Clubs fight to survive
CLUBS on the Tweed are losing the battle to recoup multi-million dollar downturns in revenue since indoor smoking bans came into effect almost a year ago.
Coupled with multi-million-dollar poker machine tax bills, the smoking bans have the potential to cripple an industry that was once the economic lifeblood of the Tweed.
After spending millions to provide for smokers, including outdoor poker machine areas where patrons can smoke, even the big clubs on the Tweed are noting a dramatic downturn in gaming revenue, and say their losses will continue to grow as patrons react to the ban and the economic climate worsens.
Twin Towns Clubs and Resorts have lost more than $5 million in gaming revenue since the smoking ban was introduced on July 2 last year, general manager Rob Smith told the Tweed Daily News yesterday.
"We have lost about 13 per cent in gaming revenue since the ban, and we budgeted for about 10 per cent," Mr Smith said.
That was after $1.8 million was spent at the group's three sites to provide smoking areas that comply with the legislation.
"There has only been a minute difference in food and beverage takings, so the extra patrons the government said would come when clubs went smoke-free have not materialised.
"What has happened is what the industry said would happen, clubs aren't able to make back that revenue they have lost.
"The government originally said it would take three years for clubs to recover. But in the last budget they admitted it would take up to five years for clubs to get back to the same point they were before the bans."
Patron demand at the Seagulls Club has led to more than $1 million being outlaid on two outdoor smoking gaming areas, and since the ban has suffered more than $1 million in gaming revenue, a drop of eight per cent.
The first alfresco gaming and smoking area was opened by the club in August last year and has 44 poker machines; the second area, with 65 machines and fronting the Tweed River was completed last November, club general manager Wayne Kendrigan said.
"Because we planned ahead and put in the smoking areas we have mitigated the possible losses in gaming revenue," he said.
More than 80 per cent of the club's revenue is derived from poker machines.
"Add to that the cost of poker machine taxes -- last year our bill was $5 million -- and the general economic climate at the moment, we are definitely doing it tough like everybody," he said.
With two smoker-friendly gaming areas, Seagulls Club is a favourite place to spend a few hours for punter and smoker, Giselle Lucas.
"To be honest I wouldn't go to a club or pub unless I can have a smoke while playing the machines," said the Tweed Heads West resident.
"It's basically like when drink-driving laws were brought in, the clubs provided courtesy buses to cater to what the patron wants.
"Club members want to be able to choose to have a smoke when they play the pokies."
Meanwhile, responses to a member survey led to Tweed Heads Bowling Club creating an outdoor smoking and gaming area with 12 poker machines, club general manager Ross Bailey said.
"Since the ban came into effect our general revenue from poker machines is down $750,000, which is more than we expected," Mr Bailey said.
"We budgeted to lose about eight per cent, but some clubs are worse off, with the average being a loss of about 13 per cent."