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verfolgung
03-26-2009, 02:08 PM
I'm not a labor lawyer, but I do know that when a business exerts so much control over an "independent contractor", at some point, that worker can argue that she has become an "employee" of the SC... The legal consequences are very significant and beneficial to you, because you come under the protection of federal employment laws (sick leave, overtime, worker's comp coverage, unemployment compensation, employee benefits, etc.)... also, the business is liable for a portion of your federal income taxes... and you can even seek unionization... THEY GET AWAY WITH IT BECAUSE YOU LET THEM... Consult with a labor lawyer. Also, review this site for contact information on dancer advocacy groups:
http://www.bayswan.org/EDAindex.html



Jack, the truth of the matter is that there would be just as many dancers, if not more, who would complain about having to work as employees. In many ways an employer/employee relationship would be worse than the unfair practice of charging tip outs.


My position, in terms of the original question posed by this thread "What is Fair?" would either be: 1) Do not charge Tip Outs or House Fees as a trade off for the limitations placed the dancers who are supposed to be independant contractor, or 2) Charge the fees, but lift the restricts to allow dancers to behave in a way that maximizes their earning potential.

Too many complications come into play when converting to an employer/employee arrangement.

jack0177057
03-26-2009, 05:39 PM
Jack, the truth of the matter is that there would be just as many dancers, if not more, who would complain about having to work as employees. In many ways an employer/employee relationship would be worse than the unfair practice of charging tip outs.

But, it sounds like these clubs are already treating the dancers like employees (they exert too much control over them), so why not enjoy the benefits of being an employee? This is specially true if the SC is part of a franchise or large corporation. You assume that, as an employee, you would get a hourly wage and that your annual income will be less than what you earn now. But, your compensation could be structured may different ways. Obviously, a flat hourly rate would not work, because it would not provide any incentive to sell private dances... The compensation would have to be structured like sales people (commissions and bonuses based on sales) or like service providers (salary plus tips)... or or some combination of the two. People tend to think that they are better off as independent contractors, but usually, such arrangement is more beneficial to the business than it is to the worker.

verfolgung
03-26-2009, 06:04 PM
But, it sounds like these clubs are already treating the dancers like employees (they exert too much control over them), so why not enjoy the benefits of being an employee? ...

Well Jack, I agree with you in that there are certainly some potential benefits with being an employee vs. independent contractor. Neither arrangement is perfect, and both have their pros and cons. All I mentioned was that some, not all, dancers would have a serious issue with no longer being able to work as independent contractors.

Money issues aside one of the biggest cons could be hours. Many of the benefits available to employees may only be legally required for those who work full time. This means clubs might be incentivized to restrict dancer hours and scheduleing so that they would never qualify to be more than part time. Dancers who might have flexible shift schedules as independent contractors would be limited to no more than 32 hours per week. Like I said, this one of several potential issues.

Cat2008
03-26-2009, 06:44 PM
As an independent contractor, no one can tell you when you have to be at work or that you cannot leave when you want.
I strongly believe it should be the case but in my experience it is simply not true. Even in NOLA (with which I have good experience), I went to club once (I speaking about Penthouse) and they did not let me go off work when I after quite a few hours of dancing (you have to sign some leaving slip before you leave and they didn't sign it. It was my first day in this club and other dancers told me that they never do that to regular dancers of this club. Needless to say, I never went back although I made good money).

However, where I live right now is a different story. House fees (and dancer income) is really low here but EVERY club requires you to show up on time, otherwise you can be denied of working that day period or will be paying extra charge. You WILL BE fired on spot for leaving early (unless manager letting you in case some extreme situation)! You cannot argue it because you signed agreement when you been hired that they can fire you anytime and don't have to give you a reason. Sometimes you have to work over your regular 8 hours if next shift is slow. Maybe part of reason for that is there are just very few clubs here (some of them have same owner) , so there is not much diversity in terms of rules. But having similar policy for every club, as dancer you have options:
1) quit dancing and find regular job
2) leave area (which is not an option for everyone)
3) waive your freedom to work when you wish and stick to the rules.
Makes me sad...

In fact, I hate that clubs impose working schedules on "independent" contractor much more than high house fees. I mean, they don't pay me right? ...I am ok with paying more for coming to work later, but being fired for leaving early!?

verfolgung
03-26-2009, 07:29 PM
Indeed, great minds do think alike... Once again, playing devils advocate... As an independent contractor, no one can tell you when you have to be at work or that you cannot leave when you want. What they can do is require that you work a certain amount of time or your fees go up. Ironically, my old hair dresser picked up a... we'll call it bad habit, and became very unreliable and had sporadic attendance, in order to "punish" him the salon owner increased his chair fees when he was late, left early, or did not perform as he should. ...

Many of the clubs around my area don't even let dancers even leave the club once they show up for their shift. If he was otherwise working hard, I'm sure if your hair dresser friend would been allowed to leave the salon for an ice coffee or something every now and then without resulting in fines.

Certainly a salon owner has a right to manage the image of his/her salon, and I'm sure an empty chair is not the best thing for anyone. However; if the hair dresser was fully booked with a line of customers waiting, would the salon owner make him stop and give a free demonstration on hair care, or prevent him from giving full-price hair cuts in order to offer a discount styling? ... In your example, the lazy hair dresser shoots himself in the foot and eventually gets weeded out. However, while he was there he was likely afforded every opportunity to be successful.

... As far as paying to cash in funny money goes, The reason for your being charged is two fold: One is that once a customer pays a service charge or puts any money on a credit card which is not specifically noted as being a tip, which can only go to an employee who is being paid a wage and taxed appropriately, that money is the property of the business and can be dispersed as they see fit. The money charged for redeeming vouchers is to make up for the fees and taxes paid on the vouchers, as the sale of funny money is taxed the same as any other sale. The second and most important reason is that in very many instances, the charge is disputed and in order to ensure that the money owed is collected lawyers must get involved and it is an expensive time consuming process, so girls are "taxed" in order to absorb some of this expense.
Okay, I realize you're playing devils advocate, but seriously, are you really trying to tell us that all the fees charged are used to offset administrative and transaction charges and that no profit is being made by the club? Seriously?

I'm sorry, I might agree with you except for the level of charges and fees that are involved when it comes to CC purchases of funny money. Perhaps they wouldn't have so many disputes and legal fees if they didn't charge a $50 surcharge for the use of a CC on top of a 20% fee for the purchase of the funny money, and then charging the girls another 20% when they turn the money in.

To say, "the money is the businesses to be disbursed as they see fit" is a bit misleading. But the biggest issue I have with this is that the average customer does not realize that the dancers pay a redemption fee on top of all the fees they paid to get the funny money to begin with. I think if they did, they either would not even bother with the funny money, or in some cases would give the dancers more to make up for the hair cut. ... (BTW - Other than possibly a slight offset for the transaction fee charged by the CC company, what would you hair dresser friend do if his salon added a 20% surcharge to him whenever a customer paid with a CC?)

jack0177057
03-27-2009, 08:46 AM
Many of the benefits available to employees may only be legally required for those who work full time. This means clubs might be incentivized to restrict dancer hours and scheduleing so that they would never qualify to be more than part time.

In that case, the next step would be unionization, which, I mentioned in my previous post... But, I'm not a dancer, so I'll defer to your arguments...

No easy answer... However, the first step should be to band together, even if just informally... As a group, you would have a lot more power and ammunition... like boycotting a SC for its treatment of dancers.

Cat2008
03-27-2009, 10:20 AM
^^http://forum.stripperweb.com/showthread.php?t=130300

verfolgung
03-27-2009, 10:46 AM
^^^ Thanks for the link Cat. I rarely read that forum, since I'm not allowed to post in there. Heh. I think one of the most telling posts from that thread is the following ...


Never Gonna Happen. I wouldn't sign up for a union because I know its not going to work. And a stripper strike is just laughable... I mean really - MOST dancers are not like SW girls... there's no way they would go on strike... Unions have failed again and again. Strippers are disposable - and stripping is disposable.. its not like we're going to be getting a pension from this union - is it really going to fight for its girls with attorneys, etc? I highly doubt it. A pipe dream really...

After reading this I think there would be a lot of dancers very happy to see an effort to unionize. However, I think they would be the ones who crossed the picket lines and were banking while their competition was on strike. Heh.

Also can't help but wonder about how many young ladies would want their faces on camera and aired on the nightly news while they were standing in a picket line.

I did like the idea proposed in the thread of at least trying to organize a way to effect change in the laws. In most cases the clubs' liquor licenses are their life bloods, and the laws involved with being able to obtain and keep those licenses, apart from zoning laws, are what determines how many clubs operate. I think if dancers could try to influence change in terms of enacting new laws and regulations around the liquor licenses they might be able to win many of the things they want without having the deal with complications of labor unions.

Elvia
03-27-2009, 11:00 AM
I did like the idea proposed in the thread of at least trying to organize a way to effect change in the laws. In most cases the clubs' liquor licenses are their life bloods, and the laws involved with being able to obtain and keep those licenses, apart from zoning laws, are what determines how many clubs operate. I think if dancers could try to influence change in terms of enacting new laws and regulations around the liquor licenses they might be able to win many of the things they want without having the deal with complications of labor unions.


I love this. This is brilliant.

vivianbear
03-27-2009, 11:35 AM
Stripperweb should change its name to Manager/disgruntled_ownerweb. That's all it seems to consist of lately. :-[

jack0177057
03-27-2009, 12:09 PM
I think if dancers could try to influence change in terms of enacting new laws and regulations around the liquor licenses they might be able to win many of the things they want without having the deal with complications of labor unions.

I agree that this is a brilliant idea... You may be onto something...

Also, look at the accomplishments of EDA (http://www.bayswan.org/eda-sf/) in California - Helped to pass A.B. 2509 (Owners who require the payment of "stage fees," "commissions," or "quotas" from any portion of dancers' tips will be in violation of California State labor laws)... Testified in support of AB 2509 amending State labor codes to prohibit management from receiving any portion of exotic dancer's cash gratuities in front of the State Assembly Labor Committee.... Participated in meeting with Chief of Staff, Department of Industrial Relations Division of Occupational Safety and Health regarding improving current working conditions for exotic dancers...

verfolgung
03-27-2009, 01:17 PM
^^^

Forgive me, but I don't really see how that was much of an accomplishment. (Could be why they stopped being an active group in 2004.) The AB 2509 Labor Law amendment was enacted after the Lusty Lady situation where the dancers were able to desginate themselves as employees. Okay, so this law gave some protection to those dancers who were now employees. However, this was always the case when it came to employees. Seems like more of a clarification than a real break through. The real issue regarding the legality of house fees was in regards to levying them against independent contractors.

I think we've already established that becoming employees has its faults, and may not be an ideal solution.

Did it really do anything for the dancers who work at other clubs as independent contractors? I guess I don't know for sure, but do dancers in CA not pay tip outs? The law dates back to 2001. I thought they did, but I could be wrong.

Here is a thread from March of this year discussing CA clubs and their high fees and tip outs.
http://forum.stripperweb.com/showthread.php?t=131044


What they really need is some law that would make the collection of house fees illegal from independent contractors.

Elvia
03-27-2009, 02:15 PM
^^^ Verfolgung, it may have helped, actually. I read an article in Spread last year that reported on dancers in CA who were suing clubs to recoup house fees. They were winning, due to a labor code that defined private dance money as "tips."

jack0177057
03-27-2009, 02:25 PM
Forgive me, but I don't really see how that was much of an accomplishment. (Could be why they stopped being an active group in 2004.) The AB 2509 Labor Law amendment was enacted after the Lusty Lady situation where the dancers were able to desginate themselves as employees. Okay, so this law gave some protection to those dancers who were now employees.

Yes, this is an astute observations... However, different laws define "employee" differently, so you can be an "independent contractor" for federal income tax purposes and retain your independence,... yet be regarded as an "employee" under certain specific state labor laws... A crafty lawyer can help you write a law that gives you the best of both worlds.

Apparently, this is what happened with AB 2509. The law was written with a very broad definition of "employee", obviously intended to capture the independent contractor dancers...

‘‘Employer’’ is defined as "every person engaged in any business or enterprise in this state that has one or more persons in service under any appointment, contract of hire, or apprenticeship, express or implied, oral or written, irrespective of whether the person is the owner of the business or is operating on a concessionaire or other basis."

‘‘Employing’’ is defined as "hiring, or in any way contracting for, the services of an employee."

‘‘Employee’’ is defined as "every person, including aliens and minors, rendering actual service in any business for an employer, whether gratuitously or for wages or pay, whether the wages or pay are measured by the standard of time, piece, task, commission, or other method of calculation, and whether the service is rendered on a commission, concessionaire, or other basis.

If I was a dancer,... I would want to be an independent contractor for general purposes, yet I would want to be included in the definition of "employee" for particular state labor laws that protect me from abusive SCs...

Anyway, regardless of what you call yourself,... if the SC exercises too much control over you, you may already an "employee" under the U.S. Dept. of the Treasury and U.S. Dept. of Labor regulations...

verfolgung
03-27-2009, 02:43 PM
^^^ Verfolgung, it may have helped, actually. I read an article in Spread last year that reported on dancers in CA who were suing clubs to recoup house fees. They were winning, due to a labor code that defined private dance money as "tips."


Yes, this is an astute observations... However, different laws define "employee" differently, so you can be an "independent contractor" for federal income tax purposes and retain your independence,... Apparently, this is what happened with AB 2509. The law was written with a very broad definition of "employee", obviously intended to capture the independent contractor dancers...


Well if those things are the case than good. I'm all for the direction they are heading, and hope the other areas will progress in the same way.

Thank you for the clarification Jack, and hopefully Elvia, it is only the beginning of a positive change.

MRno
03-29-2009, 06:32 AM
Stripperweb should change its name to Manager/disgruntled_ownerweb. That's all it seems to consist of lately. :-[

Agreed, why is there so much belly aching when at the end of the day you are right back at the club working..dancing/stripping, managing,dj'ing.

Seriously for all the "righteous" information given to me and all the "i must be dumb" not to understand what you know. Why haven't you found investors who are more than happy to do business with you. Surely all those great ideas would turn the industry upside down and your true genius will shine through.

Is there a reason why you are so quick to blast people on the internet but yet in the real world you are not willing to demonstrate the willingness to take charge and make a difference. Before you respond blindly, make sure you share with me the club you own and i will be there to enjoy a "true" adult entertainment experience.

I am looking forward to being there with associates to afford you as much exposure that i can humbly manage to have a wonderful experience. Thanks in advance.

Crow2
03-29-2009, 09:39 AM
I've worked in SC's for a long time...

Seen quite a bit. Unions wont work. First and foremost because dancers/strippers/entertainers ( most in the real world ) are flakes. They are not like ninety percent of SW women and have no clue about business and how it works.

Secondly.. as long as the house fees are not more than what I make for myself. Who cares? The LD prices are set and the patrons continue to pay it. I can go most anywhere and get a "job", Leave when my time is up or stay. My call.. I am not on a "set" schedule and can work days that suit me.

The DJ/security/manager(s) usually receive some sort of salary or wage plus tips. Tips increase my service and for the most part I am left alone to do my job.

Whining or griping about pay out's or house fees won't change things. What will change things is all of the independent contractors banding together ( which would be scary enough in itself ) and demanding change. That brings us back to the flake part. Vicious circle.

Crow2
03-29-2009, 11:18 AM
I have been unable to read/respond for a few days due to local circumstances, but I would like to clarify that my previous posts, for the most part have not been my opinion, but conventional thinking or reasoning as presented by owners when I have asked the same questions over the years. My opinion is that while I dont think that dancers should be paid, neither do I think they should work for free, BUT, as previously stated, I do not agree with exorbitant base rent/house fees or whatever you care to call them. As far as laws, rules and regulations, your knowledge in these areas is your power or lack thereof. If you are told that you are not allowed to leave when you like or that you have to be there on certain days at certain times (I specify days/times because as an IC you can be required to be there certain days, so long as no time is specified), you are perfectly with in your right to inform them that as an IC you have no such obligations. Should they threaten you with extra fines or higher than normal fees, this too is in violation of the law because essentially they are blackmailing you. The ball is in your court in this instance, because all it takes is a call to the labor board detailing the situation. So long as you present your information in a way that is factual and does not appear to be a disgruntled employee an investigation will more than likely follow. Should the business be found to be in violation, all fees will more than likely have to be repaid, wages will more than likely be retroactive, taxes will be forced to be paid, and to top it all off, any moneys owed you will be paid with interest, because the thinking is that should you have invested the money owed you, it would have grown and since you were deprived of the opportunity to do this, it is owed you. This has already happened. A few years back it happened at a Deja Vu club in Minnesota if I am not mistaken. I have had to threaten more than a few bosses when they did not care to follow the law. If you are unaware of the law, you are subject to its misuse or miscarriage. If you have any questions or specific examples that you are curious about feel free to ask me because I am well versed.

Indeed.. this is plausible and very "do-able". Since you are in NOLA you will understand my next few comments. MOST clubs ( in my experience ) are run in a forthright and fine manner. SOME operate in a seedy fashion.. so why subject one's self to strong arm tactics. Blackballing and sometimes worse?

Let's face it. LE isn't very keen on supporting or even defending strippers/entertainers in general. The legal system? Even worse. I am not trying to be all gloom and doom here - this is simply the reality of the situation.

MRno
03-29-2009, 11:40 AM
I suppose you may have a point and that this a strippers forum. What i have had issue with is that when "strippers" share a difference of view it seems generally accepted. I have asked for clarification on topics and got hammered for that, i disagree with some views and get blasted.

Nothing was stopping me from making my profile seem as if i share your profession, I suppose then i would have had the benefit of just having my question answered without the drama.

I am not interested in being a "troll" but if you are comfortable viewing me as such thats your issue not mine.

Crow2
03-29-2009, 12:11 PM
I suppose you may have a point and that this a strippers forum. What i have had issue with is that when "strippers" share a difference of view it seems generally accepted. I have asked for clarification on topics and got hammered for that, i disagree with some views and get blasted.

Nothing was stopping me from making my profile seem as if i share your profession, I suppose then i would have had the benefit of just having my question answered without the drama.

I am not interested in being a "troll" but if you are comfortable viewing me as such thats your issue not mine.


Do you strip? Or entertain? IE: Take your clothes off for money? Do you bounce - perform security or play music - run the show for dancers to preform to?

If not then you have to understand that some of us will be slightly peeved when you - as a customer say do this or do that when it concerns we ( the independent contractor) that do it sometimes on a nightly basis.

Of course I am paraphrasing horribly to get my point across. No one likes to be told how to run their business by an individual that is not involved in some way in that business.

And I am not in any way shape or form flaming or bashing you. Simple explanation

Cat2008
03-29-2009, 01:28 PM
Why haven't you found investors who are more than happy to do business with you. Surely all those great ideas would turn the industry upside down and your true genius will shine through.
:O
Oh...MRno, the topic of this thread is "What is FAIR" (as I am sure you aware, you started it). In this context you comment seems a little strange, to say the least. How able you to live in this world for 50 years and still not able to discriminate between "fair" and "profitable for owner of the business"? You think it is the same thing!? Do you think interest taken from side "profitable for owner" as compared to "fair to employee" have equal significance for both owner and the employee? Why you ask then if we are owners to tell what is fair for us?

Cat2008
03-29-2009, 01:30 PM
The ball is in your court in this instance, because all it takes is a call to the labor board detailing the situation. So long as you present your information in a way that is factual and does not appear to be a disgruntled employee an investigation will more than likely follow.
I did not knew that! Good to know. Thank you

chris91
03-29-2009, 02:53 PM
I suppose you may have a point and that this a strippers forum. What i have had issue with is that when "strippers" share a difference of view it seems generally accepted. I have asked for clarification on topics and got hammered for that, i disagree with some views and get blasted.

Nothing was stopping me from making my profile seem as if i share your profession, I suppose then i would have had the benefit of just having my question answered without the drama.

I am not interested in being a "troll" but if you are comfortable viewing me as such thats your issue not mine.

You "difference in view" was that we are greedy and selfish if we complain. You didn't get hammered because you disagreed with us. You got hammered because you insulted us. People would have been mad at you even if you did work in the industry.

You can say "I was looking for clarification" all you want, but don't expect us to be dumb enough to believe it. This thread may be 4 pages long, but we can still go back and see your first post. You came in here with your mind made up about us, and you're still looking for ways to prove what you already believed to be true.

I wouldn't call you a troll. You're just uninformed and quick to judge. Maybe instead of all this backpedaling, you should just edit your first post, admit that you were wrong about us and apologize.

MRno
03-30-2009, 07:06 AM
I see that perhaps had i not have been so interested in "stripper confessions" i may not have posed the question in the first place. But i did and people did write it and I had questions about what you wrote. I know someone said something along the line that it was not meant for me to read, but this is the internet and the site does allow new individuals to browse topics of interest. What was confusing, is I was instantly "viewed" as something when all i did was inquire. I even mentioned this on maybe my first response. It took 3 pages before someone took me serious and replied to educate me oppose to argue my "ignorance" i said thank you.

I mean have you read stripper sins and if you did then perhaps you may realize how someone after reading the posts there may come away with an impression. The difference with me i suppose is that i really wanted answers. I have been told i judge, but i ask is that not the same thing done here to me. Considering that you drew your opinions from my one post, what do you expect of people that read 100's of post in one thread carrying a certain "theme".

That is all.


You "difference in view" was that we are greedy and selfish if we complain. You didn't get hammered because you disagreed with us. You got hammered because you insulted us. People would have been mad at you even if you did work in the industry.

You can say "I was looking for clarification" all you want, but don't expect us to be dumb enough to believe it. This thread may be 4 pages long, but we can still go back and see your first post. You came in here with your mind made up about us, and you're still looking for ways to prove what you already believed to be true.

I wouldn't call you a troll. You're just uninformed and quick to judge. Maybe instead of all this backpedaling, you should just edit your first post, admit that you were wrong about us and apologize.

chris91
03-30-2009, 03:25 PM
I mean have you read stripper sins and if you did then perhaps you may realize how someone after reading the posts there may come away with an impression. The difference with me i suppose is that i really wanted answers. I have been told i judge, but i ask is that not the same thing done here to me. Considering that you drew your opinions from my one post, what do you expect of people that read 100's of post in one thread carrying a certain "theme".

That is all.

I drew an opinion of you based on what you wrote. You drew an opinion of a large group of people that you've never met based on what a few people wrote about one side of a story that you know nothing about. That is the difference.

Cappii
03-31-2009, 03:45 PM
I see that perhaps had i not have been so interested in "stripper confessions" i may not have posed the question in the first place. But i did and people did write it and I had questions about what you wrote. I know someone said something along the line that it was not meant for me to read, but this is the internet and the site does allow new individuals to browse topics of interest. What was confusing, is I was instantly "viewed" as something when all i did was inquire. I even mentioned this on maybe my first response. It took 3 pages before someone took me serious and replied to educate me oppose to argue my "ignorance" i said thank you.

I mean have you read stripper sins and if you did then perhaps you may realize how someone after reading the posts there may come away with an impression. The difference with me i suppose is that i really wanted answers. I have been told i judge, but i ask is that not the same thing done here to me. Considering that you drew your opinions from my one post, what do you expect of people that read 100's of post in one thread carrying a certain "theme".

That is all.


You never get a second chance to make a first impression.

MRno
04-02-2009, 08:55 AM
Thanks ;D

You never get a second chance to make a first impression.

Elvia
04-02-2009, 04:41 PM
^^^what?

Christyismyalias
04-02-2009, 04:47 PM
I look at it this way, if the business wasn't there, I wouldn't be there and then I would be making 6 an hour at a BS job..
So I'm happy to pay what they ask and if they are being greedy and I'm not making profit I'll switch clubs.
People will always complain, that's just the way of the world. :)

Elvia
04-02-2009, 04:56 PM
^^^ But where would we be if we, as a society, just accepted that logic? For any industry? "Oh,well, if you don't like it don't choose to work there?" We'd still be living in a society where the working class basically has very few of the rights we enjoy today, like the 8 hour work day and minimum wage.

jack0177057
04-02-2009, 07:23 PM
^^^ But where would we be if we, as a society, just accepted that logic? For any industry? "Oh,well, if you don't like it don't choose to work there?" We'd still be living in a society where the working class basically has very few of the rights we enjoy today, like the 8 hour work day and minimum wage.

This is an interesting debate and I agree with Elvia that regulations are necessary to protect the worker (or independent contractor, in this case) from employer greed and abuse.

On the other hand, I think you have to be careful not to slit your own wrist. As has been already pointed out, it is not easy to be a SC/GC club owner, and at some point, the financial incentive to own and operate a SC/GC may be completely eradicated. Aside from the constant battle with organizations that oppose SC/GC on moral grounds, club owners have to wage endless legal battles with cities and states. In Dallas, a decade-old legal battle (which I'm sure exceeded a million dollars in legal fees) finally resulted in a settlement requiring clubs to relocate to a designated red-zone area. In Houston, the upscale Penthouse Club was recently forced to close (a big tragedy). In the entire state of Texas, a proposed $5 per customer "sin tax" applicable to SC/GC is being fought in the courts and another "sin tax" applicable to SC/GC is being debated in the legislature. If you add to all this substantial restrictions on what the clubs can collect from the dancers... That action may ultimately become the proverbial straw that breaks the camel's back... You may see SC/GC replaced with Hooters restaurants... (Now, that what be a monumental tragedy!)

That being said, I do agree that laws should be enacted to protect the dancers from the greed and abuses by the clubs... I'm just saying that the financial incentive must remain sufficiently substantial enough to offset the many obstacles and burdens of the club.

In the ideal world... Dancers would own the SC/GC... Really, ladies,... it is totally doable... Three or four dancers (with some savings) should be able to pool together sufficient money for a downpayment to buy a club.

chris91
04-03-2009, 03:01 AM
. I'm just saying that the financial incentive must remain sufficiently substantial enough to offset the many obstacles and burdens of the club.


The financial incentive must also remain sufficiently substantial for the dancers. If the club needs to raise my fees to cover their costs, that's fine as long as I can raise my prices to cover my fees. That is not what is happening.

Crow2
04-03-2009, 11:46 AM
This is an interesting debate and I agree with Elvia that regulations are necessary to protect the worker (or independent contractor, in this case) from employer greed and abuse.

On the other hand, I think you have to be careful not to slit your own wrist. As has been already pointed out, it is not easy to be a SC/GC club owner, and at some point, the financial incentive to own and operate a SC/GC may be completely eradicated. Aside from the constant battle with organizations that oppose SC/GC on moral grounds, club owners have to wage endless legal battles with cities and states. In Dallas, a decade-old legal battle (which I'm sure exceeded a million dollars in legal fees) finally resulted in a settlement requiring clubs to relocate to a designated red-zone area. In Houston, the upscale Penthouse Club was recently forced to close (a big tragedy). In the entire state of Texas, a proposed $5 per customer "sin tax" applicable to SC/GC is being fought in the courts and another "sin tax" applicable to SC/GC is being debated in the legislature. If you add to all this substantial restrictions on what the clubs can collect from the dancers... That action may ultimately become the proverbial straw that breaks the camel's back... You may see SC/GC replaced with Hooters restaurants... (Now, that what be a monumental tragedy!)

That being said, I do agree that laws should be enacted to protect the dancers from the greed and abuses by the clubs... I'm just saying that the financial incentive must remain sufficiently substantial enough to offset the many obstacles and burdens of the club.

In the ideal world... Dancers would own the SC/GC... Really, ladies,... it is totally doable... Three or four dancers (with some savings) should be able to pool together sufficient money for a downpayment to buy a club.


Doable yes.. First off no one would take us seriously ( Ive tried)
All I got for my trouble was a pained smile - pat on the rear and the run around.

jack0177057
04-03-2009, 12:27 PM
Doable yes.. First off no one would take us seriously ( Ive tried)
All I got for my trouble was a pained smile - pat on the rear and the run around.

I commend you for trying... I don't know why you wouldn't be taken seriously... You do need to hire professionals to assist you, though... You need a lawyer to incorporate your business (even before you buy the club) and prepare legal documentation concerning the company's organizational structure and its investors, employees, etc... You need the assistance of a CPA to prepare a business plan, proposed budget, projected revenue, financial statements, etc... You also need a loan broker to research many different banks, so you find the right fit (probably one that has worked with clubs already and understands the industry)... You may also need to include in your loan application the names and credentials of an experienced staff of people that you will hire to help you manage the club...

So, its doable,... but yeah, it takes a lot of work... and you cannot do it alone... At minimum, you need a lawyer and a CPA on your team... And I would strongly recommend that you use professionals that have worked with other clubs and are very familiar with the industry. Ask the club owners who they use.

Also, a good place to go for free business counseling and education is the local office of the US Small Business Administration.

Crow2
04-03-2009, 01:57 PM
* Sighs *

Yes dear.

I KNOW all of that - that's why it ticked me off so badly. I DID all of that.

jack0177057
04-03-2009, 02:06 PM
* Sighs *

Yes dear.

I KNOW all of that - that's why it ticked me off so badly. I DID all of that.

I would blame your lawyer and/or CPA, then... Was it a stock purchase or asset purchase transaction? A stock purchase should be easier because you wouldn't be required to apply for new permits, licenses, etc...

glambman
04-03-2009, 02:18 PM
Sorry to be a spoiler but regardless how well your plan is, if you don't have significant assets to put up as collateral, no financial institution is just going to put up all the money.

jack0177057
04-03-2009, 02:56 PM
Sorry to be a spoiler but regardless how well your plan is, if you don't have significant assets to put up as collateral, no financial institution is just going to put up all the money.

No, not all the money... You probably need at least $150k for the downpayment and operating capital... That's why I suggested several dancers pooling their savings (maybe $30k to $50k each).

The club itself is the collateral... Are we talking about buying the real estate (good collateral) or just the business personal property - tables, chairs, sound system, etc. (not-so-good collateral) and leasing the building?

I've seen people with some savings, but very little actual wealth, purchase multi-million dollar commercial property... Before the subprime mortgage crisis, it was shocking to see how little wealth was actually required to borrow millions of dollars for real estate investments... Obviously, the real estate has to be good collateral and the borrower has to show that it has a very sound business plan... For example, if you are buying a SC/GC that has been around for a while, has been very lucrative and you are leaving the same management in place, it should be easy to convince a bank that it is a sound investment (so long as the sales price is reasonable). But, requesting a loan to construct a new building in the untested boonies to be used as a SC/GC will not be an attractive deal for the banks, specially since you have to apply for a number of permits and licenses, which might or might not be approved.

Anyway, this was true prior to the subprime mortgage crisis... In the current economy, everyone is having a tough time getting the banks to loan them money...

Crow2
04-03-2009, 03:20 PM
No, not all the money... You probably need at least $150k for the downpayment and operating capital... That's why I suggested several dancers pooling their savings (maybe $30k to $50k each).

The club itself is the collateral... Are we talking about buying the real estate (good collateral) or just the business personal property - tables, chairs, sound system, etc. (not-so-good collateral) and leasing the building?

I've seen people with some savings, but very little actual wealth, purchase multi-million dollar commercial property... Before the subprime mortgage crisis, it was shocking to see how little wealth was actually required to borrow millions of dollars for real estate investments... Obviously, the real estate has to be good collateral and the borrower has to show that it has a very sound business plan... For example, if you are buying a SC/GC that has been around for a while, has been very lucrative and you are leaving the same management in place, it should be easy to convince a bank that it is a sound investment (so long as the sales price is reasonable). But, requesting a loan to construct a new building in the untested boonies to be used as a SC/GC will not be an attractive deal for the banks, specially since you have to apply for a number of permits and licenses, which might or might not be approved.

Anyway, this was true prior to the subprime mortgage crisis... In the current economy, everyone is having a tough time getting the banks to loan them money...


Now? Pahaha.. I would not even bother.
Jack darling. Sweetheart. DEEP SOUTH and yes.. the traditional antiquated ideals still do apply. Need I say more?

glambman
04-03-2009, 03:20 PM
That sounds like what you hear on the infomercial on getting started in real estate with little or no money. While I have had friends who followed that route for rental properties, none ever bought multi-million dollar properties, and what they did own was highly leveraged.

When I first tried to get in business for myself, I went the route of trying to buy an existing business (with me providing 1/4 of the cost) and did not fare as your ideal. It sounds good in theory.

jack0177057
04-03-2009, 03:49 PM
DEEP SOUTH and yes.. the traditional antiquated ideals still do apply. Need I say more?

Okay, let's assume that is true... This is easily resolved... You form a corporation and elect church-going right-wing conservative good-old-boys (friends and/or relatives) as the directors and CEO of the company. On paper, they are managing the company and they apply for the loan. However, they have little or no actual ownership of the corporation. Also on paper, you are a mere "passive" investor (albeit the majority shareholder). As the majority shareholder, though, you have the power to call a special meeting anytime to replace the directors and the CEO at whim, so you retain all the actual power despite your "passive" role.

jack0177057
04-03-2009, 04:09 PM
That sounds like what you hear on the infomercial on getting started in real estate with little or no money. While I have had friends who followed that route for rental properties, none ever bought multi-million dollar properties, and what they did own was highly leveraged.

When I first tried to get in business for myself, I went the route of trying to buy an existing business (with me providing 1/4 of the cost) and did not fare as your ideal. It sounds good in theory.

Not theory, buddy... The law firm I work for represents a bank (can't say which one). We see the financial statements and balance sheets for the borrowers and can't believe that these individuals are getting millions of dollars for the acquisition of commercial property... But, it happens... Or, it used to happen...

And again, no one is saying "no money down", I am assuming that a few dancers with savings can come up with at least $150k for a downpayment and operating capital.

Anyway, if you cannot obtain loan big enough to purchase the real estate, the next best option is to lease the space. In that case, you would need to purchase and finance only the equipment, furniture, fixtures, etc., which should could be relatively inexpensive, depending on the size of the club, whether you are buying new or used, fancy or standard, etc.. Your biggest on-going expense would be the rent.

Crow2
04-03-2009, 04:25 PM
Okay, let's assume that is true... This is easily resolved... You form a corporation and elect church-going right-wing conservative good-old-boys (friends and/or relatives) as the directors and CEO of the company. On paper, they are managing the company and they apply for the loan. However, they have little or no actual ownership of the corporation. Also on paper, you are a mere "passive" investor (albeit the majority shareholder). As the majority shareholder, though, you have the power to call a special meeting anytime to replace the directors and the CEO at whim, so you retain all the actual power despite your "passive" role.


I swear. Your like a bulldog.

glambman
04-03-2009, 04:29 PM
Not theory, buddy... The law firm I work for represents a bank (can't say which one). We see the financial statements and balance sheets for the borrowers and can't believe that these individuals are getting millions of dollars for the acquisition of commercial property... But, it happens... Or, it used to happen...


When you say commercial property, do you mean it as in a business, or a commercial property as in real estate?. Probably both? :D

I don't doubt it happens/ed (for both), but goes against everything I experienced from traditional financial sources. I looked into non traditional sources, but the terms were enough to shy me away (for the better).

jack0177057
04-03-2009, 05:55 PM
I don't doubt it happens/ed (for both), but goes against everything I experienced from traditional financial sources. I looked into non traditional sources, but the terms were enough to shy me away (for the better).

Did you look at SBA loans? What kind of business where you trying to finance?

jack0177057
04-03-2009, 05:56 PM
I swear. Your like a bulldog.

Do you like bulldogs?/:O

glambman
04-03-2009, 06:25 PM
Did you look at SBA loans? What kind of business where you trying to finance?

That was the first type I looked for, and aside from putting my own money into it, they wanted as close to (and preferably) 100% collateral from personal assets (the business could not be included) or co-signers, etc..

They, as well as the traditional banks, wouldn't do it, as I couldn't collateralize the loan. But the 25% I did have, allowed me to start with a small start-up. Took a different route to my destination. 8)


EDIT:: This was not in the last round of easy finance, but in the late 80's to early 90's.

verfolgung
04-05-2009, 01:16 PM
Not theory, buddy... The law firm I work for represents a bank (can't say which one). We see the financial statements and balance sheets for the borrowers and can't believe that these individuals are getting millions of dollars for the acquisition of commercial property... ...

You work in a law firm with a specialty in commercial real estate? What do you do there exactly?

My apologies but you seem fairly naive on the issue of financing a SC. Especially with a small ownership group vs a large corporation.

It's not the cash nature of the business or level of personal guarantee that prohibits these types of transactions. It's the public relations.

As someone who works on the legal side of commercial real estate, then you are aware that in most areas mortgages are recorded documents, and typically public record. It is because of this situation that very few insitutions are willing to lend on these types of properties. They do not want the public relations nightmare associated with being discovered as the mortgageor.

Whether they be insurance companies or banks, portfolio lenders have rating agencies and regulators that they have to answer to.

SBA is not really an option, because in their 504 program they need a bank to underwrite and provide the frist mortgage piece.

Even in the boom times of CMBS lending from 2004-2006, adult entertainment was it's own specialized nitche. CMBS backed by SC assets would most likely either get quickly downgraded or immediately removed from a securitized pool.

The few lending institutions who are willing to lend on these property types can be best classified as "hard money" requiring several points and a much higher than normal rate of interest.

If you really want to know, the best souce of capital for these types of properties are foreign investors. Again, you're most likely looking at hard money terms or "loan to own" transactions, so it's a lot like dancing with the devil.

verfolgung
04-05-2009, 01:23 PM
... Anyway, if you cannot obtain loan big enough to purchase the real estate, the next best option is to lease the space. ...


Bwahahahahah! OMG, you crack me up. Oh, that's a good one. ROTFL!!!


... Oh wait, you're serious?

jack0177057
04-06-2009, 08:13 AM
You work in a law firm with a specialty in commercial real estate? What do you do there exactly?

My apologies but you seem fairly naive on the issue of financing a SC. Especially with a small ownership group vs a large corporation.

It's not the cash nature of the business or level of personal guarantee that prohibits these types of transactions. It's the public relations.

As someone who works on the legal side of commercial real estate, then you are aware that in most areas mortgages are recorded documents, and typically public record. It is because of this situation that very few insitutions are willing to lend on these types of properties. They do not want the public relations nightmare associated with being discovered as the mortgageor.

Whether they be insurance companies or banks, portfolio lenders have rating agencies and regulators that they have to answer to.

SBA is not really an option, because in their 504 program they need a bank to underwrite and provide the frist mortgage piece.

Even in the boom times of CMBS lending from 2004-2006, adult entertainment was it's own specialized nitche. CMBS backed by SC assets would most likely either get quickly downgraded or immediately removed from a securitized pool.

The few lending institutions who are willing to lend on these property types can be best classified as "hard money" requiring several points and a much higher than normal rate of interest.

If you really want to know, the best souce of capital for these types of properties are foreign investors. Again, you're most likely looking at hard money terms or "loan to own" transactions, so it's a lot like dancing with the devil.

Granted, I have not worked with SCs before, but I find your statements hard to believe,... at least,... here in Texas. We have adult entertainment establishments all over the place... SCs, GCs, Modeling Studios, Adult Video stores, Lingerie/Boutiques, Adult Novelty stores, etc... I cannot imagine all these businesses relying on foreign banks... Yes, maybe the more mainstream banks might shy away from this due to concerns over their public image, but there are many MANY other banks that only care about their bottom line... And bottom line is this--adult entertainment is a good investment... good economy or bad,... men want to look and naked beautiful women. Just read this article -- http://www.nydailynews.com/news/2007/07/08/2007-07-08_the_naked_truth_about_strip_clubs.html?page=0

Also, the "pornification" of America has made a lot of adult entertainment mainstream. Every major hotel chain subscribes to porn channels, every major cable or dish company offers porn on-demand, adult entertainment companies are listed on the stock exchange, like Rick's and VCG Holding Corp - both of them operating many SCs. If NASDAQ and the ASE don't have any heartburn's over promoting SCd/GCs financing, I cannot imagine a greedy little banker of a lesser-known american bank refusing to finance a cash cow.

According to the 2007 New York Daily News article I referenced above - Troy Lowrie, CEO of VCG Holdings (a publicly listed SC owner) made this statement -- "There are about 3,600 strip clubs nationwide,... And from a business point of view, it's all like Las Vegas was in the early '70s. Investors and banks are realizing that like gambling and casinos, adult entertainment and gentlemen's clubs are a legitimate business."

I guess you should also ask him what he does at VCG Holdings... Because according to you, he doesn't have a clue...

Look,... there may be obstacles and a long journey... My point is simply this... other people are doing it... Stop saying it can't be done...