First of all - one 'Golden Rule' that is worth remembering: "The only way to leave Majorca with a small fortune is to come with a big one!"
You may think that is a flipant statement well, it is - and it isn't. Many people come here to buy a business and come undercapitalised. They don't allow for those 'rainy days' because they think there aren't any in Mallorca. Well there are...
We have lived and worked in Mallorca for more than 16 years and have seen bar owners come and go. Many of whom regret the day they invested their hard earned cash into their 'dream'. But on saying that, there are some that have turned their dream into a reality and are on their way to making that small fortune, but the reality of it all is that they they are in the minority.
We cannot tell you what the key to running a successful bar is - other than hard work. Don't come here expecting to make money while you are lying on the beach, you won't. You have to work twice as hard for every £ over here than in the UK, but if you do it properly then you can have a great life.
We have seen bad bars turned into good bars by a change of ownership, and we have seen great bars turned into rubbish bars overnight by the same token. We have seeen miserable, boring and rude people run successful bars, we have seen really great outgoing people run unsuccessful bars. So, what are you gathering by all this so far? Nothing I presume...
We are not, never have been, and probably never will be, Property Agents. On the contrary, I would dearly love to set up an agency whereby potential bar owners pay me to provide then with a confidential report on any potential bars - but that would only be greeted with: "That's a great scam - I'm not parting with £100, or whatever, to somebody I don't know.
OK, fine. In that case, let us pass on our years of wisdom of the area by freely giving you some pointers when buying a business over here:
Many properties and businesses in Mallorca are overpriced
Most bars are sold on a "Trespaso" i.e. you buy the lease and pay rent. Make sure your rental period is for a decent period of time - less than five years is no good, because you won't be able to sell it on
The Summer season lasts from Mid-May to Mid-October. Outside of that don't expect to make much money. Very few bars make money in the Winter. Therefore, you have five months in which to earn 12 months wages.
Don't believe everything agents tell you. There is no recourse, most are not registered estate agents. Anybody can set up in business selling bars. Also, be careful who you take advice off, there are people who have lived here 'five' minutes and know it all (so they think).
If an agent puts you up in accommodation in, say Arenal, and shows you around bars in Magalluf and Santa Ponsa just stop and ask yourself WHY? The answer is, he/she won't want you asking questions around the resort when he/she is not with you ... but the sound advice is MAKE YOU OWN ENQUIRIES from other bar owners. Their reaction will tell its own story.
The busiest time for bars is July and August - if anybody is selling a bar at that time, just stop and ask them why are they selling at a time when they are making the most money.
Check that the property has got the licence it is supposed to have. If you are buying a bar selling food, make sure it has a licence to sell food, if you are buying a music bar, make sure it has a music licence, and always ask to see the "opening licence' because many bars don't have them. Don't rely on the agent to confirm this information, get and 'Abogado' (Solicitor) or "Gestoria' (Business Agent) to check it out for you. It will be money well spent - or well saved.
It's not always the biggest bars who make the most money
...and don't forget the three golden rules to consider when buying a bar are 1. Location 2. Location and 3. Location...
We hope the above will be of some use to you in pursuing your dream. It might sound like doom and gloom. It is not, it is just commonsense. Living on the island is beautiful and, if you run your business and your life properly, then you can have an enjoyable time. We have for 16 years, and hopefully, for many more to come but, there again, we've never owned a bar!
Ann & Ian Morrison
