Industry sector: Leisure

Night club: Market research

Estimating demand

It's important to do all you can to find out whether there is enough local demand for your night club. Be aware that the late night economy is very competitive and that you will be competing directly against other clubs, bars and licensed venues as well as indirectly against other entertainment venues that stay open late, like cinemas. There are also growing concerns that late night disorder, drunkenness and noise need to be curbed and in some areas local authorities have taken steps to limit or prevent new nightclub licences from being granted or have imposed restrictions on opening hours on new licensees. Before going too far with your planning it makes sense to check with the local licensing authority and the police that you have a reasonable chance of obtaining a licence.

Check out the competition in your area to identify:

  • how many existing night clubs and pubs with late licences there are
  • the types of customer they target
  • their opening hours
  • the types of music they play and whether this varies throughout the week
  • their entry fees and bar prices
  • any special offers and promotions
  • how popular they are

This might immediately show you that there is a gap in the market for a certain type of club, for example incorporating a stylish restaurant area.

It would also be helpful to find out how many nights in a typical week are 'big nights out' - nights when large numbers of people normally visit existing clubs in your area.

Use the Record sheets to record the results of your research

Record sheet 2 provides you with a more detailed template in which to enter your Cash sales, showing income from different sources separately. Total the monthly amounts and enter the totals in the main cash flow.