Ukrainian business has been experiencing huge losses every day for almost two years. According to the Kyiv School of Economics, direct losses incurred by private companies in Ukraine in 2022 and the first half of 2023 ranged from $13 billion in direct to $33 billion in indirect losses.
At the same time, the segment of the entertainment business, focused on work at night, received the most devastating blow. And here a moral dilemma arises in society - is it appropriate to support the activities of cinemas, nightclubs, restaurants and solve their problems at the same time when the number of dead on the front is increasing every day? Elite Expert understood this issue.
THE STATE HAS REMOVED ITSELF
As an example, ElitExpert examined the activities of night clubs in Kyiv and Odesa as the two most famous "centers of gravity" of night life in Ukraine.
Co-owner of restaurants and nightclubs of the chain "Boho" (Kyiv) Rostislav Ruchko explains that his business suffers significant losses because it is impossible to fully adapt the night business model to daytime and evening hours.
"The basis of our business was work in the evening and at night, and this time was preferred by the clients, not us. Therefore, with the introduction of restrictions and curfews, we found ourselves on the verge of survival. On the other hand, our restaurants and cafes hardly felt any damage from the curfew, because even in peacetime, their peak attendance was at 19:00-22:00." he noted.
The manager of the Ithaca and Palladium entertainment complexes (Odesa) also holds the same point of view. Oleksandr:
"We work until 10 in the evening. And let's be honest: who will come to a disco in the evening or even more so during the day? Well, maybe the children. Accordingly, there is almost no revenue. We survive at the expense of some one-time large-scale events."
Business representatives point out that the support from the state is not enough, and it is not enough to stay afloat.
"From June 2022, we are given a 50% discount on rent, but this discount is not proportional to the losses associated with the reduction of the working hours of our establishments, - notes Rostislav Ruchko. - Before the war, we rented large premises in order to profitably process guest traffic on weekends, because in our business model, these days generate 80% of turnover. Currently, all these spaces are not filled. We did not receive any other benefits."
Both in Kyiv and Odesa, the owners had to cut about 50% of the staff - hundreds of people. Also, a significant part of the employees was mobilized and currently serves in the ranks of the Armed Forces. Therefore, in addition to other problems, there is currently a shortage of qualified personnel in this segment.
DOUBLE STANDARDS
At the same time, there is a clear paradox. On the one hand, the government declares the need to support domestic business and stimulate the preservation of jobs, and on the other hand, entire fields of entrepreneurial activity are actually frozen. At the same time, unlike nightclubs, similar segments of the entertainment business, such as theaters, cinemas, concert venues, continue to work in full. Moreover, all over the country, entertainment events are sold out, which shows that Ukrainians are not ready for an ascetic lifestyle and daily mourning. Apparently, only people themselves have the right to set the moral line of what can and cannot be done during war, based on their inner convictions.
Now, at the end of the second year of the war, it is already clear that the further from the front line, the more Ukrainians want to return to the past, pre-war life. In Odesa - crowded beaches, in Kyiv - concerts of stars, in Western Ukraine - restaurants and cafes are packed to the brim. To some extent, this is due to the impossibility of men going abroad for recreation, but still, the trend is obvious.
Perhaps it is precisely because of the public demand for rest during the last 1,5 years, and especially in the summer of 2023, that there are more and more reports about the transition of night clubs and restaurants "into the shadows". Information also regularly appears that some establishments that have the tacit support of law enforcement agencies successfully operate at night, albeit semi-clandestinely. And others who do not have such a "crushing" are forced to idle, lay off staff and close their businesses.
As in any other segment of entrepreneurship, there is widespread competition, including unfair competition - in informal conversations, entrepreneurs say that very often "raids" by law enforcement officers and investigations in the media about some clubs do not appear for nothing, but on order business colleagues.
WHAT SHALL I DO
Entrepreneurs surveyed by ElitExpert are sure that in the current economic situation, the state should give an opportunity to work to any legal business that can provide jobs and generate taxes.
Rostyslav Ruchko believes that for this government it is necessary to take into account the specifics of each individual direction, without generalizations - and to understand that nightclubs cannot work during the day. However, he doubts that the state will take such a step.
"Until the war is over, who will take responsibility for allowing entertainment when people are dying every day? But I myself understand that this is not the right time." - says Oleksandr, manager of "Ithaka" and "Palladium".
But all the same, entrepreneurs agree that to support this area of business in the rear cities, it is enough to cancel the curfew from Friday to Sunday, allowing the work of establishments that guarantee safe conditions for guests' stay.
In turn, as compensation, the state could introduce an additional tax to ensure increased security measures at night. If, of course, the authorities, and last but not least, Ukrainian society, are ready for such a step.
Olena Ovchinnikova, Oleksandr Shorokhov
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