The amusement park industry has shown steady traffic and profit growth for over twenty years. But not all amusement parks are successful. While a well-planned amusement park can generate steady profits and huge profits, a poorly-planned theme park can result in a waste of money. To ensure your theme park is a success, for visitors as well as investors, you need to plan carefully, assemble an experienced team to monitor design and construction, and train staff carefully to ensure a smooth opening of the theme park.
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Part 1 of 3: Planning Amusement Parks and Attracting Capital
Step 1. Select the type of amusement park you want to open
You will need to do market research to determine the size of the market and competition in your area. If there is a fairly successful theme park in the area, it will be easy to break into the market if your theme park offers a relatively different experience, in terms of rides or themes. The two main types of amusement parks are water parks and adrenaline-filled amusement parks that have roller coasters and other types of rides. There are seven main types of theme park themes, although many theme parks combine several of them:
- Adventure – Rides full of adrenaline, mystery, action.
- Futurism – Discovery, exploration, science, robotics, science fiction.
- International – A feel of the world, an area with a national theme.
- Nature – Animals, gardens, natural wonders.
- Fantasy – Cartoon characters, magic, myths and legends.
- History and Culture – A historical setting, an area with themes of the past.
- Movies – Rides based on movies, action shows, behind the scenes.
Step 2. Decide between establishing a franchise or starting a new theme park
While starting your own theme park will give you more control over the attractions on offer and the style of the theme park, it also comes with greater risks. Establishing a franchise will provide more support and a proven brand will help raise capital. For people who are new business owners, this is a safer option.
Step 3. Hire an experienced team to conduct a feasibility study
Starting an amusement park requires a lot of capital, and there is no point in wasting time and effort if there is no market for your theme park. The feasibility study will take into account potential locations, theme park concepts, local and tourist markets, as well as industry trends and local competition to estimate costs, revenues and the expected number of visitors in the first year. This last figure is very important, as the number of first year visitors expected will determine the amount of money that needs to be spent to build a park that can accommodate them. If the estimate is too low, your garden will be overcrowded. If the estimate is too high, your park will fail due to the inability to cover development costs.
Step 4. Create a business plan
To attract investors, you need to develop a strategic plan, which will be based on the results of the analysis of the feasibility study. You can find more details on how to write a business plan here, but in general, you should include:
- Business concept: what kind of garden you will create, your strengths and weaknesses, long-term goals, indicators of achievement, beyond profit or loss, that will let you know whether you are a success or a failure.
- Market research: nature of the theme park industry, market size and how much you have to reach to generate a profit, who are your customers, who are your local rivals, how will you advertise the park.
- Marketing plan: how you will communicate with your customers and grow your customer base.
- Operational plan: identify each project that will lead you to accomplish a larger goal. For starters, these projects may include steps to build a park such as finding a favorable location, deciding what type of park to build, hiring an architect, or steps to running a park such as hiring an experienced manager, determining the number of staff needed. and their salaries, placing advertisements, and hiring staff.
- Financial projections: the first things a potential investor will look at include: initial costs such as to purchase land, construction and equipment; operational costs include staff, insurance, facilities, and supplies; marketing costs; projected income from ticket sales, food and beverage sales in parks, games, gift shops, and other sources. Project costs and revenues for at least the first five years.
- You can find an example of a business plan for an amusement park here.
Step 5. Hire an experienced firm to design your theme park
Before approaching a potential investor, you need to have an attractive display sample of your park, which showcases attractions and takes into account zoning, safety, and traffic flow. Designing a theme park requires a wide range of specialized skills from drawing to understanding mechanical engineering and ride safety to managing traffic flow. To make a presentation that can convince potential investors, it's best to hire a firm that has successfully designed amusement parks.
Step 6. Make a mature pitch for investors
Your pitch should be designed with the goal of quickly grabbing the attention of potential investors, impressing them with your financial acumen, and showing them how they're going to make money out of it. Make sure to include:
- One minute “Elevator pitch” (interesting pitch) – This pitch should be practiced until you really get the hang of it. This pitch tells a story that explains the opportunities in the market and how you intend to take advantage of them, and should make investors want to know more. You'll use it when you meet a lot of people by accident-at cocktail parties, elevators-and to start a formal pitch.
- Great PowerPoint presentations-the key is to keep them short and simple. A good presentation should take no more than 15 minutes, which means 12 to 15 slides summarizing the content of your business plan.
- Exit strategy – Make sure your PowerPoint presentation discusses how investments can make money, whether by paying dividends, recapitalizing (making loans to replace investors' money), going public, or selling to other operators.
Step 7. Pitch your amusement park to potential investors
Amusement parks are expensive. The average development cost for each potential visitor in the first year is IDR 1,531,690, which means, if you want to attract one million visitors in the first year, you will need to raise around IDR 1,531,690,000 in capital. Approach banks, venture capitalists, and angel investors (wealthy individuals).
- In addition to the business plan and draft, you will need to write an investor proposal letter. Send very wisely, usually after withdrawing some investment.
- Amusement parks can be difficult to attract. To increase your chances, start with people who have already invested in theme parks or the world of entertainment.
- Investors usually receive proposals unsolicited in the hundreds, most of which are never read. Your best chance is to use a connection who can recommend yourself to potential investors.
Part 2 of 3: Building Your Amusement Park
Step 1. Build your team
You will need several architects, landscape experts, construction firms with experience installing theme park rides, and experienced project managers to guide the project to completion. There are specialized companies that will monitor all aspects of the building, or you can take on that role and choose your own contractor.
Step 2. Choose a location
You should have confirmed two to three potential locations before approaching investors. Now is the time to choose a location, based on availability, cost, and other undisclosed factors from your feasibility study:
- Easy access for locals and tourists alike.
- Climate.
- Environment and business.
- Potential for expansion.
- Placement rules for the proposed site and surrounding area.
Step 3. Finalize the theme park design
The schematic designs used to attract investors must now be explained in detail, including engineering studies for all rides and attractions. Clearly document every aspect of the park to be built.
Step 4. Obtain the necessary permits and licenses
You will need a business license to start construction, as well as a local building permit. In addition, there are various other licenses that are required before the theme park opens, as well as regulations that you need to follow:
- You may need a local and/or state license to serve alcohol/food, a general entertainment license, an amusement park license, etc.
- All states in the United States except Alabama, Mississippi, Wyoming, Utah, Nevada, and South Dakota have rules regarding theme parks, so you need to make sure your theme park complies with the regulations of each region.
- You also need to make sure your amusement park complies with the ASTM International F-24 Committee on Amusement Ride and Devices standards.
Step 5. Announce the elements of your project for auction and determine a timetable for completion
You or the company you have hired to monitor the build should be auctioning various aspects of the build competitively to reduce costs as much as possible. Once you have selected a builder, negotiate a contract and a schedule for completion. Plan to open the park in early summer to maximize the number of early visitors.
Step 6. Build your amusement park
This is where your dreams start to come true. The builders you've hired will construct the buildings, rides, and show sites, then install the ride systems and show components. All attractions will be tested to ensure they are functioning properly.
Part 3 of 3: Opening Your Amusement Park
Step 1. Buy insurance
There are various firms that offer property and liability specific insurance for theme parks. Auction your garden to get the best coverage at the lowest price.
Step 2. Choose a marketing firm to help advertise the amusement park
Even before construction is nearing completion, you will need to hire a firm to help you start advertising your new amusement park through billboards and targeted television, radio, newspaper and online advertising. Also consider offering discounted opening day and first year tickets to increase early visits and create more word of mouth.
Step 3. Hire and train staff to run the park
After determining the number of staff, their positions and salaries, one of the project managers must assume responsibility for the staffing of the amusement park. When the theme park is nearing completion, you need to start training staff for rides, food and drink spots, ticket sales, games, etc. Rehearsals for shows or entertainment features in the park should also begin.
Step 4. Start with a small opening
Invite members of the public to try the theme park before it officially opens. This will give your staff the opportunity to practice with real visitors and allow you to correct operational deficiencies. You may need to plan a trial day for a week or more to help perfect the running of your theme park.
Step 5. Open your amusement park
After all your hard work, the amusement park has finally opened! Invite the media, government officials, celebrities, important investors, and friends to official ribbon-cutting events. Be sure to schedule special events to commemorate the day. You'll want your first-time visitors to be impressed that they will promote the theme park to their friends.
