Dance clubs in the 1990s have significantly impacted cities from coast to coast. Los Angeles Hollywood, New York’s Times Square, and Seattle’s Pioneer Square are just a few examples. Dazzling their audiences with high-powered lights, sound, and music, these venues are still one of the highest cash flow businesses in the world. Studies have shown that the average person will spend three to four hours per weekend in an entertainment environment and will spend an average of 20 to 50 dollars in that timeframe.
This trend also shows no signs of declining. The typical dance club is open from 9:00 P.M. to 2:00 A. M.
, and within this span of five hours, the venue can achieve gross revenues anywhere from $5,000 to $35,000 nightly. The primary sources of revenue in a nightclub are high-volume traffic, coupled with nominal spending. In addition to alcohol revenues, a nightclub also generates substantial revenues from door charges that can typically range from five to ten dollars per person.
For example, a 1,000-person capacity nightclub will typically accommodate approximately 1,500 people in the five-hour span of operation. A $5 door charge, in addition to a conservative figure of $12. 5 collected from each patron in alcohol sales, would generate approximately $30,000 in nightly revenue. Nightclubs in the late 1980s and early 1990s focused on spectacular light shows and energetic dance music.
This relatively simple concept is still quite popular today. However, these concepts have greatly evolved with society. In recent years this industry has become more sophisticated with the availability of new technology. Larger metropolitan areas have taken this technology to new heights with sound and lighting designs that create an exciting and memorable experience.Fortunately, no one in the downtown Cliff area has capitalized on this specific segment of the industry to date. Additionally, the nightclub industry is shifting towards a more entertainment-oriented concept.
Guests of these clubs are not only offered a dynamic place to dance, but also a place to participate in the entertainment through interactive contests, theme nights, and other events. We intend to heavily utilize entertainment-oriented marketing in an effort to withstand the perpetual shift in trends and cater to as large a client base as possible. Nightclubs and other drinking establishments rely heavily on their primary suppliers.The primary suppliers are the various beverage distributors that provide the establishment with both alcoholic and non-alcoholic beverages.
The alcoholic beverages (beer, wine, and liquor) are the primary sources of income in this industry. Other beverage suppliers also play a crucial role by providing non-alcoholic beverages. These are either served alone or mixed with alcohol. In the Cliff area, all major brands of alcoholic beverages are available, in addition to several regional brands of beer. Initial research shows that the major distributors in the market have a high rating in both product availability and delivery.Business Description The resurgence of the downtown Cliff area represents a unique opportunity for a high-energy dance club.
The city’s central location, demographics, and lack of direct competition are major advantages to this project. The proposed club—tentatively named “Wild Oasis”—will provide a local solution to the lack of dance and live music venues geared toward the 21 to 35 age group in the Noble County area and will help keep late night entertainment expenditures within the region. The development of the University of Waters Cliff campus has been, and will continue to be, a major catalyst in bringing people to the area.
With current enrollment of over 1,300 students, the year-and-a-half old campus is slated for steady expansion through 2010 when enrollment is expected to hit 6,000 students. Additional surrounding educational institutions (two universities, two community colleges) also contribute to the potential customer base. Other proposals in the area such as the Multiplex Theatre and shopping center will also greatly impact the city’s traffic flow and nightlife. The new nightclub will specialize in high-energy dance music with a quality light show, and will offer beer, wine, and an array of liquors and mixed drinks.In addition, the club will sell non-alcoholic beverages such as soft drinks, juices, and bottled water. A small food menu consisting mostly of appetizers and small entrees ranging in cost from $6 to $9 will also be available. The initial hours of operation will be 8:00 P. M.
to 2:00 A. M. Wednesday through Saturday. The club will draw primarily from the Cliff market while attracting guests from the area’s other major cities in the state. Club Design Our goal is to provide a comfortable and welcoming environment as well as a unique, exciting nightclub experience.This dance club will feature high ceilings and a contemporary look with dynamic upscale decor, furnishings, and color scheme modeled after a big city loft. The central area of the club will consist of a large dance floor with cocktail seating along the perimeter and a large bar located nearby.
A VIP lounge for special guests is also being explored. The focus of the club’s design will be to create a highly social atmosphere. This will be achieved through the placement of couches, booth seating, and a quieter lounge area located away from the dancing and music.State-of-the-art sound and lighting will round off the club’s environment.
A RMS point-of-sale system will be put into place and will serve as a sales, labor, and liquor/inventory control system. This system will ensure an accurate, secure, and efficient control over labor costs, as well as day to day inventory, thus minimizing the possibility of loss or theft. MARKETING PLAN Area Analysis The geographic target market for this nightclub is all of Noble County, which includes the city of Cliff and many others. Current population of the county is over 680,000 people, 26% of whom fall into the proposed age demographic 21 to 35) for the club. This number is expected to rise significantly over the next decade. Cliff, the city in which the proposed club will reside, is Noble County’s largest city, accounting for 28% of the total population, and the third largest city in the state.
The 51-square-mile city has been nationally recognized for its outstanding quality of living in national consumer magazines. There are several contributing factors behind the emergence of the downtown area of Cliff. The $70 million redevelopment of the University of Waters Cliff campus has been the largest stimulus for economic growth in the area to date.
Various other projects, including a multiplex theater, shopping center, marina, numerous restaurants, and residential housing, have been proposed or are currently in development. Growth in the area is also attributable to the expansion or relocation of major corporations representing the computer, sportswear, and aircraft production industries. Many of these companies have created new, higher-technology jobs in the areas that have welcomed in a younger and more affluent workforce. Cliff was chosen as the location for the new club for several reasons.
First, the city is an emerging market with lower real estate rates and at the same time high levels of commercial development. Second, Cliff lacks direct competition from other dance clubs. The next major city, which is over 45 minutes away from downtown Cliff, maintains a highly competitive nighttime entertainment market yet poses little threat to the development of a Cliff dance club. Site Analysis The proposed location for the venue is at 1039 Thurman Avenue on the first and second floors of the Pfeiffer Building. Thurman Avenue is the downtown area’s primary commercial business street, and has excellent freeway and back street access.The club would occupy approximately 7,300 square feet (5,500 downstairs and 1,800 upstairs) of the building. This location is centrally located to many existing and proposed attractions in downtown Cliff.
Its second-story addition provides for an excellent nighttime view of parts of the city and the Mark Anthony Waterway. The site and the proposed club are a perfect fit. The Pfeiffer Building is the creation of its current owner, a prominent local developer responsible for downtown’s newest office complex, the Maximus Building. His experience with renovation of historic buildings will facilitate the development of the nightclub.Additionally, the Pfeiffer Building resides in one of downtown Cliff’s busiest intersections with access to the city’s major interstate freeways. Plans for the building include installation of high-speed Internet connections in an effort to attract technology companies. Thus far, a technology firm as well as a local recruiting company already have agreed to lease space. Target Market & Demographics The primary target market for this venue is the age group of 21 to 35.
Market research indicates that the demand for a new dance club in Cliff among this demographic is very high.Most are tired of the existing scene and are looking for a local place to dance, meet people, and have a good time. Currently, high-energy dance clubs are only found in the next largest city, but the 45-minute drive north discourages much of Noble County’s market from frequenting these venues. This, coupled with the tremendous current and forecasted growth throughout the region, indicates that the time is perfect for such a venture in Cliff.
The market research study included men and women within the target market that do, or would, support the downtown Cliff nightclub entertainment industry.The most common responses and comments regarding existing venues in the area were: •Not enough room to dance •Tired of the existing sports bar/tavern atmosphere •Existing venues play the same music every night; no variety •Low quality light and sound •Lack of energy and excitement; too low key Therefore, the venue being proposed will address all of these concerns. It will maintain a heavy focus on dancing—offering the largest dance floor in the downtown area—and will offer a high-energy, very social atmosphere for the prospective market.The interior will be designed with an upscale decor and the lighting and sound will drive the ambience. Most of all, the music will be consistent, but not played out. DJs will be responsible for playing a variety of music our patrons like, from Top 40 to remixed techno to hits from the 1970s and 1980s. Demographic data obtained from Noble County’s web site demonstrates that the region contains over 175,000 individuals within our target market, 26% of the total population. Estimates indicate an expected 3-4% annual growth over the next 10 years.
Population Estimates for 1999 Noble County Total Population 682,450Total Males (by age) 21 to 25 27,733 26 to 30 27,431 31 to 35 35,756 Total Males (21 to 35) 90,920 Total Females (by age) 21 to 25 24,667 26 to 30 26,802 31 to 35 35,347 Total Females (21 to 35) 86,816 Total Target Demographic 177,736 Percentage of Total Population 26. 04% Promotions Promotional efforts are critical to the proposed club’s success. Accordingly, the venue will offer nightly, weekly, and monthly promotional specials.
These promotions will help to stimulate excitement for the new club, thus leading to high traffic and exposure. The main idea is to offer a new entertainment experience night after night.This is the key ingredient for success and profitability, as well as longevity, in the nightclub industry.
Proposals include: •Prize giveaways •Nightly dance floor and stage contests •Cooperative promotions with local radio stations Entertainment will be provided by charismatic disc jockeys featuring a blend of current Top 40 and dance music. During the week, special theme nights and promotions will be used to attract a more diverse crowd, and to increase the number of customers who frequent the dance club. These theme nights will change as popularity and demand dictate.The market will be targeted and reached via the following primary vehicles: advertisements in local print media, strategically broadcast radio spots, and an Internet web site. Advertisements printed in the local and college newspapers, as well as broadcasts over the local radio stations will provide exciting club information on current promotions and specials. A more “grass roots” marketing campaign also will be employed. This includes club representatives and spokespersons attending area events, postering of college campuses, a “prize patrol” van, and other person-to-person marketing efforts.
CompetitionThe new nightclub will meet a demand in the Cliff area that is not currently being served. We will provide a high quality, energetic nightclub while maintaining a safe, secure atmosphere for guests to enjoy themselves and the surroundings. Providing a safe nightclub is essential to maintaining customer loyalty and growth.
Therefore, security at the new club will be top priority. Currently, nighttime competition in the area is limited to mostly bar/tavern facilities including McArthur’s, Lucky Six, Jubilee, The Harbor, and Westside Elite. Only Jubilee and The Harbor offer large-scale dancing facilities.