owning a bar?
what are some pros and cons to opening up a bar with my bestfriend at 21
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2 answers
Glaucia Matos
Sales Transformation Director
1
Answer
São Paulo, Brazil
Updated
Glaucia’s Answer
I had this same idea when I was in my twenties, so I'm going to share the pros and cons I considered:
Pros:
1) Social environment: I'm a extrovert, so I really enjoy meeting new people and interacting with people from different backgrounds
2) Creativity: Owning a bar allows you to express your creativity through cocktails, food, events, music, décor, and more. My idea was to have a bar with live music on weekends and some game nights during the week.
3) Earnings potential: A well-established bar can generate high revenue and profit. You can also host private events and create loyalty programs to increase your earnings
4) Independence: You make all the decisions about the business and its strategy. For me, it was also an opportunity to apply the business knowledge I gained in college.
Cons:
1) Work hours: Bars operate during long, late hours, including weekends and holidays.
2) Regulation: Bars are heavily regulated, which requires a strong management and can lead to additional costs.
3) Investment: It requires a significant investment for rent, décor, staff, and licenses/permits.
4) High liability: Alcohol increases risks, intoxicated customers can cause damage and are often challenging to handle.
My decision was not to pursue the idea at the time due to the required investment and work hours, but it's still a future plan for me
Pros:
1) Social environment: I'm a extrovert, so I really enjoy meeting new people and interacting with people from different backgrounds
2) Creativity: Owning a bar allows you to express your creativity through cocktails, food, events, music, décor, and more. My idea was to have a bar with live music on weekends and some game nights during the week.
3) Earnings potential: A well-established bar can generate high revenue and profit. You can also host private events and create loyalty programs to increase your earnings
4) Independence: You make all the decisions about the business and its strategy. For me, it was also an opportunity to apply the business knowledge I gained in college.
Cons:
1) Work hours: Bars operate during long, late hours, including weekends and holidays.
2) Regulation: Bars are heavily regulated, which requires a strong management and can lead to additional costs.
3) Investment: It requires a significant investment for rent, décor, staff, and licenses/permits.
4) High liability: Alcohol increases risks, intoxicated customers can cause damage and are often challenging to handle.
My decision was not to pursue the idea at the time due to the required investment and work hours, but it's still a future plan for me
Aparna Chandrasekaran
Technical writer
2
Answers
Bengaluru, Karnataka, India
Updated
Aparna’s Answer
Adding to Glaucia’s advice, here are a few critical points specifically around starting young and navigating a business partnership:
Additional Pros
- Target Demographic Alignment: At 21, you naturally understand current nightlife trends, social media marketing, and what your peers actually want in a venue better than older operators.
- Division of Labor: A partnership lets you split the massive daily workload—one can run operational back-of-house (finances, ordering, scheduling) while the other runs front-of-house (hospitality, marketing, staff).
Critical Cons & Risks
- Friendship Strain: High financial stress and 80-hour workweeks routinely ruin personal relationships. Without a legally binding Operating Agreement covering profit splits, labor expectations, and exit strategies, money disagreements can end both the business and the friendship.
- Capital & Lease Barriers at 21: Commercial landlords and banks are often hesitant to sign leases or approve loans for 21-year-olds without established business credit, asset collateral, or a strong co-signer.
- The "Hangout Spot" Financial Leak: A common trap for young owners is treating their bar as a personal social hub. Giving out free drinks, running unrecorded tabs for friends, or mixing partying with managing destroys profit margins quickly.
- Managing Older Staff: Managing bartenders and security guards who are older or more experienced than you requires firm HR skills and authority, which can be tough to navigate right out of the gate.
Bottom-Line Tip: Work with an attorney to draft a clear partnership agreement first, and consider gaining 6–12 months of bar management experience to learn inventory control and pour-cost math before taking on a lease.
Additional Pros
- Target Demographic Alignment: At 21, you naturally understand current nightlife trends, social media marketing, and what your peers actually want in a venue better than older operators.
- Division of Labor: A partnership lets you split the massive daily workload—one can run operational back-of-house (finances, ordering, scheduling) while the other runs front-of-house (hospitality, marketing, staff).
Critical Cons & Risks
- Friendship Strain: High financial stress and 80-hour workweeks routinely ruin personal relationships. Without a legally binding Operating Agreement covering profit splits, labor expectations, and exit strategies, money disagreements can end both the business and the friendship.
- Capital & Lease Barriers at 21: Commercial landlords and banks are often hesitant to sign leases or approve loans for 21-year-olds without established business credit, asset collateral, or a strong co-signer.
- The "Hangout Spot" Financial Leak: A common trap for young owners is treating their bar as a personal social hub. Giving out free drinks, running unrecorded tabs for friends, or mixing partying with managing destroys profit margins quickly.
- Managing Older Staff: Managing bartenders and security guards who are older or more experienced than you requires firm HR skills and authority, which can be tough to navigate right out of the gate.
Bottom-Line Tip: Work with an attorney to draft a clear partnership agreement first, and consider gaining 6–12 months of bar management experience to learn inventory control and pour-cost math before taking on a lease.