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+--Forum: Pump Haven Lounge
+---Topic: 7(a) Loan for an arcade? started by Noodles
Posted by: Noodles on 08:07 CST :: 3/31/2010
I had this faint idea of opening a arcade off of a 7(a) small business loan. I can pull up to $2 million dollars on it. The location will be in a heavily busy mall in Orlando.
Think it'll do? At this time and day?
Posted by: Turkeyslam on 09:54 CST :: 3/31/2010
There isn't a bank in the country that would loan anything near that amount of money to a kid fresh out of high school with no experience to open up a business in a failing industry.
You got an arcade machine. That's great. But don't be delusional about any effects of owning one.
Posted by: Noodles on 10:19 CST :: 3/31/2010
Not for me.
My dad. He has managed small businesses for over 20 years and have been successful. He owns several small businesses in the Orlando area profiting well. Don't jump to the conclusion of it being just me.
And this WOULD end up being handed down to me. I'm going into UCF for a bachelors in Business Management.
Posted by: Turkeyslam on 10:54 CST :: 3/31/2010
Dude, arcades are dead. The industry's dead. It's financial suicide even backed up by your dad.
Posted by: Noodles on 11:04 CST :: 3/31/2010
That's all I wanted to know, whether it's a good idea or not.
The Florida Mall is in the heart of Orlando is literally packed everyday. It is a major tourist spot as well as local spot. Most businesses there stay in business. There were only a few places that I know of left (Such as FYE, a CD/DVD store.). There are no arcades in the mall, but there are a couple on the side of town that still stay open.
I wanted to get an idea of how are arcades around in everyone's area.
Posted by: Turkeyslam on 11:08 CST :: 3/31/2010
Even in tourist areas, "arcades" only thrive when backed up by a primary source of income, such as with Dave & Buster's. "Pure" arcades have been dying left and right and are breakeven at best. Not to mention your competition will be huge in that area. It's a hell of a dream, but unrealistic in this economy.
Posted by: cpubasic13 on 11:38 CST :: 3/31/2010
btw Gameworks shut down like half of their locations the other day
Posted by: No.9 on 11:42 CST :: 3/31/2010
Besides the probably exorbitant rent for a place in a tourist area, you'd also have to sell the idea of your arcade to people who would rather go to a Dave N Busters for more than just the arcade.
Spending a lot of money for a business that has been declining during an economic recession is not a very smart idea. The arcade you saw might seem packed with people, but it also doesn't mean they're all paying to play. Like Turkey said, most arcades are breaking even if that. I wouldn't recommend it...
Posted by: Noodles on 11:52 CST :: 3/31/2010
There are No D&B's within a hour radius of me. And it won't be straight arcade. It will have a "game bar" featuring Dollar Pop, Snacks, etc. (Will be similar to Chuck E Cheese's eat n play, d&b's eat n play)
Posted by: Turkeyslam on 12:05 CST :: 3/31/2010
That's not a primary source of income. You need a primary source of income that does NOT come from arcade machine credits.
Posted by: No.9 on 12:23 CST :: 3/31/2010
yeah dude an arcade alone won't cut it...
Posted by: Noodles on 12:35 CST :: 3/31/2010
So you're talking about maybe a Bar & Grill? I'm hoping the main focus could be arcade games but a restaurant could be used as a primary source.
Posted by: No.9 on 12:42 CST :: 3/31/2010
Definitely look into offering something more than just an arcade service. That way your clientele is not limited...
Posted by: Noodles on 13:39 CST :: 3/31/2010
I'm trying to make it simple. There are tons of food places in malls so I wanted to avoid something that may involve that. However something abstract and not in the mall sounds good.
Posted by: Zozoken on 15:23 CST :: 3/31/2010
I understand your dream, because I share it. I have looked into the costs of opening my own arcade with my dad, who has had similar success to yours. We had a lot picked out but were hesitant because of the arcade scene falling apart. It's still on the table and I feel it would be successful because there are no arcades anywhere within an hour radius, but my dad and I came to the conclusion also that there would have to be more of a draw than just machines to play on.
The big thing, I think, is tournaments. Arcades are dying because the social gaming scene is dying. You can play online at home with Team Speak or Steam without having to pump quarters in a machine. However, I've personally gone hours out of my way before to show up at a tournament, and usually when you go to a tournament you don't go alone.
So having unique tournaments, events (D&Bs are packed on Wednesdays because of their half-price off Wednesdays), and something that can draw them in besides just machines will go a long way, I believe.
Good luck and keep your dream but try to be really realistic about it.
Posted by: Noodles on 15:36 CST :: 3/31/2010
Thanks Zozoken, I wanted to also hold a console room that will have monthly bimonthly tournaments such as Melee, Brawl, MW2, Halo, etc. There are a few Cyber Cafes around here that do that and are extremely successful. I am also looking into a small Corner for computer games / internet browsing. I think all of this is a good idea but it would be so hard to keep it going.
I have years ahead to think it through when I finish my BS, and if the economy picks up again I look forward to doing that.
Posted by: valius on 03:34 CST :: 4/01/2010
I actually think that combining a LAN party/cyber cafe setup with the traditional arcades might work well. A LAN party is great fun. I've heard from a few friends that, in Korea, a lot of cyber cafes even provide drinks and snacks to keep you there due to how competitive cyber cafes are. I do think a pure arcade will struggle, so you need something alongside the arcade, cyber cafe or other means such as food, alcohol, etc.
Posted by: WayneC02 on 10:52 CST :: 4/01/2010
Opening up an arcade in general is a god awful idea. Entire gaming companies that have been around for 70+ years have folded because arcades are NOT profitable anymore. Console games can, for the most part, recreate the same experience that arcade machines can, for a tiny fraction of the price. Unless you're opening a Bar/Grill or PC cafe FIRST and having a few arcade games on the side, instead of the other way around, this is a HORRIBLE idea and will not turn a profit.
Posted by: Pumper Zero on 22:02 CST :: 4/01/2010
Well, me and my friend will be opening an Arcade this month...
This was my dream for years and now I'm finally able to fulfill it.
If you have a dream and think you're able to make it happen, then go for it.
Posted by: kpopgrrl on 22:30 CST :: 4/01/2010
Actually, they weren't shut down. At least some of them were bought by a different company, like the one in Indianapolis.
Posted by: PaRtYbOy on 22:33 CST :: 4/01/2010
OBT, right next to where all the hookers are. That way, you get peoples attention when they attempt to pick up a hooker. "Miss, how much do you charge?" "$500 an hour" "Too much, sorry. Ooohh, a cyber cafe... And they have Pump... WOO!"
Posted by: Noodles on 22:46 CST :: 4/01/2010
After visiting Rio a few times, I can tell those arcades are highly profitable. They are always jammed packed.
And I love the token system (weird-ass cut on the tokens, ha ha)
Posted by: Turkeyslam on 09:55 CST :: 4/02/2010
Brazil is a completely different market. It appeals to people because they A) have a greater sense of community and B) generally can't afford the insane home console setups that people in America have.
Posted by: Noodles on 10:08 CST :: 4/02/2010
i.e. - PS3 costs R$1,000, roughly $600 :s
Posted by: Pumper Zero on 11:33 CST :: 4/02/2010
To be honest, the "arcade fever" here in Brazil started to fade in the late 90's, with the introduction of better home consoles and lan houses.
Arcades turned out to be something that pleasures only a niche market here in Brazil too, but this doesn't mean that an Arcade house can't be sucessfull; You just need to know how to explore this market.
You can't put a bunch of crappy machines with old games in a dirty place, charge R$ 1,00 for one credit and expect people to play, like I saw many times.
* Just to clarify, I'm speaking about the Brazilian market.
Posted by: Turkeyslam on 12:27 CST :: 4/02/2010
1000? It's way more than that. I remember at one point it was R$3000+.
Posted by: WayneC02 on 14:29 CST :: 4/02/2010
That's the thing, though. If you know how to explore your market, then you already know what you're doing. But no matter the quality of the machines, no matter the niche market, no matter how many people say "I'll come every day!", any standalone arcade opening in the US recently or soon WILL fail.
As far as music/rhythm games go, places like Arcade Infinity in Cali only work because it's an established place where the market for music games was and is ENORMOUS. They jumped on the wagon when music gaming took off and that's the only reason they're still in business. It's THE spot to go for music games in the states. They know how to cater to the regulars by getting new versions when they come out, when old mixes get old. How many people do you see making trips to Orlando solely to play arcade music games? Your place won't change that.
It has to be a side attraction instead of the main event. Make the bulk of your money from something else and have arcade machines as a bonus.
Posted by: Pumper Zero on 14:58 CST :: 4/02/2010
The official price for a PS3 Slim (250GB HDD) is R$ 1.799,00, but it can be found for something around R$ 1.000,00 when it is not legally imported.
Posted by: MoonLight129 on 22:37 CST :: 4/02/2010
Since your going to UCF, why not try to put your Machine in the Student Union Center? They have an arcade that is right next to a place call Wacko's, which is a bar and grill that also has pool tables. A lot of students like to hang out in the Student Union areas and the machine is going to get exposure and its in a good location.
Posted by: Brett on 19:03 CST :: 5/18/2010
No it's not.