'Want to know why the pub DJ is working for less money....and why this is expected to decline even further?' The debates come and go about the £40 to £50 a night DJs, but when you delve into the subject a little deeper, some interesting facts turn up that put a slightly different perspective on things....for instance whether you put a simple question to a landlord or manager of a pub "Why do you pay Pub DJs 'XX' amount?", the answer invariably seems different but with a common denominator - they always appreciate the DJs ability - but can not afford to increase the money! I put the very same and one or two other subtle questions to an ex-regional brewery manager recently on behalf of the DJU expecting the same usual brief answer of sorts but I was given an explanation and 'enlightenment' to a perspective of 'our business' which I hope you find as interesting.

Example Case I was given a Public House investment 'case example' where the particular brewery left no margin for live music or DJ entertainment. The brewery looks upon a Pub as a thriving community focused business. Statistics and changes in trends motivate particular investment opportunities. Many considerations have to be taken onboard before they invest, say £230,000 on extensively refurbishing the interior and exterior of a pub. Focusing on two key areas, distinguished by fixtures, fittings and layout, good quality bar food is served in an informal, relaxed environment - the important element for a great community / family pub. Including modern kitchen facilities, patio and extensive garden area for the summer months and substantial staff/family accommodation, grounds include ample car parking facility's, etc, etc

The projected turnover of such a pub is realistically in the region of £500,000 per year. So I asked if 'this type of pub venue' would benefit from featured entertainment? Simple answer, not from his point of view, but the brewery would usually leave the end decision to the investor / landlord if they 'allowed for the investment'. With reference to his position, he would have had the final word in the past! Further, why should a brewery subsidise, for example, £10,000 per year from their profit margin towards entertainment / DJs earnings when they can improve greatly other aspects of the venue? With the changes to the Licensing Act and meeting the statute requirements, health and safety, fire regulations, inspections, noise limitation, etc - all and a lot more play an important role in whether a Pub remains or is turned into an entertainment venue. It's not just about throwing money into a venture. Other logistics are taken into consideration and constantly evaluated.

For such a Pub with a projected turnover of £500,000 a year, the brewery would be looking for £100,000 Capital (minimum) investment given their £230,000 investment. He said that any allocation of entertainment would have to come off the bottom line at the end of the day, for example, in explaining some of the requirements of contract with respect to a landlord, the rent is payable monthly in advance by direct debit with a deposit that is one quarter’s rent deposit. The annual rent requirements for his example would be in the region of around £65,000. Responsible for repairs, the Landlord insures building and recharges, fully repairing and insuring lease. Decoration is to be carried out by lessee at least every five years. There is no dilapidation or decorations fund. From the machine income, the lessee will receive 50% of net income after duty, VAT and rent. Investment will include Security Deposit and legal fees, stamp duty and fixtures and fittings (including purchase of existing fixtures and fittings where applicable). Typical Lease terms - 15 year nil premium lease, assignable after 3 years, full beer and machine tie lease.

Another (more basic) Managed House example was given which I had heard before but this was the first time that it has been explained in 'detail'. For every £100 paid out net on entertainment, a further £350 - £400 should be taken over the bar in that venue to make it a profitable venture unless entertainment is allocated out of gross profit. i.e. they have taken into account off the top line earnings and make it an entertainment venue.

Example: Saturday night £1,000 takings - to pay a DJ £100 would require a further £350 - £400 in takings. On £10,000 per week, should expect 65% profit on booze and 35% profit on food. Thus, £8,000 on booze, £2,000 on food (Bar = 65% profit before bills, Food = 35%) However, from £2,000 (35%) food, Money from food profit isn't put towards entertainment. The Breakdown: £8,000 Less £2,800 for beer and spirits - paid. £5200 (net profit) Less Staff wages Allocated (usually 15%) £780 £4,420 Less Landlord and landlady wages @ £600 per week £3,820 Less Electric £100 £3,720 Less Gas £100 £3,620 Less Maintenance, repairs, call outs - £450 - miscellaneous bills - breakages, call outs Less Gaming Licence £50 £3,120 Less Cleaning materials - £150 £2,970 Less Cleaner/s - £120 £2,850 Less Water rates - £100 £2,750 Less Higher rates business premises rates = £1250 £1,500 Sky - £170 £1,330 Other entertainment licences - £15 PEL PRS £1,315 Telephone - business calls - £50 £1,265 VAT - £221 Rounded off, the bottom line figure = £1,043 - profit Brewery should make over £50,000 profit per annum Consequently, any entertainment allocation would come off the 'bottom line', adding that not all Pubs turn over £10,000 a week and that many run at a loss.

 At the end of the day, the figures quoted are mere examples but the point being made here was why should there be an allocation of money to DJs off their profit? Many positive points about DJs were agreed yet the overall stance and opinion finally offered was as expected, disheartening to say the least. I suggested that the DJs of today were very sophisticated to that of 'yesteryear' but the immediate reply was that technology was now available which was affordable and available to the consumer too, after all, the consumer can entertain themselves at home, and the same / similar technology exists to supply music on demand for as little as £50 hire per week via the latest digital touch screen jukebox's which retail from around *£2,000.00+ in the UK plus incentives. Other systems are available that use modern technology but it was said that not all venues were suitable for such machines. Fair enough, these glorified coin touch-systems may take up less room than a DJ and meet many other requirements perhaps, but I stated that the 'human element' of service was missing and surely required? DJs read the crowd and build a great night to encourage returning customers.

They interact with the audience and regulars, focus on the customers by going out of their way to please, even providing mood or disco lighting, etc, etc. In the past, the general concern (brewery) was someone (DJ) in a good position could always take away custom if the opportunity was presented attractive enough.....therefore a venue needs only someone who was competent in the role, or in other words, a superstar DJ need not apply; stability in business is still required - quickly adding not just in their industry, and DJs are not on their agenda of priorities. DJs are considered a novelty thing of the past. In fact, they are now considered dinosaurs. You can always find a DJ willing to work for £40 - £50 or even less no matter where you are! It's not a recognised trade and pretty much a hobby, isn't it? Now, where have I heard that before? Accepted that comments made were a mixture of presented fact and opinion, I may not agree entirely with what he said but at least I understand a little more than when I was back in the day, and appreciate that it isn't always these type of venues that DJs perform in for similar earnings.

Written & Researched by DJ Associates Chairman - Dan "Dukesy"

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