FAQFAQ   SearchSearch   MemberlistMemberlist   UsergroupsUsergroups   RegisterRegister 
 ProfileProfile   Log in to check your private messagesLog in to check your private messages   Log inLog in 


Leasing the Kitchen in a Bar

 
Post new topic   Reply to topic    The Smoke Ring Forum Index -> Commercial BBQ
View previous topic :: View next topic  
Author Message
mrcustomsteel
BBQ Super Pro


Joined: 01 Mar 2005
Posts: 1997
Location: Bilings, still a Texan, MT

PostPosted: Sat Jun 24 06 9:54 pm    Post subject: Leasing the Kitchen in a Bar Reply with quote

There is an established local bar & grill for sale. A friend has been looking at bars to buy but does not want one that serves food. We have been discussing leasing the kitchen to me to serve BBQ and TX bar type munchies.

Does anyone have experience in valueing this? How would I determine a fair price to pay him? I'm not interested in working for him in the kitchen. I would need to keep this as a separate entity. Any ideas, comments?
_________________
D. Tillery
Texan transplanted in Billings, MT
www.mrcustomsteel.com
Back to top
View user's profile Send private message Visit poster's website
Texman
BBQ Pro


Joined: 19 Oct 2005
Posts: 831
Location: Del Rio, TX

PostPosted: Tue Jun 27 06 11:52 pm    Post subject: Re: Leasing the Kitchen in a Bar Reply with quote

mrcustomsteel wrote:
There is an established local bar & grill for sale. A friend has been looking at bars to buy but does not want one that serves food. We have been discussing leasing the kitchen to me to serve BBQ and TX bar type munchies.

Does anyone have experience in valueing this? How would I determine a fair price to pay him? I'm not interested in working for him in the kitchen. I would need to keep this as a separate entity. Any ideas, comments?


From all appearances both setups could compliment each other, and to some degree, feed off of each other.

Just some of the issues we see (using the assumption it is a Bar & Grill, not a Honky Tonk, with a kitchen).
1) Kitchen/Grill area requires cook, needed help, equipment repair/replacement etc.
2) Patrons eat in the bar.
3) Bar area requires order takers, servers, table cleaners, money takers and change givers.
4) All help in the Grill area, and bar food handlers, will require health permits/license, even temp. employees.
5) Will the bar feed the kitchen business, or will the kitchen feed the bar business?
6) Generally, after people eat they drink less.
7) Who is responsible for equipment repairs and replacement?
Cool Who does the bar help work for, the bar or the grill?

Once the above questions, and any added thereafter, are answered then the economics could be put in place.
Back to top
View user's profile Send private message Visit poster's website
mrcustomsteel
BBQ Super Pro


Joined: 01 Mar 2005
Posts: 1997
Location: Bilings, still a Texan, MT

PostPosted: Wed Jun 28 06 9:56 pm    Post subject: Reply with quote

Thanks Texman, those are good points. I figured splitting common employees would be a challenge. I know you can't really split everything down the middle because you are dealing with two very different profit margins too.

Food was a nice part of this place before it closed. I think the food is a necessity even though it can cut down on the drinking.
_________________
D. Tillery
Texan transplanted in Billings, MT
www.mrcustomsteel.com
Back to top
View user's profile Send private message Visit poster's website
Texman
BBQ Pro


Joined: 19 Oct 2005
Posts: 831
Location: Del Rio, TX

PostPosted: Thu Jun 29 06 10:47 pm    Post subject: Reply with quote

mrcustomsteel wrote:
Thanks Texman, those are good points. I figured splitting common employees would be a challenge. I know you can't really split everything down the middle because you are dealing with two very different profit margins too.

Food was a nice part of this place before it closed. I think the food is a necessity even though it can cut down on the drinking.


And of course there are utility issues. Waitresses need to hawk your product, or menu, through whatever effective means that compliments the complete operation. Since the place is closed, it is a new startup that will require exposure though advertising and later, hopefully, positive word of mouth.

One might entertain a percentage of the gross sales, only, as a payment method, and in a manner that would economically contribute to all involved parties i.e., facility use and bar support personnel, and to the bottom line of each. Using a percent of gross sales realistically reflects back to facility use and bar personnel support. You will only be charged for what you actually use and vice a versa.

Arriving at a gross percentage could be viewed in various ways. From your standpoint you might consider the cost associated with leasing a stand-alone facility – not a fun financial thought.

From our understanding the new owner is viewing it as a business he does not want to deal with, which brings up the question …why? Possibly he looked at the books of the bar vs. the grill, or as you have stated he just doesn’t want to have to deal with a cook and would rather give it up, and in a manner that adds to both parties financial success.

Arriving at a gross percentage could be tricky and tough to nail down to an equitable number. You have nothing invested, except your cost of goods, time, talent and desire. Possibly a starting gross sales percentage of 20% may be functional.

What do you think? Let us know how it turns out.
Back to top
View user's profile Send private message Visit poster's website
Oregon smoker
BBQ All Star


Joined: 07 Nov 2006
Posts: 6246
Location: Portland, OR

PostPosted: Sun Nov 12 06 2:16 pm    Post subject: Reply with quote

this is interesting. the bar that my wife used to work at, the owner knows that i make some good 'que and he has heard all about it. he offered the venue if i did all the cooking. he took the alcohol sales, and i took the food sales. he talked to his insurance agent and lo and behold i need to get a business license then im a independent contractor. so it didnt work out this year but im pondering it for nest summer.
jason

what kind of a mark up on meals should i think about?
Back to top
View user's profile Send private message
mrcustomsteel
BBQ Super Pro


Joined: 01 Mar 2005
Posts: 1997
Location: Bilings, still a Texan, MT

PostPosted: Sun Nov 12 06 11:49 pm    Post subject: Reply with quote

We lost quite a few posts to this thread in the last crash.

This deal did not work out. The whole place sold and re-opened as a restaurant & bar. The more I thought about how to separate the two, the more complicated it got.

Maybe everyone who contributed to this thread will jump in again. There ended up being some pretty good advice on it. This is something many of us dream of doing.

Oregon, what were the details of the deal your guy was proposing?
_________________
D. Tillery
Texan transplanted in Billings, MT
www.mrcustomsteel.com
Back to top
View user's profile Send private message Visit poster's website
Display posts from previous:   
Post new topic   Reply to topic    The Smoke Ring Forum Index -> Commercial BBQ All times are GMT + 8 Hours
Page 1 of 1

 
Jump to:  
You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum


Powered by phpBB © 2001, 2002 phpBB Group