A major nightclub operator in the UK has been forced to seek administration due to financial difficulties. Rekom UK, which owns the Pryzm and Atik brands, will reportedly undergo a major restructuring, putting the future of several venues in question. Citing challenges facing the industry, such as energy costs and a drop in attendance by university students, Rekom UK said the decision was necessary. The company is working on a restructuring plan, in consultation with stakeholders, including landlords and lenders.
Costs faced by Rekom UK have been exacerbated by the impact of the Covid pandemic on the nightclub industry. Notably, bars and clubs have had to weather lengthy lockdowns, leaving many struggling to meet costs, particularly as customers’ habits and behaviours have evolved during this period. Meanwhile, the announcement of a new minimum wage, due to come into force in 2024, means that additional funds will be required to cover the increased wage costs.
Rekom UK’s plight is far from unique, and the knock-on effects of the pandemic continue to be felt by many in the industry. Since the onset of the pandemic, bars and clubs across the UK have been grappling with closures and plummeting demand, leaving some businesses on the brink. For many, increased costs and a period of restructuring will be essential to remain viable, in some cases, with venues forced to close altogether.
It is unclear which of Rekom UK’s branches will be most severely affected, though reports suggest that “larger clubs” are among those most vulnerable. The situation echoes the struggles faced by many in the nightclub industry, with rising costs and evolving customer habits making for a far from certain future. For those venues that survive the current challenges, a new landscape awaits, one that will likely be shaped by fundamental transformations within the industry
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