Do you want to start a hookah lounge business? Here is the stepwise business guide to launching a hookah bar covering aspects like legal formalities, cost, setup, and much more.
The hookah is actually a water pipe, a kind of smoking apparatus. And it is used to smoke flavored tobacco. The demand for hookah bars nowadays is high globally. In addition, the market is not saturated. Hookah bars are a great destination not only for shisha smokers but also for anyone looking to relax in a laid-back environment.
Hookah Lounge Business Plan Guide for Beginners
To start a profitable hookah lounge business, it is extremely important to follow the following essential steps.
1. Create a Hookah Lounge Business Plan
Create a business plan and include aspects like start-up capital, ownership pattern, location, mission statement, and objectives. A detailed business plan will make you confident in achieving short-term goals and in building a smooth day-to-day operation module.
Here are the topics you must address in your business plan:
- What are the startup and recurring costs of starting a hookah lounge in your city?
- Your target customers
- Pricing Strategy
- How you plan to acquire customers?
2. Name Your Hookah Lounge Business
A proper business name is a critical part of the process of creating a brand. Brainstorm different names and select the one which aptly manifests your hookah business. you can check our guide on how to name a business.
Following are the popular hookah lounge business names:
- Tarboosh Cafe
- Smoke n Stuff
- Pure Lounge
- Puff Cafe
- Pharaoh Hookah
- Sinbad Cafe
3. Licenses & Permits
First of all, check what licenses and permits you must acquire to run a hookah bar in your locality. Ingredients used in hookah should be permissible and not against the anti-tobacco law. And further smoking zone should be separate from the restaurant area if the restaurant also being run on the same premises.
However, the laws vary depending on the location. In addition, choose a business structure under which you are going to run a hookah bar business.
4. Select a Proper Location
Selecting the right location is extremely critical for the success of the hookah bar business. The location should not be far from the city. You need to provide a disturbance-free atmosphere for your customers.
5. Make the Right Set-Up
A great location and space are very important for a hookah bar lounge business. You will need to delicately balance between a low-key restaurant and a social bar atmosphere. Smoking hookah is a very relaxing kind of social activity and you need to concentrate on décor.
Comfortable ambiance and relaxing atmosphere will encourage your client to sit and chill longer. To increase customer satisfaction and longer stays music is important and jukeboxes are the most classic component in the sector.
6. Cost for Starting a Hookah Lounge
A proper estimation of starting and running a hookah bar is a must. The startup cost is largely required for retail space, licenses, insurance, hookah. A minimum investment of around $30,000 will be a must.
Then there is a recurring cost of a shisha that you need to buy in containers. The amount will depend on the number of hookahs you provide to customers.
7. Set Your Profit Margin
Right Pricing strategy is extremely critical in the profitability of the business. Generally, more than two people share one hookah. You can charge by the hour, or on the amount.
Successful hookah bars make a huge amount of profit. They make in the tune of $2,00,000 yearly.
8. Supplies For Hookah Lounge Business
You will need to find suppliers for the restaurant set up. You need to source raw materials for the preparation of hookah smoke and bowls, hoses, disposable hookah, and different flavors of the shisha smoke. Make sure your hookah bar lounge business offers an extensive menu of tobacco options from fruits to mints to floral.
9. Hiring Manpower
Like any other service industry, the most important investment in Hookah Bar Lounge Business is your employees. In a hookah bar lounge business, staffs require special skills. It is absolutely crucial to hire attentive, knowledgeable, friendly personnel.
The success of Hookah Bar Lounge Business largely depends on repeat customers. It is important to have well-trained manpower having skills in establishing a positive rapport.
Related: How To Effectively Manage Manpower
10. Promote Your Hookah Lounge Business
You must go for a grand opening with some entertaining events. You can give some promotion discount on some specific flavors and foods.
A happy hour discount promotion may also encourage your clients to come chill with their friends – a great trick to reach new customers. Create a website with some inside clippings. Ask satisfied customers to give feedback there. Use social media carefully to get clients.