Written by Elma Steven | Updated on July, 2024
Find Out- Is Axe Throwing Business Profitable?
The profitability of your Axe Throwing business depends on 4 important factors: Industry Prospects, Investments, Revenue Sources, Cost and Profitability. We have taken a deep dive to find out potential profitability from the Axe Throwing business.
Axe Throwing Industry Prospects
The Axe Throwing Centers industry in the US had an estimated market size of $329.2 million in 2024, with a projected growth rate of 1.4% over the past five years (ibisworld). Additionally, the global axe throwing industry revenue was estimated to be about $215 million in 2023, with an annualized growth rate of 1.9% over the past five years (xola).
Investments
Venue Fit-Out or Renovation: Costs associated with transforming an existing space into an axe throwing venue. This may include construction work for throwing lanes, safety barriers, soundproofing, ventilation improvements and general decor to create the desired ambiance.
Throwing Lanes and Targets: Investment in building or installing professional-grade axe throwing lanes, including the construction of lanes with appropriate safety barriers and durable targets that can withstand repeated axe impacts.
Axe Inventory: Purchase of a variety of axes suitable for participants of different skill levels. This includes initial investment in quality axes and replacements for wear and tear.
Safety Equipment: Costs for acquiring necessary safety equipment for customers and staff, including protective eyewear, first aid kits and any other recommended safety gear.
Furniture and Fixtures: Purchase of furniture for customer seating areas, reception desks, scorekeeping stations and any additional fixtures needed to outfit the venue, such as lighting and decor to enhance the thematic experience.
Point of Sale (POS) System and Software: Investment in a POS system for managing bookings, payments and customer waivers, as well as back-office management software for scheduling, inventory tracking and financial reporting.
Audio/Visual Equipment: Costs associated with setting up an audio system for background music, microphones for announcements or hosting events and any digital screens for displaying scores or promotional content.
Computer and Office Equipment: Purchase of computers, printers and networking equipment necessary for administrative tasks, customer service and managing bookings.
Signage and Branding: Investment in exterior and interior signage, including brand logo displays, safety instructions and promotional materials to attract attention and guide customers within the venue.
Initial Marketing and Promotional Materials: Costs for initial marketing efforts to launch your business, including website development, social media setup, digital and print advertising and promotional events to generate initial interest and bookings.
Licenses, Permits and Insurance: Upfront fees for obtaining necessary business licenses, permits for operating an entertainment venue and comprehensive insurance coverage, including liability insurance specifically tailored to the unique risks of an axe throwing business.
Training and Certification: Costs associated with training for you and your staff in axe throwing instruction, safety protocols and first aid, including any certification programs that enhance the credibility and safety of your operation.
By carefully planning for these CapEx items, you can ensure that your axe throwing business in Omaha is well-equipped and ready to offer a safe, enjoyable and unique experience for your customers. It’s advisable to conduct thorough market research and consult with industry experts or a financial advisor to accurately estimate these costs and develop a comprehensive business plan.
Revenue
- Lane Rentals: The primary source of revenue will likely come from customers renting lanes for a specified period. Rates can vary based on the day of the week, time of day and number of participants.
- Group Events and Parties: Hosting group events, such as corporate team-building sessions, birthday parties, bachelor/bachelorette parties and family gatherings. These events often book multiple lanes and longer time slots and you can offer package deals.
- Memberships and Leagues: Offering memberships for regular customers that provide benefits such as discounted rates, exclusive booking times, or member-only events. Organizing axe throwing leagues and tournaments can also attract repeat business and foster a community around your venue.
- Walk-ins: Encouraging walk-in customers can generate additional revenue, especially during off-peak times. Offering introductory sessions or quick-play options can attract curious passersby or impulse visits.
- Merchandise Sales: Selling branded merchandise, such as t-shirts, hats, water bottles and even custom axes. Merchandise can promote your brand while providing an additional income stream.
- Food and Beverage: If your venue includes a kitchen or bar, selling food and beverages can significantly increase revenue. Even without full kitchen facilities, offering snacks, soft drinks and possibly a selection of alcoholic beverages (subject to licensing) can add value to the customer experience.
- Private Lessons and Workshops: Providing private axe throwing lessons or workshops on technique and safety for individuals or small groups. These can be priced higher than standard lane rentals due to the personalized attention.
- Event Hosting and Sponsorships: Hosting special events, such as tournaments, charity fundraisers, or themed nights (e.g., Halloween, Valentine’s Day) that can draw larger crowds. Sponsorships from local businesses for these events can also provide additional revenue.
- Gift Cards and Vouchers: Selling gift cards or vouchers, especially during holiday seasons or special promotions. These can attract new customers and encourage repeat visits.
- Corporate Packages: Developing tailored packages for corporate clients that may include lane rentals, food and beverage services and even branded merchandise. These packages can be an attractive option for businesses looking for unique team-building or client entertainment options.
- Affiliate Programs and Partnerships: Establishing partnerships with local businesses, hotels, or tourism boards to offer axe throwing as part of a broader entertainment package. Affiliates can refer customers to your business for a commission or special rate.
- Photography and Video Services: Offering to capture professional photos or videos of customers’ axe throwing experiences. This service can be especially popular with groups celebrating special occasions.
By leveraging these diverse revenue streams, your axe throwing business in Omaha can cater to a wide range of customer interests and maximize income potential. It’s important to continuously assess the demand for your services, adjust your offerings based on customer feedback and stay informed about the latest trends and innovations in the entertainment and leisure industry to remain competitive.
Cost of Services Sold
- Axe and Equipment Maintenance: The costs associated with maintaining, repairing, or replacing axes and safety equipment. This includes sharpening axes, replacing handles and ensuring all safety gear meets regulatory standards.
- Lane Upkeep: Expenses for repairing and maintaining throwing lanes, including target replacement, backboard repairs and any wear and tear on the lane surfaces or protective barriers.
- Utility Costs Tied to Service Delivery: Additional electricity and water usage costs that increase with the number of clients served, such as lighting for lanes and cleaning facilities after use.
- Staff Wages for Coaches and Safety Officers: Wages paid to employees who directly facilitate the axe throwing experience, including instructors, safety officers and event coordinators. These costs vary with the number of bookings and the need for staff on-site.
- Consumables: Costs for items that need regular replacement due to wear and tear or single use, such as paper targets, cleaning supplies and any disposable safety equipment.
- Customer Onboarding Materials: Expenses related to producing safety briefings, instructional materials and waivers for customers. This can include printing costs and any digital platform fees for managing electronic waivers.
- Software Subscription Fees for Booking and Scheduling: Variable costs associated with software platforms that manage bookings, customer waivers and event scheduling. These fees often scale with the volume of transactions or users.
- Event Supplies: For special events or group bookings, the cost of any themed decorations, trophies or prizes for tournaments and additional staffing needs specific to the event.
- Payment Processing Fees: Fees charged for processing customer payments, typically a percentage of the transaction amount. These fees increase with the volume of sales.
- Insurance Premiums Tied to Volume: While the base insurance cost is fixed, additional premiums may apply for higher-risk events or if insurance costs are tied to sales volume or the number of participants.
Efficiently managing these variable costs involves regularly reviewing supplier contracts, maintaining equipment to prevent costly repairs and optimizing staff scheduling to match customer demand. Additionally, implementing energy-efficient practices and negotiating favorable rates for consumables and software services can help reduce the impact of these costs on your overall profitability.
Operating Expenses
- Rent or Lease Payments: The monthly payments for leasing the space where the axe throwing facility is located. This is one of the most significant fixed costs and does not fluctuate with the business volume.
- Utilities: Regular expenses for electricity, water, gas and internet services necessary to maintain an operational facility. These costs can be somewhat variable but are largely considered fixed operational expenses.
- Salaries and Wages: Payments to permanent staff, including managers, administrative personnel and maintenance staff. This category also includes payroll taxes, health insurance, retirement benefits and other employee-related expenses.
- Marketing and Advertising: Costs associated with promoting the axe throwing business to attract new customers and retain existing ones. This can include online advertising, social media marketing, print advertising, signage and promotional events.
- Professional Services: Fees for services provided by accountants, lawyers, consultants and other professionals who assist with the legal, financial and operational aspects of running the business. This includes tax planning, compliance advice and business strategy consultation.
- Office Supplies and Equipment: Expenses for office supplies (paper, ink, etc.) and equipment (computers, printers, phones) necessary for the administration of your business.
- Software Subscriptions: Ongoing costs for business management software, including customer relationship management (CRM) systems, booking and scheduling software, accounting software and any other software tools that facilitate business operations.
- Insurance: Premiums for comprehensive business insurance coverage, including general liability insurance, property insurance for any owned equipment and the facility itself and workers’ compensation insurance.
- Maintenance and Repairs: Regular maintenance and any necessary repairs of the facility not directly related to axe throwing equipment, such as HVAC systems, roofing, plumbing and electrical systems.
- Training and Development: Costs associated with professional development and training for administrative staff and management, including seminars, workshops and certifications that are not directly related to axe throwing instruction.
- Travel and Entertainment: Expenses related to business travel for attending industry conferences, seminars, or marketing events, as well as any entertainment expenses for hosting business meetings with potential partners or clients.
- Depreciation: Non-cash expenses that account for the depreciation of tangible assets over their useful life, such as office furniture, computers and any vehicles owned by the business.
Efficient management of these operating expenses is crucial for ensuring the profitability and sustainability of your axe throwing business. Regular review and careful planning of expenses, seeking cost-effective solutions and strategic investments in marketing and staff development can significantly impact your business’s growth and success.
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