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How to Start a Bowling Alley

How to Start a Bowling Alley

For many families, a trip to the bowling alley is an essential element of a fun Friday or Saturday night out. The same is true of teens and adults. Bowling is a fabulous hobby and sport, and bowling alleys have evolved to offer great entertainment options for casual bowlers and pros alike. If you have a passion for bowling and want to start a business that could be successful for years and decades to come, it might be time to consider starting a bowling alley.

Business Overview

Bowling alleys offer entertainment for the general population, and for more serious bowlers, they offer a chance to train and compete. These alleys typically consist of multiple lanes, but modern-day alleys can be so much more. It’s common for a bowling alley to not only offer bowling but also to feature food, alcohol, arcade games, and other forms of entertainment. Shoe rentals, food services, bowling leagues, and events like birthday parties are other common income streams for these businesses.

A bowling alley may adopt a specific business model. Some alleys specialize in providing a professional bowling environment and are designed to appeal to professionals with lanes and setups that follow competition regulations. Other alleys take a more liberal approach, focusing on the family entertainment value that bowling offers. Glow-in-the-dark bowling parties, fun decor, upbeat music, and kid-friendly setups all appeal to non-professional bowlers who are looking for entertainment.

Industry Summary

According to IBIS World, the bowling centers industry experienced a 2.4% growth from 2015 to 2020. An increase in disposable income has driven more discretionary spending, resulting in increased demand for entertainment options, like bowling. Bowling alleys also shifted to offer various services, like the availability of arcades, to draw in consumers.

As of 2020, the bowling alley industry was a $4 billion industry. A total of 3,509 businesses employed 73,875 staff. While Bowlero Corporation and Lucky Strike Entertainment LLC are majority holders in the industry, plenty of independently and franchise owned and operated bowling alleys exist, too.

IBIS World predicts that the industry will continue to slowly grow in popularity from 2020 to 2025. Because the number of league bowlers is in decline, more bowling alleys will likely market toward the casual bowler out for entertainment than the professional bowler. This change will likely reduce the number of larger bowling centers, with the focus shifting to smaller local operations.

Industry Trends

The bowling alley industry is shifting as it’s affected by multiple trends. Tourist Attractions & Parks reports that bowling alleys are increasingly expected to offer more varied experiences and activities. As a result, many alleys have started to offer full-service dining to enhance the experience and compete with other entertainment options.

Because the bowling sport culture has changed, bowling alleys need to adjust, too. While bowling used to be league-focused with less emphasis on casual entertainment, that has pivoted. Today, alleys need to appeal to a broad audience, including kids, single adults, and families.

Technology provides alleys with an opportunity to create unique experiences. Overhead monitors, tablet screens, individual lane entertainment systems, and more make bowling fun and entertaining for everyone, encouraging bowlers to get involved with each game.

Target Market

Today’s bowling alleys need to appeal to a broad target market to maximize their profits. While professional bowlers may be a part of the alley’s target market, more casual bowlers seeking entertainment now make up a larger portion of your typical bowling alley’s customer base. Those casual bowlers could be kids, teens, families, and adults. An alley’s target market consists of people who are looking for entertainment, whether it’s a group of teens looking for a fun Friday night out or a parent looking for a great birthday party idea for their child.

Checklist for Starting a Bowling Alley

If you’re thinking about starting a bowling alley, it’s important to do your research first. Here is a checklist to help you get started.

Step 1: Write a Business plan

After coming up with the idea, the next step in starting your business should be to write a bowling alley business plan.  The business plan is an excellent tool to help focus on the important aspects of the business, including the target market, competitors, promotions, projecting income and expenses, and more.

Not only will a bank 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

Step 2: Form a Business Entity

A business entity (also referred to as a business structure) refers to how a business is legally organized to operate. There are four primary business structures to choose from, which include the 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.

When deciding on which business entity is best for a bowling alley, it normally comes down to the sole proprietorship and Limited Liability Company.

A partnership opens the owners up to unnecessary personal liability because if a partner does something to get the business sued, or runs off with cash from the business, the other partners are personally liable to repay.
 
The corporation can be a good choice to minimize liability risk because it separates the business assets from the owner’s assets. If the corporation is sued or certain business debts can’t be paid back, the owners aren’t personally responsible to repay them. The downside to the corporation is that it is more complicated than all the other entities and requires more administration than the LLC. If you plan on raising a lot of investment though, the corporation is usually the better choice.

That leaves the sole proprietorship and LLC.

The sole proprietorship is the least expensive and easiest entity to start which is appealing. The downside is that the owner is personally liable should anything happen to the business, which is an important consideration. The LLC offers the ability to operate as a sole proprietorship with the liability protection of a corporation. Depending on the state, the cost to form an LLC runs from $40 – $500, which is pretty inexpensive for protecting the owners from business-related lawsuits and certain debts.

Related: Guide to forming your LLC
 

Forming an LLC sounds complicated and expensive, but using an entity formation service guides you through the process so you know it was done right.


Some popular LLC formation services include:


IncFile - $0 plus state fees & free registered agent for 1 year!

IncAuthority - $0 plus state fees & free registered agent the first year!

ZenBusiness - $49 plus state fees & free registered agent for 1 year!

Step 3: Name the Business

Finding the perfect name for a business 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 bowling alley

Step 4: Select your Location

Many factors will affect the rent or mortgage costs of a bowling alley, including the condition of the venue, location, size, and amenities. Bowling alleys tend to benefit from being located in a high-visibility area, and when combined with the large size of a bowling alley, the property cost can be significant.

Locating close to other entertainment sources such as malls and movie theaters or on a heavily trafficked road can help bring in customers.

Related: Choosing a business location

Step 5: Apply for Business Licenses and Permits

A bowling alley 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.
Licenses that may be unique to a bowling alley are a liquor license and food handling permit, as food and alcohol can provide a lot of additional revenue for a center.

There are also general business registrations that may be needed which include a business license, sales tax permit, Employer Identification Number, and Occupancy Permit.

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

Step 6: 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 bowling alley is another.  Funding to start a bowling alley business can be difficult due to the high start-up costs.  In order to get a business loan, the borrower(s) will need to have good credit and be able to invest 15-25% of their money towards the total start-up costs.

Related: Finding the money to start a business

Step 7: Open a Business Bank Account

Keeping your small business and personal finances in separate bank accounts is important to track the income and expenses of your business and identify trends.
 
Many banks offer free business checking accounts, so be sure to find a cost-effective option for your business.

Step 8: Get your Marketing Plan in Place

Marketing won’t just help build up an initial customer base but also help bring in new customers to grow the business. Common marketing techniques for bowling alleys include being active on social media platforms, print advertising, radio advertising, online advertising, and more.

Alleys may also have success by establishing a loyalty rewards program to encourage customers to return again and again or having special nights such as hosting league bowling, corporate events, cosmic bowling, etc.

Related: Low-cost ideas to market a new business

Every business is going to need a logo. Make a professional logo in no time with the free logo makers from BrandCrowd and Canva.

Step 9: Get Business Insurance

There are several types of insurance to consider when starting a bowling alley. A few of these include:
– General liability insurance protects the business if customers are ever injured on the property, such as slipping or falling. This policy can help to cover expenses like medical bills or legal fees.
– Commercial property insurance can help to cover the cost of the business’ equipment and building if they’re damaged or destroyed by an event like a fire.
– Worker’s compensation insurance protects the business and covers legal and medical bills if an employee is ever hurt while working.

The cost to insure a bowling alley will vary depending on the business’ location, the value of its building and equipment, and many other factors. It’s best to request quotes from multiple insurance providers to get the most accurate idea of what to budget for insurance. When comparing the quotes, look at how the premiums, coverage limits, exclusions, and deductibles compare.

Related: What types of insurance does a bowling alley need?

Step 10: Hire Employees

Bowling alleys need to be staffed by multiple employees. According to PayScale, the average salaries for bowling alley staff are:
– General/operations manager: $49,000
– Mechanic/pinsetter: $32,000
– Food and beverage manager: $48,000
– Cashier: $25,000

In addition to budgeting for salaries, a business’ budget needs to include employee-related expenses like paid time off, health insurance contributions, and worker’s comp insurance.

Related: Hiring your first employee

Step 11: Set up an Accounting System

Setting up an accounting system for your bowling alley 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 the accounting for your business

The thought of accounting can be intimidating for a lot of new entrepreneurs. There are a number of ways of handling bookkeeping, from DIY to hiring a bookkeeper. These include:

- Pen and paper - Low expense, but difficult to track.
- Spreadsheet - Low expense, but easy to make errors.
- Accounting software - Medium expense, but owner typically inputs expenses. Some great accounting software programs include Freshbooks or Wave Accounting.
- Hire a bookkeeper - Higher expense, though very affordable at $100-$200 per month in most cases. A dedicated bookkeeper will probably save money because, in addition to handling all of the bookkeeping (so you can focus on the business), they also provide personalized tax advice and ensure the business is in compliance.

Find bookkeepers in your local area or use a service like 800Accountant.

How much does it cost to start a bowling alley?

Startup costs to open a bowling alley are significant, with construction being the largest expense. According to Home Advisor, commercial bowling alley construction begins at $45,000 per each lane. That figure includes expenses like installing new equipment and chairs. It doesn’t include the cost of the building or land purchase. Alternatively, renovating an existing bowling alley can be a less expensive option.

Bowling.com estimates that for a new location, expect to $90,000 – $110,000 per lane, including land, building, and equipment, and $50,000 – $65,000 per lane if renovating an existing bowling center.
Some common startup costs for a bowling alley include:
– Building construction or renovation costs
– Ball-return machines
– Bowling lanes – $18,000 (used) – $40,000 (new) per lane
– Supplies like pins, bowling balls, shoes, etc.
Inventory, primarily food
– Furniture including chairs and counters
– Uniforms
– Signage

How much can a bowling alley owner make?

According to Bowling.com, state-of-the-art, well-run bowling alleys can average between 12,000 and 15,000 games per lane per year, with chain-operated bowling alleys averaging 9,250 games each year. Bowling games average $2.00 per game, and for every $1.00 of bowling revenue that an alley sees, it also brings in approximately $0.67 of non-bowling revenue, like shoe rentals and food purchases. According to this data, if a bowling alley averages 11,000 lines, it will make about $36,750 for every lane in operation.

Many factors will affect profits, with the primary being the additional offerings such as a pro shop, pool tables, arcade games, or a concession stand with good food and beer. Also pairing a bowling alley with an arcade, go-carts, or other entertainment can help you to appeal to a broader audience and can encourage families to stay longer, spending more money. You can also develop special theme nights and birthday party packages or start a bowling league or other fun competition to encourage repeat customers.

What skills are needed to run a bowling alley?

Starting a bowling alley doesn’t require a business degree, but certain skills and experiences can give you an advantage in this industry.

Bowling experience. Experience within the industry, either as a bowler or by having worked in a bowling alley, can be advantageous since a business owner will have detailed knowledge about the game, alley operations, and more.

Customer service skills. Interacting with customers is a huge part of owning a bowling alley. A business owner with strong interpersonal skills can make meaningful connections to encourage customers to come back again.

Technical skills. Bowling alleys are full of mechanical equipment that can and often does break. An alley owner who has some basic technical skills may be able to troubleshoot or perform small repairs, saving on the expense of having a technician out to perform repairs. Whether you do it yourself or pay someone, be sure to have a plan in place as lanes that don’t operate can’t generate any income, and it’s critical to have them fully operational on the weekend.

Management experience. A business owner who has previously hired, trained and managed staff will be better prepared for some of the challenges of running a bowling alley than an owner who lacks management experience.

Creativity. Some of the most successful bowling alley businesses have unique themes or offerings, like special event nights or food offerings that consumers won’t find at other bowling alleys. Creativity is important in initially designing the bowling alley and creating offers that will appeal to customers.

Are there grants to start a bowling alley?

It’s extremely rare to find a grant to start a bowling alley. If you search for business grants, you will come across a lot of scams and misinformation. Occasionally an organization will offer grants to start a business, however, be skeptical and don’t provide any sensitive personal information or pay money to get more information.

Legitimate federal grants can be found at Grants.gov, and you can check on your state’s economic development office to see if they have any grants available.

What is the NAICS code for a bowling alley?

The NAICS code for a bowling alley is 713950.

The NAICS code (North American Industry Classification System) is a federal system to classify different types of businesses for the collection and reporting of statistical data.

Related: What is a NAICS code?

Resources:
American Wheelchair Bowling Association
Bowling Proprietors’ Association of America
International Candlepin Bowling Association
National Bowling Association
Professional Bowlers Association
Professional Women’s Bowling Association
United States Bowling Congress

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