So, you’ve opened a bar. The United States bar industry is vibrant, but it can also be unforgiving. Around 60 percent of bars close within a year, and only around 20 percent reach the five-year mark.
Financial mismanagement is one of the leading causes behind the astronomically low success rate of bars across the U.S. Learning some money management basics can bolster your enterprise’s chances of success significantly, so we’ve put together a few tips to help you understand the “money side” of running a bar. Continue reading to get some tips for managing your bar’s finances.
Make investments outside of your bar.
No matter how much money your establishment makes, it’s always a good idea to have investments outside of your business. A diversified portfolio of business holdings and investment funds is a great safeguard against an economic downturn. Due to the COVID-19 pandemic, last year and the year before were two of the hardest for business owners, and many were forced to close their doors forever. However, having other investments could have saved them a lot of financial hardship.
One of the problems beginners have when they start investing is choosing the right financial advisor. Robo advisors have become an increasingly popular option for new players and experienced traders alike. Visit Wealth Rocket’s online platform to learn about the top robo advisors and their features and trading fees.
Find the right alcoholic beverage wholesaler.
Finding the right alcoholic beverage distributor is one of the best ways for bar owners to save revenue. One of the major complaints people have about going to bars and clubs is the price of their drinks. Your bar can become the premier bar in your local area if it offers drinks at better prices than its competitors.
It’s a good idea to contract a procurement specialist to help you find the best wholesalers proximal to your business. The money you save on your beverages and other needs will be well worth the cost of consulting services.
Separate your personal and business finances.
You’ve invested a lot in your bar, and there’s no guarantee that your investment will work as you plan. That’s why it’s a good idea to separate your personal and business finances. Indeed, this is a necessary step if you choose to license your business as a limited liability company.
You don’t want to find yourself mixing your personal and business finances, as it could lead to your financial ruin and the failure of your business. You need a bank account solely for your enterprise, which will also make bookkeeping much easier.
Attract new investors.
As an entrepreneur, you want your bar to be the hottest one in the area. That means you must invest to make upgrades and create the optimal atmosphere for your establishment. It’s a good idea to put together proposals to attract investors to your establishment, providing an influx of revenue to take your bar to the next level.
One of the main reasons businesses fail is the mismanagement of their finances. That’s why it’s good for business owners to have investments outside of their entrepreneurial endeavors. You can also save money and enhance the customer experience by finding the right beverage distributors. It’s also wise to separate your personal business finances and hire an accountant to help with complex financial issues. And, attracting new investors is a great way to get funding to make upgrades to your bar.
You might have opened your bar as an extension of your passion for enjoying a brew with the crew, but you must learn to manage your finances like an exec if you want your enterprise to flourish. Hopefully, these tips will help you manage your company’s finances responsibly.
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