Nobody likes to be called a dummy by a dummy.

How much does it cost to start a bar/restaurant

Round figure.  A small modern bar that also serves a couple of entree items.

Think small but not insanely small.
Permalink Bot Berlin 
July 10th, 2007 3:04am
$100,000
Permalink Practical Economist 
July 10th, 2007 3:06am
That was a guess, but it turns out it's right:

http://www.restaurantowner.com/public/811.cfm

Minimum cost: $125,000
Permalink Practical Economist 
July 10th, 2007 3:07am
That really isnt that bad when you think about it.  Lets say you split it 2-3 people.  That comes to about 30-40k investment.  With 2% profitability and after  months becoming profitable.
Permalink Bot Berlin 
July 10th, 2007 3:10am
ok, "$52,000 profit" a year after a 200k investment. hmm.
Permalink Bot Berlin 
July 10th, 2007 3:11am
My understanding is that the overwhelming vast majority of restaurants and coffee shops are time and money sinks that fail before becoming profitable, dragging their owners into a hellhole of bankruptcy and exhaustion.

Notable exceptions are franchises which seem to be more cookie cutter, follow the directions and you'll be ok.

I don't know about bars though. I would think that's an exception to the restaurant failure rule since bars have to be really profitable once you have the liquor license. I don't know how hard it is to get that license, might involve lots of bribes.
Permalink Practical Economist 
July 10th, 2007 3:31am
Survey has a selection bias in that it doesn't include the 95% or whatever it is that failed.

Let's see...

Restaurant Failure Rates are Myth say Experts:

http://researchnews.osu.edu/archive/restfail.htm
http://www.restaurantowner.com/public/302.cfm
http://www.businessweek.com/smallbiz/content/apr2007/sb20070416_296932.htm
Permalink Practical Economist 
July 10th, 2007 3:34am
Without experience or training in the hospitality industry you would be unlikely to succeed. Compare it to someone coming in cold to a programming job without having done any coding before.

In such a case you would need to hire in people to manage the place who do have experience, and then you would have to factor their salaries into the overall cost.
Permalink Send private email bon vivant 
July 10th, 2007 3:35am
+1 bon vivant.  its a big step in a small business to go from doing the work yourself to being able to afford to pay someone else to do it.

if you want to retire to running a small bar though, go for it.
Permalink Send private email zestyZucchini 
July 10th, 2007 3:37am
"How well an owner juggles the demands of the business with family life is actually one of the most critical factors contributing to a restaurant's success -- more important, even, than "location, location, location.""


Very interesting, yes? I bet the same applies to software startups.
Permalink Practical Economist 
July 10th, 2007 3:38am
"Compare it to someone coming in cold to a programming job without having done any coding before."

Jesus bon, you know god damm well that any flunky with 3 hours and a programming for dummies can build any of the most sophisticated systems out there.  Good grief (sarcasm).
Permalink Bot Berlin 
July 10th, 2007 3:38am
"Compare it to someone coming in cold to a programming job without having done any coding before. "

It is one of those things I wouldnt mind doing.  Short of spending time on CoT and work.  That is the other place I spend time.
Permalink Bot Berlin 
July 10th, 2007 3:40am
Franchise thing is a total myth as well:

"One widely held belief is that franchise restaurants are much safer bets than independent restaurants. But Parsa found that the three-year success rate for franchised restaurants is actually only a few percentage points higher than it is for independents—about 43%. That's a far cry from the 90% or higher success rates trumpeted by many franchisors.

So far a cry, in fact, that the International Franchise Assn. decided it had to step in to clear things up. In 2005, the IFA issued a letter urging its members to remove from their Web sites or printed materials "any information claiming that the success rate of franchised establishments is much greater than that of independent small businesses," calling the information "potentially misleading."
Permalink Practical Economist 
July 10th, 2007 3:43am
I got my first programming job 7 years ago.  I had no experience.  one of my first jobs was developing a solution to interact with a banks properiety database backend and extract certain reports and data via some kind of bizarre propriety tcp format thingie.

in the first week I was trying to figure out how the hell to create and interpret a tcp stream.

hell of away to learn c++.

but it all went ok.  a little over budget but not stupidly so.

my point?  you dont have to be an expert to succeed, you just need to work like a bastard, get shit done and be a fast learner.

<g> if I still worked half as hard, learned half as much every day and got half as much done now as I did then I would be rich.

go for it bot.
Permalink Send private email zestyZucchini 
July 10th, 2007 3:44am
" Parsa determined that "beyond muddled concepts, failure seemed to stem in large part from an inability or unwillingness to give the business sufficient attention, whether due to lack of time, passion or knowledge."

" Most of the failed restaurant owners themselves attributed their failure at least partly to competing family demands, including divorce, ill health, and retirement. Some owners voluntarily closed when the family sacrifices became too much, like one owner who said she didn't want to miss seeing her children grow up.

" Location, while an important factor, appears to be more of a "moderating variable" than a causal one, Parsa says, ruling that "a poor location can be overcome by a great product and operation, but a good location cannot overcome bad product or operation."
Permalink Practical Economist 
July 10th, 2007 3:45am
"go for it bot."

dont have the money, but if I had 50-100k just lying around, it would probably be the first thing on my mind.
Permalink Bot Berlin 
July 10th, 2007 3:47am
Running even the smallest bar is not a one-man business. Too physically risky and too much to do so you'll need partners, useful and willing relatives or dependable employees. And get through all the regulatory hurdles. And stay sweet with the cops and the mob.

For this you get to do shift work? I think it would be much more fun making and selling topnotch chocolate confectionery until you went broke.
Permalink trollop 
July 10th, 2007 4:42am
"dont have the money, but if I had 50-100k just lying around, it would probably be the first thing on my mind."

Stop wasting your money on frivilous consumer bullshit, and you'll have enough saved up in no time.  You're a single guy with a decent salary, so there's no reason why you can't put away a lot of money.
Permalink AMerrickanGirl 
July 10th, 2007 5:31am
Running a bar is one of those things that people seem to have overly romantic notions about - they always imagine the bonhomie and not the hard work involved
Permalink Billx 
July 10th, 2007 7:34am
Dana's right Bot, but don't forget that you have an entire lifetime to be boring so enjoy the hell raising while it lasts.
Permalink Send private email JoC 
July 10th, 2007 10:58am
I would do it if you enjoyed it. Running a restaurant means long hours and *a lot* of work. You gotta want it.
Permalink son of parnas 
July 10th, 2007 11:13am
Better like people.

I was a bartender for 6-7 years. For me, it turned out great. I started an introvert. But an introverted bartender is kind of an oxymoron. So I was drug out of my shell, something that has served me well later in life.

A good stable of "locals" who you entertain and entertain you would be ideal and I would guess equal at least a modestly profitable venture.

But don't forget, it's got an ugly side. Mean drunks. Puke. So on.
Permalink Kepala Kelapa 
July 10th, 2007 11:45am
> But don't forget, it's got an ugly side. Mean drunks. Puke. So on.

You know, CoTers...
Permalink son of parnas 
July 10th, 2007 1:42pm

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