Illustration by Inés Antuñano.
Many have the dream of opening up a bar. A bar involves entertainment, cohesiveness, hospitality, talent, celebration and creativity, and fills even the most broken hearts with pleasure. If you find out how to put the pieces together to obtain a successful result and give it the necessary time to mature, and voilà: you have a business.
How romantic. Unfortunately, motivation is an ingredient that can end soon when you let yourself be surprised by the complexities and problems involved in a business like this. A bar could be on the lists of the best in the world, offer ingredients of Asian origin in their cocktails, even have a karaoke behind a secret door or be a brand with an authentic personality but before trying, you must know some fundamental points so that failure does not knock on the door.
First things first: is a bar profitable?
Sometimes. The real profit is the profits generated in each sale. It may be very small but if you have a healthy and well-structured business, it will be constant. I think there is more profitability in the bar business than in the restaurant business; the structure of the bars is simpler and implies less costs. However, it is necessary to have information and formats to record everything that is used, how it is used and what is wasted. If you don’t have this system, it’s more complicated to understand your business. Eventually, it allows you to have the consistency required to be profitable.-José Luis León, bar director of RitualH (Limantour, Baltra and Xaman)
The main costs of a bar are the three of deadly ones: service, payroll and distributors. In addition to this it is important not to overlook the areas in which there may be leaks of money: from the supplies – which are not so many but involve losses – to the cocktails and shots that we usually give away. As in any business, you should not be so confident; without control there can be valuable losses. With the opening of a bar you can achieve a certain degree of success, but I don’t think I’ll leave your bags full. However, from the beginning it is necessary to combine conceptual, monetary, career interests, etc., to measure aspirations and achieve objectives.-Carlos Castillo, partner and visual manager of Kaito Izakaya
Opening a bar as a sole owner and doing everything alone is a tough challenge but it is more profitable. The advantages are that very few things are undermined, it is faster to run everything, requires less personnel, less tools and less supplies, but you should not be thinking that the first load that falls will be yours: what works is the reinvestment in the faults that emerge.-Khristian de la Torre, owner of Café Taco Bar
As in any business, having partners can be a two-sided weapon: they can boost the business or make it disappear.
If you’re going to partner with someone, make sure everyone’s got a job. Beyond the financial investment, it is necessary to have clear views, contributions, skills and profiles of everyone. In my case, doing business with partners didn’t work; that’s why I decided to be the sole owner of Café Tacobar. My motivations for opening the bar were precisely not to work for anyone anymore and not to do stupid or meaningless things because someone else tells me to do them. Before, I couldn’t go faster because the business wasn’t mine.
Everything was very organic from the beginning: with the experience gathered in the F&B industry, patience and savings I decided to open a bar with specific characteristics, service, size and a menu that I could dominate almost one hundred percent. After four months of opening, I was too tired. I liked to know that I could do everything, but I had to hire someone to lend me a hand in order to be more efficient. I know that not having a staff is not logical and surely it won’t be easy either but as long as I can and have energy, I will continue.-Khristian de la Torre
Always have a “something under the mattress”: contemplating savings for turbulent times is essential
Good financial management from the start can help you cope with a crisis. The government shift, for example, has been relevant. A large part of the businesses in the Roma and Condesa colonies survive thanks to tourism, and if tourism is affected, as is currently the case, it can cause great losses because it allows us to have a second round of sales. The presence of foreigners in our bars, due to the timetables in which they attend and their consumption, represents a significant increase in sales.
Another example is the change in the price of alcohol, which practically implies updating costs every six months. Uncertainty can be the most complicated thing about having a bar: you never know when a crisis is going to hit you or how it is going to really affect you.-José Luis León
From the very beginning you have to be aware that nothing is certain: stability in this business is a luxury and there is nothing that guarantees success. The best thing for both partners and staff is to be aware that there will be sacrifices and changes. It’s good to have a team that understands the implicit drawbacks of opening and running a bar: from a paycheck delay or a rising dollar – we rely heavily on purchases from Japanese distributors – to more complex circumstances such as a natural disaster. In our case, a few months after opening, the lack of capital and customers due to the ravages of the September 19th earthquake did not allow the survival of the second Izakaya.-Carlos Castillo
No one is required to drink alcohol; a bar is visited for pleasure, so it should offer a pleasant experience.
Mexico has a very specific palate. Of course you have to take the risk and offer a creative menu but you can’t do it with your eyes closed either. The details start from the space, the presentation of the cocktails and the history behind them, the events, the bartenders invited and, of course, the hospitality. In other countries it is common for a single person to arrive at a bar whose only companion is the drink but not in Mexico; so when a client sits at the bar the service has to be impeccable, because it implies the intimacy of knowing the essence of the bar.-Carlos Castillo
Your people are the key
You need to be a team that likes what you do. I have always seen it: when they like their product, they know how to communicate it and therefore it is sold. You have to be on the lookout for them, because you can’t always solve everyone’s needs. Being a place that practically becomes your home, there will always be some problems but taking care of the personal environment is essential. Living at night is fun but not easy.-Carlos Castillo
Limantour’s worldwide recognition is due to its staff. I don’t think we have offered something so different at a cocktail level. Today more than ever, the people who have worked here are the ones who have kept the concept fresh and have given a service that brings people back. From experience, I’m convinced that the first mistake when you open a bar is not thinking about your staff; they’re the ones to bet on.
We hadn’t landed a career plan for the team until recently. Doing it as we do now gives us clarity on the direction each one wants to take and allows us to build that path. Brands, companies and customers look to them individually, not to Limantour. With all this you have a staff that is committed to the place and a balance arises between the objectives of the bar and theirs.-José Luis León
The bar already exists, now it must evolve and remain
You must define and maintain your concept. Over time you obviously have to give up things like cocktails that haven’t been interesting to customers. At one point we wanted to move sake around a lot and buy super expensive bottles but in Mexico the sake culture is not yet fully developed so it was not a convenient investment. However, there were many ways to maintain our Japanese identity. Another strategy that works is to bring bartenders from other places to learn their techniques and let them know yours. There is no innovation without feedback.-Carlos Castillo
When we opened Limantour I thought that the most important thing was the cocktails, that we were very creative and created an attractive space. Yes, all this is important, but in my career I learned what is now my mantra: “first it’s the people, then it’s the processes and then it’s the things”. This is the order in which we work in bars. It is fundamental to satisfy the need for personal and collective growth, then we can continue to rethink each menu, each strategy and each change; we are not left with the idea that we are good, there will always be something to correct and do differently. In social networks we simply find complaints of all kinds and we are aware that we are neither the 10th nor the 50th place in the world; we have many problems but being aware of them allows us to know how we are going to attack them.-José Luis León
They say animals go out at night: consider that opening a bar can bring more problems than an uncontrolled drunk.
To open a bar it is common to worry about extortion and fraud. I think the complexity of opening a bar lies in that. The problem today – especially in Mexico City – is insecurity; an issue you need to consider if you want to get into this. I think restaurants don’t extort you as much for drug use as they do bars. Bars have become that space where people can consume and make buying and selling transactions. This is a component of insecurity that at least eight years ago was not perceived. Drugs have always been everywhere but before there was greater discretion.
-José Luis León
The unavoidable dangers of having a bar are mainly three: the number one is drug-trafficking – you have to be afraid of that one – the second is internal robberies and, finally, the Government Delegation with its dependencies. That is why I have my San Judas Thaddeus well placed, for the most difficult causes.-Khristian de la Torre
Satisfaction goes beyond sales
It may sound corny, but the members of the bar become your family. When your team is small you have the opportunity to get to know everyone and understand their work dynamics; you learn to work with them and for them. I think success depends on each person’s perspective. For me, success is the recognition of the bar and its members: despite being in a crowded location, tourists and bartenders from other bars come to Kaito by recommendation, which is very gratifying. If this stays and increases, it’s because together we’re doing well.-Carlos Castillo
Living with people, the times when I have the opportunity to be behind the bar, prepare cocktails and get some shots with clients is the most incredible thing about working in a bar. If you add to that satisfaction to close your cash register and see that there’s some money inside, it’s even cooler.-José Luis León
*Our specialty is the Food & Beverage (F&B) industry.