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Can a Gaming Cafe be Successful?
droidlev asks: "For years I've been toying around with the idea of opening up a medium sized gaming cafe in the Chicago suburbs. I have already taken care of the issue on how to make money during the day, when our younger market is in school, However, the question of whether or not a place like this can be successful, still remains. I've seen plenty of undermanned and poorly planned places in the area (and on the East Coast) like this go under in six months. What is your opinion? What ideas and thoughts do you have that could help a place, like the one I'm proposing, succeed? Do you have gaming cafes in your area that are successful? What unique techniques have they implemented?"
Springfield Mall in Fairfax County (not far from the Franconia/Springfield Metro Station), Virginia has a cyber cafe which also offers gaming on PCs and game consoles and its doing really well. They also have WiFi for people who bring in their own laptops. I'd say go for it!
Michael "TheZorch" Haney
thezorch@gmail.com
http://thezorch.googlepages.com/home
I know that the Dining and Gaming combined nicely and has several locations. I've done some light research on this topic and what you'll need is a way to be able to get rid of most of the stuff if it doesn't work out. Leasing equipment untill your making enough profit to satisfy your tastes. http://www.daveandbusters.com/
I live in Brisbane, Australia, and gaming cafe's are quite popular in the major cities. I know of at least four around inner city brisbane that have been open for years and are quite successful. From my observations their main revenue intake is based around these key concepts: 1. Location 2. Word of mouth Location is imperical, and you need to strike deals/lan nights to get word of mouth generation. Setting up shop near a school (preferably private school) can sometimes make this type of business a success, as i've seen in Brisbane. If you start all nighters and events it will generate a decent amount of friends telling other friends and so on to bring in business and customers. Anyway, these are just a few suggestions i'm guessing you already know about, hope it helps. PS: If you have the room, get a pool table!
You didn't specify what kind of games your cafe would feature. I assume you mean computer games (WoW, CS:S, et al). There is a place in my area that does very well in that market, but only because of variety.
I'd recommend offering something aside from computer games. Set up some tables for Magic: The Gathering, D&D, Battletech, Warhammer, etc so you aren't only catering to the "I don't have broadband" market. This way you'll become a social gathering place for geeks. You may even consider starting a card/miniature trading deal in your shop where you buy things from your customers and sell them back.
That's my advice. But, then again, I have NO business sense.
Anyone else think the comments just weren't rendering right before they turned off ABP and saw ads?
The key to anything is adding value to a commodity. PCs are a crappy commodity even with mods.
Why should I use your facility rather than a crappy one. Are you going to have hot chicks offering massage? How about a place to smoke while you play? Good DJs beat matching to the action? Red velvet? What?
Take it from me nothing is worse than just another fucking cubicle.
Anyone who can afford your services is too busy making money to actually go to your shop. Your only chance is to appeal to people who have lots of money and lots of time. IE: Near a very expensive university.
Religion is a gateway psychosis. -- Dave Foley
Well, I run one along with two other guys. The place will eventually make money but its not exactly a cash cow here (although it may get better after some of our competition goes under).
A lot of people chimed in mentioning that computers and net access are cheap. Well, that's true. I would also mention that, at a hypothetical $5.00 / hour (we're cheaper due to being in small town USA), it takes quite a while to catch up with a computer, games, maintenance, and internet access.
For people who either just browse the net or people who play games maybe five or six hours per week, it's much less trouble and cost effective to go to a place like this. I dare say that most people fall into that more casual group--especially when you consider they also divide their time with home consoles. We also have a nightly and weekly open-pass rate that keeps the place hopping when we would otherwise be slow.
There are other mitigating factors too. Maybe they don't trust their roommates. Maybe they're traveling. Maybe they really just want to avoid their parents. Maybe they skateboard in the area and just want to buy a drink someplace cool. All of these people fill in the gaps that are left by hardcore gamers just buying their own computer.
Some advice, don't go it alone. We have three people that own / work the place (only open after 5pm) and we couldn't really do it with less (and bona fide employees are expensive). Also, plan to replace your computers. If you don't you'll run out of money just when the business is taking off. Also, don't forget the three most important things to a business: location, location, and location. Finally, keep in mind that some games aren't licensed for cafe usage without special arrangements. Most notable is Valve Software (for which we have a cafe license). Also, don't pirate Windows. It's just stupid (and *will* get you shut down when the competition kindly turns you in).
I think Mauve has the most RAM. --PHB (Dilbert Comic)
I know you're envisioning a non-stop LAN party like you have with your friends, but (at least in the USA) it's probably not going to go down like that.
You're probably going to need to cater to teens. Teens are less likely to have their own computers, or their usage is restricted by their parents. They're also a lot more social-- they want to get out of the house and they have time to kill. Conversely adults are more likely to be able to afford their own gaming rigs, and (more importantly) they tend to want to be left alone-- they'd rather play in the comfort of home than hanging around a gaming cafe-- especially if it's filled with packs of teenagers (kind of a catch 22...)
The downside, of course, is that you'll be spending a lot of time playing babysitter. You'll be constantly monitoring for theft and vandalism, telling them not to smoke in front, maybe even breaking up a fight or two. You're going to get a lot of attitude. Did I mention the theft and vandalism? Things are going to go missing and you're going to have no idea how they pulled it off. Things are going to be broken for no reason at all. Ever seen an arcade machine in pristine condition? For that matter, ever seen an arcade bathroom? That's what yours will look like every night too...
I know a guy that has a successul gaming business. He offers a laundry feature. So people can clean their clothes while they purchase \ play games. This is a great idea considering alot of gamers need to clean their clothes anyways. btw I'm an evil genius.
A good article from Slate about a guy and his failed coffeeshop business. Not quite the same, I realize, but still very insightful.
I like to think of the real problem game centers have in terms of system dynamics: a game center draws customers from within a limited geographic radius (about 10 miles, or maybe 15 km, in my case). Within that radius there are a limited number of people who will be interested in what you offer. In the early days business grows exponentially, but NOT because of any kind of growth in the number of potential customers--it's just that more and more of your fixed number of potential customers are finding out about you. At some point you reach saturation, and that where the system dynamics comes into play: you are in a fight between the number of potential customers in your area that are leaving (graduated, moved away, bought their own computer, ran out of money, lost interest, etc.) versus the number of new potential customers that are being created (moved in, got old enough mom would let them play, etc.). Basically, there are many more paths for customers to leave then there are for them to arrive in your pool of "potentials", so it's a loosing proposition.
Yes, there are things you can do to change the coefficients of some of the terms in the basic equation: you can try to bring in more adults, you can add more games more frequently, do more advertising, etc. What I've seen, though--and I've validated the basic model with several other (former) game center owners--is that if you do everything right business is good for about a year and a half, then it peaks and falls off to much lower level. Revenues can remain stable after that point, but at a level that is WAY below the peak--and that generally means you don't have the profits you need to upgrade machines, buy new games, etc. When you stop being able to upgrade and add new games, you enter the final part of the curve when business falls off further from the already-low plateau it was at, and then you're dead (in terms of the business).
Tweak the situation a little bit and the timing of when you hit the inflection points on the curve will shift forward or backward some, but the basic shape of the curve doesn't change--that's why I say that this really isn't a viable business.
Oh, those "special circumstances" I mentioned, that would make it viable? They DO exist, but are rare: for example, you don't pay for most or even any of your games (a popular strategy in developing countries, and unfortunately used much more frequently than you might think even in the developed world!); you're setting up business in a community where there's nothing else for kids to do; you find other uses for the floorspace and computers that you can make money on when people aren't playing games (computer classes, for example). Even if these or similar factors apply in your case, though, they usually only make the difference between surviving and not--I've never seen a case where they are enough to actually get things to the point where the business is financially attractive to be in.
Yes, all of the
The best thing you can do is get affiliated with Igames.org, you get a wealth of information and ideas + support from hundreds of exhisting owners.
I ran my centre, Capture The Frag here in a small town ~80,000 with 2 other pc and 1 xbox center and we did alright, surviving about 15 months.
What ends up killing you is the price of the games, the stupid licensing from companies like valve and the cost of supporting your hardware/upgrading and making sure the machines are maintained.
Get a license for Deep Freeze, it'll be your best friend.
We made a good deal of $ but it mostly went to advertising and paying for the property lease plus games, remember you're not buying 1, you're buying however many games for however many comps you have.
In the end, after about 15 months, i got sick of working 100 hours a week for no pay, its SO much more than just hooking some comps into a hub and going.
solution to the stealing the mouse balls - get a laser mouse instead
Yeah, but then people would just steal the frickin lasers, strap them to shark's heads and then we'd be in real trouble.
Disclaimer: I've never been in a gaming cafe. But I've run a small business for 20 years, so the following advice is mostly about the business side of it.
1) Your job is NOT running your cafe. Your job is improving it. Owning a small business is a red queen affair: you have to be constantly improving just to stay even with the competition. Do every job in your cafe just long enough to know how to do it well. ( This will be anything from doing taxes to fixing hubs to cleaning the toilet. ) Then DELEGATE.
2) Your territory does not end at the door. OK, legally maybe it does, but you must treat the area immediately around your business as your territory. Clean up trash, cover grafitti ( immediately ), get rid of panhandlers. If something goes wrong immediately outside your business, it is not your fault, but it is your responsibility.
Get to know your neighbors. They can be helpful, or they can hurt you. ( This is especially important in your case, for many of them may initially view your clientele as troublemakers )
Join your local business association. Get to know your local cops.
3) You may have drug dealers and hookers of both sexes trying to use your place as a base of operations. Get rid of them. Not only do they give the cops a reason to cause you problems, but they will be competing for your customers' money.
4) Decide exactly what your business is. Yes, it sounds silly, but many owners don't really know what line of work they are in. In your case, you are not just in the business of offering games. As several posters have noted, most people can get that at home. You have to offer them an experience that they can't get at home.
A) Coffee and food will help. It does not have to be great food + coffee, but decent and reliably so. ( which many people don't have at home because they are too busy playing games. )
B) Have at least one hot babe working for you. ( Most gamers don't have one of those at home ) It helps if she is not an idiot, too.
C) Create a social scene ( most gamers don't have that at home, either ) This means catering to women. Keep them happy, and they will hang around, and then the guys will hang around too. Find out what kind of games women prefer. Have plenty of them. Keep the bathrooms clean.
D) Have a clear statement of expected behavior ( no smoking, no fighting, no booze, etc - whatever rules you think will do best ) Be very, very clear about what standards you expect of your customers, and then stick to them. Be prepared to explain why those particular rules are important to you. A large number of gamers play games because they find the rest of the world to be confusing, irrational, and hypocritical. Very few of them have a social environment that makes sense at home. E) Keep asking yourself 'What can I do for my customers that they can't get at home?"
A suggestion to keep the system at default settings would be Deep Freeze. If someone manages to fuck up the system a reboot will take care of it quickly.