ATMs have staying power and money-making prowess in nightclubs and bars

By Meg Frazier

In 1969, the first magstripe card automated teller machine (ATM) made its debut outside New York's Chemical Bank. Docutel installed its Docuteller machine, the first machine to use magnetically encoded plastic.

Now more than 30 years later, ATMs appear on almost every street corner and in most convenience stores. Almost everywhere you look, it seems an ATM graces the vicinity. By having an ATM in your club or bar, not only will they provide your customers with a convenient money provider, they will also bring extra cash to your business.

A Must-Have

For the past seven or eight years, Roger Payne — general manager at Shephard's Beach Resort in Clearwater, Fla. — has been noticing the rising use in the 150,000 sq. ft. property's two ATMs. One is located at the entrance to Wave Nightclub, while the other is parked at the lobby entrance of the restaurant.

“I think it is essential for anybody who sells liquor and food (to have ATMs),” says Payne. “It helps (people) spend money. Some people don't want to use their check card. They prefer to use debit and get cash out of the machine.”

Cory Huetter, owner of The Safari Bar in Omaha, Neb., has used an ATM machine for about one and a half years, since the club's inception. The machine is located by the front door on the main level.

“It was the best place for it — visible, yet not in the way,” Huetter says.

For Huetter, the presence of an ATM machine is absolutely necessary.

“We don't take checks or run credit card tabs on busy nights,” he says.

On these nights when cash is king, the ATM receives a ton of business.

Tim Borden, vice president of corporate development for Ala Carte Entertainment, Inc. (a Chicago-based restaurant and nightclub company that operates 27 locales), says having an ATM on the property could determine whether a customer enters your property or decides to go elsewhere.

“(Having an ATM) is not even a novelty anymore,” Borden says. “People almost expect it there. For a decent size establishment, it's almost a prerequisite in people's minds.”

What You Get

Payne says that by having ATMs on his property, outside people are lured in by the amenity.

“It gives us the chance to introduce our property to somebody new,” Payne says.

The presence of the machines also encourages patrons to spend more money in the bar.

“You don't (have an ATM) if you don't make money,” he says.

Because they own the machines on their property, Shephard's receives a 100 percent return from the machines. Each machine does at least $1,000 per month and has increased transactions by 75 percent.

Borden agrees that customers tend to spend more money if an ATM is readily available.

“I think a good percent of the money withdrawn is drawn for the purpose of spending at bars,” Borden says. “You also get a lot of return on additional sales.”

Besides being an effortless way to make money, Huetter and The Safari Bar also use their ATM as a promotional tool.

“Our screen says that they get a free shot for every transaction,” Huetter says. Once a transaction is completed, customers take the receipt to the bar to redeem their shot.

“It works out pretty well,” he says. “They win something, and they get all excited.”

Huetter also has heard of club owners who put random $50 bills in place of $20 bills, giving customers a chance to win — and spend.