Industry Analysis & Industry Trends
The music has stopped for many nightclubs during the past five years. Legislation that has extended licensing hours for other drinking establishments and banned smoking indoors in public buildings has removed the industry's main competitive advantage. Late-night revellers once had to go to nightclubs, but they can now stay at a pub or bar and enjoy a wider selection of drinks, cheaper prices and a more relaxed atmosphere.
Nightclubs have also come under pressure from the economic downturn, which has made clubbing unaffordable for many. Those who have continued frequenting nightclubs have chosen to take advantage of cheap supermarket alcohol to pre-drink before leaving home, constraining revenue from drinks sales... purchase to read more
Industry Report - Industry Investment Chapter
A significant amount of labour is required to operate a nightclub. This has increased somewhat in the past five years, especially with the approval of later operating hours. Nightclubs often hire a high percentage of part-time employees (almost 70%), to give themselves the leeway to maintain a particular wages-to-revenue ratio in a volatile market.
Labour investment in the industry is moderate. For every £1 invested in capital, including the use and replacement of buildings and fittings, an estimated £3.48 is spent on wage costs. Variation in the capital-to-labour ratio largely reflects the current state of the overall economy. Tighter credit conditions and a riskier investment environment have been reducing capital expenditure... purchase to read more