Business ideas
8 min read

How to Start a Profitable Family Entertainment Center Business [11 Steps]

Want to start a family entertainment center? Follow these 11+ steps to success! Learn how to create a profitable business in the entertainment industry.

By Nick Cotter
Updated Feb 02, 2024

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This page may feature products from our affiliate partners, which could influence the products we discuss due to potential compensation. Despite this, our evaluations are impartial, based solely on our independent analysis. The content here is intended for informational purposes and should not be seen as legal advice. For professional guidance, consulting with a legal expert is recommended.
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1. Perform market analysis.

Starting a family entertainment center (FEC) requires a deep understanding of the market to ensure your business meets the needs and preferences of your target audience. A thorough market analysis will help you identify trends, assess competition, and determine the most promising opportunities for your FEC. Here are the key steps to guide you through the process:

  • Research the demographics of your target market, including age ranges, family sizes, income levels, and interests, to tailor your offerings accordingly.
  • Analyze local competition by visiting existing family entertainment centers to understand their offerings, pricing strategies, strengths, and weaknesses.
  • Identify gaps in the current market that your FEC could fill, such as unique attractions or services not currently available.
  • Study industry trends, such as the rise of virtual reality or educational play experiences, to incorporate cutting-edge elements into your business.
  • Assess the economic climate of your target area, including factors such as employment rates and disposable income, which can influence consumer spending on entertainment.
  • Gather feedback from potential customers through surveys or focus groups to validate your business concept and refine your value proposition.
family entertainment center business image

Are Family Entertainment Center businesses profitable?

Yes, Family Entertainment Centers can be profitable businesses. Proper planning, good customer service and marketing, as well as having a variety of activities and attractions, can help ensure the success of a Family Entertainment Center.

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2. Draft a family entertainment center business plan.

Embarking on the journey to open a family entertainment center requires a well-thought-out business plan. This blueprint will not only guide you through the establishment and growth of your venture but also assist in securing financing and attracting investors. Here are the essential components to include in your family entertainment center business plan:

  • Executive Summary: Briefly outline your vision, business concept, and key financial details.
  • Company Description: Provide information about your entertainment center, including the location, target market, and unique selling proposition.
  • Market Analysis: Analyze your local market, identify your competitors, and describe your target audience.
  • Organization and Management: Detail your business structure, management team, and employee requirements.
  • Services and Attractions: List and describe the entertainment options and services you will offer.
  • Marketing and Sales Strategy: Explain how you plan to attract and retain customers.
  • Funding Request: If seeking financing, specify the amount needed and how it will be used.
  • Financial Projections: Offer projected income statements, cash flow statements, and balance sheets for the next 3-5 years.
  • Appendices: Include any additional documents or data that support your business plan.

How does a Family Entertainment Center business make money?

A Family Entertainment Center business typically makes money by charging admission fees and/or selling merchandise, food and beverages. Additionally, they may offer special services or activities such as laser tag, mini-golf, go-karts, batting cages, amusement rides, and arcade games, with fees for each activity.

3. Develop a family entertainment center brand.

Developing a strong brand is crucial for your family entertainment center as it distinguishes you from competitors and creates a memorable experience for your guests. A well-crafted brand resonates with your target audience and reflects the values and atmosphere of your entertainment center. Follow these steps to create a compelling brand identity:

  • Define Your Brand Personality: Choose attributes that represent your center's character, such as fun, adventurous, educational, or whimsical. This will guide your branding decisions.
  • Identify Your Target Audience: Understand the demographics and preferences of your potential visitors to tailor your brand to their interests and expectations.
  • Create a Memorable Name and Logo: Your name and logo are often the first things people will notice. Make sure they are eye-catching, easy to remember, and reflective of your brand's personality.
  • Develop a Color Scheme and Design Elements: Colors and designs evoke emotions. Choose a palette and motifs that align with the experience you want to offer.
  • Craft a Slogan and Messaging: A catchy slogan and consistent messaging reinforce your brand identity and communicate your unique value proposition to families.
  • Integrate Your Brand Across All Touchpoints: Ensure your brand is consistently presented across marketing materials, staff uniforms, signage, online presence, and customer service.

How to come up with a name for your Family Entertainment Center business?

When coming up with a name for your Family Entertainment Center business, it is important to think of a name that is catchy and memorable. Consider the types of services you offer, the age range of your typical customer, and the atmosphere you hope to create. Brainstorm ideas with friends or family, and take a look at other names in your industry to see what works. Consider looking up the meanings of words, or even creating a word to bring your business to life.

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4. Formalize your business registration.

Once you've laid out your business plan and secured financing for your family entertainment center, it's time to formalize your business by registering it with the appropriate authorities. This step is crucial as it legitimizes your business, protects your brand, and ensures that you're operating within the legal framework. Follow these key points to get started:

  • Research the necessary business licenses and permits specific to family entertainment centers in your area, as these can vary by location and type of activities offered.
  • Choose a legal structure for your business (e.g., sole proprietorship, partnership, LLC, or corporation) that best fits your needs and offers the right balance of liability protection and tax considerations.
  • Register your business name with your state or local government to ensure it's not already in use and to protect it. This may also involve filing a 'Doing Business As' (DBA) if you're operating under a name different from your legal business name.
  • Obtain an Employer Identification Number (EIN) from the IRS for tax purposes, especially if you're hiring employees.
  • Register for state and local taxes to ensure you're set up to collect sales tax if necessary and fulfill any other tax obligations.
  • Ensure compliance with local zoning laws, health, safety, and building codes, and acquire any specific entertainment or amusement licenses required.

Resources to help get you started:

Explore valuable resources designed for family entertainment center entrepreneurs that provide insights on market trends, operational best practices, and strategic growth advice:

  • International Association of Amusement Parks and Attractions (IAAPA): Offers industry reports, news, and educational resources to support entertainment business growth. Visit IAAPA.
  • Funworld Magazine: Published by IAAPA, features the latest trends, success stories, and management tips for entertainment center operators. Read Funworld.
  • Amusement RC: Provides a comprehensive collection of research reports, market analysis, and forecast trends crucial for entertainment center development. Explore Amusement RC.
  • RePlay Magazine: Focuses on the coin-operated game industry, offering insights valuable for family entertainment centers featuring arcade games. Discover RePlay.
  • Blooloop: Delivers news and features on the latest innovations and developments in the attractions industry, including theme parks, museums, and family entertainment centers. Check out Blooloop.

5. Acquire necessary licenses and permits for family entertainment center.

Starting a family entertainment center involves careful planning and compliance with local regulations. Securing the necessary licenses and permits is a crucial step in ensuring that your business operates legally and safely. Here's a guide to help you through the process:

  • Research local zoning laws to ensure your business location is properly zoned for a family entertainment center and acquire any necessary zoning permits.
  • Apply for a business license with your city or county clerk's office, which is a basic requirement for operating any type of business.
  • Obtain a sales tax permit or vendor's license from your state's department of revenue if you will be selling goods or services.
  • Check if you need specific entertainment or amusement permits, which can vary depending on the attractions you offer (e.g., arcade games, rides, laser tag).
  • Ensure that all your equipment and facilities comply with safety standards and acquire any required health and safety inspections and permits.
  • If you will be serving food and beverages, apply for a food service license from your local health department.
  • Consider the need for additional permits such as music licenses, liquor licenses (if applicable), or special event permits for hosting parties or gatherings.

6. Open a business bank account and secure funding as needed.

Starting a family entertainment center is an exciting venture that requires careful financial management. Step 6 is crucial as it involves setting up a dedicated business bank account to keep your finances organized and seeking funding to cover startup costs. Here's how to navigate this step:

  • Choose the Right Bank: Research and select a bank that offers business banking services with low fees, good customer service, and convenient access.
  • Prepare Documentation: Gather all necessary documents such as your business plan, EIN, incorporation papers, and personal identification to open your business account.
  • Understand Banking Services: Consider the types of banking services you will need, such as online banking, merchant services, and lines of credit.
  • Explore Funding Options: Look for funding sources including small business loans, investors, crowdfunding, or business grants tailored to entertainment or family-oriented businesses.
  • Develop a Financial Plan: Create a comprehensive financial plan that outlines your funding needs, expected revenue, expenses, and cash flow projections.
  • Build Relationships: Establish relationships with financial advisors and potential lenders or investors early on to secure the necessary funding when needed.

7. Set pricing for family entertainment center services.

Setting the right pricing for your family entertainment center is crucial for ensuring competitiveness, profitability, and customer satisfaction. It's important to balance affordability with the need to cover costs and generate a healthy profit margin. Here are key points to consider when determining your pricing strategy:

  • Cost Analysis: Calculate the total costs of operations, including rent, utilities, staff wages, maintenance, and equipment depreciation to establish a baseline for your pricing.
  • Market Research: Look at the pricing of competitors in your area to gauge what customers expect to pay and to ensure your prices are competitive.
  • Value Proposition: Consider the unique experiences or services your center offers and price them accordingly to reflect the value provided.
  • Dynamic Pricing: Implement dynamic pricing for peak and off-peak times, or offer special discounts and packages to attract a wider audience.
  • Pricing Tiers: Create different pricing tiers for various age groups, group sizes, or for the purchase of memberships and loyalty programs.
  • Profit Margin: Set prices that offer a reasonable profit margin while still being fair to consumers.
  • Feedback: Regularly solicit customer feedback on pricing and adjust if necessary to meet market demands and customer satisfaction.

What does it cost to start a Family Entertainment Center business?

Initiating a family entertainment center business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $385000 for launching such an business. Please note, not all of these costs may be necessary to start up your family entertainment center business.

8. Acquire family entertainment center equipment and supplies.

When starting a family entertainment center, selecting the right equipment and supplies is critical for creating an engaging and enjoyable environment. You'll want to acquire high-quality, durable items that can withstand constant use and appeal to a wide audience. Here’s a guide to help you with this crucial step:

  • Research suppliers who specialize in family entertainment center equipment and compare their products, prices, and reviews.
  • Choose age-appropriate and diverse attractions, such as arcade games, climbing walls, mini-golf, or laser tag equipment to cater to different interests.
  • Consider purchasing used or refurbished equipment from reputable sources to save on costs without compromising quality.
  • Ensure all equipment meets safety standards and is compliant with local regulations.
  • Invest in a reliable point-of-sale system and software for managing admissions, parties, and other center activities.
  • Order consumables like tickets, wristbands, and redemption prizes in bulk for cost savings.
  • Think about comfort and aesthetics by getting quality furniture for seating and theming elements to enhance the overall experience.
  • Plan for maintenance by setting up contracts for regular service checks and having a stock of spare parts for quick repairs.

List of Software, Tools and Supplies Needed to Start a Family Entertainment Center Business:

  • Business plan software
  • Accounting software
  • Point of sale system
  • Cash register
  • Security system
  • Signage and advertising materials
  • Arcade games
  • Ride-on toys
  • Playground equipment
  • Table games
  • Video games
  • Climbing walls
  • Inflatable structures
  • Food and beverage machines
  • Furniture and seating
  • Cleaning supplies
  • Safety equipment

9. Obtain business insurance for family entertainment center, if required.

Securing the right business insurance is a critical step in safeguarding your family entertainment center. It helps protect your investment from unforeseen events and liabilities, ensuring that you can operate with peace of mind. Here are a few types of insurance you might need:

  • General Liability Insurance: This covers injuries to customers or damages to their property while on your premises.
  • Property Insurance: Protects your building, equipment, and inventory in case of fire, theft, or other damages.
  • Workers' Compensation: Required in most states, it covers medical costs and lost wages for employees injured on the job.
  • Business Interruption Insurance: Provides compensation if your business is unable to operate due to covered events like natural disasters.
  • Umbrella Insurance: Offers additional liability coverage beyond your other policies' limits.
  • Specialized Coverage: Depending on the attractions you offer (e.g., arcades, play structures, go-karts), you may need specific insurance for those activities.

Consult with an insurance broker who specializes in entertainment or small business insurance to ensure you get the appropriate coverage for your specific needs.

10. Begin marketing your family entertainment center services.

Marketing your family entertainment center is crucial to attract guests and create a buzz in the community. A well-crafted marketing strategy will help you showcase your unique attractions, build brand awareness, and engage with families looking for fun experiences. Here are some effective ways to begin marketing your services:

  • Develop a Strong Online Presence: Create a user-friendly website with SEO optimization to ensure your center appears in local search results. Utilize social media platforms to connect with your community and share promotions, events, and customer experiences.
  • Engage in Local Advertising: Use local newspapers, radio stations, and community bulletin boards to advertise your center. Consider sponsoring local events or sports teams to increase visibility.
  • Leverage Word-of-Mouth: Encourage visitors to leave reviews online and offer referral discounts or incentives to spread the word about your entertainment center.
  • Host Grand Opening and Special Events: Plan a grand opening celebration with special offers to draw in crowds. Continue to host seasonal events and themed parties to keep customers returning.
  • Partner with Schools and Organizations: Establish partnerships with local schools, clubs, and organizations to host events or fundraisers, thereby gaining access to a wider audience.
  • Implement an Email Marketing Campaign: Collect email addresses and send out newsletters with updates, upcoming events, and exclusive deals to keep your audience engaged.

  • Business plan software
  • Accounting software
  • Point of sale system
  • Cash register
  • Security system
  • Signage and advertising materials
  • Arcade games
  • Ride-on toys
  • Playground equipment
  • Table games
  • Video games
  • Climbing walls
  • Inflatable structures
  • Food and beverage machines
  • Furniture and seating
  • Cleaning supplies
  • Safety equipment

11. Expand your family entertainment center business.

Once your family entertainment center (FEC) has gained a foothold in the market, it's time to think about expansion. This can involve adding new attractions, scaling your marketing efforts, or even opening new locations. Below are some strategies to consider when looking to grow your FEC business.

  • Analyze Performance: Review which areas of your business are most successful and consider how you can replicate or enhance these aspects.
  • Enhance Offerings: Introduce new attractions or services that complement your existing ones. Consider trends, customer feedback, and unique experiences.
  • Technology Integration: Utilize technology to improve customer experience or streamline operations, such as implementing VR attractions or cashless payment systems.
  • Partnerships and Sponsorships: Partner with local businesses or seek sponsorships to increase visibility and shared customer bases.
  • Community Engagement: Host community events or charity fundraisers to strengthen local ties and attract new visitors.
  • Franchising: If your brand is strong, consider franchising to expand your business with lower capital risk.
  • Expand Geographically: Research and target new locations where market demand indicates potential for success.
  • Improve Facilities: Regularly update and maintain your facilities to keep them safe, appealing, and modern.
  • Staff Training: Invest in staff development to ensure high-quality customer service as your business grows.
  • Marketing Campaigns: Scale-up marketing efforts, utilizing both digital and traditional platforms, to reach a wider audience.