Starting your own family entertainment business is an exciting prospect that allows you to create your own space where joy and fun can become the center of attention. It takes more than just dreams, though. There are seven key steps on how to start a family entertainment center business. Understanding the background, market, and industry trends will help you to get started on creating a successful business. 

What is a Family Entertainment Center?

A family entertainment center (FEC) is a retail facility providing entertainment for a fee. Originally geared towards children and families, many FECs today are designed for adults and corporate events, while still attracting a large number of kids. Family entertainment centers are made up of elements that are fun for all demographics including arcades, laser tag, virtual reality (VR), miniature golf, bumper cars, and golf simulators to name a few.

When proper design and elevated food and beverage are combined, FECs are not just targeting families, but multiple generations and individuals. For example, the model can  attract families with children year round on weekends and school holidays. The FEC structure also appeals to young professionals as a venue for happy hour and dinner or late-night entertainment on the weekends. FECs also attract many companies and corporate events

In general, FECs can:

  • Provide a space for community events and gatherings
  • Offer an alternative to home-based streaming and gaming
  • Generate great memories for all attendees
  • Provide a safe space for spontaneous creative play
  • Encourage interactions between multiple generations including grandparents

Types of Family Entertainment Centers

Family Entertainment Center (FEC)

As FECs have evolved to appeal to adults, elements have been added to many different facilities. Some common types of FECs are:

  • Bowling alleys aka Bowling Entertainment Centers (BEC)
  • Movie Theaters aka Cinema Entertainment Centers (CEC)
  • Mini-golf courses
  • Go-kart tracks
  • Hotels
  • Casinos to create gaming entertainment
  • Restaurants also called eatertainment concepts
  • Sports facilities
  • Trampoline parks
  • Children’s discovery centers
  • Indoor amusement centers

Exploring the Past and the Present of the FEC Industry

Today’s family entertainment center industry evolved on the convergence of the early 1990’s standalone arcades and “pocket parks,” which were community-based go-kart and small amusement ride facilities.

Modern family entertainment centers now include a diverse array of multi-attraction entertainment concepts. Also known as out of home entertainment (OHE) and location based entertainment (LBE)), FEC’s come in many shapes and sizes, and target different customers in a variety of ways. 

Consider CEC Entertainment’s Chuck E. Cheese (Market Cap $1.64b, 608 stores, founded 1980) which targets customers 3 to 10 years of age, versus Dave & Buster’s (Market Cap $2.4b, 118 locations, founded 1982) which targets customers 21-40 years old. There are thousands of smaller companies and individual locations in between these two examples with a variety of concept formats.

Current State of the Industry

The FEC industry is currently experiencing something of a golden age. It has become a very popular, mainstream form of community-based entertainment. There are several reasons for its current popularity:

Wide Audience

For the first time ever, FEC’s are entertaining three generations of players from grandparents to grandchildren.

Balanced formula

FEC’s have discovered the right mix of attractions, especially enhanced food and beverage offerings, to attract their target audience and maximize their length of stay and spending.

Counter trend

FEC’s are an attractive social venue, providing an escape from at-home screen time for families and adults alike.

Groups and parties 

FEC’s are desirable to corporate and other groups, as well as popular venues for birthday parties, appealing to all ages including adults.

FEC’s are particularly popular with millennials, commonly considered those aged 27-42, which represent 21.67% of the US population or some  72 million individuals. This generation has grown up as gamers in one form or another, and many FEC activities appeal to their desire for active socialization. 

How to Start a Family Entertainment Center Business

Family Entertainment Center (FEC)

With a booming market that doesn’t appear to be slowing down anytime soon, starting your own family entertainment center business can be an exciting and lucrative opportunity. However, you will need careful planning and execution to make it successful. 

From finding the right location and appealing to your target audience, there are a few steps you will need to take when learning how to start a family entertainment center business. 

Step 1: Identify Your Market

Identifying your target market is a critical first step for starting a Family Entertainment Center. Narrowing in who you’re wanting to reach will help inform every other step of the process. You should examine the demographics of your target audience, including the income levels and age distribution. This will help you determine what kind of FEC facility will appeal to them the most.

Step 2: Brainstorm

After you’ve identified your target market,come up with what your ideal playground would be. Find the right balance of thinking big but making sure your concept is feasible. Ask yourself: 

  • How much funding will you need to actualize your vision?
  • Do you want an indoor or outdoor FEC?
  • What will the anchor attraction(s) be for your facility? Think of attractions like bowling, trampolines, or sports facilities.
  • How long do you see your FEC lasting?

Step 3: Search Out Locations

Finding the right location is another important building block to the success of your FEC. Decide if your facility can generate its own traffic or if you need a site that generates traffic for you. A site that provides significant traffic will be more expensive, but may be worth it in the long-term if you can afford it up front.

The location of your business must:

  • Be in a safe, well-lit area
  • Be easily accessible to customers 
  • Have space for parking or for building a parking garage
  • Be expansive and open enough to contain multiple-level structure, additions, and large crowds
  • Support heavy foot traffic inside and moderate vehicle traffic outside.

A commercial real estate agent can be a valuable partner in locating the optimal  location for your FEC. They can help you understand the local laws when opening a new business including: 

  • Zoning laws
  • Construction licenses and fees
  • Insurance rates
  • Utility costs
  • State and local incentives and taxes
  • Minimum wage laws

Step 4: Create Your Business Plan 

A well put together business plan will reinforce your ideas and better prepare you for interacting with potential investors. The format below is a good general structure to follow.Executive summary

This introduces your FEC mission and structure in an overview of the company.

Company analysis

This covers your business structure and an overview of your services.

Market analysis

This demonstrates your market research in addition to analyzing your competitors and target customers.

Capital expenses

List the capital costs you will require including building costs, and furniture, fixtures, and equipment (FF&E).

Operations and management

This covers the logistics of running your FEC. It also describes your legal structure and company roles.

Marketing and sales

This establishes your advertising strategy. 

Step 5: Secure Funding

Your funding options are based on your personal assets and business plans. Begin by putting together a detailed budget including startup costs, staff training, and operation and maintenance costs. You can obtain funding from investors, which will help protect your personal finances, but, you will no longer be the sole owner of your FEC. 

If you want to retain sole ownership, you can try for small business loans while still protecting your personal bank account, depending on the loan. There are many options available, especially for women and minority business owners. Before talking to a bank, though, be sure you have a detailed business plan ready, as well as projected revenue. 

Step 6: Talk to Experts

Getting expert opinions on every aspect of your business will not only help things run more smoothly, but it will also set your FEC up for greater success.  

For example, a good architect combined with a consultant with operational experience will know what elements and layouts will fit your budget and space. An expert contractor can then advise you regarding acquiring permits to build your FEC with accuracy. Contractors  are also linked with carpenters, electricians, plumbers, and other important workers for your construction process.

Step 7: Generate Excitement & Hold a Grand Opening

As your business plan comes to life, start to generate excitement by creating a rapport with other business owners. Having solid relationships with local businesses pave the way for partnership opportunities and greater involvement in the community. Be sure to start a strong marketing campaign through social media and develop a strong word-of-mouth referral program to bring customers into your business. 

Once your business is ready to open, hold a grand opening which will demonstrate to everyone what your FEC brings to the community, and raise awareness about your business. Consider having special promotions and involvement with local officials to show their support.

How to Start a Family Entertainment Center Business with Pinnacle 

Starting your own family entertainment center business is an exciting prospect, but can also be daunting with how much there is to do and keep track of. To help take some of that pressure and complications off your shoulder, we developed the Pinnacle Launch Package, which offers a comprehensive and streamlined approach to reaching your goals. 

With our expertise, you can easily navigate the process from concept development to marketing strategies and even operational support. By using our launch package, you are equipping yourself with the necessary tools to create a successful FEC that will bring entertainment and joy to your customers.