How To Open A Bar

By April 2, 2020 June 12th, 2020 Clubs & Bars

Opening A Bar In Sydney 

An Impeccable Guide

Do you find yourself dreaming of opening a bar in Sydney but find that you’re not quite confident about where to begin?

You may have even gone as far as to think of a name or theme for your bar but weren’t able to take any further steps as you aren’t sure of the finer details such as the rules, regulations, licenses or how you’re going to finance it.

Opening a bar in Sydney can be very lucrative and rewarding, providing you conduct your due diligence and follow the right advice. 

To help you get started on your journey we’ve outlined the milestones and shared our expertise on every step of the way.


FAQ #1

How Do You Choose A Bar Concept Or Theme?

Opening a bar in Sydney Tip 1 – Amongst the top things that make starting your own bar fun and exciting is the freedom to pick a bar concept of your choice. There are many ideas you can explore to ensure you pick the perfect bar concept and how to integrate it with your brand.

The layout, style, and ambience of your bar should reflect your brand and promote the objectives of your business.

To easily arrive at the perfect concept for your bar, you need to ask yourself – 

“what feeling or vibe do I want my bar to give to my guest when they enter? “

Here are some examples of popular bar concepts:

  • The perfect weekend hangout spot that offers popular types of beers and fun indoor games like pinball, darts and pool
  • A fancy martini bar decorated with neon lights playing fancy music. The place to be every Friday night.
  • An elegant and sophisticated wine bar that serves high-end wine, cocktails as well as appetisers. A suitable environment for a date night or when you’re looking to impress.
  • Finally, the most popular ‘after-work’ hangout where friends and people from within the neighbourhood meet up to interact and have fun.

When choosing your perfect bar concept, take into consideration the demographics of your location. You should pick a concept that blends with those living within the area.

Make sure you have a clear target market and you’ve thoroughly researched your proposed business area so you can determine and understand the different types of demographics in the area.

Here are a few useful websites you could use when undertaking your demographic research:

  1. Australian Bureau Of Statistics 
  2. Domain’s Surburb Profile Feature
  3. RealEstate.com.au’s Surburb Profile Feature
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FAQ #2

How Do You Name A Bar Or Nightclub?

Opening a bar in Sydney Tip 2 –This is the moment that you have definitely been waiting for. However, as you bring your creativity to life in naming your bar, make sure that the name promotes your brand and it’s unique.

Stick to short and easy to remember names, so that your clients can recommend or refer your bar to their friends.

There’s a few things to keep in mind when it comes to thinking of a name for your business.

  1. Stick to short and easy to remember names, so that your clients can recommend or refer your bar to their friends.
  2. Make sure the name you’ve picked hasn’t already been taken or trademarked. To check if a name is available you can start by using the Australia Governments Business Name Checking Tool.
  3. Make sure a suitable domain with your desired business name is available. Again, you should be able to check this with the same tool above.

After naming your bar, some people even take it a step further and trademark their name due to concerns that someone else may copy their brand name.  This is optional depending on your own personal preferences. 

Make sure you choose a name which is unique and scalable as this may not be the last time you will be opening a bar in sydney. As you grow, you may decide on opening a bar in other locations. People will already be familiar with your brand and what it offers.

At the end of the day, businesses revolve around trust so you want people to recognise your brand, be familiar to it but more importantly, trust it. 

FAQ #3

What Are The Different Types Of Legal Structures For Your Bar?

Opening a bar in Sydney Tip 3 – The third step on opening a bar in Sydney ushers us into a more technical section. Bars like most other businesses, also require to be properly structured in order to establish ownership rights, financing, legal liability, and taxation.

Therefore, it is imperative for you to speak with a legal professional from the outset of your journey to ensure your always treading on solid ground.

(The contents of this article do not constitute legal advice, are not intended to be a substitute for legal advice and should not be relied upon as such.)

Explained below are the three common types of business entities that you can choose for your bar. 

1. Sole Trader

The definition of Sole Trader according to Australian Taxation Office:

A sole trader is an individual running a business. It is the simplest and cheapest business structure.

If you operate your business as a sole trader, you are the only owner and you control and manage the business.

You are legally responsible for all aspects of the business. Debts and losses can’t be shared with other individuals. You can employ workers in your business, but you can’t employ yourself.

As a sole trader, you are responsible for paying your worker’s super. You’re also responsible for your own super and may choose to pay it into a fund for yourself to help save for your retirement.

2. Partnership

The definition of Partnership according to Australian Taxation Office:

A partnership is a group or association of people who carry on a business and distribute income or losses between themselves. For example, if you and a friend or family member decide to set up a business together, you might operate it as a partnership.

A partnership is relatively inexpensive to set up and operate. The partners share income, losses and control of the business.

A written partnership agreement is not essential for a partnership to exist, but is a good idea. A partnership agreement should outline how income or losses will be distributed to the partners and how the business will be controlled.

A partnership agreement can help prevent misunderstandings and disputes about what each partner brings to the partnership, and what they are entitled to receive from the income of the business. This is particularly important for tax purposes if the profit or losses are not distributed equally among partners.

The partners in a partnership are not employees, but the partnership might also employ other workers.

Partners are responsible for their own superannuation arrangements. However, the partnership is required to pay superannuation for its employees.

3. Proprietary Limited Company

The definition of Company according to the Australian Security & Investments Commission:

A company is an entity that has a separate legal existence from its owners. The owners of the company are known as members or shareholders. Its legal status gives a company the same rights as a natural person which means that a company can incur debt, sue and be sued. Companies are managed by company officers who are called directors and company secretaries.

Small business owners often use a type of company structure called a proprietary limited company (which has the words ‘Pty Ltd’ after the name). This type of company does not sell its shares to the public and has limited liability. Larger companies that do sell shares to the public can still limit their liability and will often have the abbreviation ‘Ltd’ after their name.

 

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FAQ #4

How Do You Write A Business Plan For Your Bar Or Nightclub? 

Opening a bar in Sydney Tip 4 – For a successful business to thrive a well-thought out plan is essential. Think of your business plan, like a blueprint for your business, detailing how systems operate and function as well as keeping you focused on short and long term goals and mapping your growth. 

Below are the core elements that should be included as part of your bar business plan

  1. Executive Summary (Includes your vision, objectives and mission statement)
  2. Company Description (Who you are, the location, theme, and concept of your bar)
  3. Market Research and Analysis (Customer segmentation, demographics, and marketing plans)
  4. Product Line and Menu (What do you intend to sell and to whom do you intend to sell it to)
  5. Marketing Strategy (What plans do you have to attract and retain customers)
  6. Organisational Overview (The structure of your business – Is it a sole proprietorship, Pty Ltd or a partnership)
  7. Financial Plan (Entail the bar startup costs, daily expenses, rent amongst others)
FAQ#5

Do You Need Finance To Open Your Bar Or Nightclub? 

Opening a bar in Sydney Tip 5 –Perhaps you’ve already started saving ever since you first thought of opening a bar in Sydney and you may think you don’t require extra financing. However, you can’t come to such a conclusion without doing a thorough assessment of the total cost of opening a bar in Sydney and sustaining it.

If opening a bar in Sydney has been a dream of yours for a while, chances are you have been saving for it, but is it enough to cover the entire start up, and running costs? 

To determine whether you need financing, you must first assess your current financial situation.

 The simplest way to do this is to calculate the start up costs required to open your bar such as fit out or refurbishment costs. Then calculate the additional cost that keeps your business running, this typically includes:

  • Rent
  • Licencing
  • Insurance
  • Alcohol
  • Utilities
  • Salaries
  • Food

Afterwards, you should come up with a budget that will highlight how much money you may need to keep your bar afloat for at least a year.

Now that you have a figure in mind, you can decide whether you need to approach a third party for financing. There are a few ways to do this but the most common ones including applying for a bank loan, approaching a finance company or engaging local investors. 

Please be informed that during the first few months after opening a bar in Sydney, the sales may not reach your expected target. Don’t fret! This is often normal in the business world. Securing finance is a great way to help get you through this dryer period of business. 

For more information on how to finance your business take a look at the Australian Government’s finance support page or visit our fitout finance page

 

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FAQ#6

How Do You Choose The Best Location For Your Bar Or Nightclub? 

Opening a bar in Sydney Tip 6 – Location is one of the most important decisions to make when it comes to opening up a bar in Sydney. Bar and nightclubs aren’t for everyone and placing yours in a central location where it will attract the right crowd can make or break your business.

Use the factors below to help you choose the best location for your bar.

  • Target Demographic – Set up camp in a location where you know your target customer dwells. As mentioned earlier your target demographic depends greatly on your bar concept. 
  • Competition in the Area – Selecting a competitive location to launch your new bar could be a great business move. As long as your bar is unique and offers something new to the area chances are you are likely to thrive. But it’s good to be wary, suss out your competitors and if you feel like distancing yourself is a better option then do so.
  • Accessibility and Visibility – Unless your bar concept promotes seclusion and anonymity, bars ought to be in an easily accessible area that is visible to everyone. As a result, people can always spot your joint.
  • Health and Zoning Regulations – Before you kick-start your project, always confirm the health and zoning regulations from the authorities.

FAQ#7

What Licenses Are Required When Opening A Bar In Sydney?

Opening a bar in Sydney Tip 7 – Ensuring your premise has all the appropriate licensing to legally operate is a crucial step that needs to be completed before you even think of opening a bar in Sydney.

This process can be daunting, and to ensure it is completed correctly we suggest seeking legal aid. Below, we have outlined some of the mandatory licenses that you will need when thinking of opening a bar in Sydney.

However, please check the Australian Business Licence and Information Service (ABLIS) website to make sure you meet any additional licencing requirements for your premise.

1. Liquor Licenses

To be able to sell or serve liquor, it is compulsory for you to have a liquor license. These licenses vary depending on the nature of your liquor business, your location and the local land regulations.

Liquor licenses may include;

  • Primary service authorisation
  • Small bar license
  • Liquor approved manager license
  • On premises license

Note that before you apply for a liquor license, you must get a certificate from the National Police that entails a criminal record check.

2. Business License

Business licenses are approved by the local council. They usually require the following information:

  • The type of food or beverages that you intend to sell
  • The classification of your food business
  • The name and details of your food safety representatives
  • If the food will be served on premises or pre-packaged

To get more clarification on the requirements of a business license, kindly check on your local council’s website because these requirements do vary from one state to another. Other than the above, you will need to apply and pay for the following certificates;

3. Food License

Do you intend to also sell food in your bar? If so, you will need to apply for food licensing. This license aims to ensure that the conditions in which you prepare food make it safe for human consumption.

It’s important to note that these licences are three main types you will need when opening a bar in Sydney. However, each business is unique and may require additional licences and permits. 

For instance, you will need a permit for playing music, or displaying TV’s on your premises. Similarly, if you wish to install poker machines you will need a gambling licence. Again, it’s advised to  seek legal advice to ensure you cover your bases and make good use of Australian Business Licence and Information Service (ABLIS) website.

 

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FAQ#8

What Insurance Options Should You Consider For Your Bar/Nightclub?

Opening a bar in Sydney Tip 8 – It’s a no brainer that insurance is an essential for bars and nightclub facilities. Insurance is expensive but without it you will be liable for injuries or damages that occur within your premises. 

Someone could slip on spilled drinks on the floor or cut themselves on broken glass and file a lawsuit against you.

Such incidents could leave your business in major debt or filing for bankruptcy, resulting in the closure of your business.

Insurance saves you from situations such as these. Below are some options you may consider:

1. Income Protection.

Below is how Finder.com.au define income protection:

Income protection is as simple as it sounds – it’s insurance for your income. If you can’t go to work because of sickness or injury, income protection will pay you a monthly benefit to replace your salary while you’re out of action.

Income protection insurance works by replacing lost income when you’re unable to work. If you can’t return to your job due to an illness or accident, you should be able to rely upon the benefit while you’re out of action to help you do the following:

  • Maintain your standard of living
  • Pay off your mortgage
  • Pay off your credit card and other debts
  • Buy groceries and other everyday items
  • Pay your kids’ school fees
  • Help cover the cost of your recovery

Read their full guide on income protection here

2. Workers Compensation

Do you plan on hiring support staff to assist you? Then you must take workers compensation to cover for their injuries on your premises.

According to the Australian Governments Fair Work Ombudsman:

Workers compensation is a form of insurance payment to employees if they are injured at work or become sick due to their work.

Workers compensation includes payments to employees to cover their:

  • wages while they’re not fit for work
  • medical expenses 
  • rehabilitation.

Employers in each state or territory have to take out workers compensation insurance to cover themselves and their employees.

Head over to the Fair Work Ombudsman website for more information 

3. Building Insurance

Below is how Bizcover define Building Insurance:

Building Insurance provides protection for material damage to your premises, it can cover the cost of repairing or rebuilding your business premises as a result of fire, storm and other perils, such as vandalism or accidental damage, specified in the policy that you elect to purchase.

What will it protect your business from?

Each insurance policy will have its own specific list of insured events and exclusions, therefore it is best to check with your insurer or the policy wording to confirm the details of your Building insurance policy. However, some commonly covered items include:

  • Business owned property
  • Fixtures and fittings
  • Services to the building
  • Structural improvements including fencing,
  • Gates
  • Roadways and paths

Read their full guide on building insurance here. 

4. Product Liability

Below is how Bizcover define Product Liability insurance:

Product Liability insurance protects your businesses against claims by third parties relating to property damage or personal injury caused by your products. Product Liability insurance usually forms part of a Public Liability policy and the word ‘product’ will be a defined term in the policy wording.

A common policy definition of ‘Product’ includes anything that has been manufactured, constructed, erected, assembled, installed, grown, extracted, produced, processed, treated, altered, modified, repaired, serviced, bottled, labelled, handled, sold, supplied, re-supplied, distributed, imported or exported by you, or on your behalf. 

Product Liability insurance is designed to assist you when your products cause a third party to sustain personal injury or property damage.

Read their full guide on Product Liability here. 

5. Theft Cover

If your business is situated in an insecure neighbourhood, then theft insurance will cover the loss of products and property on the premises.

Below is how Bizcover define Theft Cover insurance:

This option can cover your contents and stock from theft, attempted theft or armed hold up. It is not uncommon for theft insurance to require the item stolen to have been securely stored before the theft and for there to be evidence of forcible entry in the commission of the theft.

What’s typically covered?
  • Stock in trade
  • Patterns, models, moulds and designs stated on the Policy Schedule
  • Your fixtures and fittings if you are a tenant
  • Advertising and display equipment
  • Computers and other equipment for storing data
  • Machinery and plant, tools, instruments and utensils of trade and equipment
  • Furniture, furnishings, carpets, curtains and internal blinds

Read their full guide on Theft Cover here. 

6. Public Liability

Though the last on our list, this type of insurance is very essential. It is an ideal option because the nature of your business encourages members of the public to visit your premises. It covers lawsuits, injuries, and damages.

Below is how Bizcover define Public Liability insurance:

Public Liability insurance protects your business if a customer, supplier or member of the public is injured or sustains property damage as a result of your negligent business activities. 

Small business owners have a legal responsibility to take reasonable steps for the safety of their customers, suppliers and the community and for their property.

Most Public Liability policies also extend to cover Product Liability. If you sell, supply or deliver goods, even in the form of repair or service, you may need cover for negligence claims against you where your product has caused injury, death or damage. 

Read their full guide on Public Liability insurance here. 

FAQ#9

What Are The Rules And Regulations For Bars Or Nightclubs? 

Opening a bar in Sydney Tip 9 – Depending on the license you applied for your business, each does come with a set of regulations that govern your operations. Below are some of the rules that you will have to comply with;

  • Lockout laws – Some locations have lockout law requirements. This means bar owners must oversee lockouts from a certain time and offer last drinks to their customers.
  • Security – Security is a huge must for bars and nightclubs for obvious reasons. Each security member must hold a security licence from police and  dress in a way that distinguishes them from other staff members.
  • ID scanners – Although not mandatory in Australia, some venues install ID scanners to verify identities and seek out fake IDs. 
  • CCTVIn most local councils it’s a requirement to install CCTV around your premises and it’s definitely a wise decision to invest in.
  • Minors – In Australia, it is illegal for bars to sell liquor to minors aged below 18 years.
  • Gambling – For those intending to include bar games within their premises should get gaming licensing and adhere to the rules provided.
  • Smoking. Smoking within enclosed areas is prohibited. Premises should designate smoking zones.
  • Staff training. All staff must undergo the Responsible Service of Alcohol training.
  • Liquor. In NSW any premise selling alcohol must appoint a Liquor Approved Manager

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FAQ#10

How Do You Choose The Right Alcohol Supplier For Your Bar? 

Opening a bar in Sydney Tip 10 – Having conquered the above 9 steps, you are now ready to stock up your bar with different types and brands of alcohol. Be it beer, wine, whiskey or vodka, it’s important to get your hands on brands your customers will know and love. Being a focal selling point for your business it’s important to get this right.

Do a little market researching and identify popular brands.Make sure you select beverages that align with your bar concept and design, but also maintain variety and ensure there is something for everyone. 

Once you have come up with a list of products to put on your shelves, the next step is to find a reliable supplier. There are many wholesalers out there that will offer you different brands at an affordable price.

When choosing a distributor to work with, ensure you consider their brand selection, terms of payment, delivery time and minimum purchase requirements.

Don’t forget to always take an inventory of your stock after receiving orders from suppliers. Regular taking of inventory is essential because it tells you how your bar is performing and the brands that are in high demand.

FAQ#11

How Do You Design The Best Layout For Your Bar Or Nightclub ? 

Opening a bar in Sydney Tip 11 – Bars scream social gatherings. They are hugely popular during the evenings and weekends. People go to escape after a hectic day or working week, and enjoy kicking back with friends. Your layout will influence the mood and overall aesthetic of your bar.

If you want to emulate a lively and upbeat atmosphere you could incorporate live music or a beer garden. On the other hand if you want a more relaxing, and calm atmosphere opt for smaller tables and dim lighting. The same principle applies for nightclubs. 

You want to aim for a cohesive layout that ties all elements together nicely. To help with this process we suggest engaging with an expert to guide you along the way and transform your ideas into reality.

Always have your brand, theme and concept at the forefront of your mind during your design process. 

Some of the main design elements to consider are  lighting, seating arrangement, decor, music, bar and kitchen section.

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FAQ#12

Should You Hire Bar Fitout Experts When Opening A Bar?

Opening a bar in Sydney Tip 12 – Once you have fleshed out the design elements for your bar or nightclub, you can start on the fit out process. We are no strangers to how stressful this process can be which is why we always suggest hiring an expert bar and club fit out company to lift the weight off your shoulders. 

Before you approach a professional club or bar builder you need to have architectural design drawings. This will allow the expert bar builder to accurately quote on your project. Some construction companies offer both bar design and  fitout services which can greatly simplify the process for you. 

These plans will clearly indicate where everything will be placed inside your premise. This process can take some careful consideration and planning. 

Here’s a list of the things your should consider:

  • Bar structure – Will you have different sections and rooms? Do you have access to an outdoor area? 
  • Bar serving area – Where will your drinks and food be served? 
  • Amenities – How many bathrooms do you need and where will they be placed so they have access to proper plumbing.
  • Kitchen – Size of your kitchen and the equipment and appliances you will need for it to function
  • Music – Sound systems need to be installed prior to the fitouts completion to allow for wireless access.
  • Lighting – How many lights do you need, where will they be placed? 
  • Furniture – Select furniture that not only looks good but is durable. You want them to last
  • Entry/Exit – How many entries will you have into your premise. These doorways need to be monitored by security at all times. 

Again, juggling trades and making sure you club or bar fit out comply with government rules and regulation and be a big headache. Leave it to the experts to get the job done in a timely and professional manner.

FAQ#13

What Are The Essential Supplies And Equipment For Bars?

Opening a bar in Sydney Tip 13 – To serve drinks, food and offer other types of services in your bar, you will need the equipment and supplies to do so.

Although it may be impossible to buy all supplies and equipment on your list, consider the important things only. That may include the following;

  • Glass Washer – Thanks to advancement in technology, today you can easily find a non-electric and affordable glass washer in the market. This will improve the service delivery in your bar.
  • Beer Dispenser – If you are going to sell keg, then a beer dispenser is of utmost importance. It will refrigerate as well as hold your beer.
  • Bottle Coolers – For other types of beers, a cooler will keep your beer chilled for customers who prefer it that way.
  • Blenders – Blended drinks such as margaritas are a top choice for many people. With a beer blender, you can make the best-blended drinks in town.
  • Ice Bins – You will use these to store your ice. It should be placed under the counter to ease accessibility.
  • Ice Machines – These will be used to make the ice which you will store in bins. An ice machine is compulsory if your bar is located in an area with a hot climate.

Other than the above machines, you should ensure that your glassware is adequate. Beer, wine, whisky, and tot glasses should be in plenty. If you will also be serving cocktails, you will need stirrers, straw, and napkins.

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FAQ#14

How Do You Hire Skilled Bar Employees?

Opening a bar in Sydney Tip 14 – You may have the most stylish and cool looking bar in the area, but if you don’t have skilled employees your customer service will hinder your chances of success. 

Different types of bars have varying staffing needs. So, before you go on the hunt for a highly skilled team of workers, it’s important to evaluate which employees you will need. 

Below are some positions that are common amongst all bars both small and big;

  • Bartenders
  • Waiters
  • Security
  • Bar manager

Although some of the above positions may not require some sort of formal training, it is important to look for individuals that are experienced.

Being a new bar, there is no room for trial and error. And when it’s in the early stages, bars are very delicate, employee behaviour can affect the customer return rate.

Therefore, come up with a checklist on traits you are looking for, which you will refer to during interviews.

If it is possible, take  your staff through a short training program that will keep them at par with your expectations and objectives.

The training should include topics such as; how to handle intoxicated patrons, properly dressing for the job and amongst other things.

FAQ#15

Should You Do Marketing When Opening A Bar In Sydney?

Opening a bar in Sydney Tip 15 – Having carefully turned your business idea into an actual, fully functioning bar, (congratulations) it’s time to spread to word about your awesome new business.

A strong marketing campaign is paramount throughout the lifespan of your bar, but creating hype before your grand opening is a great way to get your business off the ground.

Here’s a list of some of the best marketing techniques to help spread the word.

1. Create a Website:

Creating a strong online presence is very important and one of the quickest ways of getting your brand out there. The minute potential customers hear about a new joint, they will go online to look it up.

Having a website will ensure they know more about you and what you offer. It is an opportunity to turn them into actual paying customers.

2. Register Your Bar on Social Media:

Facebook, Instagram, and Twitter have become popular advertising platforms. It’s a great way to reach hundreds of people all at the same time. Have a bit of fun with your post and aim to make them engaging and interesting.

As more and more people start socialising at your bar, they might upload photos, tagging your location or using your bar name as a hashtag, which is perfect, free publicity for your business. 

3. Sign Up for a Yelp Account:

Yelp reviews say a lot about your business. Registering on the platform improves your online visibility.

4. Advertise Using Posters and Flyers:

You can also make posters and flyers hyping your bar and distribute them around your local area. 

5. Get Featured in the Local Paper:

Paid advertising on local papers does have its perks because you will reach out to a larger audience. In your advert, you can talk about discounts and offers that will attract clients.

6. Host an Event or Hire a Celebrity to Perform:

Doing either of the two will create some buzz and this can attract lots of customers.

7. Offer a Happy Hour:

Happy Hours are a sure way to win over clients by offering them drinks at a reduced price.

FAQ#16

Should You Host A Soft Opening When Opening A Bar Or Nightclub?

Opening a bar in Sydney Tip 16 – A soft opening is a small event prior to your big opening night. This is where you invite those close to you such as friends and family to your premise for a sneak  preview of your bar. 

You can ask attendees to recommend any changes they would like to see and any areas that require improvement. This is a great opportunity to test out your bar and make sure everything is working smoothly for your grand opening.

If there are any problem areas, then you have enough time to fix them beforehand.

By following the above guide, you too can own your own piece of the nightlife. If you have always felt drawn to this industry, here is your opportunity to fulfil your heart’s desire.Running a bar can be fun and interesting.

Every night will usher in a cheerful mood, but to be successful you should find a balance between the life of the party and that of a successful entrepreneur.

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