There are different types of nightclubs and the characteristics of each will largely be defined by the type of crowd the owner is able to attract based on the target market and the owner’s tastes.
Nightclubs can offer a certain type of music. They can have live music, feature DJ music, or both. Contemporary DJs have become performance stars now as well. One of the most important features of any successful nightclub is the ability to attract enough paying customers to pay the rent and occasionally “pack the place,” to make tremendous profits.
A nightclub business is for people who do not mind hard work, yet also want to have fun. This sort of business can be very lucrative depending on the club’s size, its location, and its popularity. Nightclub owners ought to be “night” people. It simply means they like staying up all night and sleeping in the day.
They also need to be very popular and know many other people who are able to attract customers to their club. Note that getting out of bed after a wild night is the hardest part.
But as a nightclub owner, you will need to be awake during some of the regular business hours to take care of the things that normally happen only during the daytime, such as ordering supplies, making bank deposits, and getting change from the bank.
Have in mind that your main job will be to find trustworthy people to help you and then watch them very carefully to prevent stealing. Indeed you will find this very daunting to do because there are various ways people will steal from the club and it is the owner’s job to catch them and replace them with, hopefully, a more honest person.
Another major aspect of your job will be to promote the club. Note that most nightclub owners become somewhat famous in the city where the club is located because they go around town constantly inviting people to come to their club.
At the club, they are often the life of the party. This sounds great to some people; however, you need to have super-human stamina to party every night, which is what is required for this business. Indeed, fortunes have been made (and lost) in the nightclub business.
A nightclub can be a simple place that caters to a niche target market; such as a modest nightclub on the outskirts of a small rural town, or a multi-million dollar extravaganza in the heart of New York City or at the most popular hotel/casino in Las Vegas that caters to the rich and famous party-goers, such as the Palms (where Paris Hilton and many Hollywood stars hang out).
Your best customers will be individuals who have lots of money and do not mind spending it on a wild night out. A handful of these big spenders can make a club very profitable. Attracting famous people is very good because they attract others. In good night clubs, the owner gets to rub elbows with the entertainment elite.
From booking the hottest young DJ for a Saturday night extravaganza to giving the newest supermodel her own private booth in the VIP section, the club manager gets a chance to meet people who others only get to read about in tabloids.
If everything comes together in your club – the music, location, décor, the right mix of people – it might well be a hit. While far from being guaranteed, some well-run nightclubs are very profitable, grossing thousands every night from drink sales. For those looking to make a sure profit, you might want to stick with a profession with more certain income.
3 Smart Ways Night Clubs Make Money
A typical smaller club will make its owner $1,000 to $5,000 per week ($50,000 to $250,000 per year). A large metropolitan club can make $50,000 profit in a single night. However, the amount of income a nightclub generates will depend on a lot of varying factors. Nonetheless, here are how night clubs primarily make money.
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Entry Fee
The cover charge to enter a club can be a modest $5 to $10 per person with this money used to help pay the bands and/or the DJ. It can be much higher for special clubs like strip clubs that charge a $25+ entry fee and even higher for special live music/performance events, which sell out due to the limited seating/capacity.
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Alcohol Sales
Indeed not every nightclub makes their money off entry fees, instead, they do so from the bar and the sale of alcohol. A smart nightclub owner aims to get people in the door and keep them drinking as long as possible. Note that many clubs will offer two-for-one drink specials before midnight. This is an ideal way to get cash for several reasons.
First, the discount drinks hardly contain expensive spirits. Instead, they use lower-quality liquors. The club intention is for people to imbibe and not think twice about plunking down $3 or $5 more for the next drink that will, invariably, not be during specials hour.
Night Clubs also understand that “Can I buy you a drink?” is a common pickup line. Howbeit, they may discount drinks for ladies, but hardly for men. Women rarely buy men drinks, but the reverse happens all the time. The bar in a nightclub is the main and great money maker.
Think of the price of a case of longneck beers at the liquor store. That $12.99 retail pack sells to bars for $7.99 a case wholesale. The bottles then sell to patrons for $8 in places like New York City. One bottle of beer pays for the entire twelve packs.
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Other Money Making Avenues
Also, note that nightclubs make good profits from hosting special events. The more special events a club holds, the stronger an image it can establish among a particular clientele. For example, a club may rent out its downstairs area for $3,000 to a fashion designer for an after-show party.
The designer gets staffing and some free alcohol for the cost; they may also have access to the club kitchen for catering needs. The club, moreover, gets a percentage of proceeds from the bar, along with money from extras such as coat check or valet parking. A club may waive any of these fees if the event is for a benefit or non-profit.
Notwithstanding, the plus for the club is that some of the guests may come back. In fact, they may bring new guests. Have it in mind that the nightclub business depends on showing people a consistently good time that makes a mark in people’s memories. Without that, clubs inevitably fail.
Conclusion
Selling drinks, possibly food, charging for admission, and where possible, for special seating and/or special services offered to the customers are the primary ways Night Clubs make money.
These special services can be anything from “lap dances” at strip clubs to bottle service (customers buy a full bottle of liquor to be exclusively served to them for a special price) at VIP tables in the best spots right next to the entertainment.