Are you about starting a video game lounge? If YES, here is a complete sample video game lounge business plan template & feasibility report you can use for FREE.
Okay, so we have considered all the requirements for starting a video game lounge. We also took it further by analyzing and drafting a sample video game lounge business marketing plan template backed up by actionable guerrilla marketing ideas for video game lounges. So let’s proceed to the business planning section.
If you are passionate about keeping people busy and happy, you should think towards starting your own video game lounge. A video game lounge is one of the easiest businesses to start especially if your aim of starting the business is to take the stress off people and make them happy.
Since the invention of the first video game, tons of interesting video games have been produced and more would still be produced.
You might claim that people prefer playing the games in their houses, and you might be right, but the truth remains that most people cannot afford to keep buying new editions of video games every time they are released; hence the need for video game lounges.
Remember, people visit gaming centres not just for playing games, but to rent latest game cartridges that they do not have or can’t afford. You can also walk up to a gaming centre to exchange your old game box for a newer version at a very minimal fee.
Whether you like it or not, gamers would always come to a point where the games they have no longer look interesting to them, so the need to get a new one. Lastly, it can’t be overemphasized that opening a video game lounge is not an easy task, but nevertheless, you still need to be creative if you intend making money from your business.
One of the ways you can make money from your video game lounge is to ensure that you make your location a complete entertainment spot. Here is a sample video game lounge business plan that can give you the needed guide to write yours.
A Sample Video Game Lounge Business Plan Template
1. Industry Overview
A video game lounge or center is a facility where people go to play video games. According to a report published by IBISWorld, the Video Games industry has experienced strong returns on industry products during the latter half of the five-year period to 2018.
While the emergence of low-cost games for mobile devices has slowed demand for other games and may continue to temper growth opportunities in the foreseeable future, industry revenue has picked up amid stronger sales in games, downloadable content (DLC), consoles and their corresponding products.
Over the five years to 2018, industry revenue increased at an annualized rate of 7.2 percent. In 2018, revenue is expected to total $43.7 billion. This growth was assisted by growing consumer incomes and the releases of the revised Xbox One and PlayStation 4, as well as the Nintendo Switch, throughout the five-year period.
The report shows that over the past five years, the video games industry in the US has grown by 7.2 percent to reach revenue of $44bn in 2018. In the same timeframe, the number of businesses grew by 11.3 percent and the number of employees grew by 5.2 percent.
Statistics has it that in the united states of America alone, there are about 144,152 licensed and registered video game lounges responsible for employing about 230,914 employees and the industry rakes in a whopping sum of $44 billion annually with an annual growth rate projected at 7.2 percent between 2013 and 2018. It is important to state that no establishment has a lion share of the available market in this industry.
Lastly, the need for you to equip your gaming centre can’t possibly be overemphasized because you need to make your business point as attractive as ever.
You would need between 5 to 20 computers, Xbox stations, comfortable chairs, tables, air conditioner, shelve for stocking video games amongst others. You might also want to ask people who are already in the business about the gadgets you might need.
2. Executive Summary
Fast Track® Video Game Lounge, LLC is a licensed and well equipped video game center that will be located in one of the busiest streets in Santa Fe – New Mexico. We have been able to secure a standard facility in a central location in Santa Fe. We are equipped to service the whole of the community as well as visitors and tourists.
Fast Track® Video Game Lounge, LLC is going to become the number one destination for gamers in the whole of Santa Fe – New Mexico.
We are well equipped to operate a licensed video game lounge with a wide range of video games from top flight video games companies like Microsoft Corporation, Nintendo Co. Ltd., Activision Blizzard Inc., GameStop Corp., Sony Corporation and Electronic Arts Inc.
We conducted a thorough market research and feasibility studies and we came to the conclusion that Santa Fe – New Mexico is the right place to start our video game lounge. Our client’s best interest would always come first, and everything we do will be guided by our values and professional ethics.
Fast Track® Video Game Lounge, LLC will be open 24 hours in a day during weekends (Fridays to Sundays) and from 6:00 am to 12 midnight from Mondays to Thursdays in order for us to accommodate people with different time preferences. This is why we have made provision for effective floodlight system and also recruited enough staff to run shift.
Fast Track® Video Game Lounge, LLC will at all times demonstrate her commitment to sustainability, both individually and as a business, by actively participating in our communities and integrating sustainable business practices wherever possible.
We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
Fast Track® Video Game Lounge, LLC is owned by Olsen Hamilton and his immediate family members. The business will be managed by Olsen Hamilton and his son Jerry Hamilton. Olsen Hamilton has over 15 years’ experience in the industry working for some of the leading video game centers in Santa Fe – New Mexico.
3. Our Products and Services
Fast Track® Video Game Lounge, LLC is in the Video games industry to provide standard video game lounges for residents of Santa Fe – New Mexico which is why we have been able to put up a facility that can help us achieve this goal.
We are optimistic that everyone who makes use of our video game lounge will definitely derive huge value for their money. These are the services and amenities that will be made available to our clients;
- A wide range of video games from top flight video games companies like Microsoft Corporation, Nintendo Co. Ltd., Activision Blizzard Inc., GameStop Corp., Sony Corporation and Electronic Arts Inc.
- Video games renting
- Sale of Video games and accessories
- Sale of food and beverages
4. Our Mission and Vision Statement
- Our Vision of starting Fast Track® Video Game Lounge, LLC is to build a world – class video game lounge that can compete with leading brands in the industry.
- Our mission for establishing Fast Track® Video Game Lounge, LLC is to contribute our quota in promoting video game activities in Santa Fe – New Mexico and also to make profits from the Industry; we want to become the leading video game lounge in the country.
Our Business Structure
Fast Track® Video Game Lounge, LLC intends to become the leading video game lounge in the whole of Santa Fe – New Mexico and we are fully aware that it will take the right facility, management and organizational structure to achieve our goal.
The kind of the video game lounge we intend building and the business goals we want to achieve is what informed the amount we are ready to pay for the best hands available in the industry as long as they are willing and ready to work with us.
Our business will not be built only for the purpose of giving our customers value for their money, but also we will ensure that we make our video game lounge highly conducive for all our employees. We will provide them with facilities that will help them stay motivated.
In view of that, we have made provisions for the following positions to be occupied by highly qualified and experienced staff;
- Chief Executive Office – CEO
- Marketing and Sales Officer
- Video Games Instructor/Assistant (5)
- Customer Care Executive / Front Desk Officer
5. Job Roles and Responsibilities
Chief Executive Officer – CEO:
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
- Creates, communicates, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Responsible for fixing prices and signing business deals
- Responsible for signing checks and documents on behalf of the company
- Evaluates the success of the organization
- Carries out induction for new team members
- Responsible for overseeing the smooth running of HR and administrative tasks for the organization
- Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
- Ensures operation of video games and other equipment by completing preventive maintenance requirements; calling for repairs.
- Responsible for training, evaluation and assessment of employees
- Responsible for arranging travel, meetings and appointments
- Oversees the smooth running of the daily activities in the video game lounge.
Video Game Instructors/Assistant (5)
- Responsible for operating a licensed video game lounge
- Responsible for teaching newbies how to play various video games available in our lounge
- Responsible for selling food, alcoholic and nonalcoholic beverages
- Ensures that the video game machines are properly arranged
- Responsible for recommending the replacement of worn out or damaged video games, pads, consoles and other video game accessories
Marketing and Sales Officer (2)
- Identifies, prioritizes, and reaches out to new clients, and business opportunities et al
- Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing for the business especially as it relates to expansion
- Documents all customer contact and information
- Represents Fast Track® Video Game Lounge, LLC in strategic meetings
- Helps to increase sales and growth for Fast Track® Video Game Lounge, LLC.
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting for the organization
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensures compliance with taxation legislation
- Handles all financial transactions for Fast Track® Video Game Lounge, LLC
- Serves as internal auditor for Fast Track® Video Game Lounge, LLC.
Client Service Executive
- Welcomes members/clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with clients on the phone, uses every opportunity to build client’s interest in the organization’s products and services
- Manages administrative duties assigned by the management in an effective and timely manner
- Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries
- Responsible for cleaning in and around the video game lounge
- Cleanses up after customers
- Clears ashtrays when required.
- Washes glassware and utensils after each use.
- Maintains a clean working area by sweeping, vacuuming, dusting, cleaning of glass doors and windows, etc. if required.
- Ensures that toiletries and supplies don’t run out of stock
- Handles any other duty as assigned by the manager.
6. SWOT Analysis
Fast Track® Video Game Lounge, LLC is in business to provide video game facility for gamers in Santa Fe – New Mexico and at the same time to make profits. We are aware that there are competitions in the industry which is why we took out time to conduct an effective SWOT Analysis before investing our hard earned money into the business.
We know that if we get things right before starting our video game lounge, we will not have to struggle before attracting loyal clients and building our customer base to a level where we can easily breakeven. We hired the services of a HR and Business consultant with bias in business structuring to help us conduct SWOT analysis for our organization and he did a pretty good job for us.
Here is a of the result we got from the SWOT analysis that was conducted on behalf of Fast Track® Video Game Lounge, LLC;
One of the obvious strength that will definitely stand as a plus for Fast Track® Video Game Lounge, LLC is the fact that our facility is centrally located in a densely populated – residential area in Santa Fe – New Mexico; our location is in fact one of our major strengths coupled with the support from stakeholders in the industry.
We equally have a team of highly qualified professionals who will work with our clients and lastly our wide range of video games are amongst the best that anybody living in Santa Fe – New Mexico can get.
We looked into our Business model and we were able to identify two major weakness. One is the fact that we are a new business and the second is the fact that we may not have the financial resources required to match up with existing video games centers and even casinos and gaming centers in New Mexico when it comes to employing experts in the industry and generating the needed hypes that can drive traffic towards our video game lounge.
We are centrally located in one of the densely populated areas in Santa Fe – New Mexico and we are open to all the available opportunities that the city has to offer. We will be open 24 hours in a day during weekends (Fridays to Sundays) and from 6:00 am to 12 midnight from Mondays to Thursdays, thus giving us the advantage to leverage on any available opportunity.
Some of the threats that are likely going to confront Fast Track® Video Game Lounge, LLC are unfavorable government policies, demographic/social factors, downturn in the economy which is likely going to affect consumers spending and lastly, the emergence of new competitors within the same location where our video game lounge is located.
7. MARKET ANALYSIS
- Market Trends
If you are conversant with the video games industry, you will realize that it was worst hit by economic slowdown and it has still been unable to reach the pre-recession levels. But with creativity, they are bouncing back gradually.
By tradition, individuals with abundant leisure time, such as children and students, represent the primary demographic for video games. However, as more individuals choose outdoor recreational activities and sports, they are less likely to spend time playing video games.
In 2018, the number of individuals participating in sports is forecast to increase, representing a potential threat to the industry.
Video games commonly feature enhanced content for players with broadband internet connection. These features include multiplayer modes, downloadable content and in-game chat functions, which can be free or provided on a fee or subscription basis.
Consumers are expected to increasingly use these online features. The percentage of services conducted online is expected to increase in 2018, representing a potential opportunity for the industry.
Lastly, it is a common trend that as video game lounges grow, it becomes necessary for them to develop new service offerings or install new facilities that will help them attract more people.
Little wonder some video game lounges now have juice and smoothie bars, retail food, alcoholic and non – alcoholic drinks et al within their facility to encourage people to relax and socialize. In order words, it is very important for video game lounges to continue to improvise if they want to grow their business.
8. Our Target Market
Aside from teenagers and children, the target market for video game lounges cuts across people of different walks of life. The fact that people visit video games centers for various reasons makes marketing the business interesting. These are the category of people that we intend marketing our business to;
- High school students
- Applicants/School Leavers
- Sports Men and Women
- College Students
Our competitive advantage
The Video games industry is indeed a highly competitive industry. Clients will only patronize your video game lounge if they are comfortable with the games you have or if you can provide the enabling environment and facility for them to socialize.
Fast Track® Video Game Lounge, LLC is centrally located in a densely populated residential area in Santa Fe – New Mexico; this is obviously going to give us an edge amongst our competitors. We equally have a team of highly qualified professionals that will work with all our clients and make it easier and comfortable when they patronize our video game lounge.
So also, our video game machines are amongst the best that anybody living in Santa Fe – New Mexico can get; it is easy to use and highly reliable.
Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Fast Track® Video Game Lounge, LLC is established with the aim of maximizing profits in the Video games industry and we are going to go all the way to ensure that we do all it takes to attract clients on a regular basis. Fast Track® Video Game Lounge, LLC will generate income by offering the following services;
- A wide range of video games from top flight video games companies like Microsoft Corporation, Nintendo Co. Ltd., Activision Blizzard Inc., GameStop Corp., Sony Corporation and Electronic Arts Inc.
- Video games renting services
- Sale of games and accessories
- Sale of food and beverages
10. Sales Forecast
We are well positioned to take on the available market in Santa Fe – New Mexico and we are quite optimistic that we will meet our set target of generating enough income/profits from the first six months of operation and grow the business and our clientele base.
We have been able to examine the Video games industry – market and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projection for Fast Track® Video Game Lounge, LLC, it is based on the location of our video game lounge facility and the wide range of video games that we will be offering;
- First Fiscal Year: $180,000
- Second Fiscal Year: $350,000
- Third Fiscal Year: $450,000
N.B: This projection is done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and natural disasters within the period stated above. There won’t be any major competitor (video game lounge) offering same services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
- Marketing Strategy and Sales Strategy
Our marketing strategies will be directed towards achieving specific objectives that support the strategic goals of the organization.
The truth is that all that we do will be geared towards creating new market channels, increasing sales and our market share. We will leverage on improving on our services and facility to ensure that we win new clients and retain old clients as well.
As part of our sales and marketing strategies, we will pay attention to the promotion of our video game lounge so as to attract people to make use of our facility. Our unique selling proposition is that we are well positioned and people can easily access our facility, our payment platforms are highly reliable. Part of the marketing and sales strategies that we will adopt are;
- Open our video game lounge with a big party in other to attract residents who are our first target
- Advertise our video game lounge on national dailies, local TV and radio stations
- Promote our video game lounge online via our official website and all available social media platforms
- Introduce our video game lounge by sending introductory letters alongside our brochure to sports clubs, schools, households and key stakeholders in Santa Fe – New Mexico
- Print out fliers and business cards and strategically drop them in offices, libraries, public facilities and train stations et al.
- Deliver consistent customer experiences to all our customers; making our first impression count positively to those making use of our video game lounge for the first time
- Make use of attractive hand bills to create awareness and also to give direction to our video game lounge
- Adopt direct mailing coupon marketing approach
- Position our signage / flexi banners at strategic places in and around Santa Fe – New Mexico
- Create a loyalty plan that will enable us reward our consistent clients especially those that registered as a family or as a group
- Engage on roadshows within our neighborhood to create awareness for our video game lounge.
11. Publicity and Advertising Strategy
We have been able to work with our branding and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.
We are set to become the number one choice for in the whole of Santa Fe – New Mexico which is why we have made provisions for effective publicity and advertisement of our video game lounge. Below are the platforms we intend to leverage on to promote and advertise Fast Track® Video Game Lounge, LLC;
- Place adverts on both print (community based newspapers and magazines) and electronic media platforms
- Sponsor relevant community based gaming or sport events and competitions
- Leverage on the internet and social media platforms like; Instagram, Facebook, twitter, YouTube, Google + et al to promote our brand
- Install our billboards in strategic locations all around Santa Fe – New Mexico
- Engage in roadshow from time to time in targeted neighborhoods all around Santa Fe – New Mexico
- Distribute our fliers and handbills in target areas all around Santa Fe – New Mexico
- List Fast Track® Video Game Lounge, LLC on local directories / yellow pages
- Advertise our video game lounges in our official website and employ strategies that will help us pull traffic to the site.
- Ensure that all our staff members wear our branded shirts and all our vehicles are branded with our corporate logo et al.
12. Our Pricing Strategy
Since the bulk of our customers come from the middle class, it is advisable to set the prices for playing our video games on the moderate side. We will not allow the drive to recoup our money fast tempt us to set prices that can scare our customers away.
In view of that, our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more (except for premium and customized services) and we don’t intend to charge less than what our competitors are charging their clients in Santa Fe – New Mexico.
Be that as it may, we have put plans in place to offer discount services once in a while and also to reward our loyal customers especially when they refer clients to us or when they register as a family or a group. The prices of our services will be same as what is obtainable in the United States’ video game lounge market.
- Payment Options
The payment policy adopted by Fast Track® Video Game Lounge, LLC is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that Fast Track® Video Game Lounge, LLC will make available to her clients;
- Payment with cash
- Payment via online bank transfer
- Payment via mobile money
- Payment via Point of Sales Machines (POS Machines)
- Payment via check
In view of the above, we have chosen banking platforms that will enable our clients make payment for playing our video games and purchase of food and beverages without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.
13. Startup Expenditure (Budget)
From our market survey and feasibility studies, we have been able to come up with a detailed budget for establishing a standard video game lounge in Santa Fe – New Mexico and here are the key areas where we will spend our startup capital;
- The Total Fee for Registering the Business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits – $1,500.
- Marketing promotion expenses (8,000 flyers at $0.04 per copy) for the total amount of – $10,000.
- The total cost for hiring Business Consultant – $5,000.
- The amount needed for the purchase of insurance policy covers (general liability, workers’ compensation and property casualty) coverage at a total premium – $15,800.
- The total cost for the purchase of accounting software, CRM software and Payroll Software – $3,000
- The total cost for leasing facility for the video game lounge – $80,000.
- The total cost for facility remodeling – $50,000.
- Other start-up expenses including stationery – $1000
- Phone and utility deposits – $3,500
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
- The cost for Start-up inventory – $15,000
- The cost for acquiring LED TVs, computers, Xbox stations, comfortable chairs, tables, Air Conditions, Shelve for stocking video games and video games accessories amongst others. – $50,000
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, snooker board, tables and chairs et al) – $4,000.
- The cost of Launching a Website – $600
- The cost for our grand opening party – $15,000
- Miscellaneous – $5,000
We would need an estimate of $300,000 to successfully launch a medium but standard and well-equipped video game lounge in the United States of America.
Generating Funds/Startup Capital for Fast Track® Video Game Lounge, LLC
Fast Track® Video Game Lounge, LLC will be owned and managed by Mr. Olsen Hamilton and his immediate family members. They are the sole financiers of the business which is why they decided to restrict the sourcing of the startup capital for the business to just three major sources.
These are the areas we intend generating our startup capital;
- Generate part of the startup capital from personal savings and sale of his stocks
- Generate part of the startup capital from friends and other extended family members
- Generate a larger chunk of the startup capital from the bank (loan facility).
N.B: We have been able to generate about $100,000 (Personal savings $70,000 and soft loan from family members $30,000) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and documents have been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.
14. Sustainability and Expansion Strategy
The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and the business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.
One of our major goals of starting Fast Track® Video Game Lounge, LLC is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running. We know that one of the ways of gaining approval and winning customers over in our video game lounge is to equip our facility with state of the art videogames and to make our facility highly secured.
Fast Track® Video Game Lounge, LLC will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of ten years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
- Business Name Availability Check: Completed
- Business Registration: Completed
- Opening of Corporate Bank Accounts: Completed
- Securing Point of Sales (POS) Machines: Completed
- Opening Mobile Money Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Acquiring facility and remodeling the facility to fit into a standard video game lounge: In Progress
- Conducting Feasibility Studies: Completed
- Generating capital from family members: Completed
- Applications for Loan from the bank: In Progress
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents and other relevant Legal Documents: In Progress
- Design of The Company’s Logo: Completed
- Printing of Promotional Materials: In Progress
- Recruitment of employees: In Progress
- Purchase of the needed video games and accessories, electronic appliances, office appliances: In progress
- Creating Official Website for the Company: Completed
- Creating Awareness for the business both online and in the neighborhood: In Progress
- Health and Safety and Fire Safety Arrangement (License): Secured
- Opening party/launching party planning: In Progress