THE future remains bleak for nightclub and pub operators, especially those who are unable to pivot their businesses to eateries due to the continued ban on entertainment activities.
While most businesses are now allowed to operate as Klang Valley transitioned into Phase Four of the National Recovery Plan (NRP), nightclubs and pubs are unable to do so and have been closed for almost 19 months.
To survive, about 40% of such entertainment outlets in Kuala Lumpur converted their businesses into full-fledged restaurants, offering takeaway and later, limited dine-in when it was allowed.
However, the fate of bigger nightclubs is still uncertain as they say it is not viable for them to change their business model.
These establishments have not been able to resume business since the first movement control order was implemented on March 18, 2020 due to the Covid-19 pandemic.
Restaurant & Bistro Owners Association vice-president Jeremy Lim said that while some smaller establishments had converted their operations to become more restaurant-centric, the bigger brands were holding back as they had spent a lot of money on technology, sound systems and renovation.
“My own club Dragonfly for instance, the entire setting is more lounge style; it is not financially viable for me to convert it into a restaurant when I have put money into the sound system and lighting.
“And even the furniture is more suitable for a lounge, so how can we start serving nasi goreng in that type of setting,’’ Lim said.
Goodwin Pereira, founder and chief executive officer of South-East Asian club brand Kyo, said the place was a full-fledged dance club.
“To change our set-up, we would have to spend millions of ringgit on renovation.
“Besides, we are operating inside a five-star hotel, we are not a small joint,” he said.
The owner of Minnal Family and Fun Club at Federal Hotel, which has been operating for 22 years, converted the business into a restaurant to sustain itself, but the transition was not successful.
“The area does not support food business as people don’t come here for takeaway,” said group managing director Datuk Sivakumaran Nair.
“We tried it but it failed and we had to let our staff go as there was no income,” he said.
On Oct 18, Prime Minister Datuk Seri Ismail Sabri Yaakob announced that the Klang Valley, which covered Selangor, Kuala Lumpur and Putrajaya, would move into Phase Four of the NRP.
Entertainment operators expected to reopen their business once this happened.
However, nightclub and dance club owners were left in the lurch yet again as they were not on the list of businesses allowed to operate by the National Security Council (NSC).
According to the NSC website, entertainment is one of four activities that are not allowed to operate.
Only restaurants, pubs and bars with a licence to serve food as well as a liquor licence from the Customs Department can operate.
Over at TREC KL, a popular entertainment centre in Jalan Tun Razak, 10 of its outlets have reopened for business, but these are only the restaurants, bars and pubs without entertainment activities.
“There is no live band or deejays here. Outlets like dance clubs are not allowed to open yet,” said TREC Holdings Sdn Bhd general manager Kelvin Lam.
“We are still waiting for the government to allow entertainment activities to restart, but for now TREC is back in business and people have started trickling in,” he added.
TREC, which stands for ‘Taste, Relish, Experience and Celebrate’, had been losing tenants due to the Covid-19 pandemic, as entertainment outlets accounted for 70% of the business while the rest specialised in food and beverages.
Meanwhile, a coalition of 117 trade associations and chambers of commerce, as well as associations from the retail and hospitality sectors, called for the reopening of nightclubs and pubs in an open letter to the Prime Minister.
The statement issued by Industries Unite on Oct 22 said that with the country having achieved 94% full vaccination of the adult population as of Oct 19, and having accepted the fact that Covid-19 was now endemic, the opening up of all businesses including nightclubs and pubs should be implemented immediately.
The group also stressed that at least 150,000 to 250,000 direct and indirect jobs were at stake with the continuous closure of nightclubs and pubs.
“The longer it remains closed, the closer we are to total annihilation of this sector except for the few operators who have managed to pivot to food and beverage and other businesses,” the coalition said.