What's with the Strip Club Business Model?
dustyshoes
Illinois
Management sees it profitable to charge high entry fees, high drink prices, and higher dancer drink prices. The dance prices continue to escalate, the songs get cut, the number of customers drop, the number of dancers drop, and the profits drop. Their solution seems to be, raise the entry fee, raise the drink price, raise the dancer drink price, raise the dance price, and fine the dancers more. Result: Death Spiral.
Would it not make sense that the club's job would be to get the customers in, and the dancers would keep them there. There would be enough money walking through the door to satisfy both. Don't fleece the customers as they walk through the door and buy the first drink. I myself have walked in, been charged an entry fee, ordered a drink, and find, no dancers, price of the drink, and said sorry, I'm out of here. Why would I pay that kind of money to have a beer in a small country bar alone? That's stupid.
Meanwhile, the dancers need to remember that they are independent business people. They need to be at work every day, the same as their customers. They need to understand that sales depend on meeting customers needs. Nobody in there is obligated to give them a tip just because they stop by and demand one. Nobody is obligated to buy a dance because they happen by and say "you wanna dance". They also don't seem to know that customers are just as money conscious as they are, is it too hard to realize that instead of $25 for the 2nd dance, 2 for $40 may get them a higher net for the shift due to the fact that she would probably dance for more customers? What some dancers are willing to do during a dance obviously differs from what others are willing to do. The result of which usually provokes badmouthing of each other. They need to understand that the customer demands are what makes the difference, and if they are unwilling to meet the demands, they need to find an occupation that they are comfortable with.
Now, keep in mind, that the laws of the local town, and state, regulate a lot of what goes on inside the club. The dancers need to respect the fact that the management needs to maintain their liquor/business license, and they are allowed to make reasonable requirements of employment. Regular attendance should be required. The management need to respect the financial needs, and, like any other business, the employees, are commonly single parents and have unplanned issues arise occasionally, and need to change their schedule.
The bottom line is, the customer controls the money. If their needs are met, they will remain customers and spend their money. If there is a better deal down the road, the money will follow the better deal. Also, strip clubs are not the only means of entertainment, and as such they cannot collectively survive if there is a better deal, either perceived, or not, elsewhere.
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15 comments
Personally; I *have* noticed a difference b/w how the upscale clubs and dives are managed with most dives being very badly managed.
I assume many of these “managers†at the dives only qualification is having a pulse – they have zero business sense if any sense at all and have less-than-zero/negative-# people/social skills.
Your comments about clubs fleecing custies is something that has been on my mind and it’s probably a major contributor why SCs are not what they used to be and why so many may be struggling financially. Times have changed and we are still recovering from a pretty devastating economic situation of a few years ago – and there is also more competition for the sex/entertainment dollar – most SCs do not seem to be adjusting correctly to the new realities.
Nice write-up - you should post it over on stripperweb.com in the “Customer Section†so the folks/dancers over there can have access to a well expressed customer viewpoint.
Some, custies or club staff; may say this is ok b/c hey you are getting a discount – but to me; if you are going to give me something; give me what you say you were gonna give me – don’t be a cheap ass and short change me.
The club's true customers are the people who rent the stage space. They are the ones who bring in the subsidiary income from food and beverage sales from the second level.
That is only true for legitimate businesses- many businesses are obviously fronts for other activities. While drug distribution and prostitution are usually the first things people will think of, it's pretty clear that the other activities mostly involve gambling, money laundering, and tax evasion in my little corner of the world.
That is refreshing to hear and often not the norm; IME.
As a dancer once posted on TUSCL – “strippers don’t do anything for freeâ€
The SC model has been successful for so long because it was pretty much the only game in town. As little as ten years ago, if a man wanted the intimate company of an attractive woman his only option were SC's or the high risk rolling the dice on unknown escorts or MP's.
Now, there is so much info on the internet that using escorts and MP's could even be considered a safer bet, with better value, than a SC.
As the OP pointed out, in response to dwindling revenue, the SC's and dancers have increased the practice of fleecing (hustling) the custies harder than ever. This does nothing but drive well paying customers out of the SC's perpetuating a downward spiral.
The SC business model needs to morph into something that provides value for a customers dollar. How that would look or even if it is possible, I don't know.
Bottom line though, it is getting harder and harder to rationalize spending hundreds in a club when I can find far greater value with much less fleecing and hustle outside of it.
I've gotten entrance fee refunds when there haven't been enough dancers and I asked for it. Never been refused.
Dancers aren't necessarily brainiacs. And don't dance long enough to learn great selling technique. When I see a gal I'd like a dance from, even if she just got there, I go ask her. Got some incredible experiences that way. They like being wanted too.
Have a fee at the door but have some value to it. Include a free topless dance (the slogan I wanted to give this was 'Free Samples!') or a free drink setup. Presuming a non-alcohol place don't give a tiny cup half full of ice, bring them a full chilled can or bottle even on premium energy drinks!. You save on labor, equipment, and cleaning, and the guy thinks he's getting a great deal paying five dollars for something that cost you on average one. Don't have a high dance price if you are constantly going to have to offer specials. The customers will quickly learn to sit on their hands until the special and the girls won't bother either. Let the existence of specials be something the dancer negotiates wtih the customer one-on-one. Which brings me to maximizing the interaction between the dancers and customers and minimize the involvement of anybody else. There is no bartender or waitress or hostess (remember, full cans only) only performers and managers. The girl that helps greet you at the door and walks you to your seat says "I'll be on stage in just a moment, would you like to maybe have a private dance after that?". The girl that brings you your drink says "I'll be on stage in just a moment, would you like to maybe have a private dance after that?". Guys are naturally more attracted to what they can't have compared to what they can. That way the dancers have the guy's attention all to themselves.
In the big picture you can set up a culture in the club where this is a real job with real customers that need to be taken care of or that this is a big racket where horny men are suckered out of their money. If that attitude takes hold then the dancers will also be looking at how to sucker the club the managers how to sucker the dancers and everybody looking at how to cheat the owner.
I think you are forgetting a few things in your analysis. But let me point out the biggest. If the Strip Club owners turn the dancers into regular employees then acts of prostitution by them become acts of pandering for the owners. Pandering is a felony. The problem here is the law. Most jurisdictions are hostile or off and on hostile to clubs and club owners. They have justifiable fears of doing what you suggest. Also in terms of the strippers being at work daily on set schedules... most girls do dancing because it offers them freedom. Take that away and you take away one of the main reasons they decided on the job.
In terms of financial models that make sense I think clubs need to diversify their models.
Fetish / foot parties for example frequently use a $50 door charge (includes some food) mixed with $20/10 minutes for play. Girls don't have to tip out nor pay a percentage. Anybody paying $50 to go through the door is planning on buying playtime so there don't have to deal with time wasters. I don't see any reason some number of clubs couldn't switch to this. Many of the women who work in SCs would be very happy to be reliably pulling down $100 / hr. GoGoRama in NJ with their deli style approach is an example of a very successful club (relative to the size) that does this moderate reliable strategy well.
I think you are recently seeing a surge in clubs with higher admission and an emphasis on alcohol, VIPs and large stage tips. I think that's another good financial mode.
I think a return to clubs that mainly sell alcohol and food where the dancers make moderate stage tips but have low contact (Penns Port pub for example) might work. Obviously ultra high milage clubs, is a reliable working model.
Diversify customer bases and diversify clubs so that different clubs become more different from one another and don't complete as much.