Business plan for opening a nightclub - financial model of a nightclub: profitable business plan

Where to start opening a nightclub

The goal of the project is to open a nightclub in the city of N with a population of 300 thousand people. The prerequisites for opening the establishment are the steady growth of income of the city's population and the growing demand for entertainment services in general.

To implement the project, it is planned to attract own funds in the amount of 1,000,000 rubles and borrowed funds (bank loan) in the amount of 3,200,000 rubles. In total, the total cost of the project will be 4,200,000 rubles. Economic indicators of the project implementation:

Net profit per year = 2,776,780 rubles;
Nightclub profitability = 22,6%;
Project payback = 18 months.

Total costs, payback period

To open a nightclub you will need to spend:

425000+3000000+3900000+775000+2700000+200000=11000000 rubles.

The monthly profitability, based on an entrance ticket of 300 rubles or more (depending on holidays and promotion of the establishment), of the operation of a hookah bar, VIP lounges, cafes and bars will be 5,600,000 rubles.

Subtracting the monthly investment from this amount, we calculate the profit:

5600000-200000-200000-2700000-775000-1000000=725000 rubles.

Nightclub payback time:

11000000/725000=15.2 months.

That is, it will take almost 1.5 years to recoup the nightclub and start making a profit.

What documents are needed to open a nightclub?

Currently, activities have begun to implement the nightclub project:

The limited liability company “Night Shock” has been registered;
The location of the establishment in a room with a total area of 510 m2 has been agreed upon. The premises meet all food and fire safety standards. The preliminary lease agreement was concluded for a period of 5 years;
Preliminary agreements have been concluded for the repair and reconstruction of the premises, and the supply of sound and lighting equipment.

Business plan

The business plan will include opening a nightclub in Moscow. The club will be open from 20.00 until 6.00 am. We select and rent premises to ensure good transport and pedestrian accessibility. Preferably closer to the metro. You should also take care of registering your activities, including other permitting documentation.

All establishments that have “club” in their name must be registered as a legal entity. To carry out this procedure, you will need appropriate permission from Rospotrebnadzor to locate an establishment in a certain premises or on a certain territory if construction is carried out. In addition, all constituent documents will be required. You will need to purchase and register a cash register. The fire inspectorate and SES will have to check the premises for compliance with their requirements and issue the appropriate permit.

All approvals, obtaining permits, medical documents for employees, and eliminating deficiencies may require approximately 100 thousand rubles.

The peculiarity of the nightclub is that it will sell alcoholic drinks. Therefore, you will need to purchase a license. From 2020, the license price is 65 thousand rubles per year. You can also purchase it for a period of one year or immediately for 5 years. We will take 5 years, which will require 325 thousand rubles.

Total: 425,000 rubles.

Description of products and services

The following entertainment services are expected to be provided:

Dance and show programs;
Theme parties;
European cuisine;
VIP zone;
Table rental;
Bar work;
Carrying out banquets, wedding celebrations, corporate events.

Visitors will also be offered a menu that includes hot dishes (soups, side dishes, pizza), cold appetizers (salads, meat snacks, vegetables, fish delicacies), cocktails, juices and spirits. The establishment will sell strong alcoholic beverages.

For these purposes, a license to sell alcoholic beverages was acquired. Entrance fee to the establishment from Friday to Sunday: 200 rubles. per person. On weekdays admission will be free. The club's one-time capacity is 180 people. Our organization will employ experienced DJs, photographers, dance groups and showmen.

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Business Analysis

Before starting your own business, you first need to evaluate the area of activity within which the work will be carried out. This thesis directly relates to the development of a business plan for a nightclub, therefore, in order not to waste money and make a profit, you need to carefully approach the issue of market analysis.

For the evaluation of any business aimed at the entertainment segment of the market, there is a typical period of twelve months. During this time, it is possible to give an up-to-date assessment of business activity and assess the prospects for further development. That is, within a year the club should reach a net profit.

Before moving on to direct commercial calculations, it is necessary to decide on the following important factors for the future structure of the club:

The target audience. It is impossible to create a club for everyone. Many people have different tastes and preferences, as well as requirements for their living environment and level of comfort. The choice of the target audience determines the further choice of the stylistic design of the room, the choice of characteristic music and additional services. You can focus on the younger generation, which seems to be the most promising, but it is very fluid and a third of regular customers will eventually leave this status. Clubs that rely on the audience of golden youth - the most solvent of club regulars, are very expensive to maintain and will not soon be able to pay for themselves and achieve a decent profit.
Idea. The basic concept of the club and its stylistic design is the basis of the marketing aspect of the business. It is through individualism and an original idea that you can both attract people and keep them as regular customers. The more interesting and relevant the idea underlying the club is, the faster it will be able to pay for itself due to high popularity.
Services. The main services of any nightclub are provided by three components - a bar, a dance floor and a show. These are the basic requirements for opening, but for constant development and building a client base, it is necessary to regularly come up with various interesting ideas for holding events within the walls of the club. These could be some kind of pyrotechnic shows or striptease programs, the main thing is that they are in demand by the target audience and are relevant within the given course of club development. Very successful PR campaigns would be inviting various popular personalities among musical performers and other creative and imaginative people. The list of such programs can be greatly adjusted in accordance with the target audience and age restrictions of the club, but the most important thing is to ensure uninterrupted movement forward so that the institution does not wither under the yoke of more enterprising competitors.

Marketing plan

The building will be located in the central part of the city, in an area with convenient access roads. Our main visitors are young people aged 18 to 35 years.

We will be in close proximity to a college campus, so a significant portion of the visitors will be students. Also, next to the establishment there are two large shopping centers, which will also have a positive effect on the popularity of the establishment.

The planned average bill for a nightclub is 700 rubles. This is a small amount, since the main contingent of the establishment cannot be called elite. The main income is planned to be obtained from turnover, counting on high attendance on weekends.

The club, in addition to nightly dance programs, will provide additional services for holding theme parties for VIP guests, New Year's Eve parties, corporate events, wedding celebrations, banquets and presentations.

The main direction of music is Disco, Radio Pop (pop). This is the most numerous and most influential music, which has significantly more fans than opponents. If we talk about possible competition, we can highlight two similar establishments operating in our area. Let's conduct a comparative analysis of the strengths and weaknesses of potential competitors of the nightclub:

Relevance of the business idea

The economic well-being of the population has increased over the past century thanks to developing technologies. People of all ages, from youth to accomplished men and women, love to relax on the dance floor or bar counter and make new acquaintances. Stressful and responsible work is almost always work with a large salary, which means there is a desire to relax and leave money in nightclubs.

The best choice would be to open a club with an affordable price tag, designed for students, since the elite audience is a narrower segment, and the cost of opening a luxury club will be even higher. If you are targeting a “golden” audience, then you need to carefully evaluate the competition. Perhaps even open an establishment in another city.

How to promote your nightclub

Advertising in the media (newspaper, magazines, TV, radio);
Banners, banners, billboards;
Distributing leaflets, flyers, posting advertisements;
Creation of a personal club website;
Promotion on social networks and contextual advertising.

It is expected that holding these events will attract the maximum number of visitors from the first days of the club’s operation.

The nuances of opening a club in a small town

The main difficulty in small towns is the fickleness and instability of the audience. A nightclub is its own business, where you should always “keep your finger on the pulse” and be a little ahead of the times, analyzing fashion trends “ahead of the curve.” Regular promotions and changing show programs with their bright preliminary engagement help to retain the attention of visitors and expand the audience. Unskilled and illiterate personnel can become a problem on the way to the development and normal functioning of a business. Efficiency, communication skills, politeness and modernity - it is not easy to find all these combinations in one employee. But a successful business requires.

Owning your own business – a nightclub – is one of the most difficult and interesting. You must love your job, be aware of fashion trends, have tireless energy and disruptive power, and, at the same time, be able to count and save money.

How much does a nightclub earn?

Next, let’s calculate the organization’s potential revenue. It is expected that the main attendance will occur on Saturday and Friday, as well as on holidays (February 14 and 23, March 8, May 9, etc.). The occupancy rate of the establishment on these days will be close to 70% (~130 people).

The number of weekends and holidays per year is ~ 105 days. With an average club check of 700 rubles, the club’s revenue for data will be: 105 days * 130 people * 700 = 9.55 million rubles per year.

Additional revenue can come from services for corporate events, wedding celebrations, and banquets. About 10 such events will be held monthly. The average revenue for one event is 50 thousand rubles. The planned annual revenue from the provision of these services will be 6 million rubles.

The total amount of planned annual revenue, according to business plan calculations, will be about 15.55 million rubles.

Marketing

A powerful advertising company can attract a large number of visitors, so you should definitely use information technology, create a website, pay for advertising to public people who have high authority among the young population, who get all the necessary information from the Internet.

The specifics of advertising depend on the direction of the establishment. For example, if the main clients are students, then advertising in their hangout places, at the institute, etc. The most important thing is that your establishment can be seen from afar, so for this you need a colorful sign, better if it is neon. The cost of a sign can be from 100,000 rubles.

Start-up costs for promoting a club can range from 100,000 rubles, the cost of creating a colorful website is 50,000 rubles, monthly expenses for promotion and advertising are 20,000 rubles.

Production plan

The total area of the premises will be 510 m2. Of them:

dance hall area – 200m2;
area of the boarding area and VIP cabins – 110 m2;
kitchen area – 50m2;
hall and locker room – 80m2;
restrooms, utility rooms, warehouse – 70m2.

The monthly rent under the contract is 500 rubles/m2 or 255 thousand rubles. monthly. All premises will be equipped and reconstructed in accordance with all fire safety standards (fire alarms, emergency exits, evacuation plan, emergency fire extinguishing system, etc.). The club will have two bars at the same time. Club opening hours:

Friday - Saturday from 20.00 - 05.00;
Tuesday – Thursday, Sunday from 20:00 – 04:00;
Corporate events will be held on any day.

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Should you open a nightclub from scratch or buy a ready-made one?

It is definitely easier and more reliable to buy a ready-made business. As a rule, organizations involved in creating a turnkey business in the entertainment industry offer investments that are more economical in terms of initial costs. For example, a nightclub based in a restaurant that becomes a club at night. In addition, the sale of a ready-made business will eliminate numerous approvals from various authorities: Rospotrebnadzor, local administrations, licensing committees and the Ministry of Emergency Situations. You need to register your own business - a nightclub - as a legal entity - LLC. It is also worth considering the fact that targeted loans are not provided for opening this type of business. Therefore, if lending is chosen as the main source of financing, you should be prepared for high interest rates (from 30 percent and above) for borrowed funds.

Marketing plan

The current state of the entertainment market, in particular the nightclub sector, is in decline. The industry had just managed to recover from the crisis of 2008-2009, and began to gain momentum, when economic and political sanctions imposed against Russia by a number of Western countries forced the population to once again reconsider their attitude towards entertainment.

Download nightclub business plan

Wealthy youth and established adult businessmen did not particularly experience the consequences of the crisis that began in the country in 2020, and practically did not change their habits of visiting nightclubs. Therefore, elite establishments, like several years ago, continue to develop confidently, and the question of how to open a nightclub is still relevant.

In clubs for a wide range of visitors, things are very deplorable. During the 2nd half of 2020, more than half of the previously successfully operating “democratic” nightclubs in the country closed. The statement made by the Ministry of Economic Development in mid-February 2020 about the impending stagnation in the country's economy for several years made investors very cautious when considering projects of this kind.

However, there is an opinion of analysts that it is the general reduction in the number of nightclubs across the country that will make this business again popular and in demand in six months or a year. People have been accustomed to enjoying pleasure for long enough to suddenly give it up. In addition, a person gets used to everything, and having become accustomed to a new environment, our compatriots will return to their previous way of life.

Experts in this area estimate the average amount of investment required for the successful operation of a nightclub in Moscow, St. Petersburg, Yekaterinburg, and some other large cities with a population of more than a million people - approximately 500-600 thousand dollars. The profitability of projects is currently estimated at 30-60%.

In the “club” business over the past 506 years, there has been an interesting trend towards short operating hours, which, however, has a rational “grain” behind it. After working for 2-2.5 years, having become fairly bored with the visitors, the Club closes, only to be reopened by the same owner after some time in a different location, under a different name, and with a different concept. True, only a few manage to achieve the previous level of income, but the profit is still higher than if the establishment continued to operate in the old location.

Particular attention in the management of the Club must be paid to the “tolerance” of the pricing policy. As a rule, the influx of visitors occurs on weekends - from Friday to Sunday. It is on these days that prices need to be set as high as possible. On Monday there is a decline in guests, so on this day you can arrange a day off, a sanitary day, make entrance to the establishment free, or arrange a “discount day”. Based on the experience of existing establishments, such a “policy” justifies itself.

Statistics on how people from the target audience spend free time can be seen in Figure 1:

The frequency of visits to nightclubs by 100 respondents from the target audience can be seen in Figure 2:

Financial plan

The item of fixed expenses is:

rent – 255 thousand rubles;
salary – 357 thousand rubles;
insurance payment - about 112 thousand rubles;
food products – 150 thousand rubles;
utilities – 40 thousand rubles;
transportation costs – 25 thousand rubles;
advertising – 30 thousand rubles;
unforeseen expenses - 40 thousand rubles.

Based on this, the monthly expense of the nightclub according to the business plan is 1,023,600 rubles. To calculate net profit, you need to subtract expense indicators from the planned income. It turns out 230 thousand rubles. per month. It turns out that the club’s payback will occur at least a year and a half after opening (if no force majeure circumstances occur).

Nuances of choosing premises for a nightclub

The selection of personnel and the purchase of equipment will depend on which premises you choose. The following general options are distinguished:

seasonal (for example, beach discos or ordinary indoor spaces);
narrow focus (strip bar or club for gay people);
thematic (not only the design, but also the exterior can be in the same style).

The establishment can operate according to two principles:

For young people with low or middle income. This means there is a cover charge, but bar prices and menu items remain affordable.
For wealthy older clients. Entrance to such establishments is usually free, but the cost of drinks and food is several times higher.