How Big is New York Nightlife? Part II

By Gamal Hennessy

Last night I described the size and scope of nightlife venues and what they do to directly stimulate the economy. Today we’ll look at the other side of the equation and look at the economic activity of patrons in New York clubs.

Patron Population

All the venues and operators are useless without someone to actually serve. The 2004 Impact Study concluded that the attendance in New York clubs is more than 65,000,000 entries per year. Keep in mind that ‘entries’ is not a direct measure of the number of people who patronize nightlife on an annual basis, since club hopping and bar crawling could take one person to several venues in a night. A tourist might hit a club on her vacation in New York. A nightlife native might visit 50 or 60 venues in a year. Although total entries do not translate directly into 65,000,000 patrons, it is more than three times the amount of attendance at all 8 New York sports teams combined. 64% of nightlife patrons live within the five boroughs with each New York native visiting an average of 2.14 clubs per night out. The other 36% of all nightlife patrons came into the city from out of town and they visit an average of 2 venues per stay.

Cash Flow

Pre-Club Activity: Patrons don’t just magically appear on the dance floor at night. There are many activities that they engage in and spend money on before the night begins. The Study found that each native spent an average of $67 per person on these ‘pre-club’ activities including purchasing clothing, dining out and other activities. In addition, 82% of patrons used some form of transportation to get to the venue, for another $15 per person. So in total, each New York resident spent about $80 before she even walks inside the club. Tourist spending at non nightlife venues was even higher than resident spending. 86% of tourists people engaged in some other activity when they went to a club including dinner shopping, but also including hotels, theaters and sightseeing for an average of $90 per person. The out of town group also spent an average of $110 to get to and from the city and the venues they decided to visit, bringing their per person spending total to almost $200.

Liquor Purchases: The Study and the Zagat guide don’t estimate how much patrons spend when they are actually in a venue, but we can develop an educated guess. In our estimate, we’re going to assume that a person goes into a bar or club and buys four drinks; two for himself and two for the person he is with. I’m assuming a social unit of two, even though larger groups are just as common in clubs. I’m also assuming basic manners here, which means people not going Dutch. This might be overly optimistic in New York City, but in my experience New Yorkers can be very generous with alcohol, especially if they’ve already had a drink or two.

To keep things simple, I’m not including cover fees, coat check fees or bottle service, which would raise the numbers exponentially Let’s say each drink is $10. This is an average between the $5 beer and the $15 martini. That means in every club this guy goes into, our theoretical patron spends a total of $40. Let’s project that out to the total group. If there are 65,000,000 entries per year and only half of them pay for drinks then that’s 32,500,000 “drink entries” per year. If each drink entry is worth $40, then the estimated spending by nightlife patrons in clubs is 1.3 billion dollars.

Effect on the City

The amount of jobs, patronage and spending in nightlife might seem abstract until you put it in context. To place the numbers in perspective, we can look at the local film industry. According to the Mayor’s Office for Film, Theater and Broadcasting, local TV and movie production generates $5 billion dollars in economic activity for the city. In comparison, nightlife generates twice the revenue. The film industry has a government office to support and promote it. Nightlife has no such office despite repeated calls from operators to create it. If and when the city puts its full support behind the nightlife industry the benefit to the city could rise exponentially.

Have fun.
Gamal

How Big is New York Nightlife?

By Gamal Hennessy

There is a movement building to transform millions of nightlife patrons into a political force. As organizations like the Nightlife Preservation Community begin to gain momentum, it makes sense to look at what nightlife brings to the New York economy in hard numbers. When you look at the number of jobs, the number of patrons, the amounts the clubs spend and the amounts the patrons spend you begin to see how vital nightlife is to the financial health of the city.

Where the numbers come from
The New York Nightlife Association (NYNA) is an organization that represents the nightlife industry in New York. The NYNA commissioned a study in 1998 and again in 2004 called “The $9 Billion Dollar Impact of the Nightlife Industry on New York City”. Two weeks ago, Zagat released its 2009-2010 New York nightlife Guide with an updated analysis of the club industry. The numbers in this article are based on these two studies and my own calculations. The numbers coming out of the study have been verified, but since I can hardly add, my calculations are suspect at best.

Venues and Operators
According to Zagat, New York City currently has more than 1,300 nightlife venues, including 100 new venues added in the past year. This finding is supported by our own Trends Report that has continued to track new venues opening almost every week in spite of the economy. While there is no mention of how many venues were lost in 2008, the number of new venues is remarkable considering the economy and the stiff competition for drinking dollars.

Each venue needs several different people on hand to service and entertain customers on a nightly basis. The employees included management, security, bartenders, bar backs, dancers, waitresses, sound and light technicians and food service people such as cooks and chefs. It did not cover people who worked in the club, but were not direct employees of the venue, like musicians, DJ’s and promoters. According to the Impact Study, each bar has an average of 17 people on staff and each nightclub having approximately 38 people working there for an average of 27 operators per venue. That means that the total number of operators currently hovers around 35,000 people. The secondary group of natives who work in the club but do not work for the club is also considerable. Based on the study, nightlife generates 8,600 more local jobs as a direct result of its activities. This means that nightlife employs almost 44,000 people locally.

Spending by Operators

Wages: There are three major costs that operators pay for to keep their businesses running; wages, operational costs and taxes. Employees on the payroll of venues earn approximately $531,000,000 in wages and salaries every year. Freelance operators pull in more than $320,000,000 dollars per year. I can tell you from personal experience that the distribution of these funds varies wildly. If an unknown DJ spins at a club, she might get free drinks. If I DJ at a club, I might get $250 for a night. If a superstar DJ spins for a night, he could get several thousand dollars. While the distribution of these funds fluctuates there is still more than $850,000,000 in wages being generated by this industry, with a majority of those funds getting pumped back into the local economy.

Operational Costs: A bar or club has to purchase a significant amount of goods and services in order to offer its service to the public. While liquor and food are obvious examples, venues also have to purchase capital improvements to their spaces, furniture, cleaning and sanitation, electricity, climate control, accounting, legal advice, advertising, marketing, permits, music licensing fees and financial services. According to the Impact Study, nightlife spends more than $755,000 million dollars worth of goods and services in the city every year.

Taxes: Nightlife venues have to pay business taxes, sales and use taxes and in certain cases real estate taxes to stay in operation. The employees have to pay income taxes on the wages that they have earned (although I believe some payments are made on a cash basis to avoid taxation). The Impact Study estimates that nightlife pays the almost $104,000,000 million dollars a year in taxes to New York City and another $46,000,000 million dollars to New York State.

Part II of this study will be available tomorrow…

Have fun.
Gamal

What Imette St. Guillen’s Death Means to Nightlife

By Gamal Hennessy

On February 25, 2006, Imette St. Gullien left the Falls Bar with Darryl Littlejohn. Two days later her body was found. She had been beaten, raped, murdered and dumped on the side of a road in Brooklyn. Her killer was convicted late last week, but the shockwaves from her death are still being felt in the industry. The creation of the CEI and the passage of Imette’s Law are directly tied to Ms. St. Guillen’s death and have permanently altered the nightlife landscape in New York.

The Sean Bell Connection

The Club Enforcement Initiative (CEI) was set up by the New York City Police Department shortly after the Ms. St. Gullien was killed. Fourteen officers were recruited out of the vice and narcotics squads and sent into clubs undercover where they would investigate drug sales, prostitution and other alleged crimes. The officers were allowed a two drink minimum to help them blend into the venue and they would take deliberate steps not to reveal their identity once they were in the club.

Unfortunately, the police of the CEI were themselves accused of nightlife violence shortly after the unit was created. In November of 2006, Sean Bell and his friends left a strip club called Club Kalua in Queens after his bachelor party. Believing Mr. Bell to be armed and the suspect of a crime, the CEI proceeded to follow Bell’s car. Police reports indicate that after the car hit one of the officers and slammed into an unmarked police van, members of the CEI fired 50 rounds into Sean Bell’s car, killing him and wounding two of his friends. It was later discovered that Bell was not armed and was not guilty of any crime. This incident touched off heated debate within the city about police brutality and racism within the department.

The Best Practices Connection

On the other side of the coin, the murder of Imette also led to increased cooperation between operators and the NYPD. In 2007 a Nightlife Summit was held to discuss the issue of crime and violence within nightlife. City Council Speaker Christine Quinn organized the summit that brought together Police Commissioner Ray Kelly, David Rabin, the current president of New York Nightlife Association and other various club owners.

The result of that summit was the 58 measures of the Nightlife Best Practices which were supposed give club owners incentive to call the police if trouble occurs. In theory, the call would not raise the specter of disorderly premises citations that interfere with liquor licenses and the ability to stay open. Shortly after the summit, the New York State Assembly’s passed Imette’s Law which required video surveillance in clubs and stronger background checks for security staff

Unfortunately, not every measure discussed during the summit translated into policy. The operators at the Summit also called for finding ways to get more cops to patrol outside clubs and bars, increasing accountablility for teens that use fake IDs, targetting the makers and sellers of fake IDs, raising the admittance age for venues from 16 to 18 or 21, and fostering a better relationship among club owners, the NYPD and the SLA. Unfortunately, these measures have yet to be been implemented. Even though they could have improved safety from all types of crime and violence these recommendations were pushed aside for a quick fix at the operator’s expense. A chance to support nightlife was rejected for a one sided demand for operators to assist a police investigation after a crime as taken place.

A camera can record who goes into a club, who leaves, when they leave and who they leave with. If a person like Ms. St. Guillen leaves with a murder like Mr. Littlejohn, then the homicide division will be able to look at the tapes and compare them to criminal profiles once the body turns up bound and asphyxiated. But if there were police patrolling the club areas, criminals might decide to not commit their crimes at that point. If there were Paid Detail officers standing outside of The Falls then perhaps Ms. St. Guillen would have had other options on how to get home instead of walking away with someone she never met. Maybe nothing would have changed, but even the likelihood that nightlife could be safer should be enough of an incentive to take up the Summit’s recommendations.

Littlejohn has been convicted of murder, the lawsuits against the operators of the club are still pending and operators and patrons socialize under the new guidelines. Although violent death is extremely rare in New York nightlife, the steps left on the table during the Nightlife Summit could make nightlife even safer. Hopefully more political action on the nightlife issue will lead to more progress in the wake of Ms. St. Guillen’s death.

Gamal

A New Fight Over New Bars

By Gamal Hennessy

Hidden away from the major media outlets, a struggle is brewing over the nightlife industry in New York. The fight revolves around the laws that govern bars and the way nightlife is perceived. The latest battle in this conflict concerns the Beverage Control Law and how it is interpreted. Anti nightlife groups are planning to change current SLA law to serve their own interests and if their influence isn’t counterbalanced nightlife will suffer.

The current law requires a public hearing for any potential liquor license opening up within 500 feet of two other licenses. If you consider how dense New York is, you’ll quickly realize that almost every new venue requires a 500 foot hearing. Residents who oppose nightlife venues in general often use the 500 foot rule to protest the opening of new venues.

A judge in a recent court case involving Hudson Terrace held that a 500 foot hearing is only necessary for establishments of the same type, not for any liquor license. For example if a bar wants to open up within 500 feet of three other bars, then a hearing is required. But if a bar wants to open up within 500 feet of three clubs, or two clubs and a restaurant, or a club a restaurant and a cabaret, then no hearing is required.

Anti-nightlife elements within the city don’t plan to lose their main weapon without a fight. Daniel Squadron, a new State Senator who turned his back on nightlife before he was even elected, plans to re-write the law to tighten the restrictions and circumvent the judges ruling. He claims that “the decision undermines the spirit of the law”, so the law needs to be fixed.

There are at least three unspoken concepts that are flawed when it comes to the way anti nightlife elements deal with the 500 foot hearing process. First, they assume that more venues are automatically a problem. However, it is just as likely that more venues could reduce crowding and increase revenue for the city and the state. Second, there is an assumption that the community board is the best forum for making decisions about additional nightlife venues. But that body does not and cannot take in to account the cultural and financial impact of the venue on the city. Third, that the BCL needs to be changed to inhibit and restrict nightlife growth when in fact much of the law dates back to Prohibition and needs to be revised not to inhibit nightlife but to bring the law in line with the realities and needs of nightlife in the 21st century.

The BCL does need to be revised and the 500 foot rule needs to be examined but pro-nightlife and anti-nightlife groups need to weigh in on the subject. People concerned with the character of the individual neighborhoods and the viability of the city overall need to be heard. Hopefully organizations like the NYNA and the NPC will get involved with this issue and prevent further erosion of nightlife in New York.

Have fun.
Gamal

New Political Group Forms to Enhance New York Nightlife

By Gamal Hennessy

Unless you are having a heated political discussion over beers, nightlife and politics don’t usually mix. Think about it, what does politics have to do with grabbing a drink with your friends, chatting up a girl for her phone number and dancing like no one is watching? Why not sit back, have a good time, and leave politics for the politicians?

That isn’t a good idea because if we don’t see nightlife as a political issue, we don’t have a voice. Various groups including community boards, law enforcement agencies, and real estate developers weigh in on what they want in relation to nightlife. The only major group that does not have a seat at the table to push its agenda is us. Patrons do not have an organization that directly represents their needs or even defines what those needs are.

A group of nightlife advocates are taking steps to improve this situation by creating the Nightlife Preservation Committee (NPC). Utilizing their ability to reach voters, their substantial connections in media and entertainment and the financial strength of their industry, the NPC plans to be a forum for nightlife that has not been seen in local politics before.

In the short term, the NPC plans to establish political influence in the New York City primaries by reaching out to almost 500,000 club goers who are also registered voters. That voting block could make or break the career of an aspiring politician, since local primaries are often decided by only a few thousand votes. At the same time, the NPC want to act as a bridge, connecting nightlife patrons to the local community, law enforcement, health agencies and other groups that have not seen eye to eye in the past. In the long term the NPC plans to represent the interests of the nightlife community as the issues and concerns about nightlife evolve.

The members of the NPC were kind enough to let me sit down with them as they planned their inaugural event, which is scheduled for June 22nd at M2. I met with Ariel Palitz (Sutra), Steven Lewis (Good Night Mr. Lewis), David Rabin (the New York Nightlife Association), Paul Seres (Sol), Morgan McLean (Rebel) and Paul Insalaco (BF9 Media). I posed several questions to the group to get a better idea of how they planned to connect nightlife and politics.

NYN: What are the long term goals of the NPC?
David Rabin: “In the broadest sense, we want to have an impact on state and local politics as they relate to the nightlife industry.”

Steven Lewis: “We want to revive the concept that New York is the City That Never Sleeps in the same way that Vegas embraced the concept of What Happens in Vegas Stays in Vegas. We want to spotlight the link between the prosperity of the city and the prosperity of our industry in the same way that the two concepts are connected in Vegas and Miami.”

Are you planning to use the NPC as a pro-nightlife organization to counter anti-nightlife groups within NYC?
Ariel Palitz: “We aren’t trying to polarize the discussion. We don’t want one group of people to automatically vote against any new club. We also don’t want anyone to fight for every venue as a knee jerk reaction. Our goal is to have each venue and each issue judged on its own merits.”

Paul Seres: We are trying to create a more balanced discussion, rather than increase the level of conflict between nightlife and the community. Most of us serve on community boards, so we know there are a lot of things that need to be considered with each club and each operator.

What public relations challenges does the NPC face?
Morgan McLean: “The media paints the entire industry with one broad brush. If one of us is accused of something, then all of us are assumed to be guilty, but an entire industry should not be defined by a few bad operators.”

Rabin: “When someone gets robbed inside a bodega, the cops don’t make the bodega liable. If a fight breaks out in a pizzeria and someone gets hurt, the pizzeria isn’t blamed. In the current environment if those same incidents happen in a club, then it’s the club’s fault. It’s the entire industry’s fault.”

Lewis: “We need to change the way we are perceived. Nightlife brings jobs and taxes and tourism and life to the city. We generate twice the revenue of film and television in New York. Our annual attendance is more than every major sports team and Broadway combined. We want to work with the city and the community boards to continue to do that and more.”

Morgan: “We can’t build our individual businesses or enhance nightlife in general because we spend so much time trying to defend and justify our existence.”

How is the NPC different from NYNA? Both groups are run by operators. Both groups support and advocate local nightlife? Why is a separate group necessary?

Seres: The NYNA is a trade association of nightlife owners. The NPC is a conduit of information for nightlife patrons. It is designed to mobilize people who are interested in the political and policy aspects of nightlife in a manner that is similar to a political action committee.

The NPC will officially kick off on June 22nd. What happens on June 23rd?
Seres: We plan to launch a website on the same day as the initial event and use that as a way to get information out to our people on an ongoing basis. We’d also like to have a series of meetings and events where candidates running for office can meet patrons who are interested in protecting nightlife. Many people never get to meet or talk to the people that they vote for. The NPC will give them a platform to express how important nightlife is to their entire life.

Have fun.
Gamal

The Liquor Authority Gets a Wake Up Call

By Gamal Hennessy

Last week the Inspector General raided the offices of the State Liquor Authority. Former SLA employees are being accused of bribing employees to manipulate the system. While the investigation focuses on the gift cards and other petty items offered in exchange for “preferred” treatment, officials need to focus on the underlying situation that created the fraud and clean up the liquor licensing system.

The New York State Alcohol Beverage Control Law (ABC) states that an application for a liquor license should get an initial review within 30 days. Nightlife operators have complained for years that the review often took 2-3 months because of a lack of inspectors among other issues. Recently, nightlife opponents in the outgoing administration managed to drag out that period to 6-8 months.

Operators became increasingly frustrated with the process, since the investment in a bar or club can’t start to make money until they can sell liquor and they can’t sell liquor without a license. That’s where the “handlers” would come in. For a fee, these former SLA employees would offer ‘expedited service’ for an application. The IG claims that the service they performed was calling up their friends who still worked in the SLA, and asking for the applications to get moved to the top of the pile. In return, the handlers would give their friends gift cards and, ironically, bottles of liquor. The IG alleges that some applicants got their forms processed in as little as 11 days instead of waiting half a year or more.

It is regrettable that people in positions of authority, however minor, are willing to manipulate the bureaucracy for their own personal advantage. But the larger issue revolves around the system itself. Robert Bookman, attorney for the New York Nightlife Association, sees this raid as the result of a dysfunctional system:

“It takes 8 months to get a liquor license when the law requires it be done in 30 days. Huge investments are sitting and waiting for a license that is long overdue. Is it any wonder that people will get desperate and will do whatever they have to just to get an honest review of their application? That is the real scandal here. Notice there are no allegations that anyone got a license that they were not entitled to. The crime is that the applications were reviewed quickly…the way they are supposed to be reviewed. I am not condoning illegal activity, but no one has been listening about this unlawful, unacceptable wait for liquor licenses before now.”

If the leaders of the SLA essentially broke the law and created a situation where potential operators have to wait 6-8 months for a license, and refused to hire more examiners, then they created the atmosphere for corrupt practices in the Harlem office. The responsibility for this corruption needs to go a lot higher than the clerks who took Applebee’s gift cards. It needs to lead to a revamping of the whole process. Governor Paterson said he supported “the actions of the I.G.’s office to uncover any wrongdoing that may have occurred within the S.L.A. and is working with the S.L.A. to rebuild the organization.” Hopefully this raid can be the beginning of an overhaul that helps bring jobs and revenue to the state while cleaning up a government agency at the same time.

Have fun.
Gamal

The World's Loudest Cigarette: Six Years of the Smoking Ban

Six years ago this week, a smoking ban was imposed on bars, restaurants and other venues in New York City. While the atmosphere inside bars has improved and there are studies that suggest that there has been a significant improvement in the health of nightlife operators and patrons, there have also been secondary effects that threaten the health of the nightlife industry in general. The city has unintentionally (or perhaps unintentionally) created a situation that puts clubs at odds with local residents and ultimately threatens liquor licenses.

History

Before the election of Michael Bloomberg as mayor of New York City, bars and clubs were bastions of smoking. Federal studies found that 61% of heavy alcohol users also smoked, often performing both acts simultaneously. The image entering a smoky bar and approaching a sexual interest by asking for a light were common in many venues in the city. Anyone who went into or worked in a bar accepted the concept that smokers would be there and that they would be able to smell the smoke on their clothes and in their hair long after they left the venue, whether they smoked or not. Back when the world was young and I worked in Webster Hall, I had to sneak outside several times a night for the chance to breathe fresh air. Cigarette smoke triggers my asthma, so for me working in the basement was like working in a burning building. It wasn’t the smartest thing I ever did, but a

hustler does what he has to do, especially when he’s starting out.

In 2002 after Bloomberg became mayor, one of the first things he pushed for was a ban on smoking in restaurants, bars and clubs. The debate leading up to the passage of the law was hotly contested on both sides. Groups that advocated the ban claimed that operators inside the clubs were the most vulnerable to the dangers of second hand smoke because they were exposed to it several hours a night for several nights per week. They claimed a ban would both improve the long term health of operators and improve nightlife business because it would attract people who didn’t smoke into the environment to spend money. Groups that came out against the ban did not deny the health benefits, but they did argue that there would be economic and social effects that the law did not take into account. They also claimed that there would be increased friction from the community because of the noise generated from patrons standing outside to smoke from 5 PM to 4 AM.

The Sound of Smoking

Some people think that a few people standing outside a venue will not substantially increase the level of street noise. But that concept only considers the smokers themselves. They don’t see that smokers, especially female smokers, provide a powerful incentive for groups of fanatics to hang out in front of a club, especially the ones who didn’t get into or got thrown out. In a twisted effort to get noticed and prove their superiority, these individuals will shout, get into fights, honk their horns if they are in their cars, or try to talk to girls from their cars and back up traffic behind them which causes other cars to blow their horns. This sad mating ritual cacophony will die down when the girls finish smoking and go back inside, but it will begin again when the next group of girls comes out of the club to take their place.

The relationship between street noise and smoking outside should not have come as a surprise to anyone involved in the development of the smoking ban since the NYNA informed city that the smoking ban would lead to noise complaints. But when operators requested the ability to hire Paid Detail officers to deal with the inevitable noise the result was the worst of all options. The smoking ban was put in place and the request for Paid Detail was rejected, allowing the smoking ban to become a major contributor of street noise. When street noise increases, 311 complaints from local residents increase. When complaints increase, local community boards can use those complaints to have a venue’s liquor license revoked. Without a liquor license, a bar or a club can’t compete in the market and is forced to close. There is a direct relationship between the smoking ban and the increase in noise complaints against clubs. As the ban enters its 6th year operators need to find a way to keep patrons healthy and stay opened.

Coping Strategies

Different venues use different tactics to deal with the ban. Any venue that has been built or renovated since 2003 could factor the law into their design. The ones that could afford it added heated courtyard lounges like Cielo, rooftop access like Above Allen or fire escape access like APT to give smokers access to the open air without putting them out on the street. Venues that don’t have that option rope off areas in front of the venue to separate the smokers who already made it past the velvet rope from the throngs still trying to get inside.

There are also growing instances of venues that do not rope off areas out front, or create special sections for them. Some operators have come to the conclusion openly or privately that it is easier and more cost effective to simply break the law. Smoking in clubs reported to be on the rise in New York City, either because enforcement has dropped off, or because the fines are low enough that paying them costs less than complying with the law or getting noise complaints. While this minority of operators might not openly reject the law, they have come to the conclusion that the cost of paying the fine is less than the cost of erecting smoking areas or subjecting their liquor licenses to revocation based on noise complaints from smokers standing outside. Some solutions have worked better than others, but one thing the clubs won’t do is discourage smoking by their clientele since by some operator estimates, smokers account for 40% of patrons.

A More Viable Solution

There is an alternative that protects the health of patrons and operators, keeps noise levels down outside of venues and allows patrons to smoke all at the same time. There are air filtration systems on the market that have been approved by the Department of Health and are currently used by infectious disease wards in hospitals to clean the air. These systems reportedly are the size of a humidifier and one of them can keep 1,250 square feet of interior air cleaner than the air in Central Park, even if 60% of the people are smoking inside. The NYNA proposed that if a venue was primarily a bar, lounge or club and not a restaurant then they could have one filter installed for every 1,250 square feet of interior space and become exempt from the ban. This request was not included in the final version of the law.

The best options available for the industry are to continue to lobby officials on the state or and local level that patrons can smoke inside without health risks, through the use of technology like filtration units. They can also try and work with local community leaders and law enforcement to gain the power to control or reduce noise outside the venues through Paid Detail. Finally, they could work to sever the links between street noise and liquor licenses so that loud patrons don’t lead to closed venues. Whatever tactic operators decide to use they need to insure that the smoking ban isn’t harmful to nightlife health.

Have fun.
Gamal

Are Police the New Health Inspectors or Tax Collectors?

By Gamal Hennessy

Imagine this. You’re sitting in your favorite bar nursing a drink and wondering how you’re going to convince the waitress to give you her phone number. Without warning three cops walk in, push behind the bar and start poking around with their flashlights, making everyone in the room very nervous. As you gather up your belongings and discreetly make your way towards the door, would you assume that this was a raid? Would you guess that the cops were looking for drugs, guns or child pornography? Would you believe they were looking for fruit flies?

Fruit flies are drawn to alcoholic beverages and bar owners are required by the state law to keep them out of liquor bottles as a matter of public health. As part of the routine inspections by the Department of Health (DOH) bars are inspected for fruit flies and any venue that has fruit flies on or in the bottles is subject to a fine that could run between $700 and $1,000 per infested bottle. This is a normal part of the nightlife business and isn’t really a cause of concern among operators. The problem arises in the way the law has recently been enforced. Even if you are a nightlife native who frequents various venues, you have probably never seen a DOH inspection taking place. That’s because inspectors keep a relatively low profile while conducting their business. Patrons usually have no idea what is going on and they don’t have to. But there have been reports of layoffs at the DOH, which could mean fewer inspectors. But inspections still need to be conducted, especially since every violation can lead to fines that cash strapped city and state governments are desperately looking for. So somehow the DOH has been replaced with the NYPD who is anything but low profile when they come into the bar.

One operator commented on the climate that the NYPD creates; “By sending a uniformed officers from the NYPD behind your bar with a flashlight looking for fruit flies and whatever else they can find at the height of your business hours creates a stressful situation for you and your customers. It looks like a crime was committed in your place and they are looking for evidence. It gets people talking about your establishment in ways you don't want.”

Bar and lounge owners in various parts of the city have described this scenario happening in their bars with increasing frequency. Some operators think that the NYPD has been given a mandate to perform random inspections as a way to “find” violations and provide the city and the state with much needed revenue. Various operators have voiced opinions about the situation: “What they are thinking is that they are going to get funds for a broke state and city no matter what the consequences. No thought is given to the outcome except that those cops better come back with some violations. With cops conducting their random inspections, we are at the whim of whoever is giving these cops the orders to do these. It is much more invasive and detrimental to our businesses. “I don't think this has anything to with revenge against a particular venue. All bars are suffering this treatment. This has more to do with the city's need to collect more revenue in the shape of fines and the fact that they've laid off a number of health inspectors.”

So instead of increasing state revenue by working with the nightlife industry, local government is trying to increase state revenue by intimidating and attacking it, using the police as its instrument. We have pointed out in previous articles that ending the backlog in liquor license applications and increasing the number of venues would actually increase state revenue significantly. And as dangerous as fruit flies are to public health, the police are probably better utilized deterring and preventing crime outside of venues instead of poking around behind the bar looking for bugs. We know that the state wants to use liquor consumption as cash cow and nightlife is an economic resource that the city can use for its benefit, but only if it takes more of a cooperative stance instead of being antagonistic.

Unfortunately, some operators don’t see things getting better because they don't feel the lobbying efforts are strong enough to support their position. “With all due respect to our lobbying groups, I really don't think they have the stomach for this kind of fight. We are just going to have to put up with this intrusive behavior by our government and keep our bars as clean as possible.”

So if you see a couple of cops climb behind your favorite bar, it might not be a raid. It might just be an abusive health inspection.

Have fun.

Gamal

So Where Are the Cops?

By Gamal Hennessy

Several people were stabbed over the weekend outside a TriBeCa club. The violence that occurred is the latest incident involving this venue and is sure to be used as an example of out of control nightlife here in the city. Unfortunately, incidents like this might be inevitable given the current position of the New York Police Department. Until nightlife venues are given the same police protection as other venues, violence will be a part of the nightlife experience.

Deco has several aspects to it that make it a less than ideal example of a New York venue. According to Matthew Chayes of New York Newsday, Deco has been operating without a liquor license since January 3, 2009 and it was the scene of two shootings in 2007. On Saturday night, two people were allegedly slashed with razor blades by Mario Olmedo. Later that same evening there was a report that three more people were attacked with blades outside the same venue.

Newsday wasn’t able to contact the operators of Deco for a statement, but the ripples are already being felt in the industry. Operators who were planning to move the Flatiron performance space Cutting Room to TriBeCa withdrew his scheduled appearance before the community board yesterday because he didn’t want the backlash from Deco to influence the decision on his liquor license.

It is an unfortunate fact of nightlife that fanatics and amateurs get most of the attention when it comes to news stories about nightlife. Very few pages are written about the tens of thousands of patrons who go out, have a good time and get home safely without slicing each other up in the street. It is objectionable that these incidents occur in spite of the fact that nightlife advocates have repeatedly requested the ability to have uniformed police officers patrolling the streets near venues during peak hours. One of the major points that came out of the Nightlife Summit of 2006 was a specific request by the New York Nightlife Association to have paid police patrols outside clubs to enforce laws that club security can’t enforce outside the venue. This request was, and continues to be rejected by the NYPD because it could potentially breed “corruption between the club owners and the cops.”

Serious violence is rare in nightlife, but as long as there are fanatics out there, the potential for violence exists. But while the NYPD protects itself from potential corruption, operators are held responsible for violence that they do not have the authority to control. They suffer the wrath of the irate community board members looking for any reason to shut down our venues. We as patrons are left to fend for ourselves among the fanatics when we go out, creating a situation where some of us will have to go to the hospital when our night is over.

Have fun.
G

Balancing the Budget at the Bar

By Gamal Hennessy

Everyone knows we are in a recession. Not many people are sure how we’re going to get out of it. Many lawmakers on the state level think one of the keys to generating revenue and balancing their budgets will come from increases in so called ‘sin taxes’. This would mean that the state tax on liquor could go up. If the taxes on liquor go up, how long will it be before the cost of drinking goes up too?

Andrew Cleary of Bloomberg.com reported that state law makers across the country are planning to increase the taxes on beer, wine and spirits in an attempt to close budget gaps through increased taxation. At the same time, stocks of beverage companies have been decreasing up to 40% in the last 12 months as people tighten their belts in the face of economic uncertainty. While lobbyists for the liquor companies plan to fight against these measures, victory for them appears unlikely. If they get taxed, then the operators who serve the liquor have to pay more per bottle of liquor. If they have to pay more to buy liquor, guess who’s going to probably pay more to drink it….

I’ll give you a hint…it’s you. But before you bang your fist on the desk and curse the greedy club owner for stealing your hard earned wages, it would help to understand the economics of serving drinks.

Of course, the main source of revenue for a bar is the drinks that are served. Each drink also represents a specific cost that the bar has to pay before the bartender can throw that little napkin down on the bar and ask you what you want. The price the bar pays to serve each drink is based on the cost of the ingredients, the serving costs and the glass costs which combine to become what business plans call the cost of goods sold.

Understanding how the cost of goods sold works, we need to examine a drink and the costs associated with it. Let’s take a Vodka/ Cranberry for example because it’s simple. You go to the bar order it and the bartender charges you $8. You are shocked.

According to the Professional Bar & Beverage Manager’s Handbook, there are about 25 ounces of liquor in a 750 ml bottle. So if a bar uses a bottle of Absolut with a wholesale price of $15, then every ounce of vodka costs $.60 ($15 ÷25 ounces). If the bar puts 4 ounces of vodka in each drink, then each bottle can make about 6 drinks. So for every $15 the bar spends on liquor it pulls in $48 (6 drinks x 8 dollars).

But a vodka cranberry has more than vodka in it. Let’s say that the cranberry juice is $.20 per ounce and the ice and lime are $.05 each. When the bartender makes your drink, let’s figure a 4 to 3 ratio in a 10 ounce rocks glass. That means roughly 4 ounces of vodka ($2.40) and 3 ounces of cranberry ($.60), ice and the little lime wedge ($.10). Based on our initial prices, the bar pays $3 for the materials to serve you the drink. If the drink is $8 that means there is $5 in profit.

At this point, you might assume that you need to open a bar and make some money. Before you apply for your liquor license, you need to consider the additional costs. Drinks don’t just appear in front of you. This isn’t Star Trek. The bartender who served you the drink has to be paid. The bar back who gets the ice and cleans up the empty glasses has to get paid. Each glass that drinks are served in have to be paid for and each one has a potential to only be used once because it could chip or break completely in the hands of the drunk and clumsy. All those costs could equal an additional $.50-$.75 per drink. There is a tax on the liquor that figures into the price. If that tax goes up, then the cost of the drink goes up too.

Then you have to take a look at where you are. Unless you’re passing around a bottle of Mad Dog around a barrel fire by the highway, the space you’re drinking in has to be paid for. There is the rent for the venue and the taxes associated with that real estate (keep in mind that the cost per square foot in New York City is among the highest in the country). There are entertainment costs whether you’re talking about a satellite TV sports package, a DJ, a band or an internet jukebox. There are costs associated with the furniture you’re sitting on. There is a cost for the décor. There are costs for the security guard or hostess standing out front. The license for the computer system and touch screens that the bartenders use isn’t shareware. It costs money. Utilities like water, gas, telephone, heat, electricity and website maintenance associated with the venue also have to be paid. When you take all of that into account, you might have added another $2 to the cost of serving you that drink.

Then there are costs for things that patrons don’t see at all. There are insurance costs. There are costs for the lawyers, accountants and other professional services that a business needs. There are costs for maintenance associated with keeping things like the lights and the toilets working. You’re now talking about another $.50 to $1 cost per drink.

Finally, you have optional costs like marketing, advertising, uniforms for the staff and laundry costs for those uniforms. Or promotional deals like happy hour, two for one specials and other events designed to get people in the door by lowering the price of the drinks. If you decided to include these costs, tack on another $.20-$.50 per drink.

Now that $8 might cost the bar more than $7 to serve you. That leaves a per drink profit of less than $1. While that can be a decent return if you serve thousands of drinks per night, it doesn’t leave much room for error. If the tax goes up enough, most or all of that profit could be gone.

Of course, there are other ways a club can generate money, like covers, bottles and corporate parties. And if the state decided to let more bars open, it might not have to raise the liquor tax to generate more revenue. But this is not an argument to make you feel sorry for operators. The professional ones can keep costs down and be very successful, even in this economy. It is meant to serve as a more realistic look at the price a bar has to pay to keep the doors open. We want you to avoid sticker shock when you slide up to the bar. Just take a deep breath, pay for your drink and toast the inevitable end of the recession.

Have fun.
Gamal

Be Aware, Take Care

By Gamal Hennessy

We go out to have a good time. We want to forget the recession, the housing slump, the credit crisis and the soft job market. We want to drink, dance and seduce each other for a few hours before reality sets in again. The last thing we need is for thieves, pickpockets and scam artists to invade our refuge and make us even poorer than we were before by stealing our wallets, clothing or purses. But that’s what’s happening and this is what people are trying to do about it.

The NYPD recently approached the New York Nightlife Association with an educational campaign to help patrons guard against petty crime in the clubs. While most of the advice is common sense and straight forward, a little prevention can go a long way. Patrons are in a vulnerable spot. They are often intoxicated, literally in the dark and focused on everything except their personal belongings. Operators can only watch and do so much (like coat check or to a certain extent security guards) to prevent theft. This gives predators space to operate. Ultimately, we are responsible for our own stuff, but the NYPD flyers can make us a little more vigilant on the dance floor.

The underlying dynamic to this situation is threefold. First, there is a historical tendency for different types of crime in nightlife to rise in a down market. The city is trying to reverse that trend in an attempt to maintain its reputation as a safe city for tourism. Second, nightlife itself doesn’t need the negative publicity of higher crime in a time when patron spending is already down. Any steps taken to make the public feel safer are helpful for the bottom line. Finally this gesture between the police and nightlife comes at a time when relations have been slightly strained. The safety flyers might not settle the allegations of phony drugs busts and potential law suits but like the crisis in the Middle East, any steps toward reconciliation have to be taken with cautious optimism. If the NYPD and the NYNA continue to focus on the well being of patrons instead of attacking each other, then thieves and scam artists will have less room to maneuver and we can escape in relative peace.

Have fun.
G

What’s your opinion? We’d like to know.

Squadron Watch, SLA Inspectors and Smokeasies

Nightlife News for January 13th, 2009

By Gamal Hennessy

Is Squadron in a position to carry out his plans?
Roy Edroso of the Village Voice reports that new Democratic State Senator Daniel Squadron has been chosen to head the cites committee of the New York State Senate. Given his anti-nightlife position during the election, the question is will the new position but Mr. Squadron is a position to carry out his Nightlife Control Plan?

Club security guard sentenced for kidnapping charge
Darryl Littlejohn got 25 years for stuffing Shanai Woodward into a van. He still claims he’s innocent and that his trial was unfair because his name was also linked to the Imette St. Guillen kidnapping, rape and murder. Newsday.com didn’t specify when the St. Guillen case will be tried, but Littlejohn will continue to be a bad example of security the industry will have to deal with

Does the SLA need more inspectors?
A TV station in New York might have found the reason why liquor licenses are so hard to get. According to a spokesman for the SLA, there are only 21 SLA examiners in the whole state, and they process over 6,500 applications per year. But if New York needs to create jobs in a recession, and liquor licenses can create more jobs, why not hire more inspectors?

Watch out for the DOH before you light up
Grub Street has confirmed that the Department of Health has been conducting more raids and handing out more fines for venues that violate the smoking ban. The raids might be in response to more venues turning a blind eye to smoking in 2008, so smoking might become a contentious nightlife issue again six years into the ban.

What do you think? Should we worry about Squadron? What will it take to get more SLA inspectors? Will the DOH crackdown lead to club closings? Add a comment and let us know.

Have fun.
Gamal

Bottle Service Debates, Club Priests and the Best of 2008

Nightlife News for January 5th, 2009

By Gamal Hennessy

Bottle Service isn’t dead. Or is it?
David Hauslaib asserts that the bottle service trend is alive and well, although his argument using the Eldridge is less than compelling. While Scott Solish of the New York Observer provides anecdotal evidence that that economic trend is suffering and may not come back.

If Your Bar Moves, Will You Move With It?
You’ve owned a spot for years. You have a good set of loyal regulars. The economy forces you to change locations in an attempt to save money. Will your loyal regulars be there for your grand re-opening? Glenn Collins of the New York Times isn’t so sure…

When Generosity is Clearly a Sin
Did you hear the one about the priest who holds down the VIP? Well, Sean Evans and Tracy Connor of the Daily News reported on Father Greg Malia living the high life in New York’s most expensive clubs. Unfortunately Fox News followed up that story with news that the church rewarded his nightlife attraction by firing him.

The Best of 2008
Good Night Mr. Lewis author Steven Lewis highlights his picks for best club, best DJ, best party, best blog and best trend in nightlife. Unfortunately New York Nights wasn’t picked for best blog, but we’re hoping to do better next year.

What do you think? Is bottle service on the way out? Will patrons follow a bar? What was your favorite spot of 2008? Add a comment and let us know.

Have fun.
Gamal

New York Nights: The Year in Review

Over the past year, New York Nights has offered a unique perspective on the issues that affect the culture and business of nightlife. I’m looking forward to offering you more insight and information in 2009 but if you’ve missed any of our weekly features, don’t worry. I’ve provided links to all of them below.

Let me know what you think; what you want to know more about, where you think nightlife is going in the New Year and what you enjoy about NYN. Thank you for all your support and have a great year.

The New York Nights Weekly Recap for March 28, 2008
The New York Nights Weekly Recap for April 4, 2008
The New York Nights Poll: How has the Smoking Ban Affected You?
The New York Nights Weekly Recap for April 11, 2008
The New York Nights Weekly Recap for April 18, 2008
Last Call: A New York Nights Special Report for April 25, 2008
The NYN Weekly Recap for May 2, 2008
The NYN Weekly Recap for May 9, 2008
The New York Nights Insider for May 23, 2008
The New York Nights Insider for May 30, 2008
The New York Nights Insider for June 6, 2008
The New York Nights Insider for June 13, 2008
The New York Nights Insider for June 20, 2008
New York Nights Insider: The Pride Issue
The New York Nights Insider: The Independence Issue
The New York Nights Insider: The Alternative Venue Issue
New York Nights Insider: The Turning Point Issue
New York Nights Insider: The Mid Summer Issue
New York Nights Insider: The Liquor and Sex Issue
NYN Insider: The Down Market Issue
New York Nights Insider: The Image Issue
The NYN Insider: The Common Sense Issue
The New York Nights Insider: The Outside Influence Issue
New York Nights Insider: The End of Summer Issue
NYN Insider: The Down Side Issue \
NYN Insider: The Economy Issue
NYN Insider: The Sub Culture Issue
NYN Insider: The Controversy Issue
NYN Insider: The Woman’ Issue
NYN Insider: The Food and Wine Issue
NYN Insider: The Future Issue
NYN Insider: The Experience Issue (with Election Update!)
NYN Insider: The Crime Issue
NYN Insider: The Election Holiday Issue
NYN Insider: The Music and Fashion Issue
NYN Insider: The Culture Issue
NYN Insider: The Perception Issue

Have fun
Gamal

How Safe Are the Clubs?

By Gamal Hennessy

There is a famous saying in entertainment that "any press is good press." If you don't believe that concept, just look at Paris Hilton. But nightlife operators might not agree with that statement. The past two weeks has produced one missing woman and a shooting associated with local venues. How can clubs maintain safety without sacrificing the party or their autonomy?

Nightlife is often associated with crime, even if the operators and the venue are not at fault or even involved in the actual incident. Plaxico Burress shoots himself in the leg with his illegal gun at LQ. Jennifer Garza disappears after spending time with a sex offender at Marquee. While these events could have happened anywhere, the stories frequently mention the clubs. It’s too early to tell if these incidents will hurt attendance at these venues in the long term, but previous violence with P. Diddy at Club New York was a contributing factor in its demise. Of course, mentioning where a story took place answers one of the basic questions of journalism (who, what, when, where and why) but it isn't hard to imagine that the nightclub angle is played up to 'sex up' the story and perpetuate the concept that nightlife is inherently dangerous.

The past two weeks have been something of an aberration. Compared with the number of people in New York clubs every year (the 2004 estimate is 65 million entries), the number of high profile incidents is low. Reasonable behavior from nightlife natives, a watchful eye by club security and a stiff police presence in some neighborhoods keep serious crime down. This fact is rarely reported outside of New York Nights. Stories like Burress and Garza stay in the public consciousness.

This perception creates a potential threat to the nightlife industry. If negative stories are all that are reported or remembered then that is the image that is going to stick, no matter how infrequent the incidents are. This can lead to liquor licenses being unjustly revoked, abrupt closings and ultimately fewer quality venues in the city.

Operators have to do several things to be successful. They need to attract people to their venue, provide hospitality service, entertain their patrons, make a profit and provide a safe environment. There is a limit to what they can do. They can't keep track of sex offenders who come to the club, they can't control things that go on outside the club and they are forced to tread lightly when it comes to celebrity.

But there are things that are done. Why don't we hear about that? Can the industry show that millions of patrons aren't injured when we go out? It might be helpful for the industry to show the public what is done to keep them safe. Not just after a clumsy athlete shoots himself, but on a constant basis. That way we have a balanced image of nightlife safety, not just the bad news.

Have fun.
Gamal

How to Get a Gig in New York City

By Gamal Hennessy

The idea of the aspiring musician or dancer who comes to New York to make a name for themselves is a classic nightlife story. How many movies start off with this basic premise? How many real people have left their town or their country with their guitar on their back, dreaming of packing the Garden?

Of course the reality has little in common with the myth. The world class producer is not going to hear you humming to yourself on the subway and book you for the Knitting Factory. Musicians, DJs or any type of performer faces stiff competition to perform in the center of the universe. While most of being a working musician in New York is about perseverance, personality and luck, we have some tips to help you along.

Love What You Do
The most important thing about performing in New York is your love for performing. It is the only thing that will keep you going when you are out there hustling. In the business of art, you have to love your art because the business aspect sucks. This isn’t because nightlife operators are terrible abusive people (though some of them are). It is because the level of competition and the size of the city itself will magnify your obstacles.

The Elements of a Gig
I’m not a musician, but being a DJ is one of my hustles and a lot of my friends are musicians. People outside those communities aren’t aware of all the work that goes into the show before the show even starts. This list will give you an idea:
· You have to find the venues where you can play.
· You have to contact management, set up the gig, deal with the contract (often there is no contract)
· You have to promote the gig (social networks like myspace and facebook help, but I think the response rate is still only about 10-15%, so if you invite 40, you might get 4, if you invite 100 and you might get 10) because playing to an empty room isn’t fun.
· You have to deal with your equipment whether you are setting it up after the last band went on, breaking it down before the next band goes on, watching it so it doesn’t get stolen, or the inevitable situation when some part of your equipment of the venues equipment doesn’t work.
· If you’re a DJ you have to find some way to handle requests, which is universally annoying.
· If the gig does pay (and many don’t) you have to go through the motions of getting paid. People often don’t run up to you with fistfuls of money. If you have other people in your band or other DJ’s that play with you, you have to pay them. When its all over you might realize that the cost of the gig was more than you got paid for it.

All this takes energy and effort. And keep in mind that while you’re doing all of this you actually have to practice your music and find some way to eat and pay rent, because performing might not pay your bills. Playing a gig in New York is equal parts hustle and talent. Actually, hustle might be more important than talent.

The Power of Advertising
If all of this seems disheartening, it might help to look at your gig as an advertisement rather than a paycheck. Consider this; if you are trying to build an audience, or sell your music, get better paying gigs or get discovered what better way to let people know about you besides actually hearing you play? Your show is a sample of your art. It is a path to build a following. So when you start out, play for exposure, not for cash. Cash can come later. Just make sure you have a job so you can eat while you’re waiting for your big pay day.

The Magic of the Moment
There are many aspects of performing in New York that are stressful. Many venues don’t pay musicians or DJs to play. Most nightlife performers don’t get discovered. But in spite of all that, there is still something great about having a good show. Performing is a rush. You can’t eat applause and a full dance floor won’t pay your rent. The people that you make smile or come up to you and compliment your set won’t get you on TV or buy your CD, but money can’t create the feeling of connection, pride or euphoria that comes from a good set.

Have fun.
Gamal