3 Realities that Nightclub Consultants Evaluate When Buying a Club

Buying a night club from the perspective of nightclub consultants requires a close look at the unique marketing, management and liability issues associated with this kind of business. Unlike other non-hospitality related operations, the success and often failure are tied to events from one or more of these realities when owning and operating an alcohol beverage service and entertainment type business: 1. Short Shelf Life Much like the music and entertainment industry, nightclubs are subject to fickleness and changing tastes of customers looking for the next great hit (and venue). Many clubs only last about three years before being transformed, sold or start losing money as patron interests find the next great wonder in exciting nightlife spots. Others have expanded to multiple locations which helps to create additional income which can off set the ebbs and flow of one or more locations. Developing an exit strategy given its short term life with possibly the help of nightclub consultants with expertise in startups or turnarounds may be the first step to take once you invest. 2. Constant Marketing Filling a club with a steady stream of clientele requires a consistent and regular presence in the minds of patrons. Customers must be kept informed about the next promotion, special event or themed parties to keep them coming to your establishment and not the competition. This constant exposure can only be accomplished by taking advantage of and applying a large amount of time (and possible expense) toward social media, email marketing, radio and/or print advertising and in-house word of mouth sales. Equally important is a planned and properly funded public relations campaign and an ample expense allotment for PR and marketing to garner publicity and awareness through the local press and media on an ongoing basis. 3. Likely Lawsuits Night clubs are more susceptible to litigation that many other types of businesses. The combination of alcohol being served, large crowds of people and close movement about the premises during music and shows can cause unexpected problems. One intoxicated patron driving their vehicle into someone after leaving the premises or a shooting as a result of customers fighting in a bar or club can contribute to a wrongful death lawsuit as a result. This unwanted publicity and a bad reputation in the community can contribute to a loss of income for years. It is essential to consider whether there are adequate policies and procedures to run and operate a safe and secure operation. This may include adding security provisions to avoid increased insurance costs and attorney fees to defend the business. It is also important to know what potential litigation might occur and what steps nightclub management will take to avoid these types of lawsuits before you finalize the purchase agreement. In light of these realities when buying a nightclub or bar, it is also important to factor in the associated returns and costs as part of your nightclub business plan. If you lack the expertise in owning and operating a bar and nightclub, the cost of engaging nightclub consultants may pay for itself several times over before making the mistake of buying or investing in the wrong location and venue.