Do you want to know how much money arcade machine owners make yearly? If YES, here are 7 factors that determine the income & profit margin for arcade machines. In order to have an idea of the amount an arcade machines owner is expected to make daily, weekly, monthly or yearly, you should clearly define the services that arcade machine businesses offer.
An arcade game or coin-op game is a coin-operated entertainment machine typically installed in public businesses such as restaurants, bars and amusement arcades. Most arcade games are video games, pinball machines, electro-mechanical games, redemption games or merchandisers.
Arcade game lounges are part of the Arcade, Food & Entertainment Complexes industry and players in this industry include businesses that primarily operate video game arcades and game-focused family entertainment centers, which typically sell food and beverages.
Industry operators rent or purchase card- or coin-operated arcade games that customers play for a fee. Establishments that primarily focus on gambling games, billiards, miniature golf and other larger-scale or outdoor amusements are not included in this industry.
With that in mind, we can estimate what an arcade machine lounge can make. But it is important to point that there is no one-mold-fits-all when it comes to how much an arcade machines lounge owner is expected to make. There are some factors that we are going to look into before giving an estimate of how much an average arcade machine lounge owner can make yearly and these factors are;
7 Factors That Determine How Much Money Arcade Machines Make Yearly
Table of Content
- 1. The Size of the Lounge
- 2. The Location the Arcade Machines Facility
- 3. The Type of Arcade Machines Available in the Arcade Machines Lounge
- 4. The Management Style of the Arcade Business
- 5. The Business Approach of the Arcade Machines Lounge
- 6. The Advertising and Marketing Strategies Adopted by the Lounge
- 7. The Number of Years the Arcade Machines Lounge is in Existence
- Estimated Profit Margin for an Arcade Game Machine
1. The Size of the Lounge
You will agree that no one can conveniently state the amount an arcade machines lounge can make yearly if you do not know the size of the facility and the number of members the facility can accommodate per session. An arcade machines lounge business that operates from a small indoor facility will make far less than one that operates from a standard indoor facility.
If your arcade machines facility is a large enough, it can accommodate more members and that will mean increase membership revenue – you can actually make a minimum of $200 per week on a single arcade machine. Please note that you can build your arcade machines lounge to double that number of memberships within 24 months.
2. The Location the Arcade Machines Facility
We must not rule out the fact that the location an arcade machines lounge is located is a major factor that will determine the amount the facility owner is expected to earn monthly.
If an arcade machines lounge is located in a highbrow area, an area with the right demography especially as it relates to people who are professional gamers and who have the financial means (purchasing power) then the owner of the arcade machines lounge is expected to make more money.
The truth is that you will struggle to make good money from your arcade machines lounge if you locate the business in an area filled with low income earners or in a ghetto or a place where the residents are pretty busy working – class people.
3. The Type of Arcade Machines Available in the Arcade Machines Lounge
Another important factor that will determine how much an arcade machines lounge makes yearly is the type of arcade machines and other complimentary services offered by the lounge. You will agree that the money an arcade machines lounge that has top arcade machines like Pac-Man, Space Invaders, Street Fighter II, NBA Jam, Defender, Asteroids and Mortal Kombat II et al and also providing games rentals and accessories will be far larger than what an arcade machine lounge that only offers limited services will make monthly.
4. The Management Style of the Arcade Business
Another key factor that will determine the amount an arcade machines lounge owner is expected to make yearly is the management style of the lounge. Trust me, the results you will get when you are a good manager will definitely be different from an arcade machines lounge with poor management style. The idea is that a good manager will not just retain their old customers (members), they will also keep getting new customers (members) enrolling in the arcade machines lounge.
5. The Business Approach of the Arcade Machines Lounge
There are different business approaches that an arcade machines lounge can choose from and no doubt it will greatly influence the amount they make monthly and yearly.
Of course, we know that an arcade machines lounge may decide that they want to operate only one location and do their marketing alone, but they can also decide to go into franchising and also partner with other businesses that will recommend clients to them. It is easier to find arcade machines lounge that operate franchises and robust services partner with professional gamers and gaming clubs to make more money.
6. The Advertising and Marketing Strategies Adopted by the Lounge
Another key factor that will determine the amount an arcade machines lounge owner can make yearly is the advertising and marketing strategies adopted by the arcade machines lounge. Trust me, there are several advertising and marketing strategies that can help a business increase their earnings, but you may be expected to spend more.
But the results you will make will far outweigh the amount you spent on advertising and marketing. Of course, you don’t expect an arcade machines lounge owner that is engaging in aggressive advertising and marketing to make same amount yearly with an arcade machines lounge owner that is passive with its advertising and marketing.
7. The Number of Years the Arcade Machines Lounge is in Existence
In business, the number of years you are in existence will go a long way to determine the amount you will make especially if the business is well – managed. For example, in your first fiscal year (FY1) you might make one hundred and fifty thousand dollars (150,000), in your second fiscal year (FY2) you might make two hundred thousand dollars ($200,000) and in your third fiscal year (FY3) you might make two hundred and fifty thousand dollars ($250,000).
Please note that if you are operating a traditional arcade lounge and you invested massively in purchasing top arcade machines such as Pac-Man, Space Invaders, Street Fighter II, NBA Jam, Defender, Asteroids and Mortal Kombat II et al that are in high demand, you will make good profits. Extreme games are more expensive and are causing the average price per game to increase. In other to maximize profits, you should try as much as possible to keep the capital investment at a minimum.
Estimated Profit Margin for an Arcade Game Machine
Findings shows that Profitability and Market Outlook for arcade machines lounge is put at 8.35 percent annual growth rate projection, so there is plenty of opportunity for arcade machine businesses to make gains. In most arcade machine lounges, the markup ranges from 10 to 35 percent for new and used arcade machines and some arcade machine lounges generate roughly $5000 per in-game day.