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The Encouraging Health of the Entertainment Industry
Recently, we held our second Amusement 360 Event. During the registration process, we asked the over 350 registrants one simple question, “What’s your number 1 question about operating in the post-virus economy?”
We had a variety of interesting answers but one common theme stood out above the rest: “What is the status of this industry moving forward?” And more specifically, “Is this a good time to be starting an entertainment business?” The answer to the latter question is YES.
In this article, we’re going to break down the positive outlook of the industry and explain why now is a great time to start an entertainment business.
This is THE time to go ALL IN.
Financing
Financing is a top issue for almost any entertainment business right now, whether you’re an established business or looking to get into the market. While there has been a lot of financial struggle during the pandemic recently, interest rates are extremely low. This is one of several reasons why the outlook for financing an entertainment business, new or existing, is positive.
Jerry Merola from Amusement Entertainment Management expressed optimism during the aforementioned Amusement 360 Event in October. First, Merola explained how banks are back online and ready to lend after a six month hiatus. “The banks will be back to normal in their philosophy of how the leisure industry operates,” said Merola.
When it comes to talking to banks and lenders, Merola also suggested that the best way to explain your plan is by getting detailed and providing specific ways that your business is going to maximize efficiency.
“Some of the most effective borrowing requests have come from businesses where the business owner has literally bullet pointed everything that they have done to improve their efficiency. It tells the banker that this business owner is engaged. They’re engaged in that business. They’re looking for solutions.”
Consumer Demands
It’s no secret. After being holed up for many months, consumers are itching to get back out to enjoy themselves, particularly in the entertainment sector. Parents are desperate to get their kids out of the house and find something to do. Adults are looking for ways to unwind and have some fun. Entertainment centers are the answer to both, and the results are proving it.
The industry is bouncing back and many centers that have been allowed to open are seeing strong revenues and turnout.
“In markets where the consumer’s been allowed to return, guess what we’re seeing? We’re seeing it every week now: rising revenues in all of these facilities. The consumer is back, and frankly the consumer wants to be back,” said Merola.
Entering the entertainment industry now, if your local regulations allow you to open, gives you a chance to capitalize on this pent-up consumer demand over, at least, the next year. You have the opportunity to build strong customer loyalty with these people from day one.
Less Competition
It’s also no secret that some entertainment businesses have closed indefinitely or permanently as a result of the pandemic. While unfortunate, this has also opened up many opportunities for businesses to jump in and take advantage of the consumer demand discussed above.
The demand is beginning to rise again and the closing of many entertainment businesses has left a huge hole in some markets.
“In some markets, we’re losing competitors. What that’s creating now is a hole, an opportunity. If you look back at history, you will realize that some of the best projects were created during downturn periods when the opportunity was the greatest,” explained Merola.
This applies to both potentially new and existing facilities. For startups, it’s an opportunity to jump in to fill some of the void left by entertainment businesses that have permanently closed. For existing centers, it’s an opportunity to look at adding an attraction or project that you’ve been thinking about for a while.
Interested in adding a new attraction or project but don’t know where to start? Request a quote below to get started and our team will reach out to you to discuss your goals and needs!
Used Attractions
The difficult economic situation over the last year has also brought a large number of used attractions to the market. With closures and financial troubles, many entertainment businesses are quickly looking to sell all sorts of attractions.
In fact, you can find many of these attractions on the website we recently launched, Amusement Marketplace. Amusement Marketplace is the “eBay of the Amusement Industry”. It’s the number one place to buy and sell used attractions.
If you’re opening a new facility or looking to expand your attraction mix, there has perhaps never been more variety of used attractions available for purchase at favorable prices.
If you’re an existing facility, now is the time to add to your arcade and attraction mix with fresh new games that your customers will love!
Going All In
Sometimes we have to take a step back and reflect on the positives. As an entertainment business owner, you’ve been through a lot the past few months. Always remember to take time to pat yourself on the back for your continued perseverance and determination. Heck, by reading this article, you’re working to educate yourself about business improvement.
As we move into 2021, our theme is “All In”. We want you to go “all in” on your business, your leadership skills, your employees, your guest experience, and your life. The pandemic has shown us the importance of growing and evolving in the face of unpredictable circumstances, and we want to help guide you. We’re here to provide the continued encouragement, resources, and education to help get you where you want to go.
Interested in more market analysis and data from operators around the country? Click below to see the results of a COVID FEC survey we conducted recently.
