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Throwing around the idea of creating a hookah lounge

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  #1  
Old January 8th, 2008, 11:29 PM
freepain
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Default Throwing around the idea of creating a hookah lounge

Me and two of my friends have been smoking hookah together for about a year now and have pretty much decided that we are going to open a hookah lounge come the summer. Now im in no rush to start this out and have it flop. I'm going to be drawing up a business plan in the next week or so to try and figure out what the financial situation is gonna be like. I was just wondering if you guys could help me out with some questions.

How much money do you guys think it would cost to get basic start ups going? (We are looking at fairly reasonable area and the shop we have decided on is about 1500 a month plus expenses. I strictly talking hookahs,tobacco,bowls,ext...)

If anyone has any idea how much a license to sell tobacco in Florida that would be great.

And we are thinking about having a sort of cafe theme during the day till about 8 then we are gonna change it up and try and make it more of a night club. Does anyone see any potential hazards associated with that ?

Just some thoughts thanks for your help guys
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  #2  
Old January 8th, 2008, 11:36 PM
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Default Re: Throwing around the idea of creating a hookah lounge

All I'm gonna say is, good luck! A friend and I were into this idea a couple of months ago with connections and everything, and yet, it failed and never happened...It's expensive for a Tobacco and Alcohol license in Florida, can't remember the exact number though (you might need an investor)...
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Old January 8th, 2008, 11:40 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Investors are actually not the issue we have two individuals that are very well off that are willing to invest in us. I was expecting to need about five thousand to six thousand to get started.
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  #4  
Old January 8th, 2008, 11:43 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Quote:
Originally Posted by freepain
Investors are actually not the issue we have two individuals that are very well off that are willing to invest in us. I was expecting to need about five thousand to six thousand to get started.
That's cool then. I wasn't so fortunate Where in Florida are you planning on doing this?
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  #5  
Old January 8th, 2008, 11:44 PM
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Default Re: Throwing around the idea of creating a hookah lounge

The north Melbourne area
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  #6  
Old January 8th, 2008, 11:49 PM
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Default Re: Throwing around the idea of creating a hookah lounge

It would've been cool if you would've been in the Miami area... We need more hookah lounges here. There is only three I know of. One sucks, the other I haven't been to, and the third is the one closest to me and it's pretty good. But anyway, good luck I hope it works out for you...
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  #7  
Old January 9th, 2008, 02:00 AM
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Default Re: Throwing around the idea of creating a hookah lounge

ok im going to through out very rough figures and just come up with something. you will not even spend as close to what i list in here because no one buys all the flavors of one tobacco and you may not even use that brand of tobacco but ill give something. remember you WILL need at least 3 months rent to start if not more because generally your first year in any business will be the worse year ever and you may only break even if not at a loss.

it all depends on what brands you have. remember to be good get at least one hookah per flavor but you will need more on the more popular ones. if you start with starbuzz and want to stock them all its about 67+ flavors so thats over 60 hookah's you will need, lets say you get 2 each flavor thats 134 hookahs you need. lets say you go egyptian and i mean a decent one so km or mz each hookah wholesale at roughly 20 bucks thats 2680 there.

you are going to need enough money for the rent to cover AT LEAST 3 months if not more so if you get a location at 1500 a month thats another 4500 you need right at the start.

bowls are cheap if you use egyptian ones, maybe 50 cents each on the high end so thats nothing big, one bowl per hookah plus another 20 in case any break so thats 144 bucks there.

hoses are going to be an expense every 2-3 months to replace and each hose will run you about 10 bucks. so lets say you buy a replacement set for each hookah at the very beginning just to store thats another 1340 bucks.

tobacco, if we keep going with the starbuzz it should be at the lowest 12.00 per 250g jar wholesale (no clue what the price is of kilo tubs so going by this) but you will probably pay more. also keep in mind you will go through tobacco fairly easily but lets say you order 1 kilo of each flavor in 250g jars, that will be 6432 in tobacco. in 1 kilo tubs it will be cheaper so lets say its 35 bucks per kilo wholesale and this is just guessing so it may be more, may be less. so thats at 4760 if you stock all flavors of starbuzz.

charcoal, i have NO clue how much this costs wholesale in the big bags they get, dont even know how much to buy it from a store as i have never tried. each bag looks to be about 5 kilo's of charcoal. lets say its 10 bucks wholesale and i have no clue how much you will use a month but i say its a good idea to start with 30 bags because you cant overbuy on charcoal. in the hookah bar i go to they go through one big bag if not more each day though so the 30 guess would probably be a good idea. that would be 300 bucks per month for your charcoal but it may be more or it may be less. if your going to use exoticas i have no clue at the wholesale price but lets say 5 bucks a box. wow i cant even guess how much this will cost because it all depends on customers and how many pieces you put on each hookah so i cant give an estimate but you will probably want to go with bulk charcoal since it is cheaper.

food and drinks....not going to touch this haha but this will be a good chunk of your income so stock well on this.

edit: sorry i didnt even throw in what you where going to do, decorations, tv's or not, sound system, chairs, couches, toilet paper, etc. lets say you use 2,500 to get all that and your place decorated and have all the seating/tables you need

now if we go by all those numbers above and you bring in 3 months rent ahead of time thats almost 14,000. as i said before you may not even use starbuzz you will not buy all the flavors i can almost guarantee that so how many hookah's, how many bowls, and how much tobacco you buy will change all these numbers.

look at it this way at the very least with NO expenses in but the rent you are looking at almost 5 grand to start up. no hookah's, no tobacco, no bowls, no replacement hoses, no food/drinks, and none of your decorations/tables/chairs/entertainment.
also remember when you sign that lease if you fail and you sign a 5 year lease you will be responsible for the full 5 years so you will have to sell that lease or be stuck with a nice 1500 a month bill.

too much rambling...ill stop now....hope this was of any vague use.
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  #8  
Old January 9th, 2008, 02:51 AM
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Default Re: Throwing around the idea of creating a hookah lounge

Yeah 5-6000 is way way way way cheap, I'm in the beginnings of getting a Hookah bar going right now and once more details are set in place I'll make more buzz about it but our initial investment with some money to cover our asses is gonna be somewhere between $30K to $50k depending on how much leeway we end up giving ourselves in the bank... You need to plan this out way more...
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  #9  
Old January 9th, 2008, 05:50 AM
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Default Re: Throwing around the idea of creating a hookah lounge

Rancidmilk is right.... You can't forget insurance which will be a bitch since your business is smoking with hot stuff and what not... Finding an insurance company that will actually insure you.... FInding a place that will allow smoking. Plus license fees which I heard were a good chunk of money.

so I would assume $50k if not way more.

(I too wanted to do a lounge until sonthert and mushrat told me how hard it really is.)
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  #10  
Old January 9th, 2008, 12:32 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Good luck man, thats all I have to say!
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  #11  
Old January 9th, 2008, 12:34 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Oby's right, 50k is a good estimate, I'm still not quite sure if my 30k to 50k estimate is gonna be enough for my plan though...
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  #12  
Old January 9th, 2008, 04:34 PM
Hajo Flettner
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Default Re: Throwing around the idea of creating a hookah lounge

Quote:
Originally Posted by freepain
Me and two of my friends have been smoking hookah together for about a year now and have pretty much decided that we are going to open a hookah lounge come the summer. Now im in no rush to start this out and have it flop. I'm going to be drawing up a business plan in the next week or so to try and figure out what the financial situation is gonna be like. I was just wondering if you guys could help me out with some questions.

How much money do you guys think it would cost to get basic start ups going? (We are looking at fairly reasonable area and the shop we have decided on is about 1500 a month plus expenses. I strictly talking hookahs,tobacco,bowls,ext...)

If anyone has any idea how much a license to sell tobacco in Florida that would be great.

And we are thinking about having a sort of cafe theme during the day till about 8 then we are gonna change it up and try and make it more of a night club. Does anyone see any potential hazards associated with that ?

Just some thoughts thanks for your help guys
I actually opened one and ran it successfully for a couple of years and i'd say you had better be very careful about finding a location, looking into local laws, competition and hundred other things. If you have not turned a decent profit running a cafe of some sort you better partner with someone that has or stop right now.

If you think you can open with 6k you're kidding yourself. When I did it (several years ago in a cheap part of the country during a realty crash) we spent 100K to get going and it wasn't easy. You best go hire someone to get a business plan togeather that is up on cafe scene in your area.
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  #13  
Old January 9th, 2008, 06:16 PM
OBY
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Default Re: Throwing around the idea of creating a hookah lounge

Yeah he is right... I was dead serious about starting one. I never would have thought that it would be as big of a hassle as it really is. I have big props for people that pull it off... It's a tough business!
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  #14  
Old January 9th, 2008, 11:10 PM
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Default Re: Throwing around the idea of creating a hookah lounge

I wanted to do this for a while too, and i thought talking to the local Arab smoke-shop owner would help me get to the next level. I pretty much learned why he doesn't have a hookah lounge, and why he cannot sell alcohol anymore...

And just think about the smoking bans waving across the country...
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  #15  
Old January 9th, 2008, 11:52 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Getting into the narghile lounge business these days is fine if you have the money, a great location and no real competition. Even then with the ever quickening pace of bans and legal liability issues trying to make a living off of anything tobacco related is pretty tough.
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  #16  
Old January 10th, 2008, 07:32 AM
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Default Re: Throwing around the idea of creating a hookah lounge

look i owned a lounge.... don't do it. yeah it sounds fun, and you will make money and all that, but its not worth it in the end when you factor in the stress factor. music, customers (annoying ones) and of course the feared drunks. thats just me...

boom you were way fucking off on prices though! some cheaper, some more..

hmmmm... let me make a list for you to consider and at the end tell me if ya wanna go through with it or not.

1. Location
2. Business License
3. Tobacco license
4. Alcohol License (if you want it, don't recommend it at all) limits your bussines to 21 and over
5. Contracts with you and your friend (trust me do it, its safer)

no in the clear yet

6. inspection time! (yay!)
fire department
health department
and what ever eles is in FL
7. P.O.S system optional (highly recommend if you are going to higher staff)
8. Time to plan the floor... lol floor plan that also has to be checked buy fire department to give Max Capacity
9. Decor.... place has to look decent... your lucky over here there is so much competition it scary 1 street alone has 10 hookah lounges on it in a 5 mile span


If you make it to 10 you almost time to open!

10. Hookahs
Depending on the size of the lounge you want to open you need at least 1 hookah for every person
on the max capacity number.
I would Say about 50-100 hookahs. ( Go Egyptian! last longer hit better and easy to clean)
50 Large KM's @ $35.00 = $1,750
50 Large MZ's @ $30.00 = $1,500

11. Tobacco
No that is up to you
Starbuzz Kilo $40.00
Al Fakher Kilo $22.00
Layalina Kilo $20.00

12. Charcoal.
Go Natural! its cheaper tastes better
10 Kilo Bag= $5-10
remember you don't have to but hookah charcoal! some of the best lounges here use natural Mesquite
Charcoal. the ones from vons, ralphs, albertsons - shit like that.

13. Accessories
With your hookah Purchase i recommend you buy a couple of replacement bases for your hookahs
(They Break all the time)
Base Protectors
Charcoal strainer
Large salad tongs
Heavy Grade Aluminum Foil


14. You Made it! open the doors and start selling hookahs! (enough hookahs to cover tobacco cost, rent, utilities, and insurance!)

When it come down to buying stuff. Hit up the Good Folks at Social Smoke Up! They are the Largest hookah Importers in the USA. They Have Every thing you Need to start your lounge....



Oh and One more thing THINK OF AN ORIGINAL NAME. NOTHING STUPID LIKE HOOKAH BLISS OR SOME SHIT LIKE THAT.

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  #17  
Old January 10th, 2008, 03:50 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Sounds like a major PITA if you ask me. Good luck on your venture though.

Billy
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  #18  
Old January 10th, 2008, 11:16 PM
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Default Re: Throwing around the idea of creating a hookah lounge

This is exactly why i wanted to post here because i really wanted a hands on been threw it answers.
I'm still very much so considering it but im going to make sure everything comes threw before we even get close to setting it up.

We are really lucky we really only have 1 competition in the area. Plus there are 3 colleges located directly in the area. So im going to have to look into investment plans and draw some things up.

But thanks again so much for your guys help
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  #19  
Old January 11th, 2008, 02:26 PM
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Default Re: Throwing around the idea of creating a hookah lounge

I found a link some time ago, where you can get a complete "turnkey" operation. You get a complete business plan, and a CD with tips and hints,etc. I too, have considered opening a hookah lounge in Northern VA as a retirement business.

I have also considered opening a "hookah catering" business, where I would have half a dozen hookahs, and tobacco/coals etc, and have the whole operation in my van. I would cater hookah parties in private homes for $300 a night. provide all hookahs and supplies, and even the Arabian music. it would be a way to 'stick your toe in the water' and not have to come up with $35k.
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Old January 11th, 2008, 05:28 PM
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Default Re: Throwing around the idea of creating a hookah lounge

Quote:
Originally Posted by cemab4y
I found a link some time ago, where you can get a complete "turnkey" operation. You get a complete business plan, and a CD with tips and hints,etc.
tried it, complete waste of time. it went on for the longest time about opening a carwash then near the end went on a little about hookah bars. missing over 1/2rd of the information that it said it was going to have, i knew it was going to be a waste of money but i wanted to see how much it was going to be. if i find the paid link again ill post up the file if anyone wants it.
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  #21  
Old January 12th, 2008, 10:39 AM
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Default Re: Throwing around the idea of creating a hookah lounge

$50k is a lot of money, but it may become really popular, especially if you're in an area where there arent many already. but u just also gotta make sure that you set the right mood in the bar. so decor and sound system is really important, make sure you dont overlook it when thinking about all the equipment.
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  #22  
Old January 13th, 2008, 11:54 AM
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Default Re: Throwing around the idea of creating a hookah lounge

it's definetly a big investment, but totally worth it if u can do it right. if u pull this off i would love to know how u went about doing the business plan and how u went about approching the bank about the loan. I live in an area where the closest hookah bar is a good 3 hours north or south of me so i would love to get something going in my area.
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  #23  
Old January 19th, 2008, 03:01 PM
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Default Re: Throwing around the idea of creating a hookah lounge

I'd be very cautious about getting into this line of business. You need to keep in mind that start up costs are pretty substantial ( in my case 100K) and that you must be able to operate at a loss for several months and often for over a year while still meeting all of your personal bills. We should remember that while narghiles are presently very trendy it could cease being hip any time and business can decline in any area do to increased competition, tax increases, new anti-smoking laws or a decline in the local economy. In Albuquerque, not too far from me, it's impossible to keep a record shop open even when it's a block from a university which shows the local economy is shit. You should note that in some places in order to allow smoking in a retail establishment you need to generate upto 80% of your revenue from tobacco products. For a lot of lounges that simply is not possible as selling drinks and snacks is a major source of revenues. When I had a narghile cafe I had a record shop in the same space which helped a lot in paying the bills and that simply is not an option in a lot of places.

Still, if you have carefully researched everything, have means to get the money on decent terms and know something about running a cafe by all means give it shot. Just be ready to opperate at a loss for a year or more.
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  #24  
Old September 22nd, 2008, 05:31 AM
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Default Re: Throwing around the idea of creating a hookah lounge

I will be one of your customers!
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  #25  
Old September 22nd, 2008, 06:49 AM
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Default Re: Throwing around the idea of creating a hookah lounge

doubt this happened
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