Buying and running your own bar: How to discover your inner Sam Malone.

Should You Quit Your Job and Buy a Bar?

Should You Quit Your Job and Buy a Bar?

Starting out, not starting up.
Oct. 6 2014 4:50 PM

Discovering My Inner Sam Malone

Do I have what it takes to buy and run my own bar?

Ted Danson as Sam Malone, Cheers.
Is this what you see when you look in the mirror?

Photo by NBC/NBCU Photo Bank via Getty Images

Not long into our conversation, Kirk Struble has me feeling disillusioned. That is probably for the best.

For many years I have often fantasized about opening a bar. Sometimes the dream has shape-shifted into a Jewish deli or a music club, but more often than not, it’s a watering hole—a no-frills, low-lit space with a solid jukebox and a respectable variety of beer where I could preside in the great tradition of American tavern owners. This bar that sits in my mind’s eye is not especially unique, except that it is mine.

Jordan Weissmann Jordan Weissmann

Jordan Weissmann is Slate’s senior business and economics correspondent.

My guess is that many other men indulge in the same daydream. This hunch is based purely on anecdote: conversations with friends, some snap polling on Facebook, etc. When I brought the subject up in an editorial meeting, for instance, my colleague Will Oremus nodded knowingly. When Will lived in San Francisco, he even had a corner picked out for his imaginary establishment—Fourth Street and King. He would have called his bar The King.

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Which brings me back to Struble. In 2006 he and a partner opened 4th Avenue Pub, one of my favorite bars in Brooklyn. Since then, they’ve expanded with four more establishments, including two in Manhattan—all neighborhoody spots with thoughtful beer lists. I had called him up to learn a bit about the day-to-day of bar-owning life and to see if my dream could survive a conversation with reality.

What would he tell a friend who was considering getting into the business? “I would tell them, ‘I hope you like being in the basement a lot, because more often than not, that’s where I find myself,’ ” Struble says. “I’m the guy schlepping kegs and unclogging toilets.”

Oh? “So many people I know have a glorified idea of Oh, you’re standing behind the bar and there are so many girls. That’s the fantasy. It’s not the reality,” he says. “If I knew the occupation I would have now during college, I would have gone to refrigeration school or plumbing. I would not have gotten a master’s in education.”

Plenty of us sometimes wish we’d picked another major, but what else do bar owners mess up? “Make sure you are able to get a long-term lease,” Struble says. “You can be the most successful place in the world, but if your landlord decides in three years that he’s going to double your rent, are you going to be able to cover it? It’s not sexy, but I’ve seen people flame out.”

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Little about owning a bar, it seems, is very sexy. This should be obvious, since you’re running a highly regulated gathering place for drunk people. In major cities, the process for obtaining a liquor license can be a bureaucratic morass that requires convincing the ornery NIMBY-thinkers of your local community board that you are not planning to open a den of iniquity that will lure ravening alcoholics to the neighborhood. And as any fan of Bar Rescue will tell you, plenty of establishments fail simply due to bad bookkeeping. Selling beer takes accounting chops and, worst of all, spreadsheets.

And yet, plenty of people persevere. “There are a lot of people who have that Sam Malone in them,” says Ryan Clark, director of sales at the Veld Group, a brokerage and consulting firm based in Los Angeles that helps customers buy and sell bars and restaurants. “Whether they’re a doctor or a corporate attorney, they have this thing about owning their own bar.”

Like with any small business, the cost of a bar can vary greatly from city to city and neighborhood to neighborhood, depending on factors like local rent, competition, the customer base, and the availability of liquor licenses. Clark says that Veld has sold many for between $400,000 and $800,000. The most expensive was about $1.2 million—and that only included the business, not the actual building.

But they can come cheaper. According to Clark, in L.A. it usually takes about $150,000 to $200,000 to buy a basic mom-and-pop tavern—think of a 1,500-square-foot space with pool tables—that’s already generating a reasonable profit. “You would probably have to spend twice that amount and a year of your life to go build that on your own,” he says. Buying is also easier than building because it’s often simpler and cheaper to transfer an old liquor license to a different owner than to obtain a new one altogether.

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Not that I have $200,000 to spare, but this all seemed mildly encouraging. To put that upfront cost in perspective, Entrepreneur estimates that starting a Subway franchise requires an initial investment of $116,600 to $263,150. And nobody dreams of standing behind a stack of cold cuts.

Are there any kinds of people who simply shouldn’t try to buy and run their own bar? Sure, Clark told me: people who don’t like being surrounded by drinkers.

Heather and Andy Dismore have a more cautious perspective. The husband-and-wife team run ADI Consulting, which helps corporate clients open bars and restaurants. (Heather is also the co-author of Running a Bar for Dummies.) If you’ve never worked in the hospitality business, they tell me, diving in as an owner is a good, and expensive, way to fail at it.   

“When I hear people say, ‘Oh, we can start a place and it will be wonderful, and we’ll bring all our friends and be the center of attention,’ I have two responses,” Andy says. “One is that I can introduce them to the pleasures of cleaning out a grease trap at 3 in the morning. Or they can give me $20,000 upfront, I can kick them in the balls, and they’ll thank me in a year.”

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One of the big problems for inexperienced owners, he says, is that they can be “held captive” by their employees. Bartenders and managers have a habit of giving food and drinks away to friends and regulars, which encourages gracious tipping. They pour out stiff drinks. They hand out shots on the house. And if the staff knows the business better than the owner, they can fudge the inventory numbers and hide what they’re doing. “If you haven’t worked in the industry, most people have no idea how to track all this properly,” Andy says.

OK. But what if you pull the full Sam Malone and work as your own bartender? “If you’re stuck behind a bar, what are you not doing?” he asks. “Are you doing the marketing? Are you interfacing with guests? You’re either working in the business, or you’re working on the business—and owners need to be working on the business.”

When people ask her seriously about the idea of buying or starting their own place, Heather Dismore tells them to get a job managing somebody else’s first, to learn the industry and figure out if they actually enjoy the lifestyle. “You’re basically experimenting with someone else’s money,” Dismore says. Managing a bar is a 50-to-80-hour-per-week job, but “when you own your own place, it’s much closer to 95 or 100.”

To be fair, some of that time includes the pleasant labor of sampling beers and deciding what goes on tap. But much of it is plain old office work.

“I’m a total dork,” says Ben Wiley. “I like inventorying. I like sales charts and graphs.” Which is part of the reason he and his brother Mike have been successful with their own family of Brooklyn drinking spots, including Bar Great Harry and the Owl Farm. It takes meticulousness to make sure bartenders aren’t giving away too much free booze, or that cash isn’t mysteriously disappearing from the register.

It also does help to stay sober. “If you drink, don’t drink in your own bar,” Wiley tells me. Thankfully, I doubt I’ll ever have to worry about making that mistake.