Amusement Park Business Plan
Wasatch Family Fun Center
Services
Our FEC's will provide customers with a wholesome environment that provides amusement, entertainment, excitement, competition, year round activities, souvenirs and great food all while forming lasting memories at affordable prices.
Although there is currently no competition in the immediate area in which we plan to establish our FECs, we believe that because the FEC industry is expanding exponentially, sooner or later competition will encroach.
To that end, the company plans to become profitable and retain a solid leadership position in the marketplace by providing: * Indoor facilities - Cold weather will close the outdoor competition. * Year round play with a wide variety of activities - Our season never stops. * Seasoned, successful management team. * Contracting top FEC consultants - To counsel on key attraction layout and design. * Working with USU Extension Program - Determining tourism impact. * Working with Utah Department of Tourism - National and international exposure. * Family-oriented - Partnership-operated center gives the company local insight. * Aggressive marketing. * Customer Incentive Program - Reward frequent visitors/customers. * Easy access and exposure.
3.1 Service Description
The ability of I&B Investments to accomplish its goals and lead the local family entertainment industry, depends upon the expertise and social conscience of the management team. Our management team understands these facts and several members of our management team have been recognized in the past for their outstanding community service and involvement.
Several local surveys have been reviewed and provide valuable information about a vast list of requirements that need to be met for an FEC to attract the local residents. We will strive to meet these desires and we will take future surveys with our customers to make sure that we are ahead of the curve. Source: USU Extension Program.
The Story of Dave & Busters - Family Entertainment Centers
"In 1982, Dave Corriveau and Buster Corley brought an idea to life. Create a place where adults can enjoy great food, terrific drinks and the latest interactive games - all in one place. They discovered a winning formula. Over the past 18 years, Dave & Buster's has grown from one location in Dallas, Texas, to a nationwide organization. And with the help of our creative and dedicated employees, we're able to keep growing and providing our guests with a unique experience." Source: Dave & Busters.
I&B Investments intends on building an FEC with a 15,000 to 20,000 square-foot main building located in the Northern Utah area and provide such activities and services as: go-carts, miniature golf, climbing walls, batting cages, skycoaster or tower swing, air hockey, foosball, paint ball, laser and phazer tag, skateboard arena, outdoor bumper boats, gaming & redemption center, chess/backgammon playing areas, souvenir/gift shop, ice cream, pizza, pretzels, drinks, private party rooms (birthday & corporate), massage therapy center and a coffee shop.
I&B Investments anticipates entering into an agreement with Harris Miniature Golf Company (HMGC) to construct the course at its facility. The mini-golf course landscaping will depict the Wasatch Mountains area. The environment is casual and the design will capture the romantic era of a visit to the Olde West. The casual ambiance will be enhanced with mellow beat music and the sound of rushing water created by the falls and streams on the golf course. The quality of play and excellent service will ensure a large loyal following of customers.
"It's an icon of the American landscape. It gives people a sense of other worldliness. And it's non-gender and non-age biased," says Steven W. Rix, executive director of San Antonio, Texas-based Miniature Golf Association of the United States.
"Miniature golf's relatively low start-up cost - compared with theme parks, for example - have made it one of the most lucrative entertainment businesses around. Our latest figures show courses can return as much as 38 percent on an investment each year," states Dave & Paul of the Professional Miniature Golf Association of Salt Lake City, Utah.
3.2 Future Services
I&B Investments will expand its family entertainment activities during its first year of operation, by adding bumper boats, go-carts and other attractions as discussed elsewhere in our plan.
In addition I&B Investments is already working on contingency plans for adding more facilities along the Wasatch Front.
To further increase revenues and public attraction, I&B Investments is working to establish several other entertainment (outdoor) activities that will be put in place using revenue-sharing programs, such as the Skycoaster

Market Analysis Summary
Research has indicated that the prime market for a FEC is in urban areas close to neighborhoods with large concentrations of upper- to middle-income bracket population. Ease of access is important, but street frontage is not a crucial requirement.
Mr. Randy White, president of White Hutchinson Leisure & Learning Group, one of the leading FEC project developers in the United States has observed, "Just as entertainment is becoming an essential component of shopping centers, entertainment is the backbone of today's urban redevelopment. Often referred to as urban or location-based entertainment centers, these projects integrate entertainment with retail, dining and cultural facilities to create a resident and tourist destination."
A seven to ten mile radius is considered the radial market area of a FEC. However, depending on competition (or lack thereof) a market area can grow to a fifteen mile radius and with easy highway access to a radius of twenty miles from the FEC.
The U.S. Census Bureau, Census 2000, and the Weber County Economic Development provides us with the following demographic information about our area (15 mile radius). Counties | Gross pop. | Age 5-75 | Weber | 196,533 | 171,297 | Box Elder | 42,750 | 37,308 | Davis | 238,994 | 209,794 | * The population in a fifteen-mile radius is in excess of 500,000 * Median age is 27 * The male/female share is 50% split * Over 85% are white * Over 40% are 25 to 50 years old * Over 75% own or are buying their homes * Average household size is 3.5 persons * Average household adjusted gross income is $39,250 Change in Utah Population, By Decade | + Change | 1950s | 20,410 | 1960s | 16,600 | 1970s | 40,800 | 1980s | 25,510 | 1990s | 42,111 | 2000s | 51,170 | 2010s | 52,149 | 2020s | 50,030 | 2030s | 65,703 |
4.1 Market Segmentation
I&B Investments' primary targeted market consists of three main groups. These categories are: 15 to 24 year old, 25 to 34 and 35 to 54 years old. To better understand the size and breakdown of the local population see the following table and chart.

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Market Analysis | | | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | | Potential Customers | Growth | | | | | | CAGR | Age 15 to 24 | 7% | 90,450 | 96,329 | 102,590 | 109,258 | 116,360 | 6.50% | Age 25 to 34 | 2% | 66,800 | 68,136 | 69,499 | 70,889 | 72,307 | 2.00% | Age 35 to 54 w/ older children | 9% | 125,250 | 136,523 | 148,810 | 162,203 | 176,801 | 9.00% | Total | 6.65% | 282,500 | 300,988 | 320,899 | 342,350 | 365,468 | 6.65% |
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4.2 Target Market Segment Strategy
A full-time public relations coordinator is a vital part of I & B INVESTMENTS' management team. The job will require this person to be responsible for assuring customer satisfaction, generating public awareness for the types of entertainment offered at our "FEC," and attractively promoting the various activities to the public.
Even though, our customers can be considered all age groups, both sexes, all races, all income levels, local residents or tourist to the area. The most important factor behind our success is simply, THAT A PERSON CAN ENJOY THEMSELVES, while participating in the activity they choose.
4.2.1 Market Needs
Upon reviewing the local demographics of businesses in the Weber & Davis County area, we discovered that our proposed service will be filling a void that has existed for years in the local entertainment market.
Our primary targeted counties are Weber and Davis. These counties represent two of Utah's top three counties with the highest personal income levels in Utah (Davis county being #1) which relates to more money available for entertainment.
1999 Average Household Adjusted Gross Income County | - | Davis | $42,500 | Morgan | $42,000 | Weber | $37,500 | Box Elder | $35,000 | Cache | $34,000 | Rich | $28,000 |
4.2.2 Market Trends
Historically if a market becomes controlled by a corporate entity, services are cut, prices are raised and core business is driven away as a result of the companies indifference to local customers concerns. To avoid this happening locally, I&B Investment's desire is to create their niche in the Utah market before the national chains move in.
The Business Journal of Kansas City -1996. "During the past five years, large chains like The Blue Eagle Golf Centers Inc., and The Golden Bear Centers, have been buying up various FECs attempting to control the market."
Parks & Attractions - January 29, 2001, Amusement Business.com (newsletter). "Right now we have 20 locations. They are all the typical FEC: batting cages, bumper boats, miniature golf, indoor arcades. There have been a lot of things tried and we've seen some things fail. We've seen Disney come and go with its Disney Club, their birthday-party type concept, and Discovery Zone has come and gone." Taken from an interview with Mr. Bill Rameson, a FEC Pioneer and CEO of Palace Entertainment, the largest FEC chain in the world.
Utah's Amusement and Recreation Industry is projected to employ an increase of 33,080 employees by 2030. This equals an average of 788 more employees per year being hired by Utah's growing Amusement Industry. Source: State of Utah Economic and Demographic Research Database.
Page 11, of the 2001-2002 industry report complied by the International Association for the Leisure & Entertainment Industry, states that even after years of exponential growth, FECs are still a strong growing segment of the amusement industry. In 1990, there were only about 250 centers and today the count is around 10,000 to 12,000 with 19% of the establishments earning $1,000,000 to $3,000,000 and 16% making over $3,000,000 annually.
For more great information about the amusement industry and the positive upward tread, there are two main industry magazines that provide current industry statistics. They are Play Meter Magazine and Vending Times. The 2001 census of the Industry, by Vending Times is the 54th in a series that dates back to the dawn of the modern era in vending. It is based on a mailing to 12,000 operating entities that yielded 1,206 usable replies.
Fun Center Sector Remains Robust as Operators Pace Expansion Strategies - Vending Times, January 2002. "A complex but promising growth opportunity confronts the fun center market in 2002. Family entertainment centers, location-based entertainment sites, arcades, and game rooms all stand to create larger customer bases and have a solid chance to cement greater customer loyalty if they invest wisely to create the kinds of experiences that players actually want to have."
4.2.3 Market Growth
As the population ages the potential market size increases and with the type of entertainment offered at our facilities, we are confident that our customer base will continue to grow and remain stable for the foreseeable years to come.
The market for a modern FEC center in the Weber/Davis County area is superior to most, partly due to the tremendous population growth which has occurred during the past five years. With the overwhelming majority of the population living and working within 15 miles of our first selected site. Additionally, there is not an FEC of this type within 50 +/- miles.
Population Growth: In the 10 year period of 1990-2000, Weber County experienced a 24% increase in residents, closing the millennium at 196,500 and this rate of growth is projected to continue through 2020.
Utah's Resident Population 1850 | 1900 | 1920 | 1940 | 1960 | 1980 | 2000 | 100,000 | 250,000 | 400,000 | 500,000 | 800,000 | 1,500,000 | 2,300,000 |
4.3 Service Business Analysis
We requested Dr. DeeVon Bailey, of Utah State University, Professor of Economics to study our area and industry, then report and publish his findings. We requested Dr. DeeVon Bailey to publish his finding because, we wanted his non-bias review and we felt that informing the competition about his findings was a good thing. Here is an exact copy of that report,
Preliminary Assessment of the Economic Multipliers for
Amusement Companies in Weber County, Utah State University
By DeeVon Bailey, Ph. D.
Department of Economics
Utah State University
February 1, 2002
Dear Mark,
This document provides you information on the various economic multipliers you can use to assess the impact of your proposed business. The multipliers I am giving you were generated based on information from Weber County during 1998 (this is the latest information we had).
We were able to get information on two types of amusement companies - 1) Amusement and Recreation Services (ARS) and Membership Sports and Recreation Clubs (MSRC). I suspect that the first category, ARS, more closely fits your situation than the second.
The economic information and the economic multipliers were generated by IMPLAN, an internationally recognized input-output model that is widely used. Dr. Donald L. Snyder generated the information for us. The following table presents some of the base economic information for ARS and MSRC in Weber County in 1998: - | ARS | MSRC | Total Sales Mil. $ | 17.11 | 7.512 | Total Employment (Number) | 830 | 372 | Total Compensation Mil. $ | 5.128 | 2.051 | Employee Income Mil. $ | 1.820 | 0.680 | Proprietor Income Mil. $ | 3.552 | 0.255 | Indirect Business Tax Mil. $ | 0.866 | 0.203 | Total Value Added Mil. $ | 11.366 | 3.188 |
Let me interpret this table for you. In 1998, ARS had $17.111 million in total sales in Weber County and employed 830 people. The employment number is a person count and not full-time equivalents. You need to divide the employment number by perhaps "4" to get the full-time equivalents (jobs). Total compensation is employee income plus proprietor income plus rental income plus interest income generated by the business type.
So, in the case of ARS total compensation was $5.128 million of which $1.820 went to employees (wages and salaries) and $3.552 million went to owners (proprietors) as net profit. Indirect business taxes are basically sales taxes generated by the business types according to Don Snyder. So, ARS generated about $866,000 in sales taxes during in Weber County in 1998. Total value added is basically total sales less what would be equivalent to the cost of goods sold.
So, in 1998 ARS generated $17.111 million in sales of which $11.366 million could be attributed to the value added by labor, management, etc. by persons in Weber County. This suggests that ARS made purchases of about $5.745 million (17.111 – 11.366) from sources outside of the county to be able to generate $17.111 million in sales.
Economic Multipliers for Weber County Amusement Industries
The following are some of the key economic multipliers you should use to judge the impact of your proposed business.
Type and Value of Multiplier - | ARS | MSRC | Output Multiplier | 1.50 | 1.73 | Indirect Business Taxes | 1.57 | 2.65 | Employment Compensation | 1.52 | 1.82 | Total Value Added | 1.48 | 2.12 | Employment | 1.17 | 1.24 |
The interpretation on these would be as follows: The output multiplier of 1.50 for ARS would indicate that for each $1 in sales for this industry that an additional $0.50 is generated in sales in the County. For example, if your business generates $1 million in sales then that $1 and an additional $500,000 would be generated in sales for the County each year for a total of $1.5 million after the multiplier effect.
The indirect business taxes multiplier for ARS is 1.57. This means that for every $1 in sales taxes generated by your business that an additional $0.57 in sales taxes will be generated in Weber County. For example, if your company generates $10,000 in sales taxes an additional $5,700 in sales taxes will be generated by other economic activity in Weber County as a result of the economic multiplier effect (57% * $10,000).
The total value added multiplier for ARS is 1.48. This indicates that for each $1 in economic value generated by the business above the costs of inputs purchased from outside of the County would generate an additional $0.48 in value added for the County economy. This roughly means that if gross profit for the company is $1 then gross profit in the entire county will increase by $1.48 million (this figure includes the $1 in gross profit for your business and the $480,000 that would be generated for other businesses in the County)
The employment multiplier for ARS is 1.17. This suggests that for every person you employ in your business that another 0.17 jobs will be created in the county. So, if you employ 50 people then, besides your 50 jobs, another 8.5 jobs will be created in the County (0.17 * 50). Remember that these are jobs and not full-time equivalents since many of these people will be part timers.
4.3.1 Competition and Buying Patterns
The Amusement Industry is unique in that it has little inventory. Yet, should the need arise there exists a large network of suppliers for everything in the facility. All of these sources ship overnight which reduces the requirement for a large on-hand inventory.
"Being locally owned, you can design and operate your facility to be connected with the community and fine-tune to meet their needs. You have to be part of the community to be successful." - Economy Affects FEC Biz - October 01, 2001 Amusement Business.com.
I&B Investments is a business focusing on family entertainment where there will be sports and activities that all ages can participate in and enjoy as individuals or as a group. It is where grandparents can take grandchildren of all ages (it makes a great date night or family outing).
The simplicity of the activities enables anyone to experience excitement without having to know how to play like a pro. Miniature golf and other related activities (that require minimum strength and athletic ability) are some of the highest-rated family participation sports in the United States.
By far, the most significant factor to affect the FEC business in the forthcoming decade is the dramatic growth of the 25 to 44 year old segment of the population. This age group represents the prime segment of the population that enjoys playing in tournaments. Our FEC will be high-tech, totally computerized centers. Pro play will be offered in the facility year round, increasing the profits for the center.
Competition in the amusement industry in Weber County is considered mild at best and most venues are remotely located. Our first choice of locations is superior and offers us an edge against future FECs or similar services. We will create our niche in the market place by being the first FEC in the surrounding area, but to keep our competitive edge we know we have to choose the right location.
Experts say, "If you require a big grand opening or spend a ton on advertising your center, then you are not in the right location. The public just needs to be able to see your location, make it look fun and they will know where you are and when to come."
4.3.2 Main Competitors
Page 7 of the 2001-2002 annual industry report, complied by the International Association for the Leisure & Entertainment Industry, points out that there are NO TRUE FEC's registered in the Rocky Mountain area and our research confirms this. This provides a prime awaiting customer base and helps assure that our facilities will be in command. We will be entering the market place as the leading company for amusement and entertainment to the area.
The other local, single activity establishments will not have much of an impact on our potential customer base, especially in the winter months when most of the local amusement businesses are closed.
None the less our facility will be competing with other established recreation and amusement activities for the consumer's dollars. These venues are: movie theaters, bowling centers, roller skating, sports venues, theme parks, golf courses, fitness centers, night clubs, ski resorts and etc. Yet, none of these amusement activities truly compete with our facilities, because at our proposed facility we will offer more entertainment options custom-fit to the community and tourist.
Locally there are only two miniature golf courses (both built in the 1980s) and about ten golf courses. Many items like upgrades, new equipment, new attractions, websites or even having a fax machine, have not been a priority to some of these establishments. In others words, because there isn't much competition, the existing venues do not see any reason to make customer satisfaction a priority.
I&B Investments will be the first of its kind in the area to address our underserved market, understanding that price is not the public's only buying criterion. We at I&B Investments believes that customers want to feel a holistic process of having fun and they expect prompt service. Combine that with a clean environment and properly working equipment and we are ensured that our customers will come back again and again.

Strategy and Implementation Summary
Our services will be positioned to provide our customers with a premium amusement and entertainment experience.
Thus our pricing strategy will be to charge a premium price as per industry standards.
The following subtopics will present our sales strategy, marketing strategy, pricing strategy, daily customer projections and promotion strategy. To see comparison FECs and their current pricing refer to financials topics for projections and pro forma comparisons.
I & B INVESTMENTS will also work toward establishing community involvement programs that will demonstrate how the business can contribute to a better quality of community life. Such as: Community projects using the "FEC's" facilities to help civic groups obtain their financial goals (by offering fund raising events). Schools, churches, and other groups will be welcomed for tours of the facilities and will be shown how the facility can be used to help raise funds for their needs.
5.1 Competitive Edge
The high standards set by our company and our location are going to make it very difficult for competitors to enter and survive in the market area.
I&B Investments research shows that the opportunity exists to provide a high-quality service in a family-oriented environment, where we can offer competitive pricing to our customers and still make an outstanding profit in this demanding market.
The keys to our competitive edge
There are several critical issues based on the lifestyles of the area for our business to be accepted and survive. * Produce maximum profits, but still able to offer affordable entertainment * Provide the best games/family sports * Great food * Little or no educational curve * Repeat customers/tournaments/enjoyment * Allow space for other retail tenants (reduce overhead) * Do not compete with our tenants for the same dollar * Provide activities for a large range of age groups * Unique in design with comfortable ambience * Exciting work environment
5.2 Marketing Strategy
Our customers can come from all age groups, male and female, all races, every income level and can be local residents or tourists to the area. That is why our marketing plan started at the construction phase; by keeping in mind, if it looks fun people will come. Thus the main factor to our success is simply that a person can enjoy themselves at our center while participating in an activity they choose.
Our full-time public relations manager is a vital part of our management team, by assuring that customer satisfaction is provided and gathering information from the public about the types of entertainment most desired. This can provide our company with the means to stay in touch with the community and ready to meet their desires.
5.2.1 Pricing Strategy
To establish the following detailed chart, we referred to several factory-pricing recommendations and the local competition.
The following details our pricing and the # of customers per month that we used for our cash flow projections. These projected numbers are 35% +/- of daily operation capacity and being open for business 26 days a month, closed on Sundays. It should also be noted, there maybe activities planned that are not included in our projections. - | Price | Quantity | Go-carts | $5.50 | 7,000/month | Mini-golf | $5.50 | 7,000/month | Driving range | $5.50 | 560/month | Arcade and redemption | $10.00 | 600/month | Sky-coaster | $15.00 | 560/month | Batting cages and pitching lanes | $1.00 | 1,620/month | Climbing walls | $1.50 | 600/month | Bumper boats | $4.50 | 560/month | Restaurant | $3.75 | 10,500/month | Souvenirs | $9.50 | 250/month | Party rooms | $25.00 | 240/month | Air hockey and foosball | $0.50 | 672/month |
All business expenses are detailed in the financials topics. All other direct cost were pre-calculated and added into the Sales Forecast table.
5.2.2 Promotion Strategy
I&B Investments' first objective in promoting our center will be to capitalize on the power of the WORD OF MOUTH.
In every business it is a well-known fact that word-of-mouth advertising is any businesses' best friend or worst enemy. Yet, this does not preclude the fact that announcements, placing advertisements in the local newspapers and our future planned website are not just as important in reaching new customers and will be employed as follows:
Advertising
Getting our positioning message to the public, "family recreation," where fun and customer service is paramount.
Utah's State Tourist Dept
Keeping them aware of our center and all current promotions.
Go-cart Track Signs
Local businesses can buy sign footage and have their signs placed around the track like you would see around any race track.
Freeway & Site Signs
Self explanatory.
Sales Brochure
Informing the public of all the activities found and offered at the center.
Player Rewards
Rewarding customers for spending money through establishing frequent player programs and sponsoring up to $50,000 a year towards prize money awarded through tournament playoff prizes.
Community Involvement
The activities of the center will be promoted as a place to bring your group to participate in events and raise funds for "project name here." These types of fund raising events can request that a portion of each players expenses be donated to their organization (a standard amount will be established).
5.3 Sales Strategy
I&B Investments intends on providing a venue in which the entire family can really enjoy their leisure time by participating in fun and competitive activities that require minimum strength and athletic ability. Supported with great service and offered at competitive prices we have the winning combination.
At our facilities the value of entertainment experience that our customers receives would be considered high compared to per dollar spent ("Biggest bang for your buck" or "You get your moneys worth"), and by providing the best in the area, our management team expects to reach an even broader market than used for our cash flow projections.
Our sales strategy is set on the very basics of business, please our customers and they will return again and again.
5.3.1 Sales Forecast
Sales as per population (exclude tourist)
Using our minimal targeted market population of 418,399 people, we will detail how easily we can reach our projected income goals. * 10% of 418,399 people = 41,839 customers per year, each spending $81.26 per year, or $8.50 per visit and visiting 9.5 times a year. * Or, using our projected average per person expenditures = $8.50 x 1,225 customers daily = $10,412 x 313 days a year = $3,259,112 per year.
This means that we can meet or exceed our projected income if approximately one out of three possible customers visits our center once a year and spends a minimum of $8.50 on that visit.
2006 shows increase in sales caused by the opening of Phase 2.
The following chart shows I&B Investments Projected Sales Forecast and the annual projections for the next five years. Monthly figures are detailed in the appendix. To see activities pricing break down & projected numbers used see topic 4.2.