ONE in five nightclubs have been forced to pull their shutters down since the start of the pandemic, according to research by the Night Time Industries Association (NTIA).

It further warned that the trend of closures within the embattled night-time economy – nightclubs, late bars, restaurants, music venues and theatres – is accelerating due to the uncontrollable hikes in operating costs.

A worrying juggernaut of increases which include the culmination of pandemic debt, surging energy and supply costs, increased insurance premiums, rising staff costs, product costs and for some, hikes in rentals from landlord. Not to mention the eye-watering rises in music licenses of up to 200%, expected from the great rock ’n’ roll swindlers and music copyright kings, the PRS and PPL.

All of which has created a perfect storm of debt and despair for many businesses across the wide spectrum of the night-time economy and hospitality sectors.

In a recent survey of 100 businesses, carried out by the Scottish NTIA, over 53% of respondents said they are experiencing a 21% increase in operating costs compared to pre-pandemic levels.

For those whose energy contracts have already expired there has been an average 130% increase in their bills and I know of some operators who are being refused new quotes from suppliers. One is even considering hiring a diesel generator to power his premises because, as absurd as this sounds, filling up with fossil fuel and generating his own electricity works out cheaper than the price he is currently paying – let alone what he will be expected to pay six months from now.

More worrying is that 80% of respondents have reported that there has been no post-Covid bounce, and they are now trading well below 2019 levels. It’s no wonder, then, given those awful circumstances and average supplier and bank/loan debt of £160,000 that many operators are carrying, that 38% are “unsure" if their business will survive the next 12 months, with an additional 25% “not confident” they can weather the impending storm.

The NTIA says: “Operating cost pressures coupled with consumers with less disposable income (due mainly to the dramatic rise in the cost of living) have seen the early stages of a recession with slowing ticket sales and visitor frequency”.

This is already having a destructive domino effect on a huge array of businesses reliant on our once vibrant night-time economy such as retailers, restaurants, bars, bistros, casinos, theatres, fast food outlets, convenience stores and taxi/ private hire companies.

We shouldn’t ever forget, and many do, that the night-time economy is a vital contributor to both the UK and Scottish economy as well as one its biggest employers. Recent studies commissioned by the NTIA UK found that it generated in the region of £112 billion and employed 1.49 million people – £46 billion of which is generated through the cultural side, which includes theatres and music venues. In Scotland, around £5billion is generated and nearly 40,000 people are employed, with Glasgow generating £2.16 billion and supporting 16,000 full time jobs.

Well, these businesses and jobs now urgently need government intervention and support if we are to protect those sectors and the major contribution they make to the economy.

Call from trade bodies for a reduction in VAT to 12.5%, extensions to business rate relief and the introduction of an energy cap for SME businesses are sadly still being ignored.

Michael Kill, boss of the NTIA, sums it up neatly. He says: “We need both the Scottish Government and Chancellor to be decisive through a financial intervention. We must protect those businesses using every means possible and recognise their importance before it’s too late.”

If not, it could sadly be last orders for many of those struggling operators.