How to Start An Arcade Business

An arcade business can be a very profitable venture if it is researched and run properly. But before you buy those fun games, you'll need to conduct a market analysis to get acquainted with the opportunities and threats. Just because you build it, doesn't mean they will come.

Scale of Operations
An arcade can be started as a small entertainment center encompassing about 1000-2000 square feet, a medium one of about 3000-5000 sq. ft. or a large one of 10000 sq. ft. and more. So, this is the first thing you need to decide. Smaller arcades take relatively less time to set up and run. Of course, a lot depends on how much you're willing to invest. Larger facilities require a lot more planning, execution time and investment.

Location
Location is of paramount importance in an arcade business since it has to attract a lot of children, teenagers and young adults. Ideally, your arcade should be located close to schools, residential areas, shopping facilities and malls. This is so that you can be assured of receiving substantial traffic. Arcade businesses are known to thrive in shopping malls. So if you are able to procure your desired space in a mall, go for it.

Licensing and Permits
Before commencing operations you need to approach the local authorities and get the required license. You also have to study the local zoning laws. Earlier, there were some restrictions as far as the size and location of the arcade was concerned. So before starting your arcade, seek approval from your Zoning Board.

Business Plan
Once you get the green signal from the zoning authorities, you can proceed to draw up your business plan. This business plan should cover a breakdown of your initial investment, operating costs, future cash inflows and outflows and expected earnings. Obviously, your scale of operations is a key consideration when it comes to determining your initial outlay. On an average, you need about $10,000 to $50,000 to get started. You can approach local banks and financial institutions for your finance requirements. This is where your business plan comes handy.

Style of Arcade and Gaming Needs
Another significant factor to consider is the style of gaming arcade. Do you want to cater to the teeny-bopper crowd or do you want to include young adults as well? Perhaps, you're planning to start a wholesome family entertainment center where even middle-aged adults can join in the fun and entertainment. Conduct a market survey to ascertain what would be the most viable alternative. Introduce an interesting combination of games that will find favor with your target market. Always keep abreast with the latest innovations in gaming and try getting the latest equipment.

Value Added Services
Besides the standard games, you can include a food and beverage stand. You may also decide to serve alcohol. Vending machines can add value to your arcade. So explore your alternatives to create an all-in-one gaming arcade.

Advertising
The survival and prosperity of an arcade business depends to a large extent on a first-rate marketing strategy. Advertise extensively to boost your customer base. Place an advertisement in local newspapers, free or inexpensive websites and yellow pages. Distribute fliers at schools, clubs, shopping centers etc. Also create an attractive brochure highlighting your games and services.

An arcade business can grow and prosper pretty quickly if planned well and executed correctly. Make a careful study of your potential market and stay one step ahead of your competition by upgrading your games and introducing new ones. This should take your arcade business all the way to the top.