You’ve always loved puzzles and solving riddles. You’re the first person your friends call when they need help figuring something out. Perhaps you’re an escape room enthusiast, finding escape rooms through apps like Morty and beating all the record times in every escape room you’ve come across.
Your friends and family have told you at some time or another, “You’d be a great game master!” or “You should start an escape room business.” After thinking about it, you’re now seriously considering monetizing your skills. After all, why not?
Gather your courage and read on – this is the first step toward following your escape room dreams. There is never a perfect time to start a new business, but you can set yourself up for success with these tips.
Create a Business Plan
The first step of creating a business is developing a well-rounded business plan. You’ll want your plan to be clear, easy to understand, and cover these main points:
- What will your costs be?
- Who is your demographic?
- What is your brand?
Let’s explore those topics a bit more below.
What Are Your Business Costs?
Because you’ll be operating a brick-and-mortar business, you’ll need to factor in the cost of rent and renovations to make your escape room designs come to life. Additionally, you’ll want to have money set aside for paying general liability insurance, commercial property insurance, and obtaining a business license.
The cost of rent and insurance will depend on the location of your business and which state you’re starting it in. Some states are more affordable than others, not just in terms of rent but also taxes.
Many locations charge rent based on square footage, with costs typically ranging between $50 to $300 per square foot. Renovation expenses will vary contingent on the designs you have in mind. Elaborate designs will cost more to set up and run. Unless you plan on changing your escape room themes often, it’s better to go with high-quality materials and designs built to last.
As for business insurance, there are many factors to consider, including your business classification and which company you go through. Most escape rooms will be classified as small businesses for insurance purposes, but you will still need to shop around for the best plans and prices to match your specific needs.
Who Is Your Demographic?
You’ll need to know what your business’s target demographic is so that you can cater to those people’s specific needs. By catering to your target market, you will entice the customer to choose your business over your competitors.
Escape rooms are popular among varying age groups. Because they are appropriate for all ages, it’s often popular for businesses to use them for team-building exercises. If you live in an area that thrives on tourism, you could leverage it to attract customers to your establishment.
Define Your Brand
Besides cost, defining your brand is crucial for bringing your escape room business to fruition. Knowing your brand will help you stand out from competitors and manage public perception.
Choose a business name and logo that represent you and your business well. Use the logo consistently across all branding so that potential customers will recognize your business immediately. Don’t limit your branding – social media is a powerful tool, and so are good old fashioned tactics like flyers, print ads, and direct mail.
How To Advertise Your Business
There are numerous ways to advertise your escape room business. By knowing your demographic, you can maximize the payoff for spending money on advertising.
For example, if your escape room is in an area popular with tourists, you will want to leverage social media to entice customers into your door.
You can also develop a relationship with local hotels by asking them to recommend your business to their guests. Concierges are always looking for exciting activities for guests to do. Leave some business cards or flyers with local hotel concierges, so they remember to recommend your escape room.
In addition to these more traditional methods, you can also use an escape room app like Morty to help like-minded escape room enthusiasts find your business. Unlike other forms of marketing, Morty explicitly targets people who are already interested in escape rooms. This escape room app is also inclusive, providing information for everyone from casual players to pros.
Steps To Set Up Your Business
Once you’ve put together a plan, the next step is to put it into action. There are several steps that you need to take to make your escape room business a reality.
Obtain Permits & Licenses
You’ll need to obtain all the permits and licenses necessary to operate your business. Failure to obtain the necessary paperwork to run your escape room legally may result in heavy fines or even closure.
If you’re not sure what licenses you need, you can contact your local city or county clerk’s office.
Open a Bank Account & Start Bookkeeping
Setting up a separate bank account will save you a lot of grief in the long run, particularly as far as the IRS is concerned.
Depending on where you live, you may need to collect taxes from customers. In this case, you’ll want to open two bank accounts: one for tax and one for everything else. Having separate bank accounts will help you keep detailed records and make your bookkeeping easier.
If you aren’t confident with bookkeeping, you will want to hire a professional to help you stay organized to avoid any hiccups during tax season. Ask other business owners for recommendations, and spend time reading reviews to ensure you’re working with a professional who will understand your needs.
Open a Credit Card for Your Business
Opening a credit card specifically for your business helps you separate your personal and business expenses. By consolidating it all in one place, you don’t have to worry about holding onto personal credit card statements. It also saves you from providing proof that the purchase was legitimate should you be audited by the IRS.
In addition, you establish a credit history for your company by having a separate credit card. A healthy credit history for your business will be helpful in the future if you need to take out any loans.
Protect Your Business
In the excitement of launching a business, you must not forget to protect your hard work. These protections include forming a legal entity to protect your assets and even using liability waivers.
Form a Legal Entity
The most common legal entities are sole proprietorship, limited liability company (LLC), and corporation.
You’ll want to opt for an LLC or corporation to protect your assets. Forming an LLC or corporation prevents you from being held personally liable if your business encounters a lawsuit.
You can form an LLC or corporation on your own. You only have to pay the business’s base costs if you do the paperwork yourself. However, if possible, you should use a reliable, professional service with years of experience to avoid mistakes.
Use Liability Waivers
Because escape rooms can be high-stress environments that have complex setups, you need to have guests sign liability waivers. Escape room waivers should be custom-made to fit your business. If you do not have a business attorney you can consult, you’ll want to use a professional service to create a suitable liability waiver.
Get Business Insurance
Business insurance is necessary to operate your business legally. However, that is not the only reason it’s important. Business insurance shields your company from numerous risks and protects its financial well-being.
Additionally, if you have employees, you will need to have Workers’ Compensation insurance to protect your business in the unfortunate event one of your employees gets injured on the job.
Design Your Escape Rooms
The fun part of owning an escape room business is being able to plan each room and see it through to completion.
Some things you’ll need to consider as you build each escape room are:
- The theme
- The level of difficulty
- The time limit you’ll put on each room
After deciding on a theme, you’ll need to consider the level of difficulty you want to set for guests. Each room should offer different degrees of difficulty so that even a beginner can enjoy the escape room experience.
As for a time limit, you can opt to have the same length of time applied to each room. Or, to make things more challenging, you can set a shorter duration for more difficult rooms.
Bear in mind that you’ll want to keep the length of time reasonable for other people, so you’ll want to have friends and family do test runs before you open for business. You can even seek out professional escape room writers to advise you. RECON is an annual escape room conference based in Boston, where hundreds of escape room enthusiasts – professional and beginner alike – can connect, network, and learn.
Escape Room Business Forecast
The very first escape room was built in 2007 by Takao Kato. Located in Japan, the concept took off and spread to other countries in Asia before eventually making its way to North America.
As unbelievable as it may seem, there were no escape rooms in the US before 2010. The escape room market has continued to grow since its introduction in 2011. It is expected to continue to experience significant growth through 2028.
Summary
Escape rooms are the best when developed by people who are passionate about them. If you love escape rooms and have an eye for design, this could be the perfect opportunity to build a successful business.
With positive growth expectations for escape rooms predicted for the next five years, now is an excellent time to generate income and create a legacy while doing something you love. You might even spark a love for escape rooms in others!
