How to Open a Bar in Illinois

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A bar in the state of Illinois can be profitable, if managed correctly. Entering the business requires that you define a distinct strategy for your bar prior to securing commercial real estate, and that you devise a proper advertising campaign for your target market. Of course, the entertainment business in Illinois carries a distinct licensing protocol and unique risks.

Things You'll Need

  • Commercial Real Estate
  • Business and Liquor Licenses
  • Define strategy, and research whether your setup is viable for your part of Illinois, prior to moving ahead. Bars are classified by type and include sports bars, nightclubs, wine bars, lounges and neighborhood taverns. Your initial strategy should also specify budgeting and business organization information. Set aside a reserve fund equal to roughly eighteen months' worth of operating expenses to minimize the risks of business failure.

    In terms of location, Chicago is the most diverse market, but is highly competitive. Other Illinois cities will be less competitive, but may not carry adequate populations to sustain your entertainment venue. Still, sports bars and neighborhood taverns should work well in college towns, such as Champagne, Carbondale and DeKalb.

    Winter weather prevails throughout Illionois, and people are less likely to leave home for a night on the town during the winter. You should plan to open your bar during the spring, leading into the summer months, for good results. Opening night is arguably the most important date for your start-up.

  • Locate and modify commercial real estate to fit the overall mission of your bar. New bar owners would be better served to hire a real estate agent who specializes in commercial real estate to walk them through the search process. You should also verify with local zoning officials that the prospective neighborhood is actually zoned for the type of entertainment that you wish to provide.

    Lease or buy the building, according to your tolerance for risk. You may also elect to buy out and refurbish an existing bar location, which is a routine practice in Illinois. Additionally, you should check with the Illinois Department of Commerce and Economic Opportunity (DCEO) to research the tax credits and benefits available to locate your business within an Enterprise Zone. DCEO describes enterprise zones as "economically depressed areas of the state."

  • Apply for liquor, food and business licenses. You should actually apply and secure your local liquor license prior to investigating state licensing procedures. You can expect to wait at least 45 days for your local liquor license application to be approved. The distinct incorporated cities of Illinois maintain departments for business, food and liquor licenses that vary by type.

    The Illinois Liquor Control Commission (ILCC) is responsible for establishing and enforcing law related to liquor sales within the state. The Licensing Division has offices in both Chicago and Springfield to guide you through the liquor license application process.Your bar is subject to inspection by local and state authorities.

  • Hire, advertise and promote your new bar until opening night. Your hiring process should serve as an advertisement in its own right to draw attention to the grand opening. Purchase radio spots to announce open calls for bartenders, security, disc jockeys and promoters, in order to generate "buzz." You should then organize a "dry" opening, which is similar to a dress rehearsal for staff, prior to the grand opening.

  • You must constantly monitor and stay out in front of the trends related to your target market. Important trends for the entertainment industry are related to fashion, music, alcohol consumption and technology. Failure to embrace change adversely affects your bottom line because consumers will refuse to patronize an out-of-date bar.

Tips & Warnings

  • Forge strong community relations with the immediate neighborhood bordering the bar. Doing so allows you to build business through these locals, while keeping complaints to a minimum.
  • Bar ownership is a high-risk and high-reward business. The potential for business failure increases within Illinois, because of the inclement weather patterns and the conservative views of Middle America. Most bars will not survive beyond three years.

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