UK’s biggest nightclub operator pivots into bars
Rekom, the largest nightclub group in Northern Europe, has hired consulting firm AlixPartners to assist in shifting its focus towards bars as clubs in the UK struggle.
Rekom operates over 200 bars, pubs, and nightclubs across Denmark, Norway, Finland, and the UK.
The Danish company, which owns nightclubs including Pryzm and Atik, currently operates 36 clubs and 12 bars in the UK. However, as going out culture shifts in the UK, the company is reevaluating its role in response to changes in young people’s drinking habits.
Peter Marks, the nightclub executive who heads Rekom’s UK arm, said its nightclubs are struggling because of poor midweek trading which is usually driven by students.
Rekom now plans to sell off some nightclubs and open new bars under the Proud Mary and Heidi’s Bier Bar brands, according to The Times.
Marks said: “The student pound is stretched and we have chosen not to open a lot of early week sessions. Stakeholders are looking for independent verification that the right thing to do is to concentrate our efforts more in the bar market, which has a wider trading window and wider demographic.”
Its latest move is a significant shift from the company’s sentiment in early 2022, when it pointed to evidence that Brits were now spending more on drinks in nightclubs and bars than they did in March 2020. It said at the time that people were also turning up earlier to nights out, with young people attempting to catch up on more than two years of pandemic restrictions.
Rekom added a UK arm to its business in 2020. In January 2021, it expanded by buying up 42 of the former Deltic Group’s UK clubs and bars out of administration, leaving 10 destined for closure.
Its pivot into the bar market reflects a wider trend within the industry, as nightclubs continue to struggle. A third of nightclubs in the UK shut for good in 2022, according to the Hospitality Market Monitor by Alix Partners and CGA Powered by Nielsen, shared by the Night Time Industries Association (NTIA).
Michael Kill, CEO of the NTIA, said that more than 13,000 businesses were lost between 2020 and 2022, 4,800 businesses in 2022, with over three-quarters of these closures occurring in the second half of the year.