It’s an old cliché, but it’s true. For many nightclubs the location will determine success or failure. Opening a nightclub in a place that has failed before is often a big mistake. It’s also important for a nightclub to cater to the demographics of the people in their immediate area. For example, it probably isn’t too wise to open a hip-hop club in an area filled with retired senior citizens.
A major oversight in the nightclub industry is assuming that if you build it they will come. Often nightclub owners spend heavily on decor and leave nothing in their budget for advertising. Successful nightclub owners are masters of marketing and understanding what their customers want. They also understand advertising and are often able to create events that gains them free publicity. Smart nightclub owners make contacts with local radio DJs and newspaper writers with audiences that meet the demographics of their nightclub. They also understand “frontal marketing”, which is how a nightclub looks from the outside, and includes signs, paint and can even include the type and age of vehicles in the parking lot.
Good employees are the backbone of any business in the nightclub industry. On the other hand, bad employees can bring a business down. Employee theft in a nightclub can range from a bartender not ringing up a few drinks a night and putting the money in their tip jar, to having full bottles of liquor stashed in empty boxes and placed in a dumpster, for the employee to grab later.
Not knowing and following all state and local laws and regulations can put a nightclub out of business overnight. Serving minors can be a cause for arrest, lawsuits and fines. Even things such as how big or bright your signage is can cause legal hassles. Having a good attorney on retainer is essential for any night club owner.
Many bartenders feel an urge to over-pour. It is essential to have a system in place that can inventory how much alcohol is poured and can hold the bar help accountable. Simply pouring 1 1/2 ounces per cocktail instead of an ounce results in an increase of 50% in alcohol costs. This is often the difference between making money and losing money in the nightclub industry.