Starting a liquor business/bottle store business/bar business in Zimbabwe is very rewarding. Many entrepreneurs are making money all over Zimbabwe buy running liquor businesses. The location may be for example in a rural district or in the high, middle and low density areas. The volumes are steady or ever increasing such that the flow of income is acceptable. Depending on the capital and size you want operate, the liquor store can be a franchise, self owned or in the form of a supplier. A liquor store is not as simple as other types of businesses and thus it is challenging to start. However, a liquor business is very profitable.
You need to carry out market research and have a good liquor business plan before venturing into this industry.
What you need
Carry out a business evaluation
You should assess the costs of going into the bar business, and the potential revenue in your market. Do not start the liquor business/ bottle store business without carrying out a proper market research and a feasibility study. If you are purchasing a franchise you may need to carry out an in depth and accurate evaluation of the business. Probably you may need an expert to appraise and estimate the value of the liquor store. The evaluation may include an assets and inventory assessment. This helps to clarify the financial aspects of the business and its potential. Determine the assets of the business and evaluate whether a purchase will be beneficial to you.
Know the type of liquor store
You can set up your liquor store in different ways. Choose a set up that’s suitable for you. For example you may choose to sell liquor under a grocery shop. You can get into an agreement with the grocery shop owner to allow you to operate a liquor center / bar under his license then you pay the appropriate amount due on the liquor section.
The second option is that of opening your own liquor store/ bar business and go through all the process of name search and acquiring license. Lastly you can purchase a line of liquor stores operated under a franchise. A franchise is quite expensive to acquire but it comes with an already established line of suppliers, customers and operating locations.
Capital for Liquor Business
You may need a loan to get sufficient funds to start this business. Get your paperwork ready so you can apply for a loan of at least $20 000. You will also need assets such as motor vehicles.
Liquor Business License
To kick start your liquor business, prepare your application and get the necessary licenses. Liquor licenses in Zimbabwe are given by the Liquor Licensing Board. You can apply for the liquor license at various provincial office around the country. In Harare you will apply from Makombe building. Requirements include application letter, Town planning permit, health report, lease agreement, building plan , and advertising in the national newspaper you intention of opening a bottle store.
Follow through the legal procedure because operating this business without a license or using an expired license may result in the confiscation of the license and the business’ assets. Liquor stores have time and zoning area restrictions. In terms of time it means you can only operate till a particular time. This could limit your volumes and revenue.
Premises for your Bar Business
Decide where you wish to operate the bottle store business and start looking for an affordable spacious building to operate from. Usually a liquor business is best located at a central point although liquor stores can only be operated in certain zones and areas as permitted by the law. You will then have to consider the best possible location in your city depending on the zoning areas.
List of suppliers
Your liquor business needs regular supplies to succeed. You will need a well established list of suppliers to deliver products to your bottle store business on time. Research and select a wholesaler or manufacturing company which can provide you with the necessary liquor products at a minimum cost. You may also consider getting some of your supplies in South Africa or Zambia. Delta is the largest supplier of alcohol in Zimbabwe.
Insurance and Security
Alcohol is a high demand product. The liquor business needs an insurance cover. Some zones may be infested with crime and break ins, so install security alarms and have security guards to check liquor goods as they are checked out the door. Also get indemnity cover to cover theft and fraud.
Management and employees
You need a shop manager, assistants and a cashier if you operating a single bar business. If it’s a liquor business franchise, you need each of the above for each shop. If you operating from a grocery shop you may need only a cashier and a sales assistant.
Profitability and Costs for Liquor Business
Initial costs such as rent and rates, salaries, license renewal, advertising and marketing may cost at least $3 000 every month for a small bar business. Stock your bottle store with a variety of liquor products such as lagers, wine, spirits, ciders, whiskey brandy and vodka. You can also supply complimentary products such as soda water, cranberry juice and energy drinks such as dragon, red bull. Consider also supplying traditional beers such as Chibuku brand Ingwebu brand and Super beer from Delta. Having all types of products help boost your sales and feed into profitability. Revenues may range from at least $4 500 per month for a small bar business.
Advantages of a Bottle Store Business
The economic conditions are tough and largely influence businesses however a liquor business is one of the most stable income generator in any phase of the economy (Slump, growth, boom). It can be categorized amongst the resilient type of businesses such as retail and food industry. The income is steady and it is easier to plan and make lifetime goals and there is guarantee that the business can operate for perpetuity if you play your cards right and manage the business well.
Tips for running the Liquor Business
Understand the needs of your customer and suppliers
From the very start, analyze the buying patterns of the customer. This helps is stock management as you can be able to stock the shop with products that generate more sales. It would be critical if you run out of supplies. To attract more customers to your bar business, install a large flat screen television where customers can watch soccer or perhaps listen to music while whiling time and drinking.
Pay close attention to your supply pattern. If your supplier has high demand, it means that you need to procure your supplies well in time to fulfill all your needs. To add on, consider purchasing large quantities in order to tap in on discounts. Setup a good secure storage space if you consider purchasing in large quantities.
Analyze market trends
The rate of demand helps determine the success or failure of your liquor business. Study the demand for liquor in your area and even the sales of your competitors. Demand helps determine the value your business will accumulate over time and whether you should consider discarding the idea and selling the store off or keeping it.
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