There's a lot of legislation you'll need to comply with if you're thinking of running a late night leisure outlet. You'll find all you need to start up and run your own night club business in our practical guide.
- Research your target market
- Establish your customer profile
- Your facilities and services
- Getting a licence
- Promoting your night club
- Buy an existing business
Research your target market
It's important to do all you can to find out whether there is enough local demand for your night club. Be aware that the late night economy is very competitive and that you will be competing directly against other clubs, bars and licensed venues as well as indirectly against other entertainment venues that stay open late, like cinemas. There are also growing concerns that late night disorder, drunkenness and noise need to be curbed and in some areas local authorities have taken steps to limit or prevent new night club licences from being granted or have imposed restrictions on opening hours on new licensees. Before going too far with your planning it makes sense to check with the local licensing authority and the police that you have a reasonable chance of obtaining a licence.
Check out the competition in your area to identify:
- how many existing night clubs and pubs with late licences there are
- the types of customer they target
- their opening hours
- the types of music they play and whether this varies throughout the week
- their entry fees and bar prices
- any special offers and promotions
- how popular they are
This might immediately show you that there is a gap in the market for a certain type of club, for example incorporating a stylish restaurant area.
It would also be helpful to find out how many nights in a typical week are 'big nights out' - nights when large numbers of people normally visit existing clubs in your area.
Research current trends, plus legal and tax issues
Establish your customer profile
It is likely that a very large proportion of your customers will be young people between 18 and 25 years old, although you might also decide to have special nights for more mature clubbers or for teenagers (where you would only serve soft drinks). You might also hire out part or all of your venue to private parties and these might be members of the public celebrating birthdays, weddings and so on or business people, for example holding a launch party for a new product.
Special offers, discounts and promotions
You may decide to offer customers a variety of discounts and special offers, such as:
- cheaper entry fees at the beginning of the week
- free entry for women on some nights
- student discounts
- a free drink on entry before a particular time
- promotions on certain drinks brands - but bear in mind that the licensed trade is committed to discouraging 'binge' drinking and 'irresponsible' promotions are banned
Don't forget to brief your staff thoroughly on the discounts that can be offered. Guard against staff offering unauthorised discounts to their friends and family.
Give some thought to the dress code that you will insist on. For example, you might specify smart casual, with no jeans or trainers. Perhaps the dress code will vary on different nights. Make sure your dress code is widely publicised. You will also need to put in place an ID policy so that staff do not admit anyone who is under-age - and decide whether you will restrict entry to people over a certain age, such as 21.
Your facilities and services
The range of facilities and services you offer your customers will depend to a certain extent on how spacious your premises are. For example, you might plan to operate from a three-storey building which you would split up in the following way:
- ground floor - bar and restaurant serving meals at lunch-time and in the evenings
- first floor - cocktail and snack bar serving drinks until late at night. This area might have plenty of seating
- second floor - bar and dance floor
Or you might decide to split your premises up into different rooms, each of which offers a different type of music such as:
- 60s, 70s, 80s and 90s
- drum and bass
- soul and pop
- house and garage
- indie and alternative
- techno and hard house
- metal and rock
Alternatively, you may choose to have a single large room, with only one type of music being played. Bear in mind, though, that one of the things that puts clubbers off is not liking the music played in the club. Having different rooms with different types of music can be a way round this.
There may be the opportunity to create chill out areas if you have enough room and an outside terrace or balcony is likely to be popular in nice weather.
Other attractions you might offer your customers include:
- large screen TVs
- pool tables
- amusement and quiz machines
- food and drink and other vending machines
- cash machines
Some night clubs have installed cash machines on their premises.
Think about how you will keep customers coming back to your club. Ideally you will gain a reputation for promoting new musicians and DJs and for keeping up with musical developments. For many clubs it's essential that the venue remains fashionable, stylish and inviting and this may mean frequent refurbishments and replacement of fixtures and fittings.
Many clubs have smaller areas which they are prepared to hire out for private parties - and in some cases members of the public or organisations such as college societies can take over the whole club for a really large gathering. Think about how much you would charge for private hirings and what the fee would include - for example, you might offer catering facilities such as a buffet.
In common with the rest of the licensed trade the run up to Christmas and over New Year is often a peak period for night clubs. February is likely to be a quieter month and, if many of the customers are students, college holidays are also likely to see a fall in numbers.
Within the week, Thursday, Friday and Saturday are the busiest days and many night club operators try to attract clubbers during the early part of the week by targeting a certain age group (such as offering safe events for teenagers where no alcohol is served) or offering reduced entry fees or promotions. Sunday is becoming more and more popular as a club night out.
Getting a licence
Under the terms of current licensing legislation, anyone wanting to run a night club in England, Wales and Scotland is required to apply for two licences - a premises licence and a personal licence.
A premises licence is a single licence that covers all aspects of how a night club operates including the supply of alcohol, regulated entertainment and late night refreshment (although in some cases late night refreshment may be exempt from the licensing requirement). Premises licences are issued by local licensing authorities and require applicants to demonstrate how they will promote the four Licensing Act objectives of preventing crime and disorder, ensuring public safety, preventing public nuisance and protecting children from harm. Each local authority has standard conditions to ensure these objectives are met. These may cover matters such as:
- fire safety, including escape signage and escape routes, alarms and fire fighting equipment
- general safety, including overcrowding, ventilation, first-aid measures and so on
- controlling noise and disturbance
- arrangements for door security
- emergency lighting conditions
Applicants also have to:
- be over 18 years of age
- set out their proposed opening hours
- describe their premises (including safety features) and include a plan of their premises
- say what activities their premises will be used for, for example dancing, live music
- advertise their application
A personal licence is required as well as a premises licence. A personal licence allows individuals to supply or authorise the supply of alcohol under a premises licence. Under the Act all premises must have an identified personal licence holder. Applicants for a personal licence must hold an accredited qualification from an approved training provider to ensure that they are aware of licensing requirements and their wider social responsibilities. Applicants also need a basic criminal records check.
The Gov.uk website has more information on the Licensing Act and provides guidance for applicants in England and Wales. The Scottish Government website has similar guidance for applicants in Scotland.
Licensing in Northern Ireland
In Northern Ireland a different system of licensing operates. There are a set number of licences and a new business would have to buy one of the existing licences from a club or pub that is prepared to give up its licence. The old licence is returned in order for an application for a new licence to be made to the local court. As well as an alcohol licence, you'll also need an entertainment licence in Northern Ireland.
Local courts can provide information about licensing procedures and applications in Northern Ireland. Information is also available on the NI Direct website.
Contact your local authority for further information on licensing in your area.
Promoting your night club
It is very important that your night club attracts enough people every week - so you will need to think about not only how you will promote the business, but also how you will make sure that your club remains a popular destination.
There are a number of things you could think about doing to promote your club, such as:
- engage celebrity DJs at regular intervals
- promote local DJs and live acts
- develop an effective social media strategy, using Twitter and Facebook to reach new customers and keep existing customers up to date with events, special offers, visiting DJs and so on
- run promotions with your local record shop
- play different types of music on different days of the week so that you attract a wide range of clubber
- offer discounted entry fees on quiet nights of the week or before a certain time
- offer discounts to students and advertise at local colleges and universities
- show sporting events on a big screen
- offer free night club entry when a meal is purchased from the restaurant (if appropriate)
- advertise your club through your own website or an online directory, showing the different DJs and music throughout the coming week
- establish a good reputation for safety and maintain close links with the police. Put in place an effective drugs and weapons policy and aim to promote sensible consumption of alcohol rather than 'binge drinking'
- advertise in your local What's On and leisure guides
- distribute flyers in local pubs, perhaps advertising a special cocktail or menu available that night
- put on dedicated transport to take clubbers straight to your club
Buy an existing business
You might decide to buy an existing night club rather than start your own venture from scratch. Buying a going concern can mean that the products, customers, regular sales, staff, premises and equipment are already in place.
But buying a business can be a hazardous, expensive process unless you have the right skills and experience on your team, including legal and financial know-how. Establish the genuine trading and financial position, so that the price you pay for the business is not too high.