On the Rocks: The True Cost of Owning a Bar

Are you the bartender for all your friends? Do you love a lively scene that wakes up after the sun goes down? Are you seeking a new business opportunity?

With 66,615 bars, taverns, and nightclubs in the United States alone, there’s a good chance you’ve contemplated the possibility of owning a bar.

However, before you throw down that deposit, you should know the actual costs of this choice. Let’s get to it!

Initial Costs

The startup costs represent the first obstacle in owning a bar, with bar leases ranging from $100,000 to nearly $750,000 depending on the size and location.  True Cost Owning Bar Tavern

Bars that purchase their locations and pay mortgages can pay anywhere between $175,000 and $1,000,000.

That said, the initial lease or mortgage is only one factor to consider. You’ll also need to account for insurance, permits, and licenses. These estimates can vary wildly depending on your location and the size of the establishment.

Typically speaking, you’ll need a:

  • business license
  • insurance
  • beer and wine license
  • full liquor license
  • entertainment license
  • food license

Equipment & Operating Costs

When owning a bar, you’ll also need to factor in the large operating costs. The product can cost upwards of $5,000 to $10,000 for purchasing the alcohol alone. Experts recommend that bars average at least $13,000 per month for a staffed, average-size bar.

Typically speaking, you’ll need to pay for:

  • your bar POS system
  • appliances
  • ice machines
  • televisions
  • decorations
  • entertainment/games
  • glassware and dishware
  • security systems
  • furniture

Each bar has different needs, and it’s not necessarily a one-size-fits-all, itemized list. That said, you should expect to invest some serious money before your opening date.

Advertising & Marketing  

It’s notoriously challenging to succeed in any dining industry, and bars have similar failure rates to restaurants.

To stand out from the competition, you need to offer something exceptional to your customers. Whether it’s providing live entertainment or themed nights, these types of events cost money.

Word-of-mouth and walk-in traffic can help drive your revenue when starting out. That said, most people need to invest in some marketing campaign to really launch their business.

Depending on your strategy, these campaigns can range anywhere from a few hundred to several thousand dollars.


You’ll also need to consider how many staff you’ll need on the books. This includes your managers, servers, and bouncers.

However, it also includes people who may not even be at the bar itself, such as:

As the owner, it’s important to consider the kind of wages you want to provide your employees. You want your employees to have pride in what they do, and you ideally want them to enjoy showing up for work every day.

That said, competent employees should always receive the compensation they deserve- even if it ends up costing you more.

Final Thoughts On Owning A Bar

Owning a bar can be a lucrative business opportunity for both novice and expert investors. That said, it requires diligence, research, and significant capital to get started.

Interested in getting started on your funding process? Learn how to acquire a business loan today.


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