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From envisioning your dream venue to coming up with unique cocktails, opening a bar has many moving parts to consider. With the right approach, that goal can become a reality. Not only that, it could also become a profitable reality. According to IBISWorld, industry revenue for bars and nightclubs in Canada has grown at a rate of 11.3% annually over the past five years to 2025, reaching $2.9 billion in sales across categories like distilled spirits, wine, beer, ale and cider.
As an aspiring bar owner eager to tap into this growth, it’s important to understand the different startup costs involved in opening a bar — from renovations and equipment to marketing — as well as how to manage those costs by leveraging the right tools.
So, how much does it cost to open a bar in Canada? This guide breaks down what you need to know to set a realistic budget and ensure your bar has what it needs to attract crowds and thrive.
How much does it cost to open a bar in Canada?
Costs can vary depending on the type and size of bar, but it can cost anywhere from $208,500 to upwards of $1 million, according to Cabaret Design Group* While it can be a significant investment, opening a bar in Canada is achievable with preparation and smart decisions. To help you map out your path to success, here are some factors to consider and key expenses to budget for.
Key factors impacting the cost of a bar opening
Standard bar startup costs
There are both one-time investments and ongoing expenses to be aware of. Big one-time startup costs include things like a lease deposit or a down payment if you’re purchasing a bar, renovations, furniture, décor, initial inventory and equipment, which are essential to get started and welcome customers.
Ongoing costs are those you’ll pay every month or annually to keep your business running, like your rent or mortgage, payroll, licence and permit renewals and inventory replenishment. As you fund your venture, you’ll need to balance upfront spending and keeping enough cash flow to sustain operations while your business grows.
Renovations and interior design
Turning your space into the bar of your dreams could require some work, and will depend on whether you’re starting from scratch or taking over an existing space. Build It estimates that restaurant interior design for things such as flooring, lighting, seating and your bar counter can cost anywhere between $85 to $500 per square foot (build-out included). For a 600-square-foot bar, you’re looking at a range of $51,000 to $300,000 depending on the complexity of the project.
Equipment
You’ll need refrigerators, ice machines, dishwashers, draft or cellar systems, glassware and cocktail-making tools. To give you an idea of costs, a backbar cabinet can start at around $2,000 and a draft beer cooler at around $1,800, based on prices from a supplier like KAF Restaurant & Bar Supplies.
Specialized items may cost more but can be worth it to differentiate your offerings. For example, if you want to open a wine bar, you’ll need a broader variety of glassware. Wholesale glassware prices can start at a bit over $1 a glass for shot glasses to over $5 a glass for wine glasses.
Don’t forget bar equipment like cleaning supplies, computers, filing and storage cabinets and other basics that are easy to overlook.
Bar point of sale system
Beyond the tools required to make drinks and serve guests, you’ll also need solutions that help your business run smoothly behind the scenes, like a point-of-sale (POS) system, which includes both the hardware and software you need to accept and manage payments.
A bar POS system like Square can streamline daily operations from the moment a bartender takes an order to the moment you sit down at the end of the day to look at sales reports. It includes powerful inventory management capabilities to help you track usage, keep an eye on stock levels and manage costs.
Features like bill-splitting and tipping give customers a smooth checkout experience while reducing friction for your team. There are different hardware options based on your unique needs, from card readers like Square Terminal ($399 plus tax) and the ultra-portable Square Handheld ($449 plus tax) to Square Stand ($249 plus tax), which turns your iPad into a sleek POS.
While some providers charge monthly fees, you only pay a small fee per transaction when you make a sale with Square.
Licences and permits
- Liquor licence: Whether you manufacture alcohol on site if you have a brewery, sell alcohol to-go or simply serve drinks for people to consume in your bar, you’ll need a liquor licence. Regulations vary depending on the province or territory, but there are typically strict rules around age restrictions for patrons, operating hours and total sales volume. Fees vary too, but a liquor licence can cost between $1,055 for a two-year licence in Ontario and $4,400 for your first year in British Columbia (a one-time application fee of $2,200 plus a first-year fee of $2,200 when the licence is issued).
- Business licence: A business licence gives you the right to operate your business in your jurisdiction. It tends to cost a few hundred dollars. In Saskatoon, for instance, it’s $135, whereas in Calgary, you’d spend $327.
- Food premises licence: If you prepare and serve any kind of food, including snacks, you’ll need a food premises licence, which you typically get through your local public health unit. Again, the requirements and costs vary depending on location, but it can range from $75 for a small establishment in Prince Edward Island to $950 in British Columbia.
- Music licence: If you play recorded music or host live acts, you’ll also need to go through Entandem music licensing (yes, even if you stream Spotify on your phone). The costs depend on your venue’s capacity and how you plan to use music. For example, if you host live performances, the fee is 3% of what you paid entertainers annually, subject to a minimum fee of $89.76, plus taxes.
Other licences and permits might be required for things like signage or having a patio. The easiest way to figure out the rules that apply to you is to use BizPal, the government’s licence and permit search tool.
Insurance
If you serve alcohol, liquor liability insurance is a must. Let’s say a customer drinks too much, leaves your bar and causes damage to a car parked on the street. Liquor liability insurance would protect you from any financial losses if you were held liable for serving them drinks.
You’ll also need other types of commercial insurance to fully protect your business and workers, such as a Commercial General Liability (CGL) insurance policy, which covers accidents, and workers’ compensation insurance. It is mandatory when you have staff and acquired through a provincial board.
According to iOrders, a full-service restaurant that serves alcohol and has 15 employees can expect to pay $600–$750 monthly for a comprehensive insurance package. This is a ballpark, as bar insurance often includes premiums related to the percentage of your revenue that comes from alcohol sales. But you’ll have the peace of mind of knowing your business and customers are protected, allowing you to focus on creating an amazing bar experience.
Initial inventory
Stocking your bar with liquor, beer, wine, mixers and garnishes s another step, and the costs involved vary greatly depending on the type and size of bar and menu. To give you an idea, Profitable Venture puts the cost of stocking a new sports bar with a wide range of liquors, wines and beers at $20,850,* though you might get away with less than that if you have a very small bar with a basic menu. And you can get creative with your resources to make the most of your budget.
For example, mixing top-shelf spirits and more affordable options can help balance costs. You may stock three different kinds of vodkas, reserve the cheaper one for mixed drinks and offer customers looking for something more premium the option to pay extra for other brands.
Marketing and branding
A recent BDC study revealed that Canadian small businesses spend $30,000 a year on marketing on average. Signage alone can range between $2,500 and $4,000, according to Sign Impact.
Thankfully, you can leverage tools like Square Online, which allows you to create a professional website for free, to market your bar without spending a fortune. “We needed to get online, and without a huge team to build our digital brand, we needed a solution that would provide functionality as well as a great-looking online store. Square allowed us to do so quickly and easily,” said Stuart Wheldon, CEO of Junction Craft Beverage Co. in Toronto.
When you set up and sync your Google Business Profile with your Square Online site, you’ll also be able to manage your Google presence, which is essential for a bar business.
Consider your launch strategy to determine additional marketing needs: Will you be hosting a special event for your opening, complete with PR outreach and media coverage? A grand opening event for a restaurant, which is similar in nature, can cost from $1,500 to over $5,000, according to Second Consulting.
Tools like Square Marketing can help you market your brand after the initial buzz of your launch with features like built-in email collection and the ability to easily create custom email campaigns. And with Square Loyalty, you can encourage customers to return, earn rewards and take advantage of personalized incentives.
Extra fund
Ideally, you want to set aside an extra fund to give yourself breathing room during the early days of your business. Calculating your cash runway, a metric that tells you how long you can sustain operations before running out of funds, is a good idea. The BDC shares this formula: Divide your cash balance (the amount of cash your business holds) by your burn rate (the amount of money you expect your business to spend monthly).&
For example, if you have $100,000 cash on hand and your burn rate is $20,000, you have a cash runway of five months. Knowing this can help you put aside a a safe buffer to have on hand when you launch. That way, you won’t be caught off guard if renovations take longer than anticipated or a permit fee pops up.
Bar startup costs by type of bar
The type of bar you open impacts the answer to how much does it cost to open a bar in Canada, since it might affect the space, inventory and staff required.
For example, bars that serve food have higher startup costs requirements, such as the need for a fully functional kitchen, but a food menu creates another revenue stream and can encourage customers to stay longer, come back more often and spend more.
According to Cabaret Design Group, a neighbourhood bar can cost between $208,500–$417,000; a high-end cocktail lounge between $556,000–$1 million+; and a restaurant-bar buildout between $695,000–$1.4 million.*
Here are a few common bar types and the different factors that impact their bar startup costs.
Sports bar
Sports bars tend to be larger venues with higher seating capacities, as groups often flock to them when games are on. They also require a bigger tech setup in terms of audio and screens, which can drive up costs. But they tend to do well when tied to sporting events, which translates into consistent spikes in sales.
Cocktail lounge
With a cocktail lounge, the bar is set high for ambiance and craft. Hiring experts mixologists means you’ll face higher staffing costs and you’ll need a solid brand to differentiate your concept. Premium spirits, specialized ingredients and elaborate décor all matter. That said, cocktail culture is going strong in Canada, and you’ll also be able to charge a premium for craft cocktails to boost margins.
Wine bar
Even if you’re passionate about wine and heavily involved in curating the wine list, you’ll still need to spend money on proper storage systems to preserve your selection, and your glassware will need to match the quality of the wines being poured. But wine bars tend to be smaller and more intimate, which makes them an accessible entry point into bar ownership.
Pub / hotel bar
With a pub or hotel bar, you’re typically looking at extensive seating and a more diverse menu, which requires a full kitchen setup, a bigger food inventory and a larger team. According to s.t.o.p Restaurant Supply, operating a small-scale kitchen could cost anywhere from $15,000 to $100,000 when you factor in costs like construction fees, equipment and staffing needs. However, this also means you’ll be able to tap into multiple revenue streams, from offering brunch on weekends to hosting events like trivia night, which can help with profitability.
Nightclub
Opening a nightclub requires high upfront costs and ongoing expenses due to a typically large venue size, elaborate lighting and sound systems, DJ fees and security staff. But if you can build a loyal following, the potential profits are equally high.
Dive bar
A dive bar can be a more budget-friendly option thanks to no-frills décor and simple menus. It decreases your bar startup costs, but you’ll still need to factor in rent, payroll and licensing. Dive bars can turn into neighbourhood spots that attract regulars, which can result in steady revenue.
Brewery
Opening a brewery requires investing in brewing systems, fermentation tanks and specialized licences to be able to brew beer on your premises. According to Swoop Funding, you could spend anywhere from $250,000 to several million upfront. But the potential for scaling is there if you want to sell wholesale canned beer products, for instance (canned beer has surged in popularity in Canada, according to IBISWorld).
Costs related to bar location and lease vs. purchase
Leasing a venue is a common path to opening a bar, as it’s quicker, less capital-intensive and gives you the opportunity to test-drive a location before making a long-term commitment. How much does leasing a bar cost?
According to Build It, you can expect to pay around $550,000 to rent or lease your location. A commercial lease term in Canada typically lasts anywhere from three to 10 years and you should expect to give a security deposit of one to three months worth of rent when you sign..
Here are recent averages from Statistics Canada’s commercial rents services price index for some of the country’s biggest cities:;
- Toronto: $113.6/sq. ft.
- Vancouver: $117.3/sq. ft.
- Montreal: $109.1/sq. ft.
Knowing the price per square foot can help you compare options more objectively. A higher price per square foot isn’t always bad. Bigger venues have higher rent, but you may also be able to maximize seating and drive more revenue. On the other hand, you can also make the most of a smaller space with a smart layout to lower your rental costs.
Buying a property is another route. If you’re certain about your location, it gives you more stability and, in the long run, an appreciating asset. You’ll likely need a down payment of at least 20% of the property’s value to finance the purchase.
How much does it cost to buy a bar? Pricing varies based on the bar type and location, but recent listings range from $350,000 for an oyster bar and pub near Banff, AB to $3,300,000 for three Kelseys locations in Ottawa, ON.
Whether you lease or buy, you’ll also need to consider how much work is required to transform the space into a venue with personality and purpose. Renovating a tired-looking bar can end up costing more than moving into a space that’s ready for customers, but it also gives you the chance to fully personalize the venue to match your concept.
Whether you lease a turnkey space or purchase and renovate a venue with potential, what matters the most is choosing an option that aligns with your budget, goals and vision.
Bar staffing costs
Hiring employees is an important step. A knowledgeable, engaging bartender can turn a one-time visitor into a regular. Friendly, attentive servers affect your online reviews. And your manager is the backbone of daily operations.
The size of your team depends on your unique business, size, type and hours of operation. You’ll want to learn about minimum wage rates and regulations in your province or territory. There are specifics that apply to the bar industry, like Quebec’s lower minimum wage rate for employees who receive tips.
Being fair with tips can also help you retain team members in an industry known for its high turnover. Tip-pooling is a common practice, which means that everyone (including back of house staff like kitchen cooks and bussers) shares the tips collected during service. The process doesn’t have to be overwhelming. A tool like Square Shifts takes the guesswork out of calculating tips and planning payroll.
Bar inventory costs
You may wonder how much to spend on liquor when starting from scratch, and, the truth is, there is no black-and-white answer to this question. According to Profitable Venture, stocking a new sports bar with a wide range of liquors, wines and beers can cost you about $20,850*, though you might get away with less than that if you have a very small bar with a basic menu. If you plan on serving food, you’ll also have to stock your kitchen.
A consultant can help you make initial projections and stock your bar within your budget range. Afterwards, you or your bar manager can use inventory management software to forecast stock levels, control costs and reduce waste, since regularly replenishing your bar is going to be a major recurring cost.
The better you are at understanding and managing your inventory, the more you can identify opportunities to increase profits. Square can help you sync your sales and inventory data in real-time. Let’s say that you notice that your old fashioned delivers the best margins. You decide to run a promotion on the cocktail on Saturdays, which are your busiest nights. Or maybe you realize that a craft beer brand is super popular with your customers. You can use insights about sales volume to negotiate a better deal with the supplier.
In several provinces, you have to go through the official government store to make wholesale alcohol purchases. For example, the LCBO is the exclusive wholesaler for Ontario bars and restaurants as of 2026. The LCBO website notes the formula to calculate wholesale price is: Retail Price – Container Deposit – HST (13%) –Discount (15%) + HST (13%) + Container Deposit = Wholesale Price
In Quebec, the SAQ is the provincial-run liquor store. It doesn’t offer wholesale pricing, and bars and restaurants have to pay the full retail price. In British Columbia, you need to go through the LDB. You can register to access the wholesale hospitality catalog and view pricing.
Bar operating costs
When you’re doing the math to estimate how much does it cost to open a bar in Canada, you should also be aware of your operating costs, which are the expenses needed to keep your bar running. They fall in three categories:
- Fixed expenses: Rent or lease ($113.3/sq. ft. on average), utilities ($2,000+ if you have a kitchen), insurance (about $600–$750 monthly) and licence renewals (a few hundred dollars per licence/permit) that remain relatively stable each month or year.
- Variable costs: Staffing (usually between 25–35% of total sales), inventory replenishment, marketing and any other expenses that fluctuate with sales volume.
- Maintenance and repairs: Equipment repairs, cleaning and any other upkeep required to keep the bar in good shape.
Track these expenses from the get-go, as you have to drive enough sales to make a profit after all bills have been paid. Calculate your break-even point, which is the stage at which revenue equals costs and you’re no longer operating in the red, to make a realistic financial plan.
A bar POS system like Square gives you real-time sales and performance data and integrates with accounting software to help you stay on top of your numbers and thrive.
Bar marketing costs
Marketing can be a significant variable cost, as you may invest in monthly support like social media management and also pay for ads, run special events or spend on influencer partnerships. An established business may need to put aside at least a couple of thousand dollars a month to cover marketing bases, but that’s not always necessary when you’re starting out.
As a new bar owner, turning to alternatives like Square Marketing can be a smart decision to effectively build your brand on a budget. Email campaign promoting happy hour specials or inviting customers to a special event can be sent out in minutes. Want to target customers who have bought your canned beer in the past? You can send them an exclusive discount with a few clicks. And, thanks to real-time reports and analytics, you can tweak marketing efforts based on data and improve them as you go.
If you want to invest in more support as you grow, a BDC survey revealed that Canadian small business marketing costs average just over $30,000 a year ($2,500 monthly) while businesses with 20 to 49 employees spend $60,000 yearly on average ($5,000 monthly). This can include working with freelancers or agencies to outsource services like social media management or influencer marketing.
Tips to manage bar operating costs efficiently
Running a bar can be capital-intensive, but you can maximize profits with the following cost-management tips:
- Use a bar POS system: A POS system like Square can streamline all aspects of operations to maximize resources, from managing orders more efficiently on the floor (and in the kitchen if you serve food) to improving staff scheduling and creating marketing campaigns.
- Negotiate supplier contracts: Shop around and negotiate, even for basic supplies like paper towels, as small savings add up. As for alcohol, you can work with specific liquor suppliers through your government-run wholesaler, which acts as a distributor.
- Invest in energy-efficient equipment: Look for appliances with high ENERGY STAR ratings to reduce your utility bills.
- Optimize labour costs: A tool like Square Shifts can help you optimize your team schedule based on sales data. You can schedule less employees during quiet periods and have a bigger team on busy nights to cut down on payroll costs without damaging the customer experience.
- Track inventory to minimize waste: Roughly estimating the ingredients your bartenders use in cocktails isn’t going to cut it. Track inventory to spot issues like over-pouring before they become chronic problems. Square can help you streamline that process too.
How much does it cost to Open a Bar FAQs
Can I run a bar without serving food?
It depends on the province or territory, as liquor laws vary across Canada. But even if it’s not mandatory, it’s encouraged to align with responsible alcohol service best practices.
For example, the Alcohol and Gaming Commission of Ontario (AGCO) encourages businesses that serve alcohol to actively market food by providing a range of food menu selections, offering reduced food prices during the late afternoon and evening and having low-cost, low-salt snacks or food at all times.
How can I run a bar successfully in Canada?
To run a successful bar in Canada, focus on delivering a unique customer experience. IBISWorld data shows that Canadians are increasingly choosing to consume alcohol at home, with per capita alcohol intake dropping over the last five years, so you’ll want to entice them with a great menu and even greater customer service.
Managing costs effectively is also key to maximize your chances of success. Track inventory closely, optimize labour costs and negotiate with suppliers to increase profit margins.
Finally, prioritize safety and compliance by following provincial or territorial regulations and keeping all your licences and permits up-to-date.
