Potential investors and lenders spend the majority of their time analyzing the financial plan, yet many entrepreneurs have little or no idea how to create it. You financial plan must provide a breakdown of all potential revenue streams (most often sales of drinks, food and/or cover charges), including their relative importance and when they will be implemented, along with projections for outside funding. You must also summarize both past and projected Income Statements, Cash Flow Statements, and Balance Sheets, and the assumptions you make must be reasonable and easy to verify through a competition analysis. A solid exit strategy (if you eventually plan to sell your bar) might be helpful to show to equity investors.
In your financial model, you need to include the costs involved in starting a bar. These costs primarily depend on the location and license type you end up purchasing (wine and beer only or liquor too). Some of the general costs incurred by new bar owners include the following:
- Fixtures and equipment
- Leasehold improvements- air conditioning/heating, carpentry, flooring, painting, plumbing, electrical etc.
- Starting inventory
- Legal services
- Permits and licenses
- Utilities and phone deposits
- Initial marketing for a grand opening