Laser Tag Business

Laser tag has emerged as one of the amusement industry's heavy weight attractions. From that initial light-saber battle between good and evil, it's a fascination that most people retain through adulthood, which goes a long way to explain the appeal of laser tag games.

Once considered a flash in the pan by industry observers, laser tag has gone from fad to phenomenon. The number of laser tag operators has steadily proliferated and the number of suppliers and manufacturers has settled into a handful of industry professionals as witnessed by anyone that attended any recent IAAPA show. There have been a great many success stories and as manufacturers steadily improve the reliability, precision and durability of their technology, more and more amusement operators are buying in.

At the same time, not all forays into the laser tag business have proven fruitful. Bad location, poor vendor selection and ineffective management will sink any business and laser tag is no exception. Many new amusement developers get into this business without fully understanding it, and need to do their homework, it is a very management-and-marketing-intensive attraction that requires a lot of focus. When people open up and go out of business due to poor planning it does nobody any good and gives the product a bad name.

LOCATION:

There are a lot of conflicting opinions about the nature of the right demographics, the necessary proximity of other commercial activities and the size of the laser tag facility (maze arena) itself. Ideally, a highly residential family-based demographic with a population of at least 100,000, and a warehouse situation with high ceilings and as much as 8,000 square feet is ideal.

Be wary of malls. It might seem like an ideal location, but they put a lot of restrictions on time, space and volume, all of which you need plenty of to run a successful operation. Smaller mall locations that are 1,800 square feet to 3,000 square feet and not really the best choice... after two minutes you've seen the whole course. Malls can be expensive as well - rent as high as $60 per square foot in some high traffic locations. Laser tag can work very well in existing family fun centers as a primary draw for individual games, group events as well as birthday parties.

There are differing opinions on whether laser tag is viable as a stand-alone attraction or requires the synergy of an existing fun park or attraction. One thing is for sure, laser tag must be supplemented with some ancillary amusements or attractions to divert customers waiting in line. Including some kind of complement activity to laser tag with coin-op and some light concessions is a necessity. There is a certain amount of standby time and you want to make sure they are spending their money with you in as many different ways as possible. You want to keep your guests interested and you want to keep them in your facility for as long as possible.

There are still a lot of opportunities in the medium to big cities and stand-alone operators can do quite well in these areas. However, like any new business ventures, there is a lot of red tape. Gaining approval and permits from the relevant government or regulatory bodies can be speeded up if you position your proposal properly. You want to sell the "experience" as a high-tech family entertainment concept, not an arcade. If you are trying to get zoning approval or government permits, you don't want them thinking it's just going to be some teenage hangout.

A large part of the appeal of laser tag is its uniqueness. Most medium-sized markets will support a finite number of operators. Look for fresh turf, but if you are facing competition make sure you have an edge, make sure you have something unique in terms of other attractions to distinguish yourself from other operators. One way to distinguish yourself is in how you theme your play arena. The laser tag experience leands itself very well to themeing, a story-line or something that makes it more than just a great game, but an interactive, high adrenaline blacklight adventure game.

INVESTMENT:

Make no mistake, laser tag is not cheap. After you've purchased or leased a location the material costs of hardware, software and building and theming an arena is easily six figures, although there seems to be two schools of thought:

1) Spend low initially and see where it takes you, or
2) Spend a lot of money on a flashy location, highly themed arena maze in the hopes of attracting people with spectacle.

Spectacle costs more - but in this world of bigger, better, faster - people have expectations of a certain quality of experience for their entertainment dollar.

Some say the most advisable approach is somewhere in between. You are looking at anywhere from $80,000 to $150,000 for a turnkey laser system. Any quality vest that has good battery life, will take a beating from your guests (banging, dropping, bumping and wear and tear) will cost you $4,000 to $6,000 each. Add your facility build-out, arena maze, themeing, check-in, party rooms, etc and very quickly you're topping $300-$400k.

But don't count on every bank financing you, many still see it as an unproven fad, or don't know much about the attraction. It's not yet established a national brand name like a Subway sandwich franchise, for instance. Suppliers offer very optimistic timetables for a return on your investment - any where from one season to two years - but these forecasts are subject to any number of variables and circumstances as unpredictable as the weather.

CHOOSING A VENDOR:

After location, your choice of vendor can make or break you. The number of suppliers has grown to the point where many industry analysts predict a shakeout in the coming years and when the dust settles only a select few could be left standing. When you are making a $150,000 investment, you want to make sure the company will be around to support the product. Look for a manufacturer that has a quality product, but also has some operational know - how.

Look for dependability in the equipment and service after the sale, which everybody says they do but almost nobody does. Get out there and do your won leg work. Look at what the market offers, get references and, if possible, try out as much gear at existing laser tag locations as possible. If it works out for you, a four day pass to the annual IAAPA tradeshow can also be time well spent as many vendors have extensive displays and opportunity to touchy-feel their equipment.

Even though technical advances continue to improve the durability and reliability of the laser tag equipment itself, it is manhandled everyday by customers and the sheer repetition of use will eventually cause breakdowns. When the productis not working, it is not making money. A vendor with an excellent maintenance and technical support program is essential, but price should be only one of many considerations.

Most manufacturers offer some form of proprietary system or technology, you need to ask a vendor if there is a problem do I call you and only you? Or will they put you off to one of their suppliers who built that particular piece of gameware?

You want someone that will teach you how to fix the gear yourself, if necessary and somebody that is accessible, somebody that is two days away by Federal Express in terms of shipping gear back and forth. Each gun can bring in up to $500 a day and each day you don't have it, you are losing that revenue. The technology seems to be moving in the direction of minimalism -- the less gear, the less potential for breakdowns. No matter how great your play system and arena is, your customers will go elsewhere if your hardware starts falling apart.

LAST WORDS:

Play-a-bility. Don't forget that from the point of view of the players it's playability that counts. The game experience versus the amount of money each player leaves at the counter must be an equitable exchange and your guests need to leave feelinig you, your game and your staff have delivered on the adventure experience of laser tag.

Although there are still a lot of questions about laser tag, two things have become clear: the technology has stabilized and the concept itself has proven to more than a fad.