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Old 05-12-2008, 07:18 AM   #1
TommyBB
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Tough to succeed in bar business in Melbourne, Australia.

20% losses since smoking ban.

Quote:
Sunday Age (Melbourne, Australia)

May 11, 2008 Sunday
First Edition

Raising the bar

BYLINE: Peter Munro

SECTION: M; Upfront; Pg. 6

LENGTH: 1951 words

The number of licensed premises in the city is climbing towards 1500. But with tougher times and licensing laws ahead, it looks as though Melbourne's bar binge is almost over. Peter Munro reports.

The baby animals were home in bed by the time the police arrived with capsicum spray. Five young men were making gin fizzes, shaking each cocktail mixer exactly 100 times, under a night sky muddled by cigar smoke and clinking glass, when the force came to shut down the show.

As parties go, the 10th birthday celebrations of the Gin Palace were a fitting portrait of modern Melbourne: a bustling bar and lashes of alcohol, loud music, angry residents and police officers. The birthday party, on Melbourne Cup day last year, began with an afternoon sideshow of fairy floss, poker games and a petting zoo busy with baby ducks, geese, goats and lambs. As the sun sank, the baby beasts were replaced by dirty beats, and later by police calling last drinks and hosing down a couple of unhappy revellers.

Modern Melbourne indeed, but the party's premature end might also be a portent. New bars open apace in the city, spilling into vacant rooftops, alleys and even stairwells, and topping up the 1500 or so licensed premises already squeezed into the CBD. But like a sozzled drunk ordering one more drink before he kisses the floor, might the city's booming bar trade already be over the limit? The city's been like a party where everyone's invited, but as the economy cools and the heat rises over binge-drinking and street violence, Melbourne's bar bubble could be in danger of bursting.

Gin Palace owner Vernon Chalker, 44, says only the strongest city bars will survive. When he first switched on his cocktail bar's flickering front light - which he modelled on the neon sign of a brothel in TV show Twin Peaks - it was one of the first venues to reap the spoils of Victoria's liberalised liquor laws. Now there are several hundred bars within walking distance of the Gin Palace's discreet front door off Little Collins Street.

Chalker's eyes are bleary from a party the night before in the laneway behind Collins Quarter, his latest CBD venue. He nurses a double gin and tonic in the early afternoon while discussing Melbourne's bar scene. Last year, he opened this Collins Street bar, with a separate upstairs cocktail lounge. His stocks also include the Order of Melbourne on Swanston Street and Madame Brussels, his chintzy two-year-old balcony bar on upper Bourke Street.

He describes the Gin Palace as the city's grand dame, promoting the bar with snaps of a friend's 104-year-old grandmother, draped in fur with martini in hand. In Melbourne bar years, it deserves a seniors' card, alongside other well-preserved vintages such as Meyers Place and the Supper Club. Yet the Gin Palace still attracts a trade envied by its younger rivals, despite suffering a 20% downturn after last year's ban on smoking indoors.

Chalker says the secret of his success is simple. "The businesses I admire are particularly Pellegrini's and Florentinos, where the brand is solid and they stick to a formula that is really identifiable," he says. "The idea with the Gin Palace was to really create this kind of lounge-room type environment with table service. Unlike other bars that opened up and tended to focus on the product or the design, I only wanted one thing and that was table service. And it worked."

Melburnians have come to expect more over the past decade, he says, and are gradually killing off all but the strongest, most adaptable operators. It sounds like Darwin's theory of evolution, as determined by two bar hounds choosing which venue to prop up on a Friday night. "You can't open a place serving bad coffee or drinks and expect to survive in the marketplace. Dodgy places will still survive but they will become fewer as the market improves."

The looming economic gloom will help sort the strong from the weak. Trent Alexander, 36 - whose Liquid Lines company fitted out Comme, Collins Quarter, Vue de Monde and Longrain - says people tipsy about the current bar boom have short memories. "It was only 15 years ago things weren't in good shape and the last thing you thought of doing was going out to a restaurant or bar on a Monday night and spending $50 to $100 a head, which is common practice these days," he says.

"You will find that the bars who are flying through on the margins or skimming through on a very buoyant economy will probably start to feel the pressure over the next three months as people start to tighten up with their money. I know people who have curbed their spending habits in the last three months. These guys are not going out, they've got big mortgages they've got to service. Something's got to give."

Liquid Lines has about half a dozen projects in motion in the CBD, including the first local footing of Britain's clubby Match Bar Group. He opened his own bustling establishment, Trunk, on Exhibition Street two weeks before Christmas.

The hype over Melbourne's booming bar trade has meant good business for him. But he reckons the city has almost hit bursting point. "We are seriously overcatered for in Melbourne. There is this idea out there at the moment that you just open a bar and you're going to be making money...In the city on a Friday night, you could open a cardboard box and sell beer out of it and people will buy it from you, it's all about how you manage your business Monday to Thursday."

Even proven bar operators are tested by the times. Jerome Borazio's Sister Bella bar has been on slow burn since opening early last year. On Friday nights, students crowd its wooden box seats but on other weeknights it has taken time to match the success enjoyed by its sister bar, St Jerome's, in nearby Caledonian Lane.

Now, Sister Bella is all about the love. A new chef was brought in to improve the menu and free wireless was cast out to lure more students. Free hugs are offered by front of house staff, perhaps to reward punters for braving the heaving garbage bins either side of Sniders Lane.

Borazio, 36, dressed for a beer garden in T-shirt, shorts and thongs, admits Melbourne's bar trade can be a tough business. "These are a 24-hour-a-day job, seven days a week. Unless you have that level of commitment, I wouldn't think you would succeed," he says. "Sometimes what you think is a good idea on paper is not a good idea in practice."

Yet he shows no signs of sobering up. Borazio is planning a new warehouse conversion at the city's top end, which he says will be the city's biggest beer garden, and is also negotiating to buy an established bar in the CBD. He also boasts about his most recent venture, the ingloriously named Shit Town, which runs up and down a stairwell next door to St Jerome's.

He is undeterred by the fact the City of Melbourne says the bar does not have the proper business or planning permits to operate as a licensed venue. It is a mystery just how Shit Town can continue to float in the face of such opposition. The bar did shut suddenly in March under pressure from the council, but soon reopened to large crowds - though with the ominous advice to "Get down there before it disappears again and you're all dressed up with nowhere to go".

Borazio concedes, at least, that the growing pressure on governments to curb binge-drinking could be bad for business. "Things might have hit a capacity for now," he says. "If they muck around with the laws, it is really going to have a negative effect."

The State Government this month announced a crackdown on licensed venues, including a trial 2am lockout for bars in the CBD and inner city from next month. Michelle Matthews, publisher of Bar Secrets Melbourne, says the growing agitation over violent assaults, which jumped 17% in the city last year, could be the tipping point. "If anything stops the boom, I think number one it will be the liquor licensing board," she says. "They will bow to pressure from the police and outraged community groups."

Bar operators are already complaining about delays in the approval of new venues by the licensing board. Some bars have already shut up shop in the CBD, most notably the opulent Lexington, on the second floor of the GPO. The glam venue - which patrons reached via the shopping mall - called last drinks towards the end of 2007 after less than a year in the game.

It was a meek end to grand designs, and a reported $870,000 fit-out, financed by Foster's, featuring chandeliers, swish chairs and a $6000 pair of "custom chromed temple dogs". Why it closed remains a mystery. Bar operator Ian Robertson, who owns the Albany Hotel in South Yarra, did not return phone calls. But real estate agent Brian Rayner, of John H. Castran, says the business was bought out by the building's owner, a sober superannuation fund.

Penny Modra, editor of Three Thousand, an online snapshot of the Melbourne scene, says new bars can only stand out from the crowd by treading lightly. "It seems you need to open a bar that no one is going to find out about, because that's how your bar is going to protect itself from being swamped on Friday nights - from having drink prices go through the roof, from being overcrowded," she says. "It is about having a small space that is a niche and reliable and not publicised. Perversely, that's a recipe for success, certainly with the younger crowd."

A new contender in the market is 1806, a glammed up but perhaps too earnest cocktail bar on Exhibition Street. Co-owner Sebastian Reaburn, 31, who has worked at the Gin Palace and the Supper Club, opened the bar last October. He believes the growing intolerance of binge-drinking will tip patrons back to an appreciation of classic drinks and conversation. "A successful, vibrant bar industry can only grow and move forward if it's about the quality of the drinks, enjoying your night and not getting paralytic," he says.

Reaburn has put this theory into practice by obtaining an onsite training licence for his Mixology Management company, to issue responsible service of alcohol certificates. He foresees a move away from drinking behemoths such as the CQ bar on Queen Street, which was forced to cut its patron numbers by nearly 5000 last month to 2150. "In 10 years' time, I can't see places that hold 2000 or 3000 people existing in the same way they do today," he says.

"If you think about a club that holds 2000 people closing down, suddenly you need 10 bars that hold 200 people to take up the slack. And the CBD in Melbourne is still the place to be."

YOUR SHOUT OPENING A BAR IN MELBOURNE'S CBD

- Applications for an on-premises licence, for bars, restaurants and cafes, cost $567.50. See: consumer.vic.gov.au/liquor.

- New bars wanting to extend trading hours to 1am must pay a further $408. There is a freeze on new CBD bars opening past 1am until May 2009.

- New applicants must undergo police checks and complete a training course on liquor law and the responsible serving of alcohol.

- Applicants must also obtain planning permission from the City of Melbourne.

- The final decision is made by the director of liquor licensing, who may refuse an application on the grounds the applicant is not a suitable person to hold a liquor licence or the venue will detract from the surrounding area.

Michelle Matthews, of Bar Secrets Melbourne, says bar owners also need:

- Good staff: a bar's success depends on the quality of the people working there.

- A point of difference: perhaps a unique layout or a speciality beer.

- Location: best bet is setting up in a proven bar-friendly area, preferably with an outdoor area for smokers.

- Coziness: no one likes standing in an empty bar, especially when it is huge.

- Money to spare: don't blow all your dosh on the fit-out, you may need it.
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