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Nadezhda Klimenko
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- What is a hookah bar
- How to open a hookah bar legally
- What documents are needed to register a business?
- What you need to open a hookah bar from scratch: step-by-step instructions
- Choosing the format and concept of the establishment
- Selection of location and premises for a hookah bar
- Design selection
- Selection of hookahs and other equipment
- Recruitment
- Services provided by the establishment
- How to promote and advertise a hookah bar
- How to keep customers coming back
- What work schedule to choose for a hookah bar
- How much money does it take to open a hookah bar?
- One-time costs
- Monthly costs
- How much profit can a hookah bar bring and payback period
- What is a franchise and what advantages does it provide?
- What problems might you encounter?
- conclusions
In July 2020, the Federation Council equated vapes and hookahs with tobacco products. Now smoking hookah is equivalent to smoking cigarettes and is prohibited in public places. This means that the business idea described below has lost its relevance.
With the introduction of the anti-tobacco law in 2014, the hookah business received a powerful impetus for development. While smoking has become prohibited in all cafes, bars and public places, this restriction has not affected hookah bars. On the other hand, in such an establishment the list of dishes and drinks served is minimized. Therefore, entrepreneurs are opening lounge areas next to hookah bars where visitors can eat, chat with friends and relax. How to open a hookah bar, what investments and documents are needed for this, you will learn from the finished review with a business plan.
Brief analysis of the industry and business features
The fullness of the niche depends on the region. To successfully start a hookah business in Moscow or other large cities, you need to create a unique selling proposition. However, in settlements with a population of less than 1 million people, the market is not full. Create your own business and occupy a niche. When promoting, focus on the experience of metropolitan establishments.
The target audience is persons aged 18–35 years. These are students and working people, full of energy and having an active lifestyle. The age category changes depending on the time of day. During the day, the establishment is visited by students aged 18-24 and freelancers who come to work there. In the evening, citizens aged 25-35 years old come into the hookah bar.
How is a hookah bar different from a bar or cafe?
Nowadays, many establishments have them on their menus, but nevertheless they cannot be called hookah bars. The main difference is that they offer this service as an additional service, quite limited (most often it is a couple of tobaccos to choose from and up to ten flavors), and for hookah bars this is the main source of income. However, to increase the average bill and overall profit, hookah bars often sell drinks, tea and coffee, and sometimes alcohol. A full-fledged bar requires a separate license and additional staff, which significantly increases opening costs. How to open a bar is another question about business with much higher costs.
Simple snacks and sandwiches can also be found in hookah bars. But few people decide to go into the kitchen: this radically changes the profile of the establishment; it can no longer be called a hookah bar in the traditional sense. The peak of popularity of hookah bars occurred the next year after the law on tobacco smoking was issued (June 1, 2014 in Russia and December 16, 2012 in Ukraine). Smoking of tobacco products in public places, including cafes, bars and restaurants, was prohibited, which gradually led to the opening of separate indoor hookah bars as special smoking establishments.
When preparing this article, we asked questions to our clients: Alexander, owner of GoodHookah (Moscow) and Arsen, owner of the Hookahplace chain of hookah bars (Arkhangelsk). We hope their business experience will be useful to you, especially if you are planning to launch a hookah bar as your debut project. Even in large cities with high competition, this is a good option, and in the regions you can even become one of the first.
And also, in order not to lose sales data, track the most marginal items of your menu and protect yourself from employee theft and keep detailed records of tobacco, we recommend installing an automation system at the very beginning. For example, you can try Poster for free for 15 days to understand how such accounting systems work and what they are needed for.
Modern design styles
The interior design of a hookah bar in a modern style attracts fewer smoking connoisseurs, but is also a good idea. What designs will be appropriate?
- Country. Everyone knows that this style is characteristic of the West. The furniture should be as rough in appearance as possible, and the overall design should have rural notes. In fact, everyone should have the feeling that all the elements were installed and assembled “to last forever.” After all, “country” is literally translated as “village.” The only materials you can use are stone and wood. Color range – any natural shades.
- Functionalism. The use of the word “yin-yang” is appropriate for this style. Here you can clutter up the entire space, the main condition is perfect harmony. All interior items should be in perfect harmony with each other. You can use folding shelves, furniture, electronic systems.
- Colonial. Although the style arose quite a long time ago, it is considered modern. Why? Thanks to him, now everyone is trying to recreate the spirit of the past, giving the interior the most ancient notes. The idea is good enough that it is often used.
The place in Russia where excellent interior designers gather is Ulyanovsk. A hookah bar made with the help of their hands will be a godsend for the owner and will bring good profits.
How to open a hookah bar legally?
Opening a real hookah bar is difficult, precisely because of the smoking law. The regulation prohibits smoking in public places. However, this is the main service of hookah bars.
An entrepreneur can try to act within the law and register the organization as a designated smoking area. This will allow you to work on legal terms, but you will have to go through a lot of authorities. Alas, it is easier to take a risk and open an organization whose services contradict the norms of current legislation.
Legal requirements and possible penalties
The list of prohibitions is given in Federal Law No. 15 of February 23, 2013. The regulation states that smoking tobacco is prohibited inside a catering establishment. The rules also apply to smoking hookah with tobacco. It is prohibited to create smoking and hookah rooms in public catering establishments. If the premises are owned by a cafe or restaurant, a ban is also imposed on it. There are no exceptions.
Smoking is not allowed on the terraces of cafes and restaurants. Through the court, you can try to prove to Rospotrebnadzor that the place is not a premises.
The question remains open; cases that go to court are usually considered individually. Violation may result in a fine. The amount of monetary penalty for the violator is 500-1500 rubles. If the incident occurred for the first time, the amount of the penalty will be minimal. In case of a repeated incident, the amount will increase to 1,500 rubles. The organization will also be punished. If the business belongs to an entrepreneur and the establishment is located in a residential building, the fine will be 30,000-40,000 rubles. When the premises are owned by a legal entity, the fine will increase to 60,000-90,000 rubles.
However, the ban is lifted if smoking is done without tobacco and other prohibited substances. It is permissible to use plant mixtures, stones, liquids and other products. But not all visitors want to order such hookahs.
Smoking tobacco is allowed outside cafes and restaurants in specially designated areas. Owners of establishments interpret permission in their own way. They open a separate room with hookahs and design it as another organization. Food and beverages are considered purchased through delivery. The law has nothing to complain about in this case, but there is a risk that the deal will be considered a sham. Another way out of the situation is home delivery of hookah.
An entrepreneur who offers tobacco hookahs can be fined 300,000 rubles. If the violation is detected again, the amount can reach 3 million rubles.
What equipment to choose for a hookah bar
It is planned to spend at least 250,000 rubles on furnishing the premises. Comfortable soft sofas with armrests, armchairs, and low tables will be purchased. Professional lighting will definitely be done to create the proper atmosphere. It is planned to purchase hookah and tobacco from a trusted supplier - an official dealer of a foreign manufacturer. This company is also developing a franchise network in Russia and the CIS countries. The staff will include cooks (2 people), waiters (2 people), hookah workers (3 people) and an administrator. In order to increase labor motivation, wages will be a piece-rate bonus. In total, it is planned to spend 25% of the establishment’s revenue on wages. The organizational and legal form of the establishment will be a limited liability company, that is, a legal entity. The simplified tax system will be used as a taxation system, 6% of revenue. A license to organize this activity is not required.
How important is service in a hookah bar compared to a restaurant or cafe?
“Service is as important to us as the quality of hookahs. Using our example, I will say that it is more important than in a cafe or restaurant. After all, when you know that guests travel across all of Moscow to smoke hookah from one of the hookah vendors, it warms your soul.”
“I think service is very important! Do you really want to return to a place where you weren’t greeted, served poorly, and didn’t see you through?”
Is it possible to use the loft style?
How do you know if a loft is right for the space the owner has chosen? Of course, like other styles, this direction may not fit into the existing layout.
Before you start planning your design, you need to decide a few questions:
- you should decide on the type of loft - which one you like best: rustic, industrial, etc.;
- you need to immediately understand what important and mandatory interior items are;
- It is also advisable to select the color scheme immediately, and in no case deviate from the chosen option.
What do you need to open a hookah bar?
To open a hookah bar, follow this procedure:
- Formulate the overall concept of the organization.
- Familiarize yourself with current legislation. Study the regulations governing the business and activities of hookah rooms.
- Analyze the market and draw up a business plan for a hookah bar with calculations. It is important to describe all stages of opening, calculate possible costs and profits.
- Complete the registration procedure. You can operate as an individual entrepreneur or LLC.
- Rent a room. Cooperation with a cafe, bar or restaurant is acceptable. The establishment must have a good reputation - this will allow it to acquire a constant flow of customers.
- Purchase equipment and hire staff.
- Promote your business.
Documentation
To open a hookah bar from scratch, you will need to register a business. Activities can be conducted in the form of an individual entrepreneur or LLC. In the first case, costs will be minimal, and it will be easier for an entrepreneur to take out a loan for business development. But the person bears full responsibility for the obligations. In addition, an individual entrepreneur cannot sell alcohol. Financial responsibility is an additional risk factor. Choose this form of ownership if you are planning to create a hookah delivery service or a small organization in the form of a closed club.
An alternative is to register an LLC. Business requires a lot of expenses. The size of the state duty increases, there is a need for authorized capital - at least 10,000 rubles. But the company is liable only within the limits of its property. An LLC can sell alcohol.
To sell alcoholic beverages you need to obtain a license. Its price is about 70,000 rubles. To open a hookah bar you will need additional documents:
- certificate of registration of the form of ownership;
- documents on registration with the Federal Tax Service;
- permits from SES, Roskomnadzor and fire service;
- certificate of ownership of the premises or lease agreement;
- agreements with contractors and product suppliers;
- a license to sell tobacco products, if the entrepreneur decides to sell hookahs with mixtures containing tobacco.
For registration, OKVED code 92.72 “Other activities for organizing recreation and entertainment, not included in other groups” is suitable.
If you registered as an individual entrepreneur, you can choose the simplified tax system (USN) tax form: 15% income minus expenses. Most of the money will have to be spent on rent, supply of products, and wages.
Room and interior
Finding a suitable premises for a smoking club is not easy: the place must not only be characterized by high traffic, but also comply with the requirements of legislation and fire safety regulations, and also meet the entrepreneur’s capabilities regarding rent. Looking through various options, many beginners think about whether it is possible to open a hookah bar in a residential building. There is no direct prohibition in this matter, however:
- The club premises must be transferred to non-residential use;
- The hall should be equipped with high-quality sound insulation;
- When planning to open a hookah bar in a residential building, it is necessary to install the air ducts of the exhaust system above the roof of the building so that neighbors do not smell the tobacco;
- A separate entrance to the establishment should not be located from the entrances.
Premises intended for smoking tobacco are subject to separate technical and regulatory requirements, which are mentioned in some examples of hookah bar business plans. According to these rules:
- An entrepreneur should obtain written consent from the property owner to convert the premises into a smoking club;
- Fire evacuation plans must be posted in the hall;
- There must be at least one fire extinguisher for every 100 m² of area;
- The hookah bar should be equipped with a supply and exhaust ventilation system that provides at least 15 air exchanges per hour;
- Connection to electrical networks must be designed for a load of 12–15 kW;
- The room must be able to connect to heating, water supply and sewerage systems.
When calculating how much money you need to open a hookah bar, you should assume that to create a medium-sized establishment you will have to rent and renovate a hall with an area of 100–120 m². The room must be divided by screens, partitions or curtains into several zones intended for receiving clients, and also provide space for a bar counter, bathrooms, administration room, and warehouse.
Smoking clubs differ from other entertainment establishments by their characteristic atmosphere of peace and leisure. Therefore, before developing a detailed business plan for a hookah bar, you need to study the methods of interior design, appearance and specifics of work of similar establishments located in eastern countries. The following tools will help create the necessary mood among visitors:
- Color palette. In general, designers recommend using muted pastel shades, although colorful Arabic carpets and red lighting in seating areas are no less popular;
- Furniture. Soft sofas decorated with a large number of pillows are best for relaxation. Ottomans, frameless chairs and tables with short legs should also be designed in oriental style;
- Sound accompaniment. Music seems to be one of the most effective tools for creating the appropriate atmosphere. Of course, it is almost impossible to select compositions that are pleasing to the ears of the vast majority of visitors, and therefore this issue remains under the jurisdiction of the owner of the establishment. However, the music should definitely be low and unobtrusive in order to avoid creating obstacles for guests’ communication;
- Light. Bright ceiling lighting is contraindicated for hookah bars. Preference should be given to wall or spotlights of low power.
Hookahs and other equipment
For a hookah bar you will need furniture. The best thing is soft sofas - furniture will help visitors relax and create a cozy atmosphere. An additional audio system will be required. It's better not to skimp on it. Background music should not sound too loud, but of high quality.
Pay special attention to the hookahs themselves. They must be of high quality. Smoking mixtures or tobacco should not be bitter or give off an unpleasant odor. If a visitor gets a bitter hookah, he will definitely not return.
Buy several flasks, cups and tubes. Spare parts will be needed if a hookah component fails. Buy cooling tubes - they can be used to make your hookah more saturated. Complete the interior with oriental trinkets. You can purchase pillows with oriental patterns, paintings on this topic and carpets. This will create a pleasant impression of the interior.
Equipping a hookah lounge with an area of 100 m²
Name | price, rub. | Qty | Amount, rub. |
Technical systems | |||
Security alarm | 30000 | 1 | 30000 |
Fire alarm | 25000 | 1 | 25000 |
Ventilation system | 195000 | 1 | 195000 |
Audio system with overhead speakers | 38000 | 1 | 38000 |
Laptop | 18000 | 1 | 18000 |
Multifunction device | 9000 | 1 | 9000 |
Wi-Fi router | 2000 | 1 | 2000 |
Internet connection | 2000 | 1 | 2000 |
Interior | |||
Three-seater soft sofa | 21250 | 16 | 340000 |
Bag chair | 1200 | 16 | 19200 |
Low table | 1500 | 8 | 12000 |
Administrator's chair | 1500 | 1 | 1500 |
Drapery and zoning | 120000 | 1 | 120000 |
Wall light | 1200 | 20 | 24000 |
Furniture pillow | 500 | 48 | 24000 |
Metal hanger | 2200 | 8 | 17600 |
Bar counter | 95000 | 1 | 95000 |
Food equipment and utensils | |||
Ice maker | 12000 | 1 | 12000 |
Coffee machine | 71000 | 1 | 71000 |
Tea cup | 150 | 50 | 7500 |
Coffee cup | 170 | 50 | 8500 |
teaspoon | 50 | 50 | 2500 |
Sugar bowl | 250 | 8 | 2000 |
Napkin holder | 220 | 8 | 1760 |
Other | |||
Cash machine | 12000 | 1 | 12000 |
Fire extinguisher chrome | 3500 | 2 | 7000 |
Hookah storage rack | 3500 | 1 | 3500 |
Lockers for staff clothing | 3200 | 6 | 19200 |
Employee uniform | 1500 | 8 | 9000 |
Plumbing kit | 15000 | 2 | 30000 |
Entertainment and leisure | |||
Checkers/Chess/Backgammon in a set | 3500 | 8 | 28000 |
Cards | 600 | 8 | 4800 |
Domino | 500 | 8 | 4000 |
TV 55” | 45000 | 1 | 45000 |
Hookahs | |||
Egyptian hookah | 2800 | 16 | 44800 |
Forceps | 200 | 2 | 400 |
Hole puncher | 150 | 2 | 300 |
Ershik | 170 | 2 | 340 |
Coal basket | 900 | 2 | 1800 |
Ignition for coals | 1100 | 2 | 2200 |
Hookah cup | 100 | 16 | 1600 |
Spare flask | 1300 | 4 | 5200 |
Two hose splitter | 800 | 8 | 6400 |
Additional hose | 800 | 8 | 6400 |
Total: | 1309500 |
Staff
Hookah bar employees must be responsible for the quality of the work performed. Hire at least 4 people - 2 hookah workers, a cleaner and an administrator - and take on the responsibilities of a manager.
Hookah workers are engaged in interaction with guests. Hire a sociable person with a pleasant appearance for this position. The hookah man finds out the guest's preference, takes the order, makes hookah and tea. At the end of the working day, the employee makes a list of materials that need to be purchased.
The administrator takes phone calls, reserves tables and registers guests. An employee greets visitors, talks about the establishment and prices. Guests are escorted to their table. The administrator's responsibilities include maintaining order. The person is in charge of the cash register. The administrator receives goods, places orders for suppliers, manages a group on social networks, and informs about new interesting offers.
The cleaning lady is responsible for maintaining the cleanliness of the premises. She comes at the end of the day and cleans up the room.
You will also need a manager - a person who will control the opening and closing of the establishment, promptly resolve emerging issues, interact with tax authorities and maintain accounting. The manager is responsible for hiring and firing staff and issuing wages.
Staffing schedule of the hookah bar
Position | Rate, rub. | Qty | Amount, rub. |
Hall administrator | 30000 | 2 | 60000 |
Hookah man | 30000 | 2 | 60000 |
Waiter | 20000 | 2 | 40000 |
Cleaning woman | 15000 | 2 | 30000 |
Tax and insurance payments | – | – | 57000 |
Accounting services | – | – | 5000 |
Total: | 252000 |
Marketing
The main audience of the hookah bar is young people and middle-aged people. Therefore, it is wise to advertise on social networks. It is necessary to create a group or community; you can organize a repost competition about the opening of a new establishment. As a reward, give the winner a few hours of free hookah. Invite presenters and musicians to the opening, hold themed parties, show imagination and creativity.
Organize actions. Example – “Bring 3 friends and get a hookah as a gift.” Organize a system of discounts after a certain number of visits. Use flexible prices depending on the time of day. Until 17:00 you can set the price of a hookah at 500 rubles. Visitors arriving later will pay 800 rubles. Students will gather during the day, and a more solvent audience will gather in the evening.
Event marketing is beneficial. Invite live music performers and stand-up artists. Organize film screenings and other events.
Promotion of a hookah bar
How to open a hookah bar according to the law and avoid fines for promoting its services? After the introduction of the provision banning any promotion of tobacco use, owners of completely legal smoking clubs were faced with the following:
- Advertising materials cannot depict not only people smoking, but also objects associated with this process - pipes, hookahs and their parts, tongs and other accessories;
- Advertising must not mention or encourage smoking;
- Booklets can only be distributed to interested adults;
- Leaflets and flyers cannot be posted or placed in mailboxes;
- It is formally prohibited to publish advertisements on social networks.
Of course, some neglect these requirements, but when choosing between legal and illegal ways to promote a hookah bar, it is still better to prefer the first option: the risk of fines and even the closure of the establishment is not justified by the immediate increase in the number of customers. However, there are not many legal ways left:
- You can promote a website containing information about the hookah bar and the services it offers, as well as a table booking mechanism. Access to the resource should be limited to persons who have confirmed their majority;
- Social networks remain a good way to advertise small businesses in 2020. The community page must contain a warning that the materials published here are prohibited for viewing by persons under 18 years of age;
- Word of mouth also works great for hookah bars. Exclusive offers (for example, a special mix or a hookah man trained in Arab countries) in combination with the high-quality provision of basic services can arouse active interest among the target audience;
- A hookah bar operating in the format of a closed club needs to constantly use its established contact base and interact with clients who have previously visited the establishment. You can send them information about discounts or promotions by email or SMS, inform them about upcoming events and new services.
What equipment to choose for a hookah bar
To open a hookah bar, you will need the following equipment: It is necessary to purchase high-quality modern hookahs, costing 10,000-15,000 rubles each.
- coal, tobacco, smoking mixtures;
- replaceable cups, tubes and hoses;
- spare flasks;
- mouthpieces, flask brush, tongs, foil.
- Collauds
In addition, the hookah bar should be equipped with upholstered furniture and it is advisable to arrange the interior in an oriental style. An atmosphere of rest and relaxation should reign here. The premises for a hookah bar should be spacious, which can be divided into small rooms, up to 10 sq.m. and each client can smoke in a separate room. All hookah bars must be equipped with ventilation and a fire safety system.
Hookah bar structure
From the very beginning of work, it is necessary to calculate and approve the structure of the hookah bar. Each employee of this institution must clearly know his duties and fulfill them. Employees are responsible for the quality of services provided. Three hired workers will be enough to serve visitors. When the hall is not completely filled with people, one is enough. Table 2 presents the responsibilities of personnel depending on the position held. Table 2 – Responsibilities of hookah bar employees.
Job title | Responsibilities |
Hookah man | This position is for a sociable, friendly person with a pleasant and attractive appearance. His responsibilities include: identifying the visitor’s preference, advising on the choice of hookah flavor, accepting and placing an order, and serving the client. The prepared hookah should please the visitor; if this is not the case, then the work must be redone. The hookah man tries to please the client. He also monitors the serviceability of all equipment, the availability of clean hookahs, different flavored types of tobacco, compiles lists of missing raw materials, and passes them on to the club administrator. Works according to an individual schedule. Salary depends on the qualifications of the hookah operator. |
Administrator | Like the position of a hookah man, the administrator must be a sociable and pleasant person, since his main job is to communicate with guests. His responsibilities include: answering calls, booking tables, meeting a new visitor and taking him to the reserved table, talking about the hookah bar and planned events along the way, ensuring that order is maintained in the club, the presence of everything necessary on the tables and in the hall, registering new clients, issue them club cards, etc. He accepts funds from clients. The administrator must be able to operate a cash register. He also receives previously ordered goods and compiles a list of missing ones together with the hookah man. The administrator is also in charge of the hookah bar’s social media page, which he must maintain and update regularly. When finishing his shift and closing the hookah bar, he cleans up. If something suddenly breaks, you should call a specialist. The work schedule, as in the case of a hookah man, is selected individually. Salary also depends on the performance of duties, the qualifications of the employee and by agreement with the business owner. |
Manager | At the very beginning of work, the owner of a hookah business can be the manager to save money. His responsibilities include: concluding the necessary contracts for the supply of necessary goods, monitoring the opening and closing of the establishment, promptly resolving all unexpected issues, working with the tax office, and accounting calculations also on him. The manager must select qualified personnel for the hookah bar and fire them if they fail to fulfill their assigned duties. Sets and pays salaries to employees. Resolves issues to improve the quality of customer service, analyzes their requests and wishes, and improves service. The club is developing according to his business plan. The work schedule is individual, as is the salary. |
As your business develops, you can additionally hire another administrator, cleaner, accountant and manager.
Is it profitable to open a hookah bar in a small town?
The question of the profitability of a hookah bar always remains open. It mainly depends on the presence and number of competitors. It will be very profitable to open such an establishment in a small town if there are practically no competitors. If your establishment becomes the only one providing such services in a large area of the city, then this will be a very big plus.
Even if there is a competitor nearby, try to surpass it in all respects. Make an original design of the room. Hold themed events for guests. Provide them with a free hookah when ordering for a certain amount, and also get your own club cards that will give discounts to regular customers.
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Range of services
When listing what is needed to open a hookah bar from scratch, among other activities it is necessary to mention the development of an assortment of hookahs and leisure facilities offered by the establishment. In addition to regular tobacco, an entrepreneur can include a huge number of flavored mixtures in the hookah card:
Hookah fillers
Flavors of tobacco mixtures | |||
Apricot | Grape | Coconut | Mint |
A pineapple | Cherry | Cinnamon | Peach |
Orange | Pomegranate | Latte | Rose |
Watermelon | Melon | Lemon | Plum |
Banana | Jasmine | Raspberries | Chocolate |
Vanilla | Strawberry | Honey | Apple |
Fillers for bowls and flasks | |||
apple | pomegranate | juice | absinthe |
grapefruit | melon | wine | sambuca |
a pineapple | milk | cognac | rum |
Entrepreneurs who are struck by the thought: “I want to open a hookah bar,” sometimes pay excessive attention to the organization of leisure time for visitors, forgetting about the main goal - selling hookahs themselves. In order not to distract guests too much from smoking, you can limit yourself to the following entertainment:
- Board games. This category includes backgammon, chess and checkers, cards, lotto and even the well-known Monopoly;
- Gaming consoles. They should be used with caution, since during the game customers not only forget about the hookahs, but also make noise, thereby creating discomfort for other visitors;
- TV programs and films. A more neutral option that allows you to attract a specific target audience to watch sports broadcasts or popular films. However, we should not forget that guests with other interests may be disturbed by too loud a sound.
Investments
Opening a full-fledged hookah bar can hardly be called a business idea without investments from scratch in 2020: the cost of the hookahs themselves is low, but repairing and decorating the hall, buying furniture, installing a ventilation system will require much more significant investments from the entrepreneur:
Initial Investment
Article | Amount, rub. |
SPD registration | 4000 |
Rental during renovation | 75000 |
Design project | 100000 |
Repair work | 300000 |
Signboard | 25000 |
Equipment | 1309500 |
Marketing expenses | 20000 |
Administrative expenses | 10000 |
Total: | 1843500 |
When figuring out how much it costs to open a hookah bar in Moscow, some of the values given here should be increased by 30–50%: for example, finding a company willing to carry out repairs at a rate of 3,000 rubles/m² is quite difficult. Rent near metro stations with high traffic can also reach 1,500–2,000 rubles/m² per month.
Step-by-step plan for opening a hookah bar
- Select a premises that complies with the standards of Rospotrebnadzor and Fire Supervision;
- Find sources of project financing (own funds + loan)
- Find suppliers of equipment and quality raw materials (tobacco, hookahs)
- Register a legal entity
- Carry out repairs and redevelopment of the premises in accordance with legal requirements. Obtain the necessary permissions.
- Select staff and train them
- Work out the hookah recipe
- Launch an advertising company
Revenues and profitability
Obviously, entrepreneurs are primarily interested in the question of whether it is profitable to open a hookah bar. To determine the profitability of an establishment, you need to make some calculations using basic input data - the cost of the service and the expected attendance of the club.
Analyzing the data presented on the Internet, you can see that hookah bars, with slight variations, set the price for hookahs in the range of 900–1200 rubles, changing it depending on the type of tobacco, filler for the flask and the use of fruit as a bowl. If each company stays at a table for two hours, then a club operating from 12:00 to 2:00 can theoretically sell 56–60 hookahs per day. However, in the initial stages you should not expect such an intense flow of customers, so when making calculations you should assume that the establishment will be half-loaded. The cost of one hookah prepared with wine, juice or milk for a company of four people is:
Operating expenses of a hookah bar
Article | Amount, rub. |
Rent | 75000 |
Communal payments | 15000 |
Payroll | 252000 |
Consumables | 363150 |
10000 | |
Connection | 2000 |
Administrative expenses | 5000 |
Security alarm | 3000 |
Insurance premiums for individual entrepreneurs | 2300 |
Total: | 727450 |
Cost of hookah
Name | price, rub. | Qty | Amount, rub. |
Tobacco | 8 | 15 g | 120 |
Coals | 4 | 4 things. | 16 |
Foil | 1,5 | 1 PC. | 1,5 |
Disposable mouthpiece | 3 | 4 things. | 12 |
Paper napkins | 3 | 8 pcs. | 24 |
Coffee or tea | 20 | 4 things. | 80 |
Filler for flask | 150 | 0.7 l | 150 |
Total: | 403,5 |
Considering how much it costs to open a hookah bar from scratch in the format of a full-fledged smoking club, you can calculate the main economic parameters of the enterprise and calculate the payback period for investments:
Economic indicators of hookah bar
Name | Meaning |
Cost of hookah | 403.5 rub. |
Hookah price | 1000 rub. |
Number of hookahs per day | 30 pcs. |
Daily turnover | 30,000 rub. |
Monthly turnover | 900,000 rub. |
Monthly expenses | RUB 727,450 |
Profit before tax | 172550 rub. |
Tax simplified tax system 15% | 25880 rub. |
Net profit | 146670 rub. |
Profitability | 20% |
General investment | 1843500 rub. |
Payback period | 12.5 months |
Obviously, this business is distinguished by good profitability and guaranteed payback even with a minimal flow of visitors. However, an entrepreneur must be prepared for the fact that he will have to invest at least two million rubles in the business, and then expect their return within a year.
Video on the topic
What is a franchise and what advantages does it provide?
Let's discuss the idea of opening a hookah bar as a franchise. What it is?
Franchising (or commercial recession) is a type of cooperation in which the brand owner, for a certain monetary benefit, grants the partner the right to use his trademark, technology and production secrets.
“Monetary benefit” means a one-time payment (lump sum), as well as regular deductions in the form of a percentage of profits (royalties). Some franchisees do not require this and only charge an entry fee.
How does franchising work? Let's say there is a well-known network of hookah bars in Moscow and they want to expand in all regions. This network enters into an agreement with a partner, provides assistance from marketers, and helps him open an establishment. It will operate under the same name as the Moscow network.
A franchise is a good option for beginners who want to work under the wing of a well-known brand, receive comprehensive assistance from A to Z and save money (usually a franchise business is cheaper than opening it on your own). However, there are nuances and disadvantages to this form of cooperation.
pros | Minuses |
A ready-made and proven model for a successful business | You work under someone else's brand, not your own |
Ready-made design solutions, mixtures with exclusive mixtures, branded equipment and accessories | Commitments in terms of design, assortment, menu |
Opportunity to purchase raw materials and equipment at a discount | Many franchisees are obligated to purchase goods from a specific supplier; changing contractors is prohibited |
Saving money, a franchise is always more profitable | The need to pay a lump sum fee and royalties (not always) |
Quick business launch | |
Expert help |
It is worth noting that brand popularity is not the main factor that you need to pay attention to. After all, the establishment may be the most popular in Moscow, but in Execution they have not heard of it. Therefore, when evaluating franchise offers, pay attention to the cost, the franchisor’s obligations and your benefits.
What is the cost of starting this business?
The goal of the business in this case will be to open a popular hookah restaurant offering popular dishes, hookah, alcoholic, hot and cold drinks to its guests. In order for the establishment to accommodate everything you need and be spacious for visitors, you will need to rent an area of approximately 200 sq. m. meters. The premises should include a kitchen, a reception room with booths and tables, a couple of restrooms, the necessary storage rooms and utility rooms, a refrigeration compartment, a bar counter and an administrator’s work area.
In order to open such an establishment, you will need to invest an average of about 3,000,000 rubles .
The profitability of the enterprise will be approximately 35%.
The payback period for such a business is about 6 months with a competent marketing approach.
In order for a business to produce good results, the following tasks must be completed:
- try to receive a stable profit from the enterprise every month;
- meet the needs of guests and visitors fully;
- implement a wide range of menu items;
- create the face of the enterprise, a brand that will stand firmly against competitors;
- make plans for the future, implying an increase in the network of hookah bars throughout the city and region.
The recreation area for hookah bar guests will be designed to accommodate 50 people at a time. The design of the room is best done in a cross between oriental and neutral styles. The hall should have several booths with sofas and many tables for 4 people.
The kitchen must be properly equipped for the work of cooks, equipping the room with everything necessary.
So the initial costs will be:
- advertising campaign - 150,000 rubles;
- arrangement of the premises - 750,000 rubles;
- purchase of necessary equipment - 750,000 rubles;
- purchase of goods, products and consumables for the first month of work - 1,150,000 rubles;
- associated expenses - 200,000 rubles.
9.Risks and guarantees
In the process of operation, a hookah bar may encounter certain risks that must be taken into account at the planning stage. Their assessment and prevention measures are described in Table. 5.
Table 5. Assessment of project risks and measures to prevent their occurrence or their consequences
№ | Risk | Probability of occurrence | Severity of consequences | Prevention measures |
1 | Lack/shortage of experienced personnel in the market | average | average | Personnel training by the manager, internship, offering the most favorable terms of cooperation than competitors |
2 | Unannounced inspection by inspection authorities | low | low | Work within the legal framework, a ban on the sale of alcohol and food, staff knowledge and compliance with legal regulations, availability of all necessary documents, a ban on entry to minors |
3 | Increased competition | average | average | Application of all competitive advantages, discount system, more active work with potential clients through social networks |
4 | Low profitability of hookah bar | low | high | Revision of pricing policy, expansion of assortment, search for new ways of positioning, working with clients through social networks |
5 | Decrease in quality of purchased products | low | average | Changing suppliers, searching for new supply channels, maintaining relationships with several suppliers |
6 | Rent increase | low | low | Concluding a lease agreement with a fixed amount of payments in rubles, readiness to increase the rent by the time the agreement is extended |
Registration of activities
What is needed to open a small hookah bar: a novice businessman must draw up documents for an individual entrepreneur or a limited liability company. If you plan to serve goods without nicotine and at the same time sell alcoholic beverages, then you need to register an LLC.
When opened, the following package of documents is collected:
- papers on registration of an individual entrepreneur or LLC - in the latter case, the charter of the enterprise and relevant orders are attached;
- certificate from the Federal Tax Service on tax registration;
- clearance from the fire inspectorate, sanitary-epidemiological service and Roskomnadzor;
- lease agreement or title deed;
- contracts with suppliers and product certificates.
Important! A simplified taxation system is used for work – 6%. Reporting documentation is submitted to the tax office before March 31 of the following year.
Advantages and disadvantages of the hookah business
The advantages of such a business include the absence of seasonality. People will always go to eat and relax.
The second advantage is that low competition in a small town and a good advertising campaign can achieve really high income for a hookah club.
The third point is the high demand for hookah services in Russia, because it is already very common in Europe and is trending.
The cost of opening such an establishment and the financial model itself are not that expensive, with a high payback and profitability rate.
The pitfalls and disadvantages include the fact that you will have to constantly coordinate the work of the establishment with the SES and firefighters, and this often requires unauthorized costs.
In addition, it is very important that employees undergo medical examinations on time; this will have to be closely monitored, monitoring everyone.
We reviewed the hookah bar business plan with calculations of profitability and profitability. It is worth concluding that this business is very in demand and popular, which is very important for the hookah business and the catering business in general.
If you are still in doubt whether to open this particular business or invest in something else, then read the reviews of the owners of similar establishments in cities similar to yours. With such information, you can draw logical conclusions and make decisions based on them.
In addition, a restaurant and a hookah bar always offer a wide range of options. You can hold events for large companies in the establishment, organize weddings and other celebrations, as well as combine a restaurant and a nightclub. This can bring you even more income.
If you definitely decide to start organizing just such a business, then do not forget to initially calculate, think through and analyze everything. The preparation stage is the most important on the path to business success. Take the time to read the literature, as well as all other possible sources of information that you will have access to.
Only a competent approach and prudence will allow you to build a company that is firmly on its feet.
Minors
How to work with minor clients? Just let in only those who are over 18 years old and only with a passport. If there is any inspection, and you have minors in your establishment, then problems will definitely not be avoided. Under no circumstances, no matter what money they offer you, do not let minors in. Otherwise you will create a lot of problems for yourself.
The simplest option is to keep a journal and record each client in it. Check your passport and fill out some information in the log. And also have the client sign that he agrees to be in a room where people smoke.
conclusions
A hookah bar is a promising direction for a budding entrepreneur. The demand for establishments is growing from year to year, and operating costs are small (you can meet the amount of 700,000–1,500,000 rubles). Moreover, the annual income here reaches 2 million rubles or more. However, as in any business, success here depends on a number of factors. If you choose the right premises, create a cozy atmosphere and offer visitors a quality product, this business is doomed to success.
Sources
- https://www.equipnet.ru/org-biz/razvlecheniya/razvlecheniya_442.html
- https://joinposter.com/post/how-to-open-hookah-bar
- https://volgoust.ru/v-sfere-uslug/gotovyiy-biznes-plan-kalyannoy-s-raschetami-2020-goda.html
- https://FrMall.ru/biznes-plany/post-kalyannaya/
- https://Delen.ru/biznes-idei/kak-otkryt-kaljannuju.html
- https://www.openbusiness.ru/biz/business/biznes-plan-kalyannogo-kluba/
- https://goincome.ru/biznes-plan-kaljannoj
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Hookahs
You can start with simple Khalil Mamoon hookahs, Egyptian. These are the most popular and high-quality hookahs in Russia. They are relatively inexpensive; for 2-4 thousand you can assemble a good hookah. In general, Egyptian hookahs are usually of good quality, regardless of the brand. To begin with, you can take five pieces if the room is not large.
Over time, hookahs can become more expensive. But they will not differ much in quality and smoking experience. Basically, the overpayment occurs due to a more impressive appearance. Their price can be from 8 thousand rubles and above.