An e-mail I received this
morning emphasizes my point perfectly: “I’m an investor with a love for
flying teenagers and providing things for kids to do besides drugs. Although
I love kids, I also like to make money for myself and my investors, many of
whom will be skaters’ parents. As popular as the sport is, it looks like
you’d have to be an idiot not to make money with a park.” Signed Mr.
X from Texas. Okay, what was the question again? Of course there is no
question. All Mr. X wants is validation of his belief that he can throw down
a few ramps and have a grip of cash in no time.
Logic such
as this tends to be based upon the assumption that the success of free
public skateparks is an indicator of the potential success of a private
facility. Most free municipal facilities will get a session no matter what,
even when the kids know it’s crap. That is because it’s free. Charging
someone money to skate even once, let alone developing a repeat clientele,
is another thing entirely. To date, a direct correlation between the success
of free public parks and that of private parks has yet to be established. Of
course, private skateparks can be dynamic and profitable business ventures,
but it has to be done right. And even then there are no guarantees. No
market is ever hot enough to jump into without the proper research and
planning. And like Grandpa was fond of saying, “Be careful before running
out and borrowing a lot of other people’s money, because when you can’t pay
them back, they will sue you.”
Private
Skatepark 101
Unless one
comes from within the industry, prospective skatepark owners should prepare
for a steep and possibly uncomfortable learning curve. Being open-minded and
tolerant is the best practice. Go with the flow. Skateboarding is a dynamic
industry that is driven by emotion and defies most attempts at definition
using standard business language. Previous job experience has value, but is
not enough. Of course, I can already hear Mr. Fifteen Years At Such-And-Such
Job and Ms. Managed A Chain Of Retail Outlets gearing up to tell me how
wrong I am. Again, that experience has value and will be beneficial at some
point, but it’s not enough. There will be as much to unlearn as to learn.
Don’t try to make skating conform to outsider ideals. It will not.
In my
experience, the more one is exposed to something, the more readily they can
discern the good from the bad. Begin by visiting skateparks and talking to
owners and/or staff. Travel across the country if need be. Keep an eye on
the industry press, as it’s a useful source of information. Read all of the
industry magazines, even the ones that appear juvenile. The ones that have
been at it for years know the market well. Perhaps most important, seek out
and take advice from professionals within the skateboard and skatepark
industry from the beginning. And don’t expect that knowledge to be free. Professional skatepark
designers should be among the first considered as most know first-hand what
it takes to construct a skatepark. Don’t forget about owners of existing
private skateparks. Chances are they can be hired as a consultant unless the
park that you are planning is across the street from theirs. Likewise, the
manager of a local skate-shop is another great resource. Sooner or later a
staff will be required for any skatepark facility. Why not start networking
and recruiting from the beginning? Again, don’t balk at paying for someone
else’s time and knowledge. Compensating someone demonstrates that you are
serious about the project and that you value the individuals’ expertise.
Expect to spend anywhere from two to five thousand dollars laying the
conceptual groundwork for a private skatepark facility. This is money well
spent and a drop in the bucket if plans move forward. Look at it this way.
The advice of qualified individuals will likely cost less than the fees of a
bankruptcy attorney if the project goes pear shape due to lack preparation.
Develop A
Business And Marketing Plan
A for-profit
skatepark is a business, pure and simple. To begin, it’s necessary to
develop a business and marketing plan based upon local demographic
information. Unsure of what a business plan is? Start the research there.
Without a business plan the best idea stands a much worse chance. It’s a
nuts and bolts outline of what the business will be and how it will grow.
From space requirements to design, construction, insurance, utilities, and
amenities, it all needs to be in there. Also include a detailed narrative of
how it will be accomplished, and back everything up with cost and income
projections, including the promotion and marketing strategy. Then use it
like a road map. Don’t even begin to approach bankers and other investors
without a completed business plan or they will laugh the concept right out
the door.
Developing a
business plan is not that difficult, it simply takes time and effort. There
are dozens of books at the local bookstore or public library on the subject.
There is also a great deal of software available, both for purchase and as
shareware. My computer came with a business-plan builder as part of the
operating system. There are also many firms that specialize in obtaining and
compiling this information for a fee.
Getting A Feel For The Numbers
In order to
make any financial projections, one must be able to accurately predict the
number of potential customers. The easiest way to do this is scope out the
nearest private park and count traffic for a couple of weeks to gauge the
market. Find out how much they charge for admission and do the math. That
will give some indication of a monthly break-even point for their facility.
If there are no other private parks in the vicinity, a well-designed survey
within the community will determine if the need is really there. Consider
contracting with a professional marketing firm unless you have expertise in
this area. Avoid the temptation to take demographic data from another region
and plug them into a business plan. They may look good, but will have little
meaning and the banker will catch it first thing. In the end, it should be
relatively clear whether the market can reasonably be expected to support
the business or not.
Know Your “Target”
Market
Any
potential for-profit skatepark owner without extensive skate experience
and/or time spent working within the skate industry will not know the
intended market. For starters, I recommend throwing out any vague, idealized
concept of the future customer, “the average skater”—the one on television,
the well-behaved youth, cap turned backward snacking on yogurt in a tube or
whatever else. If only it were that simple. Hopefully it’s no surprise that
many skaters who consistently go to private skateparks are older. They can
afford to pay on a regular basis to skate, have the means to get there, and
possess the skills to skate the larger transitions and terrain that private
skateparks typically offer.
Get ready
for a mixture of individuals. Everything from the eight-year-old “first time
at the skatepark with Cousin Eddie” to a 24-year-old construction worker
straight from a job site and a slight detour for beer. They both want to
skate, but have significantly different needs. Your business will have to
identify and meet the needs of those customers and everyone else in between.
Any decent
skatepark must have the events, staff, and infrastructure in place to
provide all customers with a safe, comfortable place to skate. Again,
tolerance and open mindedness is the key. Don’t sweat anything that’s not
directly related to running a safe, comfortable facility for the customers.
Getting hung up on the tattoos, piercings, language, or whatever is just
spinning the wheels. The fastest way to alienate your customer and their
money is with a bunch of arbitrary rules.
A Space, Design, And Construction
Indoors or
outdoors? Concrete or wood ramps? The questions really begin to pick up now.
Many private parks are located within existing buildings for economic
reasons. When renting a building, most everything is there with the
exception of the skating elements and whatever additional amenities the
owner chooses to provide. The biggest benefit is if the business goes bust,
the stuff just gets pulled out. But, this also presents a number of design
and fabrication restrictions. The best and most successful private
skateparks tend to be ones that offer a combination of concrete and wood
elements. That is the surest way to meet the needs of all skill levels. The
down side to going that direction is that concrete is permanent, and if the
venture fails, a great deal more money will have to be spent just turning
the facility back into a warehouse.
No matter
what, consult the city regarding all code requirements that must be met. The
most common requirements to catch folks off guard are the number of
bathrooms and parking spaces required for the facility. This is usually
based upon the square footage of the building and its intended use. What may
have been adequate parking when the place was a machine shop may not be when
it’s a skatepark.
In the end,
whether made from concrete or wood, the overall popularity of any skatepark
will be determined by its design, construction, and the environment that
surrounds it. Any potential skatepark owner or investor would be wise to
consult with a skatepark professional every step of the way. Stick to the
reputable skatepark design and construction firms with a number of
successful parks to their credit. Always check their references, and don’t
forget the contract.
How
Much Money Will I Make?
The big
question with the enigmatic answer. It depends. Let’s say we have a
thoughtfully designed skatepark in the right location with proper promotion,
marketing, and management. This operation is overseen by an owner who
remains an active part of the business. By that I mean working the typical
50 to 80 hours a week like any other entrepreneur starting out. This team
should stand a pretty good chance of growing a business and turning a
reasonable profit. Eventually, the owner may be able to delegate
responsibility and assume a greater managerial role, or even absentee
ownership. But don’t take that to the bank, because currently many private
skateparks do not turn a profit. Or, if they do, it’s not much.
