The lively nightlife in Kampala, often regarded as East Africa’s party hub, is experiencing a significant transformation, marked by the closure of high-profile bars and nightclubs. Notable establishments like Gabz Bar and Lounge, Levels Lounge, The Garage, Luxe, and Mevek Lounge have recently shut down, raising questions about the future of the city’s nocturnal scene.
The closures, occurring over the past six months, are attributed to a combination of economic challenges, shifting consumer behaviors, and the lasting impacts of the Covid-19 pandemic. Interviews with industry insiders, bar owners, and patrons unveil a complex narrative that sheds light on the underlying reasons behind the closures.
Economic Struggles
Morgan Kamoga, known as Morgan MC in nightlife circles, reveals a sobering reality within the financial landscape of these establishments. Most bars thrive primarily on select nights, such as weekends, while operational costs remain high throughout the week. The struggle to break even becomes evident, with revenue from bottle sales often insufficient to cover escalating costs.
Joel Martin Sengendo, a bar manager in Kololo, highlights the challenge of maintaining profit margins from bottle sales, particularly on less busy nights. The burden of operational costs, including rent, salaries, and taxes, becomes overwhelming, pushing bar owners toward closure.
Survival for the Fittest
Japhet Higiro, a director at Gabz Lounge, views their closure as a strategic move to adopt a new business model in a highly competitive industry. Dr. Innocent Nahabwe emphasizes the volatile nature of nightclubs and bars, where only the best survive amidst intense market competition.
Rugiirwa Katatumba, Chairperson of the Bar, Club, and Entertainment Owners Association, points out the challenge of exorbitant rent costs, especially in prime locations. High-end bars in areas like Kololo, Nakasero, and Bugolobi face monthly rents of up to $10,000 (Shs38m), adding to their financial strain.
Shifting Consumer Behaviors
The changing habits of patrons contribute to the challenges faced by bars. The influx of new bars, offering free entry and exit, prompts established venues to eliminate entry charges to remain competitive. However, relying solely on drink sales becomes a significant challenge, as economic hardships lead patrons to allocate funds to other necessities.
Dr. Nahabwe notes a trend of patrons hopping between bars without settling at a particular venue. Economic challenges hinder some patrons from overspending on alcohol in bars, prompting them to consume drinks purchased elsewhere before visiting larger establishments.
The Road Ahead
Bars are exploring innovative solutions to navigate challenges, such as introducing creative theme nights, collaborating with event organizers, and diversifying offerings beyond alcoholic beverages. Dr. Nahabwe suggests a strategic cycle of operating, closing, and reopening establishments to sustain interest and appeal among patrons.
Covid-19 Factor
While the Covid-19 pandemic undoubtedly influenced the closure of some bars, Rugiirwa Katatumba points out that over 300 bars closed in Kampala due to tenants’ inability to maintain rents during and after the pandemic. The pandemic served as a catalyst for re-evaluating priorities, with alternative entertainment options gaining popularity.
Joan Bella, a bar and nightclub marketer, notes a decline in nightlife revellers post-Covid, attributing it to alternative entertainment options like house parties embraced during the pandemic. Bars are challenged to rethink their business models, and those unable to adapt are making the difficult decision to close.
