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View Full Version : Spearmint Rhino UK feeling economic pain



mysteryman
03-04-2009, 09:27 PM
Looks like Spearmint Rhino is taking a beating in UK due to the economical down turn. Its no longer a good thing to be seen having fun and spending money.


http://www.thisislondon.co.uk/news/article-13571209-details/Is+Spearmint+Rhino+endangered/article.do

Jezzebelle
03-05-2009, 04:59 AM
Yep, we all guessed they would get hit hard, as Rhino is where the baNkers and city guys go to party. Not anymore........

Bubble
03-05-2009, 10:25 AM
Yep, we all guessed they would get hit hard, as Rhino is where the bakers and city guys go to party. Not anymore........I didn't know bakeries were that lucrative ;)

Jezzebelle
03-05-2009, 10:53 AM
LMAO!!

Didnt you? The sale on buns have rocketed Ill have you know!!!


Ill edit it now.............hahaha!

Phil-W
03-05-2009, 01:11 PM
I would expect Rino to have been hit hard by the problems in the banking sector.

However, one other possibility is that Rhino have also gradually eroded their customer base from the change in their business model to getting the bulk of their income from dancers: more girls/higher stage fees/more of a cut from lap dances.

Dancers under understandable pressure to maintain their earnings tend to hustle customers harder to make money. This tends to stop the 'marginal' customers coming as they want to have relaxing evening - not have to keep saying "no" to too many dancers chasing too few customers.

This sets up a vicious spiral: increased hustle drives some customers away --> few customers --> remaining customers get hustled harder --> even fewer customers.

A lot of SC's have taken the short sighted approach that increasing the revenue from dancers temporarily boosts their profit figures - but they seem blind to the long term implications.

Phil.

Paris
03-05-2009, 01:51 PM
I would expect Rino to have been hit hard by the problems in the banking sector.

However, one other possibility is that Rhino have also gradually eroded their customer base from the change in their business model to getting the bulk of their income from dancers: more girls/higher stage fees/more of a cut from lap dances.

Dancers under understandable pressure to maintain their earnings tend to hustle customers harder to make money. This tends to stop the 'marginal' customers coming as they want to have relaxing evening - not have to keep saying "no" to too many dancers chasing too few customers.

This sets up a vicious spiral: increased hustle drives some customers away --> few customers --> remaining customers get hustled harder --> even fewer customers.

A lot of SC's have taken the short sighted approach that increasing the revenue from dancers temporarily boosts their profit figures - but they seem blind to the long term implications.

Phil.

I totally could have written this post! I have bent the ear of a few club owners in the past, and said exactly what Phil laid out, that too many dancers is bad for business. Some shrugged and dismissed my idea (funny, at least one is out of business now) and some listened and still limit their rosters to this day (and have dancers waiting in line for weeks to work there).

Phil-W
03-06-2009, 02:46 PM
I think there's another insidious effect when management puts to many dancers on. If there are too many girls chasing too little money, a few girls will start to allow higher levels of contact in order to try and maintain there earnings.

And that's a slippery slope, because other girls have to go down that road in order to maintain their earnings. Not to mention, customers soon realize they're getting more contact for their money - and won't want to go back to the old regime.

I think this also changes the customer demographic, because the guy that comes in one or two evenings a month for the fun of it, doesn't want to keep coming into a gropefest - so he'll go somewhere else.

So too many dancers (cf my earlier post) not only drives the nicer sort of customer away, but also tends to increase the contact levels in the club.

Were it me, I'd pass a law saying clubs cannot charge dancers any sort of fee until they'd made a basic profit for themselves - say 80/$150 for a 6 hour shift. Then when the dancer had reached that level of income, all further money would be split 70/30 between dancer and club.

That would mean clubs would have to improve their game substantially, but would be able to make a healthy profit if they:

(a) Restricted the number of dancers on a shift to a sensible number
(b) Worked hard at putting bums on seats so that there was a reasonable amount of money coming into the club.
(c) Created an environment within the club that made it fun to spend that money.

What that sort of law would do is stop clubs taking the lazy option of putting on way too many dancers relative to the number of customers.

Phil.

Phil-W
03-08-2009, 05:16 AM
I agree with a lot of what you all are saying, but government regulation of base rent? That's absurd!

Nola,

It wasn't an altogether serious suggestion, but my basic point stands - the business model in many clubs has moved away from a split of entrance fees/drink profits/fees from dancers to one that has increasingly become dependent on fees from dancers.

So many clubs respond to a drop off in business by attempting to make yet more money out of dancers. And the resulting higher level of hustle by girls desperate to maintain earnings has a long term detrimental effect on profitability.

I can understand a hard-pressed GM trying to get the owners off his back by resorting to a short term expedient (more shift fees) - but that's just storing up problems further down the line.

Hence my suggestion of a minimum 'profit' that has to be achieved before clubs can start charging stage fees. It may not be a perfect suggestion, but it's a mechanism that would force clubs back to a more even split between the entrance change/drinks profit/stage fee revenue streams. (There are of course other ways of achieving the same end).

Or do you agree with clubs going down the route of making ever more of their profit from stage fees?

Phil.

mysteryman
03-08-2009, 06:01 AM
No fees such as house fee/locker fee, etc... should be charged right now if the owner/management wants to stablize his club.

Charging an entery fee for a customer is still fine and helps keep the reft-raft out of the club or to a minimum. But charging entertainers right now in this economy is a bad move.

Phil-W
03-08-2009, 02:08 PM
^^^

With due deference to your far greater expertise in this - why change dancers no stage fee at all?

My point in my earlier posts was that the business models in SC's has increasingly come to use dancers as the primary source of revenue - and it would be nice if SC management went back to the old fashioned philosophy of 'putting bums on seats' as the best way to making a long term profit.

That said, dancers are independent contractors making use of the facilities in the club - so the stage fee is a recompense for that. However, it does require club management to recognize that the stage fee (and the number of dancers they put on) should be consummate with the number of customers coming into the club - and not disproportionately loaded against the dancer.

If they want to increase the income they get from dancers - put more 'bums on seats first'.

Phil.

mysteryman
03-08-2009, 03:49 PM
Puting butts in the seats is equal to having quality dancers on hand. If you charge a customer to enter an empty club you will have a bunch of pissed off customers because they are there to see girls dancing. So if the club wants quality girls and control the amount of girls then do not charge right now.

Why cause economic stress on dancers who cannot predict if customers will be in the club when they come making the dancer go negative to show up for work when business is in a down turn.

Smartest move is to suspend charging the entertainer a house fee and keep door fees reasonable. Enforce the dress code for customers.

No house fee for dancers. Increase the quality while decreasing the quantity of dancers per shift. The club can be much more selective on which dancers are hired and how many shifts the dancer will be allowed to work since no house fee is being charged.

This means the quality of dancer goes up, and in turn the customer quantites will go up.

This will stop the dancers from doing hard sale hustles which actually pushes the customer away from coming back to the club on a normal basis. Entertainers can now start off positive, not negative when going into work.

Phil-W
03-09-2009, 02:54 PM
I am going to assume that all of you who are pontificating regarding how you think things should be are customers...

Some us have been managing for 30 years (not in strip clubs) and are quite capable of downloading Spearmint Rhino's UK accounts (9 companies):

http://www.companieshouse.gov.uk

Some of us are also quite capable (if we could be bothered) of getting enough anecdotal evidence from Spearmint Rhino girls (and other employees) as to prices, customer numbers, etc, to combine with the afore mentioned accounts and put together some estimated management accounts, P & L's and cash flow forecasts that are probably not too far from the truth.

Phil.

PS - you might just find one or two of the other guys who post on here have real expertise in the finances of SC's.