Thinking of opening a bar in Tenerife.
Sep 18th 2011, 9:38 am
#61
Banned
Joined: Dec 2006
Location: Living in a good place
Posts: 8,824
Re: Thinking of opening a bar in Tenerife.
A professional restaurant will have costed everything. A large one I know in Banus even costed out the price of a bit of salad trimming on a meal! Rents, taxes, utilities are portioned out for pricing. Meat was ordered from wholesale butcher in strict weight portions. They costed that it was cheaper than staff doing it.
See bars in Fuengirola with about 4 people in. They have to pay electric, water to be open. How much profit can you get on that, even if they are drinking themselves silly.
Irish theme bars tend to have had considerable investment in them. The Brit bars on the coast usually have a few plastic patio chairs....some with plastic dusty flowers too
See bars in Fuengirola with about 4 people in. They have to pay electric, water to be open. How much profit can you get on that, even if they are drinking themselves silly.
Irish theme bars tend to have had considerable investment in them. The Brit bars on the coast usually have a few plastic patio chairs....some with plastic dusty flowers too
Sep 18th 2011, 9:44 am
#62
Not Banned (yet)
Joined: Aug 2008
Location: Madrid
Posts: 6,400
Re: Thinking of opening a bar in Tenerife.
A professional restaurant will have costed everything. A large one I know in Banus even costed out the price of a bit of salad trimming on a meal! Rents, taxes, utilities are portioned out for pricing. Meat was ordered from wholesale butcher in strict weight portions. They costed that it was cheaper than staff doing it.
See bars in Fuengirola with about 4 people in. They have to pay electric, water to be open. How much profit can you get on that, even if they are drinking themselves silly.
Irish theme bars tend to have had considerable investment in them. The Brit bars on the coast usually have a few plastic patio chairs....some with plastic dusty flowers too
See bars in Fuengirola with about 4 people in. They have to pay electric, water to be open. How much profit can you get on that, even if they are drinking themselves silly.
Irish theme bars tend to have had considerable investment in them. The Brit bars on the coast usually have a few plastic patio chairs....some with plastic dusty flowers too
Good point about restaurants. You often hear of places run by the famous chefs going bust - didn't Keith Floyd use to go regularly bankrupt? I suppose at that level they concentrate on good food at the expense of profits in order to get the tv bookings, and make their money from books, supermarket deals etc.
Sep 18th 2011, 9:49 am
#63
Banned
Joined: Aug 2009
Posts: 5,008
Re: Thinking of opening a bar in Tenerife.
A professional restaurant will have costed everything. A large one I know in Banus even costed out the price of a bit of salad trimming on a meal! Rents, taxes, utilities are portioned out for pricing. Meat was ordered from wholesale butcher in strict weight portions. They costed that it was cheaper than staff doing it.
See bars in Fuengirola with about 4 people in. They have to pay electric, water to be open. How much profit can you get on that, even if they are drinking themselves silly.
Irish theme bars tend to have had considerable investment in them. The Brit bars on the coast usually have a few plastic patio chairs....some with plastic dusty flowers too
See bars in Fuengirola with about 4 people in. They have to pay electric, water to be open. How much profit can you get on that, even if they are drinking themselves silly.
Irish theme bars tend to have had considerable investment in them. The Brit bars on the coast usually have a few plastic patio chairs....some with plastic dusty flowers too
You forgot about the sauce bottles next to the dusty flowers.
Sep 18th 2011, 10:39 am
#64
Joined: Jun 2011
Location: In the middle of 10million Olive Trees
Posts: 12,053
Re: Thinking of opening a bar in Tenerife.
I can understand why those 2 euro places do it though. Nothing is more off-putting to a prospective punter than an empty bar or cafe. Entice an early crowd in to sample the cheap breakfasts, and you then have a chance of pulling in more profitable customers. Nothing to stop you over-charging for the coffee or tea that most people will drink with the breakfast! Personally I think it'd make more sense to pay an attractive person or two to sit around, so the place never looks empty!
as to coffee, had a coffee in local hospital restaurant - £1.75 to public, £1.20 to staff and it was self service. Downstairs a Cafe Nero or something was charging £1.99 but that was near the entrance.!
most cafe\bars in centre of Granada charge €1.20 although there is one that has been charging €1.00 all summer.
Sep 18th 2011, 10:52 am
#65
Joined: Jun 2011
Location: In the middle of 10million Olive Trees
Posts: 12,053
Re: Thinking of opening a bar in Tenerife.
Any place that does a 2 euro breakfast is either;
Run by a couple doing unsustainable amount of hour because they are on the edge.
OR
If there are any employees, they will have not contracts and get cash in hand at afew euros and hour.
About 12 years ago people used to talk about a place in Benidorm that did a 100 pesetas brekkie, the works, but without tea of coffee included.
The number of folks who "pretended" to think wether the wanted tea or coffee, but then said "no I dont think I could possibly drink another just yet!!!!!
They actually thought they were believed, and not just so tight as not wanting to spend more that the 100 pesetas in the gaff.
Lesson, if you put your prices so low as to attract this type of customer, then you will get the tight assed racanos and it is not really possible to overcharge on the teas and coffees.
By the way you cannot charge more for a coffee or tea to the folks that have a cheapo brekkie, because that would mean you would have to charge all your other customers the same price too.
If they are going in for only coffee, and have to pay more while watching the vultures cashing in on the cheapo brekkies, they will go elsewhere.
This is an example of people going the wrong way about business,punishing what are the "loyal" customer to appease the skint and tight asses.who would show not loyalty if the found a place doing a 1 euro 99cent brekkie.
Only an unprofessional bar owner would think along the lines of givine peeps an expensive item (brekkie) at a much lower price than the competition, and charging more for a cheap item (tea or coffee) than the other places around.
If any owner does that he must be prepared to make no profit on the brekkie with no drink bought, then watch as the full to bursting customer then walks next door to have a coffee and save the extra 10 or 20 cents that the brekkie place charges.
Great business plan, no wonder so many fall flat on their butt if that is the logical thinking that abounds.
Run by a couple doing unsustainable amount of hour because they are on the edge.
OR
If there are any employees, they will have not contracts and get cash in hand at afew euros and hour.
About 12 years ago people used to talk about a place in Benidorm that did a 100 pesetas brekkie, the works, but without tea of coffee included.
The number of folks who "pretended" to think wether the wanted tea or coffee, but then said "no I dont think I could possibly drink another just yet!!!!!
They actually thought they were believed, and not just so tight as not wanting to spend more that the 100 pesetas in the gaff.
Lesson, if you put your prices so low as to attract this type of customer, then you will get the tight assed racanos and it is not really possible to overcharge on the teas and coffees.
By the way you cannot charge more for a coffee or tea to the folks that have a cheapo brekkie, because that would mean you would have to charge all your other customers the same price too.
If they are going in for only coffee, and have to pay more while watching the vultures cashing in on the cheapo brekkies, they will go elsewhere.
This is an example of people going the wrong way about business,punishing what are the "loyal" customer to appease the skint and tight asses.who would show not loyalty if the found a place doing a 1 euro 99cent brekkie.
Only an unprofessional bar owner would think along the lines of givine peeps an expensive item (brekkie) at a much lower price than the competition, and charging more for a cheap item (tea or coffee) than the other places around.
If any owner does that he must be prepared to make no profit on the brekkie with no drink bought, then watch as the full to bursting customer then walks next door to have a coffee and save the extra 10 or 20 cents that the brekkie place charges.
Great business plan, no wonder so many fall flat on their butt if that is the logical thinking that abounds.
they sell up and buy a place with hard earned capital to blow it because they have circumvented the banks and business consultants such as Business Link (in UK). All will insist on you having a properly written Business Plan, showing the SWOT, the CV's of the people concerned, the costings covering rent, utilities, materials etc etc etc.
A good BP can easily run into 20 even 30 pages if it is done properly.
last year I had to advise a guy who had a specific idea, it was a good model, good products, good backup, but he had this idea of a high street shop to front it all. I sat him down and went through what his startup costs would be, ongoing costs for rent, rates, labour etc etc over first 3, 6, 9, 18months. He sank lower and lower in his chair. Then we talked about the product he wanted to sell, the way it would be packaged, handled, environmental rules and training, etc etc. As I say it was, and still would be a good business model. He is now selling double glazing and doing well at it.
Sep 18th 2011, 11:22 am
#66
RETIRED ;-))
Joined: Jul 2003
Location: Benalmadena Pueblo,Spain
Posts: 20,156
Re: Thinking of opening a bar in Tenerife.
I must meet up with some of these Fuengirola oficiandos and let them take me on a tour of the bars.
Maybe we should do a little wager, every bar they take me in that has dusty plastic flowers in I will give them ten Euros and every one that I take them in that doesn`t have them in they can give me just five.
I quite fancy another holiday in Cancun.
Maybe we should do a little wager, every bar they take me in that has dusty plastic flowers in I will give them ten Euros and every one that I take them in that doesn`t have them in they can give me just five.
I quite fancy another holiday in Cancun.
Sep 18th 2011, 12:26 pm
#67
MODERATOR
Joined: Mar 2007
Location: Costa Valencia
Posts: 14,800
Re: Thinking of opening a bar in Tenerife.
"To charge too high a price for a thing."
I have always deferred to the OED but maybe either of you do not.
Graham
Sep 18th 2011, 12:51 pm
#68
Banned
Joined: Dec 2006
Location: Living in a good place
Posts: 8,824
Re: Thinking of opening a bar in Tenerife.
As in Starbucks and Costa Coffee I would say it's more like rip-off, plus the one in marbella who charged 2.50 for a small expresso! Overcharging is deliberately asking for more than the price on the menu...just how I see it anyway
Hang on they could be the same
Sep 18th 2011, 1:04 pm
#69
Joined: Jun 2011
Location: In the middle of 10million Olive Trees
Posts: 12,053
Re: Thinking of opening a bar in Tenerife.
They are wrangling like two old queens
As in Starbucks and Costa Coffee I would say it's more like rip-off, plus the one in marbella who charged 2.50 for a small expresso! Overcharging is deliberately asking for more than the price on the menu...just how I see it anyway Hang on they could be the same
As in Starbucks and Costa Coffee I would say it's more like rip-off, plus the one in marbella who charged 2.50 for a small expresso! Overcharging is deliberately asking for more than the price on the menu...just how I see it anyway
Hang on they could be the samesit down and work out how much a cup of coffe costs you and you will say its what? 10c? But what about the electricity, the use of the cup and saucer and spoon, the sugar? the milk? how much to apportion the drinkers use of 1msq of space for an average of 14.5mins etc etc etc
I don't agree with the prices the majors charge for their product, and a sticky bun for €3.50 that is 75c around the corner. But it all comes down to the desire for Costa Coffee etc being there next year and the year after whilst Jackies Upper Class Cafe will not make out the year.
Sep 18th 2011, 1:48 pm
#70
Banned
Joined: Aug 2009
Posts: 5,008
Re: Thinking of opening a bar in Tenerife.
Because to me there is big difference.
for me the difference is, a 10 euro coffee in a swanky place could be overpriced, but that is the norm there, so I have a choice, pay the 10 or go elsewhere
Over charged is if they charge me 11 euros for said coffee, with or without intention, and if it is brougfht to their attention it will be remedied.
Sep 18th 2011, 6:03 pm
#71
BE Enthusiast
Joined: Nov 2007
Posts: 536
Re: Thinking of opening a bar in Tenerife.
Bad idea.
If you have some money left over from the sale of the house and paying off your debtors, invest it in a business in the UK. I am generally against the idea of franchises, but there are some succesful ones. You will have to get your hands dirty, and basically you are buying yourself a job.
But, it's a better option than the one you have laid out.
If you have some money left over from the sale of the house and paying off your debtors, invest it in a business in the UK. I am generally against the idea of franchises, but there are some succesful ones. You will have to get your hands dirty, and basically you are buying yourself a job.
But, it's a better option than the one you have laid out.
May 11th 2012, 11:05 pm
#72
Just Joined
Joined: May 2012
Posts: 1
Re: Thinking of opening a bar in Tenerife.
Hello everyone!
Id like some advise... from people that are likely to tell me the truth - pitfalls - and "gotch's" that I may run into...
OK - about me.
Im an IT professional of nearly 20 years. Have always worked in IT... and it has usually paid me well.
However the area of IT I specialize in is a very narrow field - and it's collapsing. Last year I lost my job - and since then Iv been unable to find satisfactory work.
So... things are getting serious now. Going to have to sell the house to pay off debtors. That cant be helped. Even if I found a new well paid job today - that would still likely happen.
So...
After the sale of the house - and repayment to my debtors... I will still have a tidy sum of money left.
I could use this to purchase/lease a bar in Tenerife.
I am focusing on Tenerife as it is more of an all year round destination than other holiday locations - and I think I have identified a niche in the market that I could exploit.
Think: Internet bar with a difference. It would be popular with young people... and Id have no difficulty in setting up the internet service and server myself that would be needed.
Anyway... lets not get bogged down in the details of WHAT Im thinking of doing... Im much more interested in advise relating how best to do this.
Iv seen agencies offering businesses for sale in Tenerife... but have no idea how reputable they are. Any advise there is welcome...
What legal processes would I need to go through?
I assume Id need an accountant for the business - any rough guesses on costs and my liability?
What is a "reasonable" price to pay for a business in Tenerife? I realize that current business throughput will have a huge impact on that one...
Eligilabity to work... Tenerife isnt in the EU. Does this affect me? I also might be setting this up with a partner from the USA. Is that a problem? Are non-EU residents allowed to live and work there?
I have no health issues... but who knows. One day something may happen... If I am living and working in Tenerife - and contributing to their tax - I assume I will be entitled to health care. Is this correct?
Supply chain. Am I likely to be ripped off from suppliers and distributors? How would I know? Other bar operators are unlikely to tell me what they pay bottom line for consumables (drinks and food). How should I go about this?
And...
Any other concerns or suggestions you guys think I should look into.. or be aware of... will be gratefully received!
Thanks to you all in advance
Id like some advise... from people that are likely to tell me the truth - pitfalls - and "gotch's" that I may run into...
OK - about me.
Im an IT professional of nearly 20 years. Have always worked in IT... and it has usually paid me well.
However the area of IT I specialize in is a very narrow field - and it's collapsing. Last year I lost my job - and since then Iv been unable to find satisfactory work.
So... things are getting serious now. Going to have to sell the house to pay off debtors. That cant be helped. Even if I found a new well paid job today - that would still likely happen.
So...
After the sale of the house - and repayment to my debtors... I will still have a tidy sum of money left.
I could use this to purchase/lease a bar in Tenerife.
I am focusing on Tenerife as it is more of an all year round destination than other holiday locations - and I think I have identified a niche in the market that I could exploit.
Think: Internet bar with a difference. It would be popular with young people... and Id have no difficulty in setting up the internet service and server myself that would be needed.
Anyway... lets not get bogged down in the details of WHAT Im thinking of doing... Im much more interested in advise relating how best to do this.
Iv seen agencies offering businesses for sale in Tenerife... but have no idea how reputable they are. Any advise there is welcome...
What legal processes would I need to go through?
I assume Id need an accountant for the business - any rough guesses on costs and my liability?
What is a "reasonable" price to pay for a business in Tenerife? I realize that current business throughput will have a huge impact on that one...
Eligilabity to work... Tenerife isnt in the EU. Does this affect me? I also might be setting this up with a partner from the USA. Is that a problem? Are non-EU residents allowed to live and work there?
I have no health issues... but who knows. One day something may happen... If I am living and working in Tenerife - and contributing to their tax - I assume I will be entitled to health care. Is this correct?
Supply chain. Am I likely to be ripped off from suppliers and distributors? How would I know? Other bar operators are unlikely to tell me what they pay bottom line for consumables (drinks and food). How should I go about this?
And...
Any other concerns or suggestions you guys think I should look into.. or be aware of... will be gratefully received!
Thanks to you all in advance
Really pissed off and trying to help others not making the same mistake.
Just came back from Los Cristianos after managing to sell the bar I bought for a fraction of the price I paid.
A piece of advice: make your research before buying a 'traspaso'. Lots of research. Most of the places do not work, but agents will tell you quite the opposite. Do not believe a word. They are struggling too and need to make a life. The only bars and restaurants that work well are not for sale or they ask something stupid. Then, you will pay the 'traspaso', sign for 5 years rent and will realise that you are not making any profits.
About 50% of the units (locales) are closed. Out of the rest, maybe 10% are making money. You will find out that people selling have been usually a few months. Wonder why? They got into the same rat trap I got into. Tourism is not what it used to be there. People do not expend so much out. Only youngsters at night, but be prepared to pay 80-100,000 for traspaso of a night bar (if you like that life), plus 4000 euros rent but this does not guarantee a return.
I hope this helps.
Ian
May 12th 2012, 6:40 am
#73
MODERATOR
Joined: Mar 2007
Location: Costa Valencia
Posts: 14,800
Re: Thinking of opening a bar in Tenerife.
Hi there
Really pissed off and trying to help others not making the same mistake.
Just came back from Los Cristianos after managing to sell the bar I bought for a fraction of the price I paid.
A piece of advice: make your research before buying a 'traspaso'. Lots of research. Most of the places do not work, but agents will tell you quite the opposite. Do not believe a word. They are struggling too and need to make a life. The only bars and restaurants that work well are not for sale or they ask something stupid. Then, you will pay the 'traspaso', sign for 5 years rent and will realise that you are not making any profits.
About 50% of the units (locales) are closed. Out of the rest, maybe 10% are making money. You will find out that people selling have been usually a few months. Wonder why? They got into the same rat trap I got into. Tourism is not what it used to be there. People do not expend so much out. Only youngsters at night, but be prepared to pay 80-100,000 for traspaso of a night bar (if you like that life), plus 4000 euros rent but this does not guarantee a return.
I hope this helps.
Ian
Really pissed off and trying to help others not making the same mistake.
Just came back from Los Cristianos after managing to sell the bar I bought for a fraction of the price I paid.
A piece of advice: make your research before buying a 'traspaso'. Lots of research. Most of the places do not work, but agents will tell you quite the opposite. Do not believe a word. They are struggling too and need to make a life. The only bars and restaurants that work well are not for sale or they ask something stupid. Then, you will pay the 'traspaso', sign for 5 years rent and will realise that you are not making any profits.
About 50% of the units (locales) are closed. Out of the rest, maybe 10% are making money. You will find out that people selling have been usually a few months. Wonder why? They got into the same rat trap I got into. Tourism is not what it used to be there. People do not expend so much out. Only youngsters at night, but be prepared to pay 80-100,000 for traspaso of a night bar (if you like that life), plus 4000 euros rent but this does not guarantee a return.
I hope this helps.
Ian
BE is a very large expat website, so if you have problems finding your way around we have concierges who will try to direct you. The moderators for the Spanish forums are Mitzyboy and Fred James, moderators are there to ensure that the site runs smoothly within the rules of BE. Problems and complaints should always be addressed to a moderador who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are friendly and helpful with a wealth of knowledge of the issues of living in Spain. At the top of the page you will find a quirkily named thread called Free Beer which is full of important and useful information. Hope you enjoy your time participating in the forums.
Please let me know if you need any further help.
Rosemary
May 12th 2012, 9:48 am
#74
On the road again.
Joined: Aug 2008
Location: On Top of the World
Posts: 17,507
May 12th 2012, 2:37 pm
#75
Banned
Joined: Aug 2009
Posts: 5,008
Re: Thinking of opening a bar in Tenerife.
Hi there
Really pissed off and trying to help others not making the same mistake.
Just came back from Los Cristianos after managing to sell the bar I bought for a fraction of the price I paid.
A piece of advice: make your research before buying a 'traspaso'. Lots of research. Most of the places do not work, but agents will tell you quite the opposite. Do not believe a word. They are struggling too and need to make a life. The only bars and restaurants that work well are not for sale or they ask something stupid. Then, you will pay the 'traspaso', sign for 5 years rent and will realise that you are not making any profits.
About 50% of the units (locales) are closed. Out of the rest, maybe 10% are making money. You will find out that people selling have been usually a few months. Wonder why? They got into the same rat trap I got into. Tourism is not what it used to be there. People do not expend so much out. Only youngsters at night, but be prepared to pay 80-100,000 for traspaso of a night bar (if you like that life), plus 4000 euros rent but this does not guarantee a return.
I hope this helps.
Ian
Really pissed off and trying to help others not making the same mistake.
Just came back from Los Cristianos after managing to sell the bar I bought for a fraction of the price I paid.
A piece of advice: make your research before buying a 'traspaso'. Lots of research. Most of the places do not work, but agents will tell you quite the opposite. Do not believe a word. They are struggling too and need to make a life. The only bars and restaurants that work well are not for sale or they ask something stupid. Then, you will pay the 'traspaso', sign for 5 years rent and will realise that you are not making any profits.
About 50% of the units (locales) are closed. Out of the rest, maybe 10% are making money. You will find out that people selling have been usually a few months. Wonder why? They got into the same rat trap I got into. Tourism is not what it used to be there. People do not expend so much out. Only youngsters at night, but be prepared to pay 80-100,000 for traspaso of a night bar (if you like that life), plus 4000 euros rent but this does not guarantee a return.
I hope this helps.
Ian
You are not the only one in the postition of having to sell for a loss, many places are going to the wall.
A lot of bars that are still in business have had to make adjustments to be able to stay afloat a while longer, in the hope of selling soon.
Of course that does not take away the pain in the pocket, but life will be a lot less stressful now.