How to Start a Batting Cage Business

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Quick Reference

As America’s national pastime, baseball is hugely popular. You probably played baseball or softball as a child, and you may still play today. There’s something therapeutic about hitting balls for hours on end, though if you ever tried to find a friend or family member willing to pitch to you for all of that time, you know how difficult that can be.

Batting cages offer a solution, and it’s no wonder that baseball enthusiasts and families out for a day of entertainment can spend hours at the cages. If you love the sport of baseball or softball and want to incorporate that passion into a job, then starting a batting cage business might be a great career move.

Business Overview

Batting cage businesses give baseball and softball enthusiasts a chance to practice their batting in a safe environment. Pitching machines eliminate the need to have a person available to pitch, and they deliver consistent throws so that a player can focus on their batting. Batting cages may be indoors or outdoors, and players purchase time in the cages. Beginner players, youths, and more advanced adults may use these types of facilities.

Batting cages aren’t just for serious baseball players, though. Many families head to the batting cages for a fun afternoon out, while batting cages also offer a source of entertainment for teens. Many sports facilities focus on the entertainment value they can provide, adding concession stands and other options like go-karts and mini-golf courses.

 

Industry Summary

According to Market.Us, the baseball batting training aids market should grow significantly from 2019 to 2028. That increase is likely due to an increase in youth participation in baseball. ESPN states that the number of kids playing baseball and softball, combined, grew by almost 3 million from 2013 to 2018. Participation in soccer and football declined during that same time period. As of 2018, more than 25 million children played baseball or softball, and of those players, 15 million played 13 or more times each year. The MLB has launched several baseball programs for youth, like the Play Ball Program and Fun At Bat Initiative. These programs help introduce kids to the sport, ensuring baseball’s sustainability with young athletes coming up through the ranks.

Based on keyword search results, Topend Sports reports that baseball is not only popular in the United States but also the Dominican Republic, Canada, Puerto Rico, and Cuba.

Industry Trends

USA Today reports that from 2014 to 2019, youth sports participation increased. Programs like the Reviving Baseball in Inner Cities program are increasingly reaching youth who might not otherwise get introduced to the sport, helping to increase the number of kids who take up baseball.

The ASPEN Institute noted that 13.6% of kids ages 6 to 12 played baseball in 2018, making for a total of 4,100,000 young athletes who played the sport. That’s a 3.3% increase over the number of kids who played baseball in 2017. Families spent an average of $660 per year on children who played baseball, and those costs included registration, equipment, travel, lessons, and camps. The ASPEN Institute also noted a decline in physically inactive children, or kids ages 6 through 12 who did not pursue a sport throughout the year. In 2012, 19% of children were physically inactive, but in 2018, that statistic had dropped to just 17.1% of children. The increased awareness of childhood obesity and its related health issues may be partially behind this decline.

From 2016 to 2020, disposable personal income in the United States has increased annually, according to Trading Economics. This increased disposable income means that families are more likely to support kids’ participation in sports and take part in the entertainment aspect, like going to the batting cages as a family.

Target Market

Batting cage businesses may focus on multiple target markets. The primary market is sports and enthusiasts, both youths and adults, who want to perfect their batting skills. Secondary markets are people who seek out batting cages for entertainment, including families and teens.

Skills, experience, and education useful in running a batting cage business

Running a baseball batting cage business doesn’t require a business degree, but certain experiences and skills can be helpful.

Experience playing baseball. A business owner who has experience playing baseball will be able to design the batting cage facility better to meet baseball enthusiasts’ needs.

Customer service skills. Much of this business involves engaging with customers. A business owner who is outgoing and who can establish strong relationships with customers can encourage repeat business.

Management experience. Previous experience hiring, training, and managing employees can help a business owner to build up a strong team of great employees.

Costs to Start a Batting Cage

Startup costs for a batting cage business will vary significantly depending on if you’re remodeling an existing facility or building an all-new facility. Plan to spend at least $20,000 on a remodel of an existing facility to over $400,000 for a brand-new facility.

General guidelines to the number of cages will vary on the population, demographics, and competition. Battingcages.com provides some general estimates on the number of cages based on population:

20,000 – 40,000 – Four Station batting cage with dual machines
40,000 – 80,000 – Five to Seven Station batting cage with dual machines
80,000 – 150,000 – Seven to Eight Station batting cage with dual machines
150,000 + Nine Station batting cage with or without dual machines

Common startup costs for a batting cage business include:

  • Equipment like pitching machines, conveyor system, and safety netting – $20,000 – $300,000
  • Supplies like bats, balls, and helmets – $1,000 – $3,000
  • Computer system and/or cash register system – $200 – $3,000
  • Signage – $500 – $3,000
  • Renovation or construction costs – $??

Steps to Starting a Batting Cage Business

Step 1: Write your Business Plan

After coming up with the idea, the next step in starting your business should be to write a business plan. Not only will a bank or investor require you to have a business plan, but multiple studies have shown that a business plan helps increase the odds of starting a successful business.

Related:
How to write a business plan
Free sample business plans

Step 2: Name the Business

Finding the perfect business name for a batting cage can be challenging. Not only does the name have to resonate with your customers, but it also has to be available to use.

Related: Tips and ideas for naming a batting cage business

Step 3: Form a Business Entity

A business entity refers to how a business is legally organized to operate. There are four primary business entities to choose from: sole proprietorship, partnership, corporation, and Limited Liability Company (LLC). Each type of entity has its own pros and cons, such as liability exposure, costs, and administrative requirements.

Related: Comparison of Business Entities

Step 4: Select your Location

Rent costs will depend on factors like a facility’s location, size, and available amenities. A property located close to a retail area with other types of entertainment venues can bring in more walk-in business and overall public awareness. This can be valuable but be prepared for these properties with prime locations to carry higher rent costs.

Consider whether utilities are included in rent costs. If the facility is outdoors and will rely on lights to allow for nighttime operation, it can significantly drive up electricity bills.

Indoor baseball facilities will allow for all year operation, whereas outdoor cages will only be used during good weather. The challenge is calculating whether the much higher cost and management of an indoor facility is worth it to you.

Related: Choosing a business location

Step 5: Obtain an EIN

The EIN or Employer Identification Number (also called a Federal Employer Identification Number, FEIN, or Federal Tax Identification Number) is a unique 9-digit tax identification number assigned to a business by the Internal Revenue Service (IRS). Similar to a social security number for an individual, the EIN identifies business entities for tax purposes. The EIN will be needed to hire employees, open a bank account, register for business licenses and permits, file federal and state taxes, and more.

There is no cost for the EIN when registering through the IRS. The number is available immediately when applying through the IRS website; however, you can also register by phone, fax, or mailing IRS Form SS-4.

Related: How to Apply for an EIN

Step 6: Apply for Business Licenses and Permits

A batting cage business owner will need to obtain certain business licenses and permits. These permits and licenses can vary based on the state and town where the business is located.

Some common local, state, and federal business registrations a batting cage business may need include a sales tax permit and Employer Identification Number.

Related: Common business licenses, permits, and registrations by state

Step 7: Find Financing

Coming up with a good business idea and having the skills to run it are one thing, but getting the funding to start a batting cage business is another. To get a business loan, the borrower(s) will need to have good credit and invest 15-25% of their money towards the total start-up costs. Private investors will want to own a percentage of the business based on the amount they invest.

Related: Finding the money to start a business

Step 8: Open a Business Bank Account

Keeping your business and personal finances in separate business bank and credit card accounts makes it easier to track the business’s income and expenses.

Step 9: Get your Marketing Plan in Place

Ongoing marketing is essential to keeping a batting cage business running. Marketing can be performed in many ways, but common activities include marketing on social media platforms, print advertising, online advertising, and radio advertising. Establishing relationships with sports leagues and local sporting goods stores can also lead to valuable referral business. A batting cage business may also have success in offering loyalty rewards programs and giving local youth sports leagues, and schools discounted admission. Holding special themed nights and benefit nights can also help bring in new customers and build up the business’s customer base.

Related: Low-cost ideas to market a new business

Step 10: Get Insurance

A batting case business will need several types of insurance for full coverage:

  • General liability insurance helps to protect the business if a customer is ever injured while on the property or while using the batting cages.
  • Commercial property insurance can help to cover expenses a business might face if its property or equipment were ever damaged or destroyed in an event like a fire.
  • Workman’s comp insurance helps to cover expenses like medical bills that might result if an employee were ever hurt while on the job.

Insurance costs will vary depending on the business’ size and location and the value of its equipment. To get the most accurate idea of insurance costs, request quotes from multiple providers. When comparing the quotes, consider not only how the premiums compare but also how other factors like deductibles, the exclusions of each policy, and coverage limits differ.

Related: Common types of insurance a business may need

Step 11: Hiring Employees

A batting cage business will need at least a few staff to cover all of the shifts. According to Glassdoor, batting cage attendants earn an average of $21,010 per year, though salaries can range from $18,000 to $27,000.

Depending on the services offered, the operation can be minimally staffed if a coin-operated only facility or a larger operation could be staffed with baseball coaches, front desk instructors, and maintenance staff. Fortunately, finding the right staff is easier than many businesses, as many people are passionate about baseball and want to see your facility succeed.

In addition to staff salaries, a business will need to be prepared for other costs that come with hiring employees. These expenses can include workman’s comp insurance, unemployment insurance, and paid time off.

Related: Hiring your first employee

Step 12: Set up an Accounting System

Setting up an accounting system for your batting cage business is critical to the long-term success of your business.

Staying on top of taxes not only keeps the business out of trouble with the government, but the numbers can be used to track and monitor trends and cash flow in the business and maximize profits.

Related: Setting up accounting for your business

How much can you potentially make owning a batting cage business?

Batting cage business profits will vary depending on the business’ size, the number of batting cages available, its profit margins, and how long the business has been in operation. A business in an area with many local baseball leagues and a strong sports interest can see decent profits off of these customers. Innovation plays an important role in the business’ profitability, too, and creative marketing can help to bring in and retain new customers.

Most facilities focus on coin or token operated cages, which is the easiest way to manage but is the lowest in profit. Most cages will program machines to throw 12-15 pitches per game, at $1-$4, which lasts around 90 seconds. Profits can be greatly increased by also offering pitching and hitting clinics, video analysis to improve techniques, or one-on-one coaching to increase revenues.

Things to consider before starting a batting cage business

While selling customer’s time in batting cages serves as this business’s main form of income, there are many ways to supplement and upsell customers on other services. A concession stand with refreshments can be a popular addition, encouraging customers to stay longer and buy additional batting time.

Some businesses combine batting cages with other forms of entertainment, like mini-golf or go-karts. This will increase the required size and cost of a facility, but it can pay off in increased profits and a larger customer base.

Depending on the climate of the business’ location, a batting cage business may be a seasonal operation. Indoor businesses can operate year-round, but enthusiasm for the sport may wane over the winter. Consider looking for a way to supplement income during the off-season.

 

Resources:
Little League
Minor League Baseball Players Association
National Adult Baseball Association
National Club Baseball Association
National Softball Association

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