SO YOU WANNA BUY A CLUB?

[mangina]

Check out the prices to have your own space

CLUBS FOR SALE

[Raven Fox]

RENT...

[Keith Blackstone]

Alot more reasonable then I expected...

[julian_kelly]

I agree...I thought they would be more

Interesting

Originally posted by Keith Blackstone:
Alot more reasonable then I expected...

[House]

Originally posted by julian_kelly:
I agree...I thought they would be more

Interesting

</font><blockquote>quote:</font><hr />Originally posted by Keith Blackstone:
Alot more reasonable then I expected...

</font>[/QUOTE]whatcha think..i got millions?...ya just gotta have the right coalition

peace

[Koffy Brown]

Originally posted by Keith Blackstone:
Alot more reasonable then I expected...

that's exactly what i was thinking...I thought liquor licenses themselves would run you around 10k...and with the sale price of 295k that included liquor licenses and caterer license...not bad at all

[mangina]

Originally posted by St Magus the Reviled:
</font><blockquote>quote:</font><hr />Originally posted by julian_kelly:
I agree...I thought they would be more

Interesting

</font><blockquote>quote:</font><hr />Originally posted by Keith Blackstone:
Alot more reasonable then I expected...

</font>[/QUOTE]whatcha think..i got millions?...ya just gotta have the right coalition

peace </font>[/QUOTE]Absolutely correct. It's actually quite cheap to purchased or finance a club. However it's altogether a different thing to run a place successfully and profitable.

[Fletch]

Anyone who buys Downtime should NOT get rid of Batcave Saturdays. No, I havent been to them, but coming out of The Studio from band rehearsals, I would see very pretty chicks roll up to Downtime, even though they would be dressed like The Monster Mash and what not! A very popular party.

Didn't know Nell's was rented, as opposed to owned.

Decade's up for contract, too. Nice spot!

[julian_kelly]

Those spots are probably zoned appropriately already...aint gotta worry about that. Some already have licenses...aint gotta worry about that. I dont know anything about the communities the spots are in, but Im assuming the surrounding bussiness are used to a club being there...so you aint gotta worry about angry neighbors ...its already established that a club is active in the area. Its a given that good location is also important. Ive never owned or run a club so Im assuming these things.

Assembling the right team and above average marketers would make the spot succeed or fail. In addition, having good relationships with the other business owners in the area as well as the police and a government official or two would probably be a must.

$400-700k aint breakin the bank if you finance it right...people buy $400k homes...and a $400k home wont make you money, but a $400k club ran effectively will.

Heck...somebody on dhp or in the community that likes other types of music, can get one of those $400k spots, make it a hip hop/rnb or even pop top 40 spot catering towards a demographic that spends a lot of money.

Since its hard for a club to last past 5 years, Id live dirt poor for a year or two and pay down the note to lower some liability and build some equity....possibly owning the spot free and clear (depending on cashflow, my future potential for liability and how long I think the club will last in the fickle industry.) Take the profits from that venture and let it finance a underground house club.


mangina or anyone else, How many sqare feet was the old Shelter/B&S location? How many folk could fit on the dancefloor when near capacity? How many folk could fit in the building when near capacity?

julian kelly

[jsd540]

Originally posted by Keith Blackstone:
Alot more reasonable then I expected...

I thought so also, some were as low as 8 or 9 grand a month, but thats just rent theres a whole lotta other sh** to think about too...

[mangina]

Well to put things into perspective. A small lounge /Bar space of say 2000 square feet could make a nightly bar revenue of between $4 and $6K

Thats with about 150 drinkers in the spot.
A weekend crowd in the same space could do $7 to $10K per night.

Just to give you another perspective.

Opening night of Crobar NY (3500 capacity), the bar did $125,000 and that didn't include the lucrative Bottle service revenue which was probably another $100K, Plus door revenue plus coatcheck.

4000 coats at $3 each is $12,000 and the doors on a normal night will generate $150,000.

Basically if the club is packed over a 3 day weekend it can make $1 Million and then you can add special events, corporate events, etc etc.

Not bad huh?

[Mark Andrus]

Originally posted by julian_kelly:
Im assuming the surrounding bussiness are used to a club being there...so you aint gotta worry about angry neighbors ...its already established that a club is active in the area.

From my experiences, this isn't neccesarily a safe assumption. We've had *many* instances here in San Francisco where people moved in next door to long-established bars/clubs, then proceeded to campaign aggressively for their removal. Even in cases where the places stayed open, a lot of money was spent fighting off the neighbors, and on implementing expensive noise-abatement schemes.

[DaveR]

Originally posted by mangina:
Well to put things into perspective. A small lounge /Bar space of say 2000 square feet could make a nightly bar revenue of between $4 and $6K

Thats with about 150 drinkers in the spot.
A weekend crowd in the same space could do $7 to $10K per night.

Just to give you another perspective.

Opening night of Crobar NY (3500 capacity), the bar did $125,000 and that didn't include the lucrative Bottle service revenue which was probably another $100K, Plus door revenue plus coatcheck.

4000 coats at $3 each is $12,000 and the doors on a normal night will generate $150,000.

Basically if the club is packed over a 3 day weekend it can make $1 Million and then you can add special events, corporate events, etc etc.

Not bad huh?

Not bad until you start subtracting:

All these little things (commonly referred to as Expenses):
Sales and Marketing Expenses:
Sales and Marketing Payroll
Ads
Mailing
Promo
Shows
Literature
PR
Seminar
Service
Training
General and Administrative Payroll
Payroll Burden
Depreciation
Utilities
Insurance
Rent
Security
Contract/Consultants
Interest Expense Short-term
Interest Expense Long-term
Taxes Incurred
Extraordinary Items

[DaveR]

But hey, I'm not gonna turn down a 6% net profit on $1MM weekly - so don't get me wrong ... he he [img]smile.gif[/img]

DR

[House]

Its interesting to note how far this thread went...easy to "talk" about saving house...a lot harder to "do"

[DaveR]

Originally posted by St Magus the Reviled:
Its interesting to note how far this thread went...easy to "talk" about saving house...a lot harder to "do"

Yeah b/c when you break off cool sounding things like how much cover charge you're gonna clock, and start addressing the details like insurance, cups, napkins and straw shipments ... it ain't house anymore [img]graemlins/stupid.gif[/img]

[House]

Originally posted by DaveR:
</font><blockquote>quote:</font><hr />Originally posted by St Magus the Reviled:
Its interesting to note how far this thread went...easy to "talk" about saving house...a lot harder to "do"

Yeah b/c when you break off cool sounding things like how much cover charge you're gonna clock, and start addressing the details like insurance, cups, napkins and straw shipments ... it ain't house anymore [img]graemlins/stupid.gif[/img] </font>[/QUOTE]lol

[julian_kelly]

Correct, it would be difficult to pull off. Thats why if I were to open a house club, I'd use a two business strategy -- Business #1 being a profitable business and Business #2 being a house club.

With the scenario presented, a business netting 6% or 60k a month (business #1) could significantly lower or eliminate the mortage on business #2 -- eliminating a major expense and giving it more 'wiggle room'. I think the idea of being able to eliminate a mortgage with a house club is significant because the profit margin on a house club is already low enough and close to non-existent as it is.

If business #1 could knock $10-20k a month off a mortgage payment and speed up paying off the mortgage, it would be more possible for the house club to sustain itself longer. Eliminating a mortgage completely could go a long way and the house club would only have to worry about other expenses. Not to mention you can gain some tax advantages and create favorable expenses within the two businesses by loaning money and performing services between the two businesses.

Business #1 could pay off the mortage completely in the form of loaned money to business #2 and then business #2 could pay the loaned money back to #1 in terms (length of time and interest rate wise) more favorable than a conventional mortgage that was originally instituted to build the house club.

DaveR have you ever owned/run a club before?
I never have, so Im definitely naive to all the issues and risks involved. Its difinitely a hard task, but all things start with a dream.

julian kelly

Originally posted by DaveR:
</font><blockquote>quote:</font><hr />Originally posted by St Magus the Reviled:
Its interesting to note how far this thread went...easy to "talk" about saving house...a lot harder to "do"

Yeah b/c when you break off cool sounding things like how much cover charge you're gonna clock, and start addressing the details like insurance, cups, napkins and straw shipments ... it ain't house anymore [img]graemlins/stupid.gif[/img] </font>[/QUOTE]

[DaveR]

Originally posted by julian_kelly:
DaveR have you ever owned/run a club before?
I never have, so Im definitely naive to all the issues and risks involved. Its difinitely a hard task, but all things start with a dream.

Yep, GREAT things start with a dream.

No, I have never owned a club (the physical structure), but ran an afterhours for 2 years (leasing the space, assuming most of the expenses and yes, enjoying the revenues that come along with it) ... and continue to do some regular/monthly ventures ...

I only mention the expenses above as thought-provoking, rather than a deterrant ... going into any club venture it's pretty easy to count all the money you could make - but it's the little things, often forgotten that can take a toll ...

e.g. (and this might not apply to NYC), but you can have things all straight, anticipate a slamming night/wknd, and then beep-beep-beep across the TV Screen Doppler 3000 Weather alert can kill ya ... parking bans during snowstorms, and the list goes on ... and on ...

Definitely go for it - it's a great ride ...

[House]

Originally posted by julian_kelly:
Correct, it would be difficult to pull off. Thats why if I were to open a house club, I'd use a two business strategy -- Business #1 being a profitable business and Business #2 being a house club.

With the scenario presented, a business netting 6% or 60k a month (business #1) could significantly lower or eliminate the mortage on business #2 -- eliminating a major expense and giving it more 'wiggle room'. I think the idea of being able to eliminate a mortgage with a house club is significant because the profit margin on a house club is already low enough and close to non-existent as it is.

If business #1 could knock $10-20k a month off a mortgage payment and speed up paying off the mortgage, it would be more possible for the house club to sustain itself longer. Eliminating a mortgage completely could go a long way and the house club would only have to worry about other expenses. Not to mention you can gain some tax advantages and create favorable expenses within the two businesses by loaning money and performing services between the two businesses.

Business #1 could pay off the mortage completely in the form of loaned money to business #2 and then business #2 could pay the loaned money back to #1 in terms (length of time and interest rate wise) more favorable than a conventional mortgage that was originally instituted to build the house club.

DaveR have you ever owned/run a club before?
I never have, so Im definitely naive to all the issues and risks involved. Its difinitely a hard task, but all things start with a dream.

julian kelly

</font><blockquote>quote:</font><hr />Originally posted by DaveR:
</font><blockquote>quote:</font><hr />Originally posted by St Magus the Reviled:
Its interesting to note how far this thread went...easy to "talk" about saving house...a lot harder to "do"

Yeah b/c when you break off cool sounding things like how much cover charge you're gonna clock, and start addressing the details like insurance, cups, napkins and straw shipments ... it ain't house anymore [img]graemlins/stupid.gif[/img] </font>[/QUOTE]</font>[/QUOTE]SEE...I keep tellin y'all about this brother Julian. I know of three spaces that use the formula he describes to make the dream attainable ( not necessarily a house dream)...you gotta be creative. If , your rent is below 10k per month and you have about 2000 square feet you can make some serious bread if you diversify your game.

[DaveR]

Hey Julian - check this site

http://nightclubbiz.com/night-club-q...s.html#courses

Lots of text, but many of the issues mentioned here are right on, in my opinion ... like:

"You may still be thinking, "ahh… that's easy; it's because of the cool music and lights", but rarely is this representative of why a nightclub is busy, stable, and profitable. Nightclubs are about 100% people, and not alcohol. Strong alcohol sales are the result of your ability to:

- Accurately perceive and understand a marketplace
- Acquire an intimate knowledge of the people "specific" to your marketplace
- Understand what it is "your" market really wants, and it's "NOT" always what you want!
- Anticipate the needs of your patrons before they do
- Implement and maintain a vision, which is customized to the needs of your market

In short, what you read in a book, or some idea you observed in South Beach will very likely "NOT" be viable for your marketplace in Texas, Arizona, or Toronto for example. You need to acquire the ability to understand your 'unique' marketplace, and once you're able to so this, you've just accomplished the first step to achieving a successful nightclub operation. Believe me… No two marketplaces are remotely the same!"

"Contrary to much mislead belief, 80% of the nightclub industry is driven by psychology, and not alcohol or music. In essence, developing an understanding of people is your best asset, for it's this understanding that you'll base everything from the concept, to the day to day operations on. Sounds easy, however this is where many go horribly wrong. People are exceptionally complex creatures, and one large mistake many new, as well as current nightclub owners make is "assuming" they have an "accurate" understanding of their marketplace, when in fact, they're not even close."

"... unless you want most of your product being given away to customers, or walking out the back door. You may think you have eyes in the back of your head, or that perhaps you can trust the people working with you. Guess what? You can't.. This is a cash business, and where there's cash, (as well as liquor), there's mistakes, magic, and scams. Either you maintain control, or you do not -there's no in between."