52 replies to this topic

[MitchSchaft]

I wonder what it would entail. I can assume there wouldn't be much profit to have, but there are no arcades in Memphis (specifically Bartlett) that I know of. Except for maybe Chuck E. Cheese or PuttPutt golf and games.
Have you guys ever thought of this?

[rmaerz]

Yes.

But haven't because of the absence of capitol and the skills required to repair machines. If I had those I know of a strip mall with a location next to a pizza shop and across from a middle school that I would be interested in.

Also, the model would have to be showroom, arcade and birthday party rental in order to survive.

[MitchSchaft]

I would love to learn how to work on the machines. I'm sick of working on copy machines! I wonder if there's a formal place to learn or if it's hands-on/experience and an electronics background. Maybe it would be a good excuse to learn more about electronics.
Or would working on them consist more of just swapping out a board if troubles start.

[rmaerz]

MitchSchaft, on Mon Sep 20, 2010 11:11 AM, said:

I would love to learn how to work on the machines. I'm sick of working on copy machines! I wonder if there's a formal place to learn or if it's hands-on/experience and an electronics background. Maybe it would be a good excuse to learn more about electronics.
Or would working on them consist more of just swapping out a board if troubles start.

This guy has instructional DVDs for sale:

http://randyfromm.com/shopping/

[MitchSchaft]

badass, thanks.

[The_Laird]

Speak to Shaggy The Atarian who is a member here. He set up his own arcade in a mall in Utah a few years ago now and its still going strong!

[Cebus Capucinis]

Frankly I think arcades are a non-feasible business model in a 21st century world, which is quite sad.

[MitchSchaft]

Awesome, I'm curious about monthly upkeep costs 'n stuff. If we can get away with living off my wife's salary as a nurse in a couple years, maybe my goal should be to break even. I'm tired of working for other people, lol.

[Shaggy the Atarian]

Yep, I thought about it and did it two years ago (as mentioned in the thread already ).

It can be difficult but if you can get the right place with good foot traffic then it can be done. The problem, as it is with any business is having capital to make it work and to pick a solid game selection of games that people want to play (that's something I'm still tweaking to this day). How much it costs really depends on the location, how many games you will buy and all of that so it's hard to give an estimate as rent, electricity rates, insurance, taxes are variables that depend upon the local area. Also before you get started, one reason why there might not be any arcades in the area is because of local laws that prohibit arcades or restrict them to the point where they are severely restricted. There was a story online a short time ago of an arcade in New York that was allowed to run for 18 months until someone complained about the noise and then the city suddenly rediscovered an old law banning arcades and enforced it, shutting the business down. A lot of people don't realize that the reason for the lack of arcades often times is due to such laws and not a lack of interest in arcades. Interest is there, you just need the right place to tap into it. I'd also check state laws for how machines are taxed, some states or counties put licensing fees into place. Oklahoma just did that and the amount is probably going to kill off arcades in the state there.

As for games, I think that combining old and new is a good way to go. There are plenty of people who are interested in playing classic stuff on an original cabinet although the only way to make money off that is to have *a lot* of classics in one place. Otherwise the new games will be the way to go. They set you back a lot in their initial price but the right game can bring in solid earnings for a long time. Right now Terminator Salvation is making a killing and you can never go wrong with a few racing games.

I have written plenty about the subject of starting a new arcade, there's a huge thread on Jaguar Sector 2 about it and I also have done several posts on Arcade Heroes and the Arcade Heroes Forum. And I'm always happy to answer any other questions.

[MitchSchaft]

Wow, thanks a lot, man. I will go check out your other threads. I know zero about running a business so I have LOTS of research.
Do you have any idea where I could research local laws/statutes?

[Dan Iacovelli]

a new aracde opened up in IL with 150+ arcades
http://gallopingghostarcade.com

[Shaggy the Atarian]

MitchSchaft, on Mon Sep 20, 2010 4:33 PM, said:

Wow, thanks a lot, man. I will go check out your other threads. I know zero about running a business so I have LOTS of research.
Do you have any idea where I could research local laws/statutes?

Yeah, among the first things you'll want to do is write a business plan. If you know little or nothing about business that will help quite a bit. It will take a while to do but it's worth it. I spent quite a bit of time writing and perfecting a plan and it helped me to not just think everything through properly but it helped in obtaining funds as well. Bankers won't take you seriously if you wander in and ask for money without a plan, especially right now. For help in putting a plan together, I used SCORE.org. They had a template there and they have other business resources including mentors which can help.

It's also a good idea to talk to any arcade operators or distributors if you can. Distributors have sales guys who have access to a lot of current data, including trends, that are huge in helping you plan everything out. Beyond the online stuff I already mentioned you can also look into Replay Magazine and Play Meter Magazine as they are industry trade magazines.

I would also suggest talking to a certified accountant. They will help you know what you will need to do with taxes and registering your business. You'll eventually have to create your legal entity in the state where you live and you'll also need things like a Federal EIN. An accountant can help out with that stuff since they will be familiar with the state laws where you are doing this.

I'm not sure how you are at electronics but also becoming familiar with repairing arcades will be essential unless you will be able to afford a tech, and they do not come cheap. I've learned a lot about these games since I started but one regret I have is not studying more about it before I got this all started. One excellent site that can help is Arcaderepairtips.com, randyfromm.com and the KLOV Forums has a technical section with knowledgeable guys who can assist with issues.

As for the local stuff, you will want to call the people at the Zoning and Planning Commission. Tell them what you plan on doing and ask about any restrictions for arcades or amusement facilities in that city.

Edited by Shaggy the Atarian, Tue Sep 21, 2010 5:32 PM.

[MitchSchaft]

Great, thanks. I know some about electronics and can solder fairly well (I even own a couple of o-scopes). I really want to learn how to repair myself for the knowledge and adventure! That sounds like one of the more fun parts of the job.
I've learned quit a bit in the past 24 hours. I'm on page 16 of that big thread of yours at JS2. Wow, it's very inspiring and helpful. I hope that part of the forum is backed up!

FYI, none of the pictures (floorplans, etc...) work for me in that thread. Maybe because I'm too new. It says I don't have access so I'm not sure if the pics are even still there or not.

Edited by MitchSchaft, Tue Sep 21, 2010 5:41 PM.

[Shaggy the Atarian]

MitchSchaft, on Tue Sep 21, 2010 5:39 PM, said:

Great, thanks. I know some about electronics and can solder fairly well (I even own a couple of o-scopes). I really want to learn how to repair myself for the knowledge and adventure! That sounds like one of the more fun parts of the job.
I've learned quit a bit in the past 24 hours. I'm on page 16 of that big thread of yours at JS2. Wow, it's very inspiring and helpful. I hope that part of the forum is backed up!

FYI, none of the pictures (floorplans, etc...) work for me in that thread. Maybe because I'm too new. It says I don't have access so I'm not sure if the pics are even still there or not.

I think a lot of the old stuff was lost when the site moved - not sure if I have backups or not. I remember drawing out floor plans only to completely scrap them when I found a new location and was in there in only a couple of days. Then I just winged it, having a general idea of what would work and I adjusted the games as they came in. Some of my old videos might be missing too :\

[MitchSchaft]

I got through that entire thread and any others I could find. Also watched all the videos, too.

I'll PM you if I have any questions (I do, but I'll bother you some other time, lol).

[yuppicide]

I too have always wanted to run an arcade. If you knew how to repair them, that would help business. Richie Knucklez (was in a band Knuckle Sandwich) was collecting games. When his collection got too big he opened an arcade/repair place. Friday nights it's one price all you want to play. He only opens to the public like that on Friday nights.

I think a better business model would be to start another business, but also have arcade games there. For example, hot dogs are a huge markup. Make some unique chili sauce or something, put a bunch of different dogs on the menu, some fresh cut french fries, make some special sauces, offer drinks, and you're good to go.

This one guy I knew ran a hot dog cart.. he would do a few hundred dogs a day! He was so popular the car dealership hired him to come down on Saturday and give out free dogs. So, he'd tell everyone to come have a free hotdog.

Another idea is something like Barcade. It's a bar and arcade in Brooklyn. But liquor licenses are expensive here.

I think SCORE is pretty good to check out. They have mentors that can help you out.

Another idea is if you have friends and family that will help you out, try and start a project on Kickstarter website. People donate money in exchange for something in return. For example, someone donates $25 you give them a free shirt, donate $50 and have a free party at your arcade when it opens for you and up to 20 friends, donate $5 and get your name on the wall as thanks, etc.

Edited by yuppicide, Mon Oct 4, 2010 6:23 PM.

[rmaerz]

yuppicide, on Mon Oct 4, 2010 6:17 PM, said:

I too have always wanted to run an arcade. If you knew how to repair them, that would help business. Richie Knucklez (was in a band Knuckle Sandwich) was collecting games. When his collection got too big he opened an arcade/repair place. Friday nights it's one price all you want to play. He only opens to the public like that on Friday nights.

Have you been there yet?

Also, there are tournaments held at his place like the CAGDC and Richie Knucklez Invitational. Non-tournament games were available flat fee to the public during the CAGDC tourneys.

There are talks of having a Donkey Kong "Kongoff" at his place in January. Billy Mitchell has reportedly put up $10K for the winner.

yuppicide, on Mon Oct 4, 2010 6:17 PM, said:

I think a better business model would be to start another business, but also have arcade games there. For example, hot dogs are a huge markup. Make some unique chili sauce or something, put a bunch of different dogs on the menu, some fresh cut french fries, make some special sauces, offer drinks, and you're good to go.

I wouldn't want to do that - I'd be afraid of people getting chili sauce all over the cabinets.

[Chris Leach]

Here is my thought of the day:
Starting an arcade can be profitable!

A) you have to know how to repair or have a buddy that can repair these things for you for cheap...read up on them and do your homework..you can fix them yourself..(so easy a chimpanzee can do it)
B) you cant do just arcades...sell video games as well...
C) opening an arcade is the perfect chance at opening your very own used video game store as well!
D) you have to have a Pac-Man arcade or you are not an actual arcade!
E) dont forget about the kids and their moms...buy some of those ticket games and throw them in as well...

If you do all this you will have a successful arcade....!!!!!!!!!! And a keeper place for amusement in your community...!

Hint there are thousands of Gamestops in strip malls everywhere! Open your game store/arcade next to a gamestop and market off their traffic they stole from others...!

take dvd's, cd's, games old and new, laserdiscs, and media..>!
If you are in Michigan and want to start a business with a partner, pm me!

[SexToyKiosk]

Cebus Capucinis, on Mon Sep 20, 2010 12:30 PM, said:

Frankly I think arcades are a non-feasible business model in a 21st century world, which is quite sad.

I wouldn't go so far as to say the arcade model is dead, I just think it needs re-imagining. The Dave & Buster's chain is on the right track if the economy ever improves enough to support it again. You definitely can't make it with dedicated machines like in the 80s, but if arcades were built with more multi-game MAME-type cabinets, it becomes more appealing. Nothing sucks more than going to your favorite arcade and waiting in line for your favorite game, but what if you eliminated said wait? I know licensing issues would have to be worked out. But it can't just be about the machines anymore; there has to be food (and, if possible, drink), and something has to be worked out to allow people to play DVDs on a screen, etc. As soon as my parents die and I get my inheritance, I'm looking into opening up one such operation with even more features than I've mentioned that I can't go into yet. But rather than trying to re-create an 80s arcade, it makes more sense to think of creating a community entertainment hangout as a whole. For it to really go the extra mile, game manufacturers/distributors also have to put out new limited-scope games that are suited to a coin-op environment using today's graphics and styles. I was just talking to my cousin the other day and he said, "Everything you see is FPS now and it sucks." I agree. To make the arcading institution work again, the games THEMSELVES have to be arcade-oriented, not Wii wannabes. That means creativity, not just hacking Doom and changing the texture files and weapons. We need GAMES again, not another flood of simulations. When I was a kid, you went to the arcade for the environment and because they had games you couldn't play at home. Now, you have to create a reason for people to leave home, and that's hard to do in an age when kids are increasingly fused to their computers and TVs. When I was growing up, you couldn't wait to get out of the house on the weekend to go to the mall or the movies or the arcade. Now, you take the kids out and all they whine is, "When can we go home? I miss my computer/game console!"

[MagitekAngel]

God I would love to have an arcade. But only the classics! Nothing more recent than 1995! And nothing more expensive than a quarter!

[theloon]

What about avoiding a ton of regulations and stage "arcade" parties in your home? Set up an arcade in your basement. Have machines with MAME for special requests. Serve liquor and beer as this is a personal party. Oh, yeah. Sound proof the arcade room to avoid noise nuisance complaints.

PROFIT.

Edited by theloon, Sat Oct 9, 2010 3:05 AM.

[Shaggy the Atarian]

SexToyKiosk, on Tue Oct 5, 2010 8:16 AM, said:

Cebus Capucinis, on Mon Sep 20, 2010 12:30 PM, said:

Frankly I think arcades are a non-feasible business model in a 21st century world, which is quite sad.

I wouldn't go so far as to say the arcade model is dead, I just think it needs re-imagining. The Dave & Buster's chain is on the right track if the economy ever improves enough to support it again. You definitely can't make it with dedicated machines like in the 80s, but if arcades were built with more multi-game MAME-type cabinets, it becomes more appealing. Nothing sucks more than going to your favorite arcade and waiting in line for your favorite game, but what if you eliminated said wait? I know licensing issues would have to be worked out. But it can't just be about the machines anymore; there has to be food (and, if possible, drink), and something has to be worked out to allow people to play DVDs on a screen, etc. As soon as my parents die and I get my inheritance, I'm looking into opening up one such operation with even more features than I've mentioned that I can't go into yet. But rather than trying to re-create an 80s arcade, it makes more sense to think of creating a community entertainment hangout as a whole. For it to really go the extra mile, game manufacturers/distributors also have to put out new limited-scope games that are suited to a coin-op environment using today's graphics and styles. I was just talking to my cousin the other day and he said, "Everything you see is FPS now and it sucks." I agree. To make the arcading institution work again, the games THEMSELVES have to be arcade-oriented, not Wii wannabes. That means creativity, not just hacking Doom and changing the texture files and weapons. We need GAMES again, not another flood of simulations. When I was a kid, you went to the arcade for the environment and because they had games you couldn't play at home. Now, you have to create a reason for people to leave home, and that's hard to do in an age when kids are increasingly fused to their computers and TVs. When I was growing up, you couldn't wait to get out of the house on the weekend to go to the mall or the movies or the arcade. Now, you take the kids out and all they whine is, "When can we go home? I miss my computer/game console!"

D&B is actually turning a profit even in this stagnant economy. They opened up some new locations recently. Also a Japanese arcade company called Round 1 just opened their doors in SoCal and their game selection alone is good enough to bring out a lot of players.

http://arcadeheroes....cades-and-more/

People won't go to Round 1 because of the few classics they have but for everything else as they have one of the most impressive collections of new arcade games anyone has seen.

As for "Everything is FPS now" that's true on consoles and PCs (naturally since everyone saw Modern Warfare 2 make a gazillion dollars so they want a piece) but not so in arcades. The last FPS I know of for arcades was Cyber Diver by Taito which was released this year to Japan only. Before that it was Half-Life 2, same market. To get to a US FPS arcade release, you have to go back to 1998 with War: Final Assault. It's simply not a genre that has a foothold in arcades.

Right now the arcade market is dominated by racers / light-gun games / sports game (like Golden Tee) / dancing/music games / fighters. It's simply because that is what people like to play and its what they will pay for. They have official MAME-like cabinets with tons of games (like Arcade Legends 3) but those aren't big money makers. Neither are classic games in original dedicated cabinets.

One thing that might be big in the near future are arcade titles which use robotics. There are a few in development now and have great potential.

Edited by Shaggy the Atarian, Sat Oct 9, 2010 8:48 AM.

[yuppicide]

Never been to Knucklez place. It's about a 40 min drive for me.

I too am worried about people getting "chili sauce" on my games, but what can I do? These games aren't in my home collection. They're in a public location to hopefully make money.

I agree that old and new is the way to go. You should have some consoles and computers available for rent. My friend used to rent computers.. installed the software that lets you only play for how much time you pay. The problem is kids have consoles and computers at home.

I think you need stuff to draw people in.. tournaments, stuff for sale, etc. One place near me has a crapload of games.. but their store is a huge mess. It's like a mound of stuff, some of it is organized. He says he takes in a few hundred items a week so it's hard. He has game tournaments as well as MAGIC card tournaments.

[MitchSchaft]

My brother-in-law has been in to MAGIC bigtime for 20 years almost.

[yuppicide]

Actually, my friend who knows Richie Knucklez, I haven't seen him in 5 or 6 years maybe more. Recently I went to a video game store to pick up some Atari 2600 stuff as I am designing homebrews. I walked in the door and he was standing there. I thought it was odd since he lives about 30 mins from me. He was there for a Magic tournament. He's been doing it since it came out. I never got into it.

MitchSchaft, on Sat Oct 9, 2010 10:50 PM, said:

My brother-in-law has been in to MAGIC bigtime for 20 years almost.