Ortus attributes the fall to increased competition from bars and pubs, as well as lack of access to funding.
It believes that banks struggle to lend to the sector and therefore fail to provide the investment required for renovation and diversification of the nightclub’s business models.
Jon Salisbury, managing director of Ortus Secured Finance, said: “The economic downturn, together with the introduction of new licensing laws, hit the nightclub industry hard.
“When it was introduced, the [2003] Licensing Act meant new and exciting opportunities [for] bars and pubs – and these venues were able to attract considerable investment as a result.
“Nightclubs, on the other hand, have struggled to secure the funding they need in order to compete with this new wave of venues.
“While there has been a transitional period over the last few years, many nightclubs continue to need funding in order to renovate, buy new equipment or even diversify to include restaurants and bars, for example.
“But nightclubs which want to respond to their customers’ wants often find themselves unable to due to a lack of access to funding.
“This puts them at an immediate disadvantage.
“Alternative lenders have an important role to play in helping nightclubs access finance.
“This is something nightclubs are increasingly recognising.”
Leave a comment