I Want To Open A Hookah Bar...

[bradleyclark86]

So as a college student in a tough economy, I've been doing a lot of thinking about my major. I've also been doing a lot of doubting about my future since my major deals with industry/manufacturing/some mild engineering and that's the field taking the biggest hit right now. Here's my reasons for wanting to open one...

1) I freaking love hookah haha. I don't think I'm addicted, but darn close. Hookah helped me developed some the friendships I have right now. I've also had the chance to educate others about what hookah is really about...none of that NHT nonsense.

2) The nearest hookah bar is 20+ miles away, in the heart of a metropolitan. My goal is to cater to the local college students (Eastern Kentucky University). I know there's a population of students who don't want to go to Lexington; another population that can't get to Lexington due to lack of transportation; and a population that would like a hookah bar within walking distance of campus. I also have some discounts in mind, like: student ID discount, greek week discount, finals week discount, etc.

3) Those populations of students mentioned earlier would bring in A LOT of business. Granted my sales would drop during the summer when everyone goes home, but that's only a couple months. I also might be able to attract some business out of Lexington due to price competition or atmosphere or...etc.

So I'd like some advice from the general public. I know some classes in business and a small business loan are to be expected. Also ideas on themes, lay outs, a name, etc are also welcome.

[Zinite]

http://www.hookahforum.com/?showtopic=11575

[Victim026]

The biggest thing to stand in your way is going to be money... You need to figure out your startup costs and see if it will be feasible for you to even afford this. More then likely you are either need to find private investors or fund this out of pocket so you could need anywhere from 20k-150k to cover startup and your first 1-2 years of business.

[Zinite]

The biggest thing to stand in your way is going to be money... You need to figure out your startup costs and see if it will be feasible for you to even afford this. More then likely you are either need to find private investors or fund this out of pocket so you could need anywhere from 20k-150k to cover startup and your first 1-2 years of business.

Good point. Not quite a 'small business loan'. You'll need money for start up, rent, wages for at least the first year, supply, etc.

[Lunatic768]

what you really need to watch is if they are going to do any kind of smoking ban in the nearish future
you can get burned really badly
ask mushrat
god it sucks so bad

[cotsi95]

So as a college student in a tough economy, I've been doing a lot of thinking about my major. I've also been doing a lot of doubting about my future since my major deals with industry/manufacturing/some mild engineering and that's the field taking the biggest hit right now. Here's my reasons for wanting to open one...

1) I freaking love hookah haha. I don't think I'm addicted, but darn close. Hookah helped me developed some the friendships I have right now. I've also had the chance to educate others about what hookah is really about...none of that NHT nonsense.

2) The nearest hookah bar is 20+ miles away, in the heart of a metropolitan. My goal is to cater to the local college students (Eastern Kentucky University). I know there's a population of students who don't want to go to Lexington; another population that can't get to Lexington due to lack of transportation; and a population that would like a hookah bar within walking distance of campus. I also have some discounts in mind, like: student ID discount, greek week discount, finals week discount, etc.

3) Those populations of students mentioned earlier would bring in A LOT of business. Granted my sales would drop during the summer when everyone goes home, but that's only a couple months. I also might be able to attract some business out of Lexington due to price competition or atmosphere or...etc.

So I'd like some advice from the general public. I know some classes in business and a small business loan are to be expected. Also ideas on themes, lay outs, a name, etc are also welcome.

a bank will NOT give you a business loan for anything dealing with tobacco. The reason is if you business does fail they have nothing to take to sell to repay back the loan. You can only get a personal loan. So you need to figure out if you can afford that or get investors to help. Next see if its even legal to open one. If theres a smoking ban see if there is a loop hole, look at RETAIL TOBACCO OUTLETS since that what a hookah bar is. If there is one NEVER, NEVER call your self a hookah bar or hookah lounge. Just a retail tobacco outlet, try and play down the fact that people will be smoking in there. Then go talk to your city planner and see what you have to do to open. Then look for a space, this is gonna be the biggest problem because the land lord has to be ok with you allowing people to smoke in there. Look for something around 1,500-2,000 sq feet NOTHING more, trust me you dont need it. Your rent should be around 2,500-3,500 a month without triple net. If you really want to make money off it charge per person not per hookah. Dont really worry about getting the tobacco license or what you should carry thats the easy and cheap part. See if you have to have a ventilation system and how much CFM you need to flow per person. I know im leaving a lot out but if you need more info PM me, or just ask on here.

[Sonthert]

I disagree with Cotsi.

800 ft2-1000 ft2 is the best size to be profitable. Contact me if you want more information.

[inino]

money and time are 2 things standing in your way. loan will be hard, and being in college will take most of your time away. not to mention your grades will probably take a huge hit if you become really devoted. best bet is to get a partner. someone who would put down the loan and help you run the place, and of course getting paid back through profits. for a college area lounge 1500 sq should do you good. remember that college kids only go for an hour or so then leave to parties, so get a nice flow of people as opposed to 15 guys who hang all night.

[Dr. B]

take those business courses!

As an accountant and economist, I can't stress enough how communicating expenses and revenues to investors will change their perceptions. Additionally, you'll be paying taxes out the ass and you'll need to know the tricks used to minimize your liability to the various levels of government. If your intent is to focus on cashflow, prepare to hemorrhage for the first years of business. Once established, the cash will return; but with proper accounting you can allocate costs appropriately and minimize fixed costs, making your ROI reflect your levels of output/service. If any of that flew over your head, and you can't squeeze in the classes, and you're still serious, hire an accountant. A CMA or CPA worth his salt will know how to plan for and work with you.

Your customer base, given the specs. on nearest lounge and population density, seems sustainable; but that's no excuse to make optimistic forecasts of revenue.

Good luck, keep us posted.

[Stuie]

Here's a couple things

The E-Myth Revisited
http://www.amazon.com/E-Myth-Revisited-Sma...4923&sr=8-1
Got this after my first business failed, maybe when i have some more cash give it another go.

Advertising, but aside a ton of it for the first year. Takes a lot of money to get the word out in the right campaign for your area. Like when I was doing catering. Spent a fortune on radio, tv, mailings.... what doubled my business just in time so i could break even before my partner quit... Underwriting on an NPR station. By far my cheapest attempt at advertising.

[Sherwood]

A quick search on Craigslist this morning turned up 1 hookah bar for sale outright ($105,000), another for sublet ($4,000/mo), and a third liquidating its assets and focusing purely on being a middle eastern restaurant.

It would appear times are very tough for a hookah bar. It is not a concept that will succeed on its own merits, but rather it takes a shrewd businessman to run it well.

Best of luck to you. I suppose hookah lounges have a similar success rate to most small businesses.

[bradleyclark86]

A lot of what has been said, I already know. So money/investors/starting up will be the hardest part. There's a lot of open property around town so that won't be a problem. Richmond DOES have a smoking ban similar to Lexington, but last I checked, if majority of your income is from tobacco sales, then the ban doesn't apply to your business.

As far as me being in college, this upcoming year is hopefully my last. If this fails, I'll have a bachelor's and associate's to fall back on. I just think I would have more fun running a hookah lounge. I do love hookah, and I think I'm pretty knowledgeable on it. Eastern is also known as a party school. You can find a party on any night of the week so that's a lot of people wanting to smoke before heading out for the night.

Not to sound cliche, but once this train gets moving, I think it will just keep on rolling.

[Sonthert]

I can summarize why most small businesses fail. Laziness and lack of imagination. Using poor quality products, marking them with high margins and expecting to become a millionaire, without doing any real work. Using garbage and stuff everyone else sells. Setting up a website and thinking the money is going to roll in. People will advocate how important advertising and marketing is...of course, those people have a vested interest in selling more marketing and advertising, generally.

Fact: To be successful, you need to apply multiple layers of dickskin...work, work and work. Simple. Do something well and do it for a reasonable price. Most authors you read have no idea how to be successful without being parasitic. You need to commit 100 hours a week to get your business to be successful. Hookah lounges are way overplayed right now. Too many bad competitors. You need to connect to customers on quality and pricing. Small, low overhead, small rent payments, kill them on price and back it up with quality.

[bradleyclark86]

I can summarize why most small businesses fail. Laziness and lack of imagination. Using poor quality products, marking them with high margins and expecting to become a millionaire, without doing any real work. Using garbage and stuff everyone else sells. Setting up a website and thinking the money is going to roll in. People will advocate how important advertising and marketing is...of course, those people have a vested interest in selling more marketing and advertising, generally.

Fact: To be successful, you need to apply multiple layers of dickskin...work, work and work. Simple. Do something well and do it for a reasonable price. Most authors you read have no idea how to be successful without being parasitic. You need to commit 100 hours a week to get your business to be successful. Hookah lounges are way overplayed right now. Too many bad competitors. You need to connect to customers on quality and pricing. Small, low overhead, small rent payments, kill them on price and back it up with quality.

I agree with you on many points. I have no expectations of becoming a millionaire. I just want to be successful doing something that I enjoy. That's my main goal. I've always been told that your career should be something that you would be willing to do for free. Another goal is to provide customers with a quality hookah experience. I've been to some horrible hookah lounges and I would never wish that experience on anyone. I want to provide an open door to a laid back, friendly environment and tasty tasty hookah smoke.

[Sonthert]

Like I said, contact me if you want more information. I like the cut of your jib.

[Tyler]

Things to make sure to have for a college town hookah bar:
Free Wi-Fi for CUSTOMERS! This will make sure that the people who want to use your internet are at least helpign to pay for your bill. Make sure to get a quality connection and router so that it's relyable and fast. Ban things like WoW that eat up a lot of the bandwith.

Comfortable seating. This will make people want to stay longer, possibly spend more money, and enjoy their exp.

NO obnoxious music. Some people can become offended with dirty lyrics or too loud of a volume so they can't talk and enjoy theirselves. In Tallahassee we had 3 main hookah bars and one of them was avoided completely because they played nothing but dirty lyriced rap at a volume to make your ears bleed.

Think about whether or not you want to serve alcohol. The bar I worked at did not. In a party college town, this was a big deal because our rival hookah bar offered achohol, which allowed for "pre-gaming" before parties. Also, this involves more liability and costs.

[shisha fan]

one or more 50 inch plasma screens and a premium cable/satellite subscription so people can enjoy movies/tv shows while laying back and enjoying a smoke.

and grilled cheese sandwiches, and maybe a selection of local and imported beers.