How to Start an Arcade Business

If you are looking to start an arcade business, the new amusement entrepreneur must first understand the local market opportunity, the demography of that local market, and just as important, his or her own arcade business goals.

There are many options to consider when looking to start your arcade business, including the arcade games you will need for your target customers, and the type of game play your arcade business will offer. This includes different arcade machines, redemption games (ticket games) and the play value of each of these game types.

Start an Arcade Business

Step 1: It all starts with a business plan

Probably not what you wanted to hear first, but the unfortunate truth to starting a successful arcade business starts with a good, accurate business plan including an analysis of your market potential. From your plan, everything else will come together. What machines, how many, your best location, startup costs, attendance and an expected return on investment.

Step 2: Use your plan to source the best arcade machines and redemption games

With your plan complete, it's finally time for the fun stuff. Sourcing the best, coolest games and machines for your location and demographic profile, along with the design, layout and build-out of your ideal location. 

Step 3: Your Ideal Location

We've all heard it before... location, location, location. In terms of an arcade game room business, finding the "ideal" location may not mean the best location, but the right location. Within easy reach of your target market, at the right lease rate, terms and available space to accomodate your guests.

When starting an arcade business, there are several things to keep in mind. Your arcade game room is a player in the overall family fun center attraction mix. Depending on your fun center business goals and your target market demographics it might be a key player, or it might just be a necessary component to the long term success of your business. Make no mistake, arcade game machines are still in fashion and profitable in the right location, with the right mix and game room design.

The point of this conversation is to open the eyes of the new arcade startup to the bigger picture. Old style, stand-alone video arcade game room just doesn't have the pull, or the community attraction they once had. However, a successful arcade business has become an integral component of your overall attraction mix and the fun center or indoor party center business itself.

Family fun center businesses are smart to include an arcade game room, if it makes sense for their target aged customer and local demographic. For a younger indoor party center demographic (typically 10 years and under), video arcade games are not as popular as redemption games. Secondly, mothers are the primary buyer for this younger demographic and justified or not, often see the content of these video arcade games as violent and destructive. If on the other hand, your market includes tweens, teenagers and young adults, a video arcade game room is expected and will do well with the right arcade game mix and game room design.

Arcade Business - Design for Profit

Among all the video games and redemption (or ticket) games available for your arcade business, each one has it’s own playability or play value. When combined together into a cohesive arcade game room, the total mix of your video game selection should provide your arcade business customers a well rounded and highly playable guest experience. Depending on your target demographic, a good game room needs to offer your guests an assortment of arcade machines and gaming experiences.

For example, you need quick play games, novelty games, merchandise and redemption games, shooting games, driving games and traditional pinball games. If you are going to be catering to a younger demographic you may also want to include kiddie games.

How to Start an Arcade - Space Planning

Here are some base rules of thumb when looking at designing a successful arcade game room:

• Use an estimated 50 sqft of floor space per game (100 games = 5,000 sqft).

• You can bunch games up side by side, or back to back to save space.

• Video arcade games need approximately 4 feet clearance in the front of the game.

• Basketball or SureShoot type games require 6 feet of clearance in the front of the game.

• Redemption games can vary dramatically however, a minimum of 2-3 feet in front and 1-2 feet on each side.

• If you are using multiples of the same type of games or titles, you can push these games side-by-side to reduce the amount of space required.
• For larger, multiplayer arcade coin games or redemption games that can be played by 4 to 6 players at a time, this type of cabinet game should be used as an eye-catcher and placed in a visible spot with a minimum of 4-6 feet around the entire game.

Your family fun center, indoor party center and other amusement attractions are a fun place for families, tweens, teenagers and groups of friends to go play and spend some time (and money) together.
 There are a wide assortment of video games, arcade machines and coin operated games that can help make this experience diverse, entertaining and time well spent for your guests.

To develop a successful arcade game room you need to offer your guests a good variety of game-play and play-ability, from a diverse set of arcade machines and redemption games.

 When designing your game room, the game mix and game room layout are the key areas of planning for long term success in your attraction business. As with space planning for your amusement fun center in general, providing your guests with a visually pleasing and traffic friendly layout is the corner stone of arcade game room success. At a glance, your fun center guests should be able to quickly feel enticed to enter the room and select an arcade game to start playing.

Arcade Game Room - Final Thoughts

Once your guests find games to play, how they play those games are just as important as which arcade machines and games they play. Some games are multi-person games and require a lot more space than a single pinball machine would need. Popular games tend to draw a crowd, and having a visible location for such games, with enough surrounding space to accommodate those crowds is also important.

When looking to purchase arcade machines for your business here are a few key things to keep in mind;

1. Your target demographic - who are your customers, and what ages are they? This will help you to determine the ultimate make-up of your game selection, arcade games vs. redemption games.
2. The amount of floor space you can devote to a your game room. As mentioned above, arcade machines and interactive games vary in size and can require a lot of square footage if you intend to offer 60-70 games.
3. Consider good crowd control and space management when placing games. Focus on visibility and popularity - bringing the hot games to the front of your game room will encourage play and guest participation as friends watch friends play.
4. Use lighting to enhance the room and direct guests focus to specific arcade machines that are proven revenue earners.

Spend the time to plan and design a good game room with the right game selection and space planning now, and it will help draw strong repeat visits and revenue opportunities for your arcade business startup today and over time.

As a point in our general experience, for many entrepreneurs we speak with, the idea of an arcade takes shape as a multi-attraction 'fun center'... or party center - if your goal is to start an arcade, you may very well be looking at starting a fun center business with an arcade game room. The reasons for this are many, check out the article Video Arcade Game - A Business in Decline to see how and why the arcade business is changing. If you have further interest and would like a no-obligation, free chat about the business and getting started, feel free to book some time with us:  Fun Center Academy - Free Advice