International Spotlight: The Economics of a German ‘Dine & Dance’ Restaurant

International Spotlight: The Economics of a German 'Dine & Dance' Restaurant

Imagine if customers could enjoy a meal at your restaurant, leave the table, and hit the dance floor — all in the same room.

That’s the concept at Munich’s HEART Restaurant & Bar, a restaurant, bar, and nightclub rolled into a single business. It may sound novel in the U.S, but similar “dine and dance” establishments have existed in cities like Paris and Madrid for years.

The venue offers a seamless transition between each of the areas, so guests can move from bar to restaurant and onto the nightclub without barriers. It’s a one-stop shop for guests, who enjoy cocktail hour, dinner, and dancing without having to hop from place to place. HEART introduced the concept in Munich, which didn’t have anything similar at the time the restaurant opened.

“From the aperitif at the bar to dinner in the restaurant to bottle service at the lounge tables — the goal is to transform the whole venue into a dance floor,” says HEART’s Head of Marketing and Communications, Adem Schuster.

We asked Adem all about the business model and how it works, from staffing and operations to profitability. Here, we break it down.

International Spotlight: The Economics of a German 'Dine & Dance' Restaurant

Operations

At HEART, different parts of the venue are open during different hours. The restaurant opens at 7 p.m. and offers regular bar and a la carte menu service until 11 p.m. During those hours, light background music plays while guests enjoy dinner and drinks.

Come 11 p.m., the DJ gets going and the party starts up. Between 11 p.m. and midnight, the music gets louder and louder as the DJ slowly increases the volume and guests start dancing. The bar is open until the last guest leaves. (In the beginning, the team tried keeping the restaurant open until 3 a.m., but they quickly realized that guests were mostly interested in drinks by that time.)

There are two waves of guests: diners and party-goers. Guests that leave after dinner are replaced by a second round of people who come to party and dance — and of course, there’s also a group that stays throughout the night.

And here’s the crazy part: there’s no actual dance floor. The entire restaurant is transformed into a nightclub over the course of the evening as guests move tables aside to dance.

Business

Financially, all three areas of the venue work as one business, but revenue is split. Only 25 to 30% comes from the restaurant; the rest comes from the bar and nightclub, where margins are big. Since the restaurant is upscale and the food is high-quality, margins in that area are much smaller. (Plus, bottle service in the lounge area doesn’t hurt.) Still, Adem says each part of the business is critical to the success of the concept as a whole.

Staffing

The foundation of HEART’s success is its team. According to Adem, “The best concept in the restaurant and nightlife business will not work if you don’t have a phenomenal team. Your staff members are the ones that make guests laugh, dance and enjoy your venue.”

The Dine and Dance concept requires a couple of special considerations when it comes to building a team. First, you need more personnel overall. HEART has special staff for each concept: there’s someone who oversees the bar, someone who manages the restaurant, and another who is responsible for all guest relations. The guest relations role operates like a hotel concierge, making sure that all special requests and guest needs are met throughout the evening.

Plus, the restaurant books a variety of DJs, which calls for advanced planning (and the sophisticated sound system is much more expensive than the one in a traditional restaurant).

There are legal implications, too. After 11 p.m., the German government requires that employees are paid an additional 25% on their wage for working late hours. That’s why most restaurants close around midnight to keep labor costs down. Since HEART is open until the last person leaves (usually around 6 a.m.) the team has to pay a significant amount in additional wages.

Photo Credit: DNA Gastronomie GmbH

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