IndustriesBar
A bar business plan where the licence is on the critical path
Bars have the best gross margin in hospitality and the tightest regulatory gate. The licence, not the fit-out, usually sets the opening date — and a plan whose first trading month ignores that is already wrong.
Written for an SBA or bank loan, which is where most plans in this sector goNAICS 722410
Where the money goes
Typical shares of revenue in this sector. Shown as a starting point to argue with, never as a target to hit — your own figures replace all of these at intake.
- Beverage cost
- 24%
- Spirits run nearer 18%, draught nearer 28%. The mix is the margin.
- Labour
- 28%
- Peaky. Two people on a Tuesday, eight on a Saturday.
- Occupancy
- 10%
- Late licences command higher rents.
- Security and compliance
- 3%
- Door staff, cameras, training. Often a licence condition rather than a choice.
A worked model
One plausible bar, built out in full.
Not an illustration. These assumptions were run through the same engine the product uses, and the plan review was run over the result. It is here so you can see the shape of the answer before you start.
- Year 1 revenue
- $797.3K
- Year 3 revenue
- $1.4M
- Operating profit from
- Month 5
- Year 3 net margin
- 7.5%
- Coverage, first full year
- 1.73×EBITDA less tax, over debt service
Balance sheet ties in all 60 periodsNo blocking findings — this model would exportLowest cash $19.2K in month 4
The revenue build
Not a growth rate. These are the drivers a reader can argue with, which is the only kind worth putting in a plan.
Bar service
Traffic × conversion × ticket
- Daily trafficPeople past the door, or covers seated
- 160
- ConversionShare who buy
- 90%
- Average ticket
- $26
- Open days per month
- 24
- Monthly growth
- 0.0%
- Cost of salesFood, drink or goods only
- 26%
Sixty months of it
Monthly revenue against monthly EBITDA. Both are flows, so they share an axis honestly — plotting a cumulative cash balance beside a monthly figure would flatten the one that matters. The cash trough is in the strip above.
- Monthly revenue
- Monthly EBITDA
Year by year
| Year | Revenue | EBITDA | Net income | Closing cash |
|---|---|---|---|---|
| Year 1 | $797.3K | -$68.2K | -$134.5K | $49.2K |
| Year 2 | $1.3M | $89.5K | $25.2K | $89.1K |
| Year 3 | $1.4M | $167K | $105.1K | $206.2K |
| Year 4 | $1.5M | $227.8K | $134K | $349.3K |
| Year 5 | $1.6M | $275.1K | $172.8K | $528K |
Sources and uses: $300K debt, $130K owner capital, $320K of fit-out and equipment. 12 people on the payroll by month 36.
Against the bar and tavern band
Benchmarks warn; they never overwrite. An assumption outside the band is flagged with its source so you can justify it — substituting an industry median would destroy the specificity that makes a plan credible.
- Gross margin, before direct labour
- 74.0%in band
- 66.0%median 74.0%82.0%The published band is quoted on cost of goods alone, so this is the comparable figure. After direct labour the statements show 49.3%.
- Net margin
- 7.5%in band
- 3.0%median 9.0%15.0%
Source: Beverage trade operating data, 2026 · NAICS 722410 · secondary tier. Secondary-tier bands are usable as ranges, not as something a lender will read; where a figure has to survive scrutiny we substitute RMA Annual Statement Studies or IRS SOI data. Pour cost runs well below a restaurant's food cost, which is why this band sits higher; a bar with a large food menu drifts toward the restaurant band.
What they will ask first
A plan that answers these before they are asked reads as competent. One that does not gets sent back with them attached.
- When does the licence actually issue?
- Months, not weeks, and it can be objected to. The plan should show the business carrying fixed costs from lease signature until the licence lands.
- What is the draught-to-spirits mix?
- It moves gross margin by six or seven points, which is the difference between servicing the debt and not.
Where these plans get sent back
Licensing delay
The single most common cause of a bar running out of cash before it opens. Model the rent from lease signature, not from the first pour.
Concentration in two trading nights
If Friday and Saturday carry the week, one closed weekend is a month's profit.
Licences and filings to budget for
These belong in the use of funds, not in a footnote. A missing permit line is the cheapest possible reason to be sent back.
- Liquor licence, with a public notice and objection period in most jurisdictions
- Responsible service certification for all serving staff
- Occupancy and fire capacity limits, which cap the revenue model
- Late-hours or entertainment permit where applicable
Requirements vary by state, county and city, and they change. Treat this as the list to go and verify locally rather than as legal advice — the product tracks the dated ones as configuration with a source and an effective date, and prints which version it assumed.
Start from these defaults, then make them yours.
The intake pre-fills this sector’s drivers and tags each one as your figure or an industry default — and says which in the finished plan.