Some wine bars are bought outright (this is known as free trade), some are managed or franchised under a brand name while others are leased from private companies and brewers. Many are also run by private bar owners and simply rented by a private landlord. So, the capital you put in could range from £20,000 to £200,000 plus. However, in order to ascertain how much you need we have broken down the average startup costs or that you can expect to pay:
Purchase of the lease: £5,000 to £80,000 - If you are purchasing an existing business you will have to pay for the existing term of lease remaining. This figure is very much dependent on the value of the business and your negotiation. If you are buying the premises out right then expect this figure to double in larger cities or London
Fixtures and Fittings (F&F): £3,000 to £30,000 – Many suppliers will supply containers or branded display items such as coolers and dispensers free of charge with certain goods and stock. The purchase of F&F may have tax implications. Speak to your accountant for more information.
Valuer's fees: £800 to £1000
Agent's fees: Approx £500
In-going stock: £2500 to £7000
Dry Stock (food): £500 to £2000
Till rolls and cleaning materials: £100 to £200
Cost of stock take: £100 to £200
Glassware: £500 to £1200
Rent leases (if you rent): £500 to £6,000 – You will be asked for a month's rent in advance for new leases or an apportionment of the current month for assignments
Till floats and change drawer: £800 to £1200 – three tills at £250 plus £300 change
Insurance premiums (F&F, stock, public & employer's liability): £250 to £450 – average cost of annual premium
Buildings insurance: £250 to £1000 – Average cost of annual premium
Surveyor's fee: £300 to £800 – Cost of full structural survey
Solicitor's fees/licensing: £750 to £2000 – should cover all legal fees
General working capital: £3,000 to £10,000 – this will cover unforeseen costs such as rentals on equipment
Training: £750 to £1250
TOTAL: Prices will vary so we have given an estimate figure of between £20,000 and £150,000 but this will rise considerably if you buy the property outright
How much can I earn?
Making a profit in business is naturally your primary target but if you’re starting from scratch getting a return on your investment may take longer than you think, particularly if your outlay runs into hundreds of thousands of pounds. Davis suggests that you can make up to 60% gross profit from running your own wine bar but that after costs and wages, for example, are taken out then the turnover figure is more likely resemble between 8 to 10%.
So, before dimming the lights, putting on a selection of easy listening tracks and serving Pina Colada’s with paper umbrellas to Del Boy lookalikes, make sure you get your business plan down to a tee and give a venture such as this one a huge amount of thought – only then will you be able to toast to your own success.