Sample Business Plan on Night Club Business Plan
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EXECUTIVE SUMMARY
The Business Concept
Club Anything, LLC (Club Anything or the Company) will be a nightclub located in downtown Any City, XY. It will provide a place for people to meet, dance, and have a good time coupled with fun entertainment.
The nightclub will be approximately 6,500 square feet and will include a bar area, table and chair seating, a stage and a dance floor. Club Anything will be a high energy club with state of the art lighting and great music.
The Company’s location is in Bricktown, a growing and bustling area. Bricktown is the heart of the entertainment district in Any City. The Bricktown area is the historic crossroads of commerce in Any City and is near the Convention Center, stadiums and several hotels. This area appeals to a wide variety of people who like to stroll along the pedestrian canal, enjoy some of Any City’s best restaurants, experience live music or dance the night away. There is always something to see and do in Bricktown.
Club Anything will take advantage of several factors to drive its growth. Downtown Any City continues to grow at a rapid pace with new condos and businesses continuing to be added. There is a new NBA team for the city. The city has a wide range of businesses and employers. Agriculture, energy, aviation, government, health care, manufacturing, and industry all play major roles in the city's economy.
Club Anything is something that Bricktown and Any City doesn't currently have. The overall loXY and quality of the club will be completely different than others in the area. The Company will take advantage of the dynamic and growing downtown and nightlife of Any City to drive its growth. Club Anything plans to promote its club heavily and to feature special events.
Club Anything expects to gain a profitable market share within a very short period of time. Determinations have been made for the size of the market, amounts of budgeted advertising and promotional dollars and the competitive landscape.
Projections call for the Company to generate revenues of $480,000 in its first twelve months. Club Anything will achieve strong growth over the next several years, reaching $702,000 in revenues and more than $96,000 of net income by the fifth year.
The Opportunity
History of Nightclubs
The bar industry is often referred to as the drinking establishment industry. This industry dates back hundreds of years to a time when Americans gathered in groups to socialize and discuss pertinent issues of the day.
Today, nightclubs are defined as late night establishments often providing artistic entertainment, featured music, dancing, drink, and generally limited menus. Establishing roots from 19th century European cabarets, nightclubs in the U. S. evolved early in the 20th century from popular music, social dancing, and dating. At that time Jazz and Ragtime were the most popular forms of music at these locations. It wasn’t until later in the century that restaurants, cabarets, dance halls, vaudeville theaters, and cafés were introduced.
During Prohibition “so-called” private clubs and cafés were developed coining the term “club”. The term was utilized to discourage scrutiny by liquor law enforcers. Throughout the depression and the mid-20s American nightclubs flourished; many of the most popular establishments incorporated illicit spirits along with lively music and dancing until daylight.
History reflects nightclubs helped foster integration through pre-World War II local and otherwise unknown musicians as well as new dance styles staged around interracial observations and contests. The encyclopedia states, “The dominance of ragtime between 1890 and 1910, the emergence of southern African American blues forms after the turn of the century, and the northward migration of New Orleans jazz marked an immense historical shift in the sources and acknowledged masters of American popular music. Creative white musicians could no longer avoid reckoning with African American musicians.”
Music changed considerably in the 1950s, following the big band sounds of the 1930/40s and swing combos that had dominated entertainment rosters in nightclubs for two decades. The emergence of rock and roll, bebop, and rhythm and blues were often the headliners for many extravagant clubs across the U.S. and in Las Vegas casinos, including popular male entertainers such as the Rat-Pack’s Frank Sinatra, Sammy Davis, Jr., Dean Martin, and Peter Lawford.
By the 1990s, unlike the disco-era of the 1970/80’s where typically only lively music (spun by DJs) and dancing was encouraged, professional and local entertainers along with older forms of popular music were renewed. Today’s nightclubs are not to be compared with pubs, taverns, or ordinary bars where only drinking alcoholic beverages and play darts apply. However, most nightclubs cater to specific music genres.
Modern nightclubs today offer a variety of entertainment features, effects include lighting such as:
Ø Flashing colored lights
Ø Laser lights
Ø Smoke machines
Ø Foam
Ø Moving light beams
Ø Strobes
Ø Rotating mirrored balls
Ø Black lights
The main attraction at Nightclubs is often live entertainment and performances; therefore, many newer nightclubs are redesigned/remodeled former underground spaces, custom-built sites, cinemas, or abandoned warehouses with thick insulated walls with no-to-few windows that muffle or stop street noises from entering the building. This “illusory realm of timelessness” gives club-goers the feeling of outside darkness irrespective of the hour, encouraging club dancing and partying to continue. 6
According to a 2007 First Research, Inc. report, “The bar and nightclub industry includes about 50,000 locations with combined annual revenue of about $15 billion.” Within this industry, taverns were the largest sector with a total of 21,557 locations. The market is divided into several categories, including:
Ø Drinking places – 21%
Ø Bars and Lounges – 18.1%
Ø Cocktail lounges – 11.8%
Ø Night Clubs – 9.2%
Ø Taverns – 37%
The bar and nightclub industry is highly fragmented; the largest 50 companies only maintain 5% of total industry sales. Developing a loyal clientele and driving traffic from successful marketing increases profitability in most markets. Studies show average yearly revenue per employee in this industry is $45,000. It is estimated that beer makes up 40% of all alcoholic sales, followed by hard liquor and distilled spirits at 30%, non-alcoholic beverages and food at 10%, with wine sales at 7%.