Is Opening a Bar Franchise Really Worth It?

From popular television shows like “Cheers” to “It’s Always Sunny in Philadelphia,” bars have played an iconic role in popular culture, capturing the imaginations of people around the world. The idea of owning a bar and recreating that lively, social atmosphere has become a dream shared by many. However, starting a bar from scratch can be both daunting and financially challenging.

But it doesn’t always have to be.

This is where franchising steps in to make the dream of bar ownership more attainable. And luckily, there are a number of franchise opportunities available within the bar industry. For example, there’s Buffalo Wild Wings, Voodoo Brewery, Wings and Rings*, The Brass Tap*, 810 Billiards & Bowling*, Bar Louie and Shuckin’ Shack Oyster Bar. These bar and restaurant franchises allow entrepreneurs to tap into their established concepts and leverage their popularity to run successful businesses.

But is opening a bar franchise really worth it? Let’s dive in.

Glass Half Full

As mentioned, one of the immediate positives of opening a bar franchise is the association with an established brand. Franchisees are able to leverage brand recognition, a loyal customer base and existing marketing efforts of the franchise to scale their business right from the start.

In addition to that, bar franchises have a proven business model that has been tested and refined. For example, if you decide to become a franchise owner of Buffalo Wild Wings, you won’t have to take on the trial-and-error process of developing your own strategies and best practices. The franchise has already identified what works and what doesn’t, which gives you time to focus your efforts on executing those strategies and making them work in your market.

Another draw to bar franchises is the training and support they provide to new owners and operators. Franchisors typically offer comprehensive training programs to franchisees, which include everything you would need to know to get up and running as a first-time bar owner. For example, Shuckin’ Shack Oyster Bar provides ample training and ongoing support to new operators. 

As a franchisor, they provide marketing and field support, as well as 140-plus hours of hands-on and classroom training that covers everything from finances, inventory management, and front- and back-of-house operations. In addition to that, the brand also ensures there’s weekly communication with all new owners to make sure they have everything they need because when franchisees succeed, so too does the franchisor.

While there are a number of logistical benefits that make opening a bar franchise worth it, Shuckin’ Shack CEO Jonathan Weathington says the essence of it is quite simple.

“Running a bar is a great time,” said Weathington. “It’s an energetic and fun environment with good food, refreshing drinks, and vibrant music. It creates a fantastic atmosphere for people to relax, unwind and come together.”

Glass Half Empty

However, there are some drawbacks associated with opening a bar franchise. As Jon Taffer, the executive producer and host of “Bar Rescue” told Entrepreneur, owning a bar demands a substantial amount of hard work, time and dedication to make it a success.

“This is a serious business,” said Taffer. “It’s a hard business. A bar is a factory, a marketing organization and a service organization all in one, and you have to manage all three.”

There’s also the financial investment involved, which can vary depending on the specific franchise you choose to partner with. Along with the initial franchise fee, there will be a number of initial costs associated with opening a franchise, which covers equipment, inventory, licenses and permits, marketing, training and site selection. Alongside the initial investment, franchisees are required to pay ongoing royalties, which are calculated based on a percentage of sales. These royalties will need to be paid on a regular basis for as long as you’re operating under the franchise’s brand name. These ongoing financial obligations also need to be carefully considered and factored into your business plan.

Another factor to keep in mind is the potential competition in your market. The bar industry is highly competitive and is only growing. In fact, as of 2022, the U.S. bar and nightclub industry ranked among the largest in the accommodations and food service sector, and is worth roughly $28.6 billion. That being said, there’s always competition for bars. Most franchisors thoroughly evaluate market saturation before granting permission to open a location in a particular region, which will help mitigate competition to some extent.

Last Call

So, is opening a bar franchise really worth it? Ultimately, the answer will depend on your individual circumstances, goals and preferences. There are undeniable benefits to joining a bar franchise, but it’s crucial to carefully consider the potential drawbacks.

Success in the bar industry is more than just the customer camaraderie seen on TV. In addition to being a place where people want to hang out in, independent owners or franchisees need to make sure they’re willing to put in the dedication, hard work and thorough understanding of the market and business needs beforehand.