What they need to do to keep the beat going
Summer is the perfect time for making new friends and connections, catching up with old ones and dancing the night away with them all in a nightclub – sometimes not emerging until it’s light again outside!
But operators are reporting that this important rite of passage and critical part of the UK’s night-time economy is under increasing threat and might be a thing of the past quicker than you’d think.
New research from the Night Time Industries Association (NTIA) has revealed that one in five nightclubs (20%) have closed for good since the first Covid-19 lockdowns were instigated in March 2020.
While the trend of nightclub openings v closures has generally been downwards over the past 15 years, the downturn of the previous two years is the most dramatic.
According to the NTIA, there are now only 1,130 nightclubs operating in England, Wales and Scotland. In March 2020, this number was 1,418. Some parts of the country have fared worse than others with the Midlands alone losing nearly 30% of its nightclubs.
In a statement the NTIA said: “Operating cost pressures coupled with consumers with less disposable income have seen the early stages of a recession with slowing ticket sales and visitor frequency.
“The situation is also having a knock-on effect on other businesses. The prices are going up and everyone is trying to save some money because the cost of living is going up day by day and we’re struggling now.
“The culmination of pandemic debt, growing energy bills, workforce challenges, supply chain issues, increased insurance premiums, landlord pressures and product cost increases have created a perfect storm.
“The government needs to recognise the economic, cultural and community values of clubs and the wider night-time economy. We must protect these businesses, using every means possible and recognise their importance before it’s too late.”
A government spokesperson responded: “We’ve stood behind the hospitality sector throughout the pandemic with a £400 billion package of economy-wide support that saved millions of jobs and offered a lifeline to hundreds of night-time businesses up and down the country.
“We recognise that nightclubs are important cultural institutions and key drivers of local night time economies, but no national government can control the global factors pushing up the price of energy and other business costs.”
One of the immediate impacts on nightclubs and other hospitality businesses is the return of business rates. Until June, the industry was exempt but now will receive a 33% reduction meaning they will have to pay 66% of the normal charge for the remainder of the financial year.
Chris Horner, insolvency director with BusinessRescueExpert, said: “As we’ve recently reported ourselves, the entire hospitality sector is taking a beating but nightclubs especially are an intrinsic part of the hospitality and entertainment industry.
“Not only themselves but supporting and symbiotic industries such as takeaways, taxis, smaller pubs and bars that people stop off on their way to the club – all are affected by closures the same way a construction company would be by their main supplier going into liquidation.
“What’s happening with nightclubs might be indicative of a wider change in society and customer behaviour but if you’re running a business you can’t afford to take a sociological perspective on things – you have to act and do it while there is still time to effect improvements and changes.”
Change is inevitable and is the natural order of things. One friend we suggested this to disagreed so we told them to put a banana in a paper bag for two weeks and then reevaluate their position.
Change can seem daunting at first but can ultimately be beneficial and transformative. Toyota began life as a loom manufacturing company after all.
But change works best when it’s done with a sense of agency – not when it is forced upon a person or a business because they are out of options.
We offer a free initial consultation to any business owner or director that wants to change their business for the better or can sense change coming whether they like it or not and wants to make sure they can withstand it.
Once our advisors have an understanding of the unique situation facing the firm then they will be able to run through the various options available to them – often with more scope than they originally thought they might enjoy.
But this is only if they get in touch early enough in the process. If they leave it too late then they could be subject to irresistible change without much scope to adapt to it or take advantage.
Don’t leave things to chance – get in touch today.