Bar Decor

The Present Situation:

The neighborhood bar has few decorations. Forget the now-common fancy, loud, or bland wall paintings, wallpapers, and MDF ceilings. We're talking about fun stickers, wall plates, small posters, and creative accessories.

For instance, the kind that says "Friends Don’t Let Friends Get Thirsty," or something similar.

You don’t see these, not because bars don’t want the small décor stuff, but rather because it’s a hassle to source them. There isn't one place where bars can easily acquire decorations.

More importantly, bars put a lot of effort into décor at the start, but afterwards, not much changes. It's all about running the business. They rarely actively search for bar-specific décor.

Yet, they would be tempted to purchase a funny sign impulsively and place it next to the counter if it's affordable.

What then would happen if you place fun affordable bar décor in front of bar owners?

 

 

Context

·         No. of bars in Kenya – Over 60,000 ( Source – NACADA)

·         Competition in the bar business is growing

·         Standard ‘kawaida’ bars are growing in popularity in response to the present economic conditions

·         Differentiation in the bar business is based on service, relationships, price, location.

·         Bars survive on customer loyalty. They want the customers to keep coming back.

·         Increasing regulatory pressure.

 

The Opportunity

The opportunity lies in becoming the go-to supplier for bar décor, offering standard items that bars can purchase without hesitation.

These are not necessarily expensive top-tier decorations, but rather everyday items that bar owners impulsively buy to enhance their space.

For example, a funny sign priced at no more than Kshs. 200, an interesting table cover priced at Kshs. 1500, and other items priced at Kshs. 100, and so on.

By providing these everyday décor items, bar owners will recognize your business as the convenient destination for their decorating needs.

Bar owners would recognize you as the go to place for everyday décor items

 

How It Would Work

 

ü  You could either make the items yourselves or buy ready-made items. Making the items yourself doesn’t necessarily mean investing in machinery; rather, it involves being the creative mind behind it and then finding a graphic designer and printer to produce the items.

ü  The alternative, or rather complementary approach, is to purchase relevant ready-made items and sell them at a profit.

ü  The target market would fall into two groups: new bar owners and existing bar owners. Finding new bar owners could be through the internet, perhaps via an ecommerce website, social media, proactive or passive advertising.

ü  New bar owners may already have a budget for décor and are likely to be more willing to spend generously on it. They are the kind of customers who are likely to opt for higher-ticket items.

ü  Existing bar owners have less motivation to purchase additional décor, and often they may not have set aside money specifically for such items.

ü  Their purchases are likely to be impulsive. This implies that you have to actively promote your products to bar owners or managers, either through door-to-door sales or by selling to them online.

ü  A possible model could involve packing your goods, hitting the road, landing in a town, and going from bar to bar to sell your products.

Characteristics of the Product

·         Aesthetically appealing

·         Durable

·         Fairly priced

·         Wide variety

·         Unique

·         Frequent new designs

·         Creative

·         Relevant

·         Funny, Witty, Interesting

·         Aligned to the needs of the bar owners

 

Product Possibilities

- Stickable rubber decorations

- Bar related small and large stickers

- Aluminum decorative plates

- Wooden decorative plates

- PVC mats

- CNC cut designs (available in various materials such as wood, acrylic, or metal)

- Bar-themed artwork or prints

- Wall-mounted bottle openers

- Vinyl wall decals with humorous quotes or designs

- Tin signs with humorous or nostalgic artwork

- Wall art or prints featuring iconic images or landmarks

- Toilet signs

- Bar mirrors and any creative decorative work

 

Revenue Model

·         Produce or buy, add a margin, and sell at a profit.

·         Expenses are the cost of production and the cost of distribution.

 

Validation

A significant number of bars investing in décor already.

 

Back of the Envelope Calculations

ü  Margins vary between products. Based on current market rates, if you decide to make your own products, you can expect minimum average margins of 20%.

ü  For existing standard bars, the average monthly spend is around Kshs. 1000. With a 20% margin, this translates to Kshs. 200 profit per bar. If you sell to 20 bars in a day, your total revenue would be Kshs. 4,000.

ü  Keep in mind that to sell to 20 bars, you might need to visit around 40 bars, considering not all of them will be open. Salespeople will assist you in reaching more potential customers.

ü  After the initial sales, you'll gather the contacts of the owners, allowing you to promote through platforms like WhatsApp.

Process

·         Conduct a quick survey: Jog your mind about potential products, decision-makers, sales timings, perceptions, and target bars.

·         Identify items to sell.

·         Determine the source of items: Make your own or buy them from suppliers.

·         Decide how you will distribute them: Consider options such as using motorcycles (buying or leasing), public transportation, or your own vehicle.

·         Acquire the items needed for sale.

·         Choose the region to start with.

·         Obtain the necessary licenses.

·         Get started with your business operations.

·         Refine the sales process, train sales assistants, and optimize your product offerings based on feedback and market demand.

 

Challenges

·         Acquiring products at a competitive price

·         Bar opening times

·         Missing owners and decision making managers

·         Unpredictable government policy on bars

·         Low barriers to entry thus always on threat of competition 

·         Competitive pricing

 

Haters

Objection: “How many bars have you seen with these kind of décor?”

Counter: “And there lies the opportunity”

Objection: The barriers to entry are low. Soon everybody will be doing the same

Counter:  The edge will be in creativity, relationship building and selling skills.

Objection: Nowadays bars don’t have profit

Counter:  Sure times are tough, thus the more pressure to remain competitive.

Resilience to economic downturn

This business will be negatively affected by an economic downturn. However, this is the same reason that to an extent pushes growth of this kind of business. The bar will do all it can to keep customers. The décor is a low cost effort to do so.

Competition

Competition is from a variety of suppliers who sell various décor. None has positioned themselves as the bar décor place, more so for the mass market standard bars.

 

Purchase frequency

Once a month

Substitutes

 

·         Hand written decorations

·         Hand painted decorations

·         General, non-bar décor  

Critical Success Factors

·         Choice of products

·         Sales skills

·         Strategic pricing

·         Effective marketing

·         Strong customer relationships

·         Adaptability to market trends

·         Quality customer service

·         Efficient distribution channels

·         Continuous innovation and product development

 

Inspiration

Bar Products

Etsy

What do you think ? Please leave a comment below.