18 Mar What do I need to open a Bar/Restaurant
Quite simply you need big B#*lls to open a business where you are at the mercy of the local community, building planners, and the Police.
Heres a list of what you need to get everything underway:
Money – Do you have enough? if you do then great, but do you own or want to own your own place yet? because if you don’t I would strongly suggest you buy a property first, because even some of the most successful operators in the world cannot get pre-approval for a mortgage. Banks do not view a restaurant as an asset. If you have to borrow do not bother knocking on their door, ask friends and family but do not offer more than 20% from any one investor. 20% investors are people who believe in you, want to help and have the means to do so, knowing full well that you are still in control of the concept. But, 30,40,50% investors feel the pressure to get involved to secure their investment and when that happens, then welcome to your nightmare.. Our budget is between $150-180K to fit out a space approx 100sqm. You can do it with less, but if you have to do it with any more I would suggest re-evaluating your fitout.
Architect – No matter how little you are spending, find an architect that you can trust who will agree to take on the project, preferably in the hospitality industry not just a generic architect. My architect happens to own a few restaurants so I know we’re in good hands, but its still a team effort to make sure that the concept is achievable for the money that we are committing. Expect to pay an architect 10-12% of the proposed fitout fee. If you can map out most of the plans yourself they can polish it off and present you with a couple of options.
Insist that you purchase and pickup all materials they just refer you where to get it from. When you arrive at the supplier make sure you mention your architects name so that they give you industry rates. They don’t know the dynamic between you an your architect so they won’t risk ripping you off to damage future business with them.
ABN/Company registration – we used ecompanies.com.au cost us $50 more than filling out the ATO forms ourselves, which is very tedious and can take a month to sort out. ecompanies got ours approved the next day.
Bank account – You need a bank thats close by to your business so that you can get change and bank your takings on a daily basis without fear of being mugged on the way. You cannot setup a Company Bank account without an ABN, and you will most likely need a bank guarantee for your lease which has to be in your companies name, and if you are on a tight deadline to sign the lease, then hence edocuments.com.au
Lease – I haven’t seen many leases but quite simply we reviewed ours multiple times, and asked as many questions until they basically did all the legal work for us. Perhaps we will regret one day not seeing a lease lawyer, but essentially we know our lease back to front especially all the ‘what-if’ scenarios so we didn’t see the need to use a lawyer, but we did do extensive research online. Refer back to our other post on location to see a checklist on what I think are the most important parts of a lease agreement.
Development Application: This is something your architect should be doing with you. I do not suggest applying for one yourself as any mistakes may cost you months of rent in delay. You also need to submit multiple drawings of your proposed renovation so I would indeed make sure a professional is handling this with you.
Private Certifier: Question, do you want a council certifier who cares very little about whether or not you get approved to develop or do you want a professional certifier who works for you, but puts their certifier license on the line to make sure that you uphold all of the councils regulations. My answer is the latter, and we paid about $1500 for this service. Note. Council Certifier’s are not free either but I didn’t even bother with a quote.
Licensing:
Decide what you want to be and stick with it. This is a whole other entry in itself but the 4 options basically are:
1. On premise- must serve food with alcohol. Easiest to approve, but the least flexible.
2. On premise + PSA – Can serve alcohol without food but must prove that alcohol is not the main source of revenue. Very hard to approve in this climate, and still leaves alot of loose ends in the future from council and licensing police. 2 venues in our surrounding area were rejected for PSA – primary service authority, so we opted against this.
3. Small Bar – Supposedly easy and straight forward to approve. – we shall wait and see.. Requires food on premises, but people are getting away with peanuts as food. maximum capacity 60 ppl at any one time, which makes it difficult for big rushes. Police supposedly endorse this because it is a low risk license. If you are paying more than $75K for your lease, I would not advise this license because the capacity is too limiting to make your money back.
4. General Bar license –
No Comments