Should you buy a new bar or start fresh?

Now the crucial question is: do you want to buy a bar currently in operation, or to start fresh and build a whole new bar? This question can be the most crucial financial decision you will make in your business, so it is imperative to choose wisely and consider all the pros and cons.

Buying an Existing Bar

The current bars in operation can be a good indicator as to how the businesses are doing in your local economy. As such, buying a bar can be a smart investment, but it also has some drawbacks.

Pros
Established customer base
Full staff so you don't have to search and hire
Little design, equipment and inventory cost
Earn profits sooner

Cons
Business may be failing (Tax Problems, Customer Service, etc.)
High sale price and initial deposit
Neighborhood may be changing for the worse

While an existing bar has a customer base, a full amount of staff, and won't cost too much in design and inventory, it also limits your options for changing the bar to your tastes. If you change too much, you'll alienate your customers, and if you fail to change to keep up with competition, you'll lose your customers then too.

When buying a bar, the price to buy may be high, especially if it is a profitable enterprise that is growing. This means that the down payment may also be very high. On the opposite end, a low sales price may indicate something is amiss. The bar may be failing due on part of the business owner, or the neighborhood may be changing. Research the area for increases in crime, which drive businesses to seek greener grasses.

Building a New Bar

The most flexibility in building your dream bar comes from starting from the ground up. If you want that see-through floor with fish swimming underneath (yes it has been done), then you definitely want to build your own bar. The pros and cons of building are unique to this area.

Pros
Design to your tastes
Allows for greater differentiation from competitors
Can choose a location more readily

Cons
High cost for construction, equipment, and design
Have to search and hire all new staff
More regulations to handle before opening day
Delayed profits

So when building your bar, you have full control over how it is built, how it looks, what you want to stock and how you want your menu. All of this means your marketing activities can focus on how you are different (and better!) than your competitors. But the high costs of starting from scratch will delay your profits, which you may or may not want.

Buy or Build? That is question before you. If you buy, you can earn profit sooner, benefit from a customer base already established, and have less start up costs in inventory to consider. On the other hand, if you build, you can build to your tastes, choose the best location possible, and be different from your competitors. The choice won't be easy, but with your knowledge and business savvy, you can make the correct decision for your future business.