Nightlife Industry in Crisis as 43 Businesses are Lost Each Week

The Night Time Industries Association (NTIA) recently published some grim findings for anybody involved in the night time economy. Figures compiled by CGA Nielson IQ show that around 43 UK nightlife businesses disappear each week, 35 of which being independent companies.

When this news is taken in tandem with the statistic that the number of licensed premises serving alcohol has dropped to fewer than 100,000 for the first time since records began, it soon adds up to a worrying time to be involved in the nightlife industry. The Independent recently reported that British pubs alone are closing down at a shocking rate of two a day. This marks a dramatic increase from last year, with 2023’s first six months accounting for 383 closures: just three less than those seen throughout the whole of 2022.

With an inflation-linked increase in business rates on the horizon come April 2024, this news becomes starker still. At the moment, pubs and other hospitality businesses enjoy a 75% discount on business rates, but this is due to end just before April 2024’s rise, making the jump in rates for them even bigger.

The CEO of the Night Time Industries Association, Michael Kill, has been vocal in asking the government to take steps to alleviate the pressure on businesses in this sector. His statement suggested that “to secure the survival of these vital businesses, we urge the government to extend the current business rates relief and reduce the VAT to 12.5%. These measures are the financial lifelines that independent businesses and the night time economy desperately need to weather the storm”.

Indeed, with 2,243 night time economy businesses lost in the 12 months preceding September 2023 alone, it’s clear that the sector is certainly in need of change in some form or other. Whether that’s through anything proposed in the autumn budget, or through innovations led by those within the sector, though, remains to be seen.

An intrinsic part of the pub and club business model is based around alcoholic drinks, and this heavily taxed offering leads to many problems for business owners. In fact, the steadily climbing prices of supplying alcoholic drinks often leads to landlords experiencing more drink-related headaches than their customers. Combine this with a waning thirst for such beverages among millennials, and the issue is only exacerbated.

In 2021, statistics released by the NHS showed that 38% of 16–24-year-olds and 21% of 25-34-year-olds hadn’t drunk within 12 months. The same survey conducted ten years prior produced findings of 19% and 16% respectively. This growing trend in teetotalism has been embraced by multiple businesses that have launched no-or-low-alcohol bars in cities nationwide. Establishments such as Torstigbar in Brighton, Café Sobar in Nottingham, and the longstanding Mr Fitzpatrick’s Temperance Bar in Lancashire are at the forefront of a new movement of non-alcoholic social destinations. Tellingly, however, not all of these stay open into the night.

Are the public gradually moving away from late-night socialising, or will changes to operating costs see the nightlife industry flourish once more? It promises to be a nervy few months for directors working within the night time economy.

Does your business operate in the night time economy ?

If you own a bar, club, or any other nightlife business that’s finding things difficult, it’s a good idea to get in touch with us before the situation becomes unmanageable. We’ve helped countless companies to navigate difficult financial situations with our years of experience in business recovery.

If you need to get some advice on what you can do to get your finances back on track, give one of our expert advisors a call. We offer free, no-obligation advice for any type of business. Simply call us on 0800 975 0380 or email [email protected]