How to Start a Trampoline Park

Overview

How to Start a Trampoline Park

As a child, did you spend hours bouncing on your backyard trampoline? You and your friends probably all tried to enjoy it at once, bouncing precariously close to the edge. Trampoline parks bring that same joy of jumping on trampolines to a larger – and safer – scale. While these businesses are still fairly new, they’ve enjoyed tremendous success so far. Starting a trampoline park of your own can be an exciting business venture and, with careful planning, could provide you with a profitable income for years to come.

Business Overview

Indoor trampoline parks have brought the backyard trampoline to a whole new level. These parks feature multiple trampolines surrounded by safety padding, essentially creating a “floor” that’s made for bouncing and jumping. These parks typically market to kids and families, giving children a safe way to play for hours on end. They also create a valuable social activity, allowing kids to meet other children as they play and making an ideal environment for birthday parties and get-togethers.

These parks have quickly grown from trampoline-only facilities to more involved businesses. Many now combine trampoline centers with other activities, like laser tag, rock climbing wall, or fitness classes. While trampoline parks still market heavily toward kids, they’re enjoyed by teens and adults, too. They are safer than backyard trampolines, large enough for plenty of people to enjoy them at once, and they provide quite the athletic workout.

Industry Summary

According to Market.us, the global trampoline park market reached a valuation of $1,415.2 million in 2018. The market is quickly growing and is predicted to reach $6,897.6 million in value by 2028.

Roller Software reports that trampoline parks first emerged in the mid-2000s, and approximately 1,500 parks currently exist globally. As park popularity has grown, these facilities have begun to appeal to a broad customer base, and they’ve evolved to offer additional activities like rock climbing and laser tag.

Based on a survey that Roller Software conducted from April through June of 2019, the age 6 through 10 age group represented the largest portion of jumpers, at 35%. The 11 to 15-year-old age group was the second-largest group, though toddlers and adults in their 20s and 30s also used these parks. People aged 40 and over use the parks too, but less frequently than other age demographics.

Industry Trends

The indoor trampoline park industry is still relatively new, but it’s already been affected by and responded to many trends. According to US Design Lab, the exercise and physical fitness element of trampoline parks are appealing to many. NASA scientists reported that jumping on a trampoline for 10 minutes offers a better cardiovascular workout than you would see after running for 33 minutes. Parks can harness this benefit to appeal to adults seeking to get fit or parents looking to keep their kids healthy and active.

Themes have become important elements in generating traffic at these parks, too. Themes like date nights, disco nights, and toddler time appeal to different audiences, creating exciting events and expanding a business’ customer base.

These parks are also increasingly being used for different purposes. Fundraising for nonprofits and corporate team-building events are just a few ways that these parks can become more versatile, increase their income streams, and even generate increased traffic during off-peak times.

According to Regiondo, as the trampoline park industry has grown, customers have begun to seek out increased variety. The days of a park consisting only of trampolines are over – now parks need to give customers choices between different activities to keep them engaged. Adding new equipment and activities like ninja courses and rock climbing facilities can help keep these parks appealing, encouraging customers to return again and again.

Target Market

One of the great benefits of a trampoline entertainment center is that it can be tailored to appeal to many audiences. The primary audience will always be families with children who are looking for a way to keep their children active and entertained. Secondary audiences may be adventure-seeking teens and adults who want to experience a day of fun activities, corporate staff seeking a team-building experience, and nonprofits looking for a fundraising opportunity.

Experience Needed

Running an indoor trampoline park doesn’t require a business degree, but certain experiences and skills can be helpful.

Physical fitness and safety background. A background in physical fitness and safety can be an asset when designing a facility and creating fun, stimulating, and safe activities for kids and adults.

Experience working with children. Trampoline parks’ customers are primarily children, so experience and love of working with kids are valuable traits.

Creativity. A little creativity will be highly valuable when designing the facility’s layout and coming up with unique marketing and event ideas.

Customer service skills. Previous customer service experience will be helpful when interacting with customers and ensuring they have a positive experience with every visit.

Management experience. Experience in hiring, training, and managing staff will ensure that a business owner can put together a great team of employees who can represent the park well.

 

Checklist for Starting an Indoor Trampoline Park

Starting an indoor trampoline park can be an incredibly rewarding experience, but it’s important to make sure you’re prepared for the challenges ahead. Use this checklist to help get your business off on the right foot.

Step 1: Write a Business Plan

Starting a trampoline park requires a significant initial investment, and it can also take a few years before the business turns a profit. If you plan to approach banks or investors for funding, then you’ll need to draw up a detailed business plan and include plenty of market research to demonstrate that your plan for the park can be a success.

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 an indoor trampoline park, 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 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 business name 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 trampoline park

Step 4: Select your Location

A facility’s rent or mortgage will depend on the park’s location, the building size, and the amenities that are available. According to the International Association of Trampoline Parks (IATP), a building should have a minimum of 18,000 square feet and a ceiling height of 17 feet high or taller.

Parks located in prime retail and entertainment locations can bring in valuable walk-in traffic, and some parks have had success securing space within shopping malls and plazas. These locations bring premium rental pricing, but the additional revenue may be worth the added expense.

Related: Choosing a business location

Step 5: Register for Business Licenses and Permits

While there are no licenses specifically for an indoor trampoline park, if you will be serving food, then licensing and inspections from the Health Department will be likely.

Additionally, there may be general local, state, and federal business registrations needed, such as a business license, sales tax permit, Employer Identification Number, and others.

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 trampoline park business is another. In order to get a small business loan, the borrower(s) will need to have good credit and be able to personally invest 15-25% 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 is important, not only in generating initial awareness of the business, but also in promoting special events and continuously bringing in new customers. Common marketing techniques include social media marketing, online advertising, print advertising, radio advertising, and more. Loyalty rewards programs can also encourage frequent returning customers.

Related: Low-cost ideas to market a new business

One important marketing task is developing an online presence. A website developer may be out of the budget, but Wix makes it easy for non-technical people to get a website running quickly and affordably.

Step 9: Get Business Insurance

There are several types of insurance to consider when starting an indoor trampoline park. A few of these include:
– General liability insurance helps to protect the park against medical bills and other expenses that might result if a customer is ever injured on the property.
– Commercial property insurance can help cover expenses the park might face if the facility or its equipment were destroyed or destroyed in an event like a fire.
– Worker’s compensation insurance covers expenses like medical bills that the park might face if an employee were ever hurt while on the job.

The cost to insure a trampoline park can vary from provider to provider, and they’re also affected by factors like the location of the business and the value of its equipment. To get the most accurate idea of what to budget for insurance, request quotes from multiple providers. When comparing the quotes, look beyond just the premiums and consider how the deductibles, policy exclusions, and coverage limits differ.

Related: Common types of insurance a business may need

Step 10: Hire Employees

Trampoline parks are family-oriented businesses, so it’s particularly important to find staff who will enjoy working in that environment. Staff who genuinely enjoy working with kids and who have friendly, outgoing personalities can make a great impression on parents and kids. This positive interaction can make each visit to the park memorable for customers, encouraging them to return again in the future.

It takes several employees to run a trampoline park. According to Glassdoor, Skyzone Trampoline Park cashiers make an average of $9 per hour, while assistant managers make approximately $11 per hour. Operations managers make an average of $38,100 per year.

In addition to budgeting for labor costs, other costs come with hiring employees. These expenses can include worker’s compensation insurance, unemployment insurance, and paid time off.

Related: Hiring your first employee

Step 11: Set up an Accounting System

Setting up an accounting system 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 trampoline park?

Startup costs for a trampoline park, especially one that is built from scratch, can be significant. Plan to spend at least $100,000 to start a smaller park, while a larger venue with more activities like rock climbing can cost $2,000,000 or more to start up.

Some common startup costs for a trampoline park include:
– Renovation or construction costs
– Equipment like trampoline flooring, basketball hoops, dodgeballs, foam pit, climbing walls, padding, etc.
– Furniture like benches and tables
– Entertainment accessories like sound and lighting systems
– Refreshments inventory including snacks and drinks
– Signage
– Working capital to cover the first few months of payroll, utilities, insurance, etc.

How much can a trampoline park owner make?

Owning a trampoline park can be highly profitable, especially if it has appealing marketing and events and is located in a prime area where the target market has plenty of disposable income. Soft Play reports that a park in California reports annual profits of $780,000, and some franchises make millions in profits each year.

Keep in mind that those results aren’t typical of a single independent park, but independent parks can still be quite successful. Factors like a park’s location, number of play related competitors, event offerings, and profit margins will all affect its profitability. Careful planning and market research can help to increase the chances of a park being a success.

Are there grants to start a trampoline park?

It’s extremely rare to find a grant to start a trampoline park. 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 trampoline park?

The NAICS code for a trampoline park is 713990.

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?

Are there trampoline park franchise opportunities?

Instead of starting from scratch, there are several trampoline park franchises on the market, with Sky Zone, Air Trampoline Park, Bounce!, and Urban Air being popular choices. Going with this business model, there will be fees additional costs from the initial franchise fee and ongoing royalties that will typically range from 5-8% of total revenue. While this may high, a good franchise will provide name recognition, established procedures, marketing support, training, and buildout support.

Resources:
International Association of Trampoline Parks

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