Buying a Bar in Spain
By: nduncan 2007.10.02
For many years foreigners have been relocating to Spain and buying a bar, especially on the Costas, all with varying degrees of success. Some succeed and countless others fail. Buying a bar in Spain is not as simple as it may first appear and the pitfalls are numerous. There are many legalities that have to be taken care of and you must be aware of the hard work that will be required of you. The first thing you will need is a good agent on your side. Make sure you choose a professional agent who specialises in commercials; not an ex-bar owner who failed in their own bar so have turned to selling bars for a living. They may have experience in running a bar but may not be experienced enough in the legalities or business practices.
The choice of bars available varies considerably from little back street watering holes to full music venues and quality restaurants. The prices vary too from a few thousand pounds up to millions.
If you choose the right agent who should give you clear and honest advice, providing you purchase in the right area, you stand a good chance of making a good living. Do not however, think that running a bar in Spain is going to be an extended holiday! Be prepared for long hours and lots of little problems - all of which can be solved quite simply and most can be prepared for well in advance.
When choosing an agent, ask the following questions:
1. How long have you been selling commercials ? Not how long have you lived in Spain !
2. Do you have an office ? Some agents work from home and you may have difficulty tracing them if it goes wrong.
3. How much commission are you putting on top of the NETT selling price ?
4. Ask other bar owners about the agent and ask about their after-sales service.
By no means is this page intended to be a full guide; the idea is that we give you a little insight into the way things work in Spain and things to be aware of.
Important things to consider when buying a bar in Spain:
Location
If you intend to serve to a tourist market then the coastal strips such as the Costa del Sol are perfect. If you find the right location on the coast you may also tap into the huge foreign resident market. Sea front bars are not always the best choice. They may be busy in the summer but can be quiet in the winter. Back street bars are often the locals for residents, providing that you can give them what they want. The main thing is that you must have passing traffic to stand a chance. There are too many bars in Spain for people to simply go round looking for you [unless you are offering something unique].
Size
The bigger the bar, the bigger the expenses, the more staff you need. Only buy what you can cope with. You may be advised to buy small to start with then maybe move on later to a bigger bar.
Budget
Set your budget and stick to it. If you buy a bar in Spain for ?30,000, make sure you have at least ?10,000 more for the first few months. Don't over commit yourself or you will fail.
Licences
Every bar in Spain must have a licence to open. Make sure that your agent checks this. This is vital. If you buy a bar without a licence [this happens a lot when you buy without an agent], you will almost certainly be closed down within a short space of time. The police are very strict on this and non-compliance can cost you everything. To stage live music in a bar in Spain you have to have a music licence. These are rare and very difficult to obtain. The EEC regulations for such venues are strict and complex.
Costs
On top of your purchase price you will have other expenses;
Your legal fees - check the amount
Rent in advance - normally 3 months
Stock - Initial stock may be included but needs topping up
Staff
You will normally not have any problem staffing your bar in Spain, especially if you need seasonal staff. Be careful though; if you employ staff on a cash basis you stand the chance of being prosecuted ! Talk to your Gestor (accountant) about contracts.
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