How To Start An Arcade Business

Although the global coronavirus pandemic has unfortunately seen many arcades close their doors in recent months, as lockdown measures ease and the popularity of arcades begins to grow again, the industry is certain to experience a resurgence.

So, if you’re an entrepreneur with a passion for video games and have long dreamt of owning your own arcade, here are some of the steps you’ll need to keep in mind when creating your brand new business.

Create a Considered Business Plan.

All successful businesses need a considered business plan. In addition to mapping out some of the specific aspects of your business, this process will also highlight some potential unknowns that could prevent you from securing success if appropriate measures aren’t put in place in advance.

In addition to researching the costs that will be involved in getting set up, you must also account for on-going running expenses, how you plan to generate enough income to keep your business afloat and your target market. During this process, you should also look at ways to increase the profitability of your business and how you plan to promote your business to your target audience.

Register your Business and Set Up your Financials.

Choosing the right business name is essential and you must do this before registering your domain name and setting up all business-related financial accounts. In the UK, most businesses register as either a partnership, limited company or sole trader and obtaining the correct business advice will ensure your company is registered appropriately.

Investing in a high quality, fully responsive website that delivers a seamless user experience (UX) will provide a place where your potential customers can learn more about your business and what you have to offer. Establishing a strong web presence as early in your business journey as possible will also help you to start implementing a powerful search engine optimisation (SEO) strategy that will boost your visibility in search engine results pages (SERPs) for relevant keywords and phrases.

In addition to creating an engaging and informative website, you should also consider creating a professional email address, such as yourname@yourbusiness.com. G Suite from Google, for example, provides a professional business email service which comes with a variety of valuable additional features but it is important to conduct comprehensive research to select the right provider for your needs.

Consider Licensing Regulations and Permits.

It is imperative to understand the gambling laws that apply in the country in which you are intending to open your arcade. In the UK, there are three types of amusement arcade and it is essential to obtain the correct permits and licences required before opening.

• Adult gaming centres (AGCs)
• Licensed family entertainment centres (FECs)
• Unlicensed family entertainment centres

Arcade video games don’t fall under the gambling commission’s definition of a gambling machine and so can be situated in any of the above, most pertinently in unlicensed family entertainment centres; that is arcades specifically for gaming and aimed solely at gamers.

Source Quality Arcade Cabinets.

There are many things to consider when purchasing an arcade machine, particularly when you will likely want to acquire multiple cabinets for a new business venture. There are a variety of different types of arcade machine cabinets and your choices will ultimately depend on the type of arcade business you want to set up and your budget. 

It is important to be aware of the costs involved with sourcing the equipment you will need to establish your arcade. Arcade machines are commonly available in either two or four player configurations and can be pre-loaded with either a single game or multiple games. Arcade tables typically start from around £699 whereas upright arcade cabinets can cost between £999 and £2249.

Sourcing your cabinets from a reputable supplier is essential to ensure the quality and durability of your investment. Your purchase should come with a warranty and each machine should have been comprehensively tested before being shipped to you.

Define and Market your Brand.

Every successful business has a strong brand that communicates several things to your intended audience including who you are, what you do, and what you stand for. A strong brand will form the foundations for myriad other business decisions and strategies as the business evolves and will be one of the primary factors that will help you to differentiate yourself from your competitors.

In addition to having a strong and immediately recognisable brand, it is important to devise and implement a comprehensive marketing strategy to promote your business to your target audience. While you might find there is value in pursuing traditional marketing methods such as radio and print, maintaining a strong digital and social media presence is likely to help you connect with your audience in more meaningful and lasting ways. Social media is also an excellent way to capitalise on the value of word of mouth by encouraging happy customers to repost your content and share their experiences at your arcade.

As part of your digital strategy, you might also choose to consider running a paid advertising campaign that can be targeted towards certain demographics in a particular location.

The choices and investments you make at the beginning will form the foundations upon which you can build success. With the right business model and a comprehensive financial plan in place, the growth potential for arcades is strong.

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