Looking to buy or invest in a strip club
Hi everybody! I'm seriously thinking about buying a club or investing in one. Anybody know of any that are for sale or an owner that would want a financial backer. I've learned how some of the clubs are run and I have an idea on how I would like to run a club. Like offer the woman health insurance and give the girls more of a cut on the dances. Any thoughts or ideas?
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If you have an old school partner, be prepared for confrontation to your ideas.
Your plans will result in the closing of your club in a year or so. Healthcare expenses are through the roof. The girls will make more money as independent contractors. Let them pay YOU to work there. Keep the profits flowing to the club and your pockets.
Unless you plan to run a non-profit corporation, and you won't make a penny. But hey the girls may love you for providing free benefits and give you all the pussy you can stand.
Now, it sounds like you have only looked at some of the issues involved in managing a strip club. Frankly I agree that trying to set up a 'you have a real job at a real business' vibe will result in fewer problems. But you have to also make a profit, understand the 'rules' of your location, promotion, personnel, security, etc.
Now, if you are really looking at buying into an existing business you want complete and audited books. Do not under any circumstances take the seller's word about how much the club is making. Get an accountant who has specialized in business valuation to do one. That will likely cost $5000. That seems like a lot, but it is way better than making a half million dollar mistake.
As to Health Care, in 2014 if you have more than fifty employees you will either have to pay for health care or pay a $2000 fine. Getting a group rate on exotic dancers may be tough. You may be better paying the fine and letting them get coverage from the state insurance exchanges.
Just sit down and make a list of expected expenditures vs. expected income. I think you'll quickly see that it would be tough to make it work. Check what the commercial lease rates are in your area for, say, a 5,000 to 10,000 sq.ft. (or whatever size) building. Then figure in where you're going to find a club in a good location with enough traffic to get customers, and not too close to the competition, and not too close to a school, etc.
And if you want to buy an existing club, figure out why someone wants to sell it in the first place. If it was making money hand over fist they probably wouldn't be selling it, would they?
And then figure the other expenses: electric (all them lights), insurance (remember, you're an employer, and you also need insurance if a customer falls on his ass), permits, licenses, cleaning, security, bouncers, bartenders, waitresses, managers, liquor/beverages, dishwashers, and on and on. And remember you have to pay staff for the entire time you're open, say, 11am to 3am, which is 16 hours a day.
And then figure out where you're gonna get strippers, and how you're gonna have a big enough stock of them to keep you going for every shift, every day, allowing for the typical stripper shit of them deciding not to show up because they're independent contractors and don't have to if they don't want to.
And then look at your favorite club during the long dayshifts, and figure how many customers come thru every hour. Dayshifts, when you still need to pay staff, but you only get 3 customers an hour who pay entry, buy a drink and a couple of dances.
So you have, say, at least 6 employees working each shift (manager, 2 waitresses, bouncer, bartender, door guy) at minimum wage (say $8 per hour) which is $50 per hour just on wages. And if you're open from, say, 11am til 3am, that's 16 hours a day, and a total of $50 x 16 = $800 per day just in wages. And if you're open 25 days a month, that's $20,000 per month in wages. Add that to the tens of thousands of $$ in leases and other expenses every month, and you'll need a lot of customers each day to recover that.
I'm guessing you're gonna have to make thousands of $$ per day just to cover expenses. And that means hundreds of customers, every single day, and enough hot strippers to keep 'em coming.
And then figure out where you're gonna get customers. If you can find a successful club to buy that's in operation and doing well, you're extremely lucky. Otherwise, you'll have to drum up business and compete with the other guys in the area. Which means advertising and promotions, which is another expense.
Dude, it's not easy.
Unless you find a profitable club that's already in operation to buy (which nobody would want to sell in the first place), if you're lucky enough to find a space to lease in a good location (where they'll allow you to have a strip club and give you a permit) you're going to need to find some way to get a loan to remodel, make a nice interior, signs, etc. That's big bucks.
And you'll also need to hire an accountant and a lawyer.
Now, why would you quit your job that's giving you a steady income? Unless you found a better one out there...
People don't get rid of income like that unless there's a reason. You don't "get out at the peak" unless selling the business is going to give you enough money to retire or something. And in fact when you sell the business most of the money you get will go into paying off loans and shit.
Be VERY suspicious of someone wanting to sell a profitable business. Because there may be some HUGE headaches behind the scenes that he can't handle, and probably nobody else can handle, especially someone new to the business.
• You want to retire
• You want to do something different
• You want to move
Being a small business owner is a 24x7x365 "job". Even when you're on vacation, you're still on call and no business is as profitable with a manager running it as it is with the owner running it. Strip clubs are mostly cash and the majority of their sales are services, not physical goods so it's very easy for the employees who are handling the cash to steal money meaning the owner is going to want to be there watching the money every night that the club is open.
I can understand the owner of a strip club wanting to sell and it's easier to sell when profits are high than when the club is struggling. If the prospective buyer is borrowing money and doesn't have enough cash to buy it outright, it's easier to get a loan when the club is earning enough of a profit to cover the loan payments than when it isn't.
HOWEVER, if you own a profitable business, and want to sell, what do you do? Do you go down to the local real estate broker and say "Sell this for me", or do you try to beat your friends, and relatives, and all the guys who know how profitable you are off with a stick, and ultimately decide not to put it on the market but sell it to someone you know, or someone in the business who knows how to manage it?
My point is, having a real profitable business show up on the market for anyone to buy is rare. Very rare. I'm not saying it can't happen, but just look in your town at the history of the strip clubs, the good ones, and think of how many times they have been sold. And for those that have been passed on to new owners, what percentage do you think was a purchase on the open market, versus selling to a friend, or big corporation like Deja Vu who will pay big bucks for it?
Do you really think some guy from out of the blue is going to thumb thru his local paper, find a highly profitable strip club in his town for sale, buy it, and make a lot of money? Not very likely, IMO.
No licenses required as desired by TINY773
Low house fees as desired by critic12345
and
No cover charges and free drinks & lap dances as wanted by Lapdanceking
Now there's an idea for a profitable club. NOT!
1. Government subsidized strip clubs, with strict rules for club performance and quality in order to receive subsidies. All lap dances at least Very High Mileage (I will write the definitions and requirements), and all strippers at least a 7, lap price cap of $5 for 3 minutes.
2. Government subsidies for strippers for self improvement, such as boob jobs, lap dance lessons, customer service lessons, etc. You get a subsidy IF you are a 7 or more (I'll define...), have consistent quality lap dances and customer service, as well as meeting other performance goals.
The money for this would come from existing programs which are a freakin' ridiculous waste of taxpayer money. Therefore, no increase in taxes, and we'd direct probably about $500 million bucks into the program. Considering that US federal spending is on the order of $4,000 billion, that's peanuts.
Now, there are about 2,000 clubs in the US (well, more, but I'm rounding off to allow for crap clubs and inactive ones). So I'd limit the program to the top performing 500 clubs in the country.
BTW, kinda interesting...25% of all the clubs in the US are located either in Florida, California, or Texas..
Anyway, 500 million bucks divided by 500 clubs gives a $1 million subsidy to each club, each year, and strippers who make the grade. And if I need to go for $1 billion, I will, so don't mess with me...
So you've got, each year, all the clubs in the US vying for the chance to win $1 million or more in free subsidies. And if the owner offers free lap dances, and no cover, he scores more points in the subsidy contest. And if the girls are doing lotion dances, 10 points.
And if the cities in which they are located provide protection and support to the clubs, they stand to get preferential treatment with any other federal or state programs.
And I'll be the federal inspector who makes the rounds to ensure compliance and performance. If I go into a club incognito, and a chick who is a 12 comes up to me and offers me a dance while she's jacking me off, then gives me a mindblowing lap dance, and when it's over she says "oh, that's on me" and charges me nothing, that club gets a smiley face on their appraisal.
Now, with, say, a $2 million subsidy per club (or more if other clubs/strippers get less for non-performance), a certain portion is given to the any strippers whose performance exceeds a certain score. Some of that must be used for self improvement, but a portion can be just a bonus to use as she wants. Now of course the government would enter into a deal with various plastic surgeons, etc., to minimize costs on the self improvement part, but those savings would be passed on to the girls. S
So if a boob job costs $10k, but the feds strike a deal to get them at $3k based on quantity, each girl gets the difference. And the more she invests in self improvement, the better her chances next time to get the subsidy. And once you've paid for your boob job, you still get a high score for excellent tits, so you still get the self improvement subsidy even though you've already made the investment.
So dancers could be looking at something like a low end minimum of $10,000 each year, up to who knows how much, maybe $50k or $100k. Each year. Free. And no income tax on it (cause I said so).
However, they have to sign up for a minimum time of service (like the military) if they're going to accept the subsidy. Oh, and all the clubs have federal protection against any local harassment or 6 foot laws or other BS.
Anyway, that's my platform, and I'm sticking to it.
Vote for me in November. And I approve this message.
What's your point?
Right now they monitor whether whores are turning tricks, or even offering to. So what's wrong with monitoring the other half of that?
You hire a building contractor to build an addition to your house. After a day he skips town, barely even starts the job. So you go to the police, right? What's the diff?
Cool. And I assume shareholders get free laps at any Ricks club? Dude, if not, bring it up at the next shareholder's meeting.
I wonder if they have nude stripper parties at their company gatherings and stuff....that would be awesome.
This is an uninvestable company for any sane investor.
I thought it was kinda like the way women pick sports teams they like. They choose the ones with the prettiest colors on their uniforms.
(Okay, that was a joke...relax)