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How To Start A Wine Bar - Small Business Start-ups

Wine bar

By Michelle Hammond
Wednesday, 04 May 2011

How to srart a wine barIf you’re a lover of great wine, starting your own wine bar may have crossed your mind at some stage – it looks like a fairly glamorous industry to carve a niche in.

 

However, the wine bar industry in Australia is fairly competitive, so your offering needs to be well executed if you are to be successful.

 

We take a look at what’s involved in starting a wine bar, so that, hopefully, you are kicking up your heels and toasting your success in no time.

 

What is it and who is it suited to?


A wine bar operates in much the same way as a pub, with an obvious focus on wine rather than beer or spirits, although these are not necessarily excluded.

 

Some wine bars are profiled on wines of a certain type or origin such as sparkling wine or Italian wine. While many wine bars are standalone venues, others exist within another establishment or are associated with a specific wine retailer.

 

The clientele of a wine bar is typically a younger crowd, but this is certainly not the rule. There is also a fashionable element to some bars, which means they’re treated as a place to see and be seen.

 

Running a wine bar is not all that different from any other business in the public domain – you must be an excellent communicator and genuinely enjoying working with people. Also, be prepared to work nights and weekends in what can be a high pressure environment.

 

Rules and regulations


The retail sale of alcohol in Australia requires that a license be obtained from the liquor licensing authority in your state or territory.

 

It is illegal for a person under 18 years to buy, drink or possess alcohol on licensed premises, and a venue is liable if it is found to be serving alcohol to anyone who is under-aged.

 

 

If you plan on serving food, you’ll need to contact the health department to ensure you meet their standards.

 

Research and competition

 

If you don’t have any experience in the wine industry, go and get some. Spend some time working in a wine bar as this will give you a better understanding and appreciation of the environment.

 

Knowing your market is vital; you need to determine from the outset the kind of clientele you wish to appeal to.

 

Another thing to consider is that many wine bars now operate a catering element whereby a high quality food operation complements the drinks on offer.

 

To utilise this additional source of revenue, you will need to either have some catering experience yourself or hire outside help.

 

There is typically a high turnover in catering positions and it can be quite costly, so think carefully before deciding to go there, because once you have, your customers will expect nothing less.

 

If your knowledge of wine is limited, stick to what you know best. If you are more of a connoisseur and decide the market is craving a specific wine, let your imagination run riot and use your strengths as much as you can.

 

You also need to undertake the following:

  • Find the right location and gain an understanding of the area’s demographics.
  • Identify and analyse your competitors – what’s doing what, how many other venues are in the area, etc.
  • Market your business accordingly.

Costs and earnings


In addition to hiring skilled staff with the appropriate training and experience, a major cost is obviously the regular purchase of stock.

 

It’s therefore essential to establish good relationships with suppliers in order to get the best deals. While alcohol can be bought in bulk at discount prices, fresh food will prove to be more expensive.

 

Some wine bars are bought outright while others are leased, and the cost really depends on the nature and location of the building.

 

Wine bars tend to stay small and intimate in size, and are typically located in more sophisticated neighborhoods.

 

In addition to all the necessary facilities, you need to invest in the overall aesthetic of the venue; the décor you decide on will directly impact the mood you set.

 

With regard to pricing, most wine bars charge between $6 and $10 per glass, but this can vary depending on the quality of your range.

 

An average day


As the owner-operator of a wine bar, you will need to juggle your presence “on the floor” with your administrative duties, including cost control, rosters and ordering stock.

 

You may also need to spend time visiting existing or prospective suppliers, and keeping an eye on what’s in season and on-trend.

 

Useful contacts


Australian Society of Wine Education

08 8222 9211

 

National Wine Centre of Australia

08 8303 3355

 

National Wine Education and Training Centre

08 8222 9277

 

Australian Government Small Business Support Line

1800 777 275

 

Australian Chamber of Commerce and Industry

02 6273 2311

03 9668 9950

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James Omond
One of the killers for startups with licensed premises is the amount of time it takes to get the liquor licence - and let's face it, without a liquor licence, a wine bar will have no income. So what you should try to do is negotiate with the landlord preferably a "condition precedent" that the lease is not binding until the liquor licence is granted (without unwanted conditions) - or if you can't get that, then at least have a right of termination for the lessee if the licence is not granted within say 90 days.
Bear in mind that you will also be required to obtain "Responsible Service of Alcohol" (RSA) certification, and there may be no courses being held at the time you are trying to obtain this.
The lease should also deal with who owns the liquor licence at the end of the lease - if you are the lessee, you probably won't want this reverting to the landlord - as it stops you from moving your bar to cheaper premises in the neighbourhood if the lessor gets greedy when your bar is a success and it's time to renegotiate the rent.
Finally, when dealing with suppliers, make sure you ask others in the industry what sort of deals are being offered - for a guaranteed percentage of your wine list, most wholesalers will provide you with free desktop publishing for your wine lists, etc, as well as offering deals on stemware, etc.
Good luck, and good drinking!
James Omond
James Omond , May 05, 2011
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