Kid's Play Place
February 25, 2018 6:42 AM   Subscribe

Mrs. Pyro and I have been playing around with an idea of opening up a kids place (art, imagination play & activities, not a bounce or jungle gym place). The part I’m struggling is whether it’ll ever pay enough for it to make sense. I’ve been trying to run the numbers, but that’s kind of hard since I’m pulling some of the assumptions out of thin air.

Does anyone have any insight into how these places run with regards to expenses & revenue? Even if it’s second hand knowledge.

To try to preempt some follow up questions:
Mrs. Pyro would run it. She has experience with kids (15 years of daycare) and some in-home business experience.
The rest of the workforce would likely be college students (several colleges in the area).
Funding is probably combination of savings & loan (personal/business).
The place would probably be 3-4000 sq ft

I did read this question:

We’re fairly sure we can do a good job of equipping/running the place, as well as marketing. But is that enough? Any and all insight is appreciated.
posted by pyro979 to Work & Money (19 answers total) 3 users marked this as a favorite
Is there a way to test your idea? I really like Pat Flynn's book Will It Fly for testing out / validating / learning the gotchas of new business ideas. Amazon link. Cheesy sales page.
posted by cgg at 6:57 AM on February 25, 2018

not to threadsit, but...
@ccg - I have thought about it. The thing is the business will work, meaning there will be clients. That I'm sure of because I've seen other businesses like this work. The issue is I don't know how to test for the long-term viability. If anyone has ideas about this I'm all open to them.
posted by pyro979 at 7:23 AM on February 25, 2018

That's a lot of square footage, meaning substantial rent. When I bought a business, I did a Pro-forma Profit & Loss Statement. Those are sites that looked good, but I don't have Excel on this laptop, so I didn't test them. I know someone who opened something similar, and it has not been profitable, even with a cafe added. But I think there's a way to maybe do it. If you use the space for child care, it will generate income during the day, then it can be used on evening and weekends for classes, art space, and especially for kids' birthday parties. This would require a lot of planning, but I think it could work. Be wary of assuming you'll find college students to work cheap; it's a tight labor market.
posted by theora55 at 7:39 AM on February 25, 2018 [3 favorites]

Okay, it sounds like you have a good start but need to be a bit more systematic in your research to make sure you are interpreting data correctly and doing a through SWOT analysis. A lot of municipalities have a department that encourages small businesses and provide guidance. If your town doesn't, there may be a non-profit/chamber of commerce/incubator that does, as well, many public libraries are also offering programs and resources (like how many households have children and what their disposable income is).

You need to do a business plan to get a loan, so start on the research for that (lots of samples business plans online) that will again, force you to be systematic about your research. You can't assume anything - ie "rent will be about $1,500/month", you will need to look at three commercial properties and get the actual monthly figures for rent/utilities as well as confirming your business can work within local zoning. Your town councillor can be another resource, they generally really like new small businesses starting up. Have a look at competition/complementary businesses - can you work together?

You also mentioned local colleges, if any have business departments maybe a Prof would be willing to have you pitch your idea to students and get their help in creating a business case as a real-world learning exercise for them.

Good luck!
posted by saucysault at 7:44 AM on February 25, 2018 [1 favorite]

Rent is a big factor here. Our paint and wine places (with kid parties and schools out days) are either way out in the suburbs with long leases or have to move every year further and further from the downtown core (rent hikes and parceling out for tear downs)
posted by tilde at 7:56 AM on February 25, 2018 [3 favorites]

Might be worth emailing similar businesses for their insight? It seems like the type of business model were the owners might be open to mentoring
posted by Ftsqg at 8:19 AM on February 25, 2018

I have a friend who tried making something like this work in suburban MA and it did NOT work. Feel free to drop me a DM and I'd be happy to put you in touch with him and he could, probably, give you some actual numbers to work with.
posted by jessamyn at 9:03 AM on February 25, 2018 [3 favorites]

I've seen or helped half a dozen chef friends open restaurants and I've seen where a lot of surprises come from. This is the general advice I now give to anyone I know who is thinking about opening their own business.

Make sure you are adding up all the services that are recurring expenses, like garbage collection, phone and internet, point of sale systems, exterminators, cleaning services, accounting and payroll services, social media management, security systems like alarms or cameras. Are you running background checks on employees? Know how much that costs.

With larger spaces, utilities can become very expensive very quickly, especially in locations that have very cold winter's or very hot summers.

It is also very easy to underestimate how much labor is actually going into owning and working. Office work can really take up a lot of time and not carving out time for that can lead to problems and burn out.

Also, be aware of economy purchases and don't underestimate how much damage the general public inflicts on floors, furnishings, and walls. For example, I've seen places buy chairs that were cheaper, but don't have replacement parts, so if a seat breaks, the whole thing is trash and must be completely replaced instead of being fixed for a much cheaper amount. Or buying discontinued and discounted floor tile or carpet squares that can't be replaced individually when they get broken or stained.

Make sure you know a plumber, electrician, and a HVAC person. Like, professionals, not just a buddy who can fix stuff with a roll of duct tape and what is in their basement. Plumbing, electrical, and HVAC problems become exponentially more expensive when not fixed properly in the first place.

Turnover with college students is high and they are not always the most reliable employees (especially if they are taking spring, winter, or summer breaks). Take the time to write policy and procedures into a handbook, have a thorough training and development program, and know how disciplinary procedures work to limit unemployment costs and to avoid losing valuable time and money.
posted by August Fury at 9:18 AM on February 25, 2018 [10 favorites]

I work in a business that has some similarities and here are some other things to consider:

- competitive landscape - what else is available in your area - don’t forget libraries and museums
- socioeconomics - with a play place you’re mostly looking at people who can afford to pay to play, where they also can afford one parent home or a nanny for your daytime crowd...which is probably going to be pretty small
- offerings - if you’re offering afterschool or weekend activities, bear in mind that either you have to have wicked awesome ones where older kids will come or your window is extremely tight because once kids are in school that often is the “out of the house” activity. If you still have half-day kindergarten you are lucky; in my province full-day kindergarten killed a lot of this kind of thing
- active evening/weekends...this is where it can get hard. Birthday parties are awesome for revenue and marketing, but you need the space for drop in at the same time, so this requires a lot of planning and thinking about what will be art space, parent space, party space; what can convert and what can’t, what staffing you will need, etc.
- if you are going for art and imagination activities be aware that your staffing costs are going to be higher than running around activities, and your market will be way smaller because parents are probably more likely to pay for Human Habitrail over something they can replicate somewhat at home
-3-4,000 square feet for art and imagination sounds huge to me - have you looked at properties yet?
- seasonality - obviously indoor space does better wherethe climate sucks

Daycare is an entirely different regulatory framework so if you’re thinking of non-parental-supervision you will need to look into that. Home daycares often have loopholes not available to larger businesses.

Employee training and retention will be huge. If you do get there feel free to MeMail me, I’m developing expertise in this area.
posted by warriorqueen at 9:37 AM on February 25, 2018 [3 favorites]

Also I’m a bit concerned about “I’ve seen other businesses like this work.” You really don’t know that unless they’ve opened their books to you or have been there with the same owners for years and years. What tends to happen in these kind of businessses is that you open, you do your marketing, your place is shiny new. Parents come out because they’re up for something new.

Then your staff don’t clean the bathroom before an AlphaMom’s birthday party and she starts trashing you on the local moms FB group every time someone says “anyone had a party at...” - after a year if you didn’t pick your materials right they start to look worn, you lose your a star staff who both shows up on time AND is cheery AND cleans the spills, you have noroviris sweep through one month, you become the place that made the kids sick, gradually word on the street is less on your side and suddenly you are fighting for market share.

Every time your wife is not actually on site, the floor is sticky. She explains how to mop 20 times in one week. A staff member stops showing up and another cuts her hours for midterm studying...the one week you are fully booked.

Meantime your HVAC dripped through the ceiling overnight and left a big stain. Alpha mom comes to another birthday party and posts a shot of the stain with glee. Your supply costs go up because your quantities for ordering are down, minimum wage went up, and you found out a staff member was letting 5 moms in for half their pockets...the week your wife and you were at a family funeral. Also another staff wasn’t on time for a party the day of the funeral and that got posted you have two bad reviews front and centre...and that week made zero profit...

I love my business where I am a mere employee but I deal with all this. I do. But please don’t blithely say you know it can work because it/looks/ like other people have done it. You don’t know if they got a break on rent from a relative, have 5 reliable cousins, or got out after 3 years barely break-even. That said I hope it does work out.
posted by warriorqueen at 9:54 AM on February 25, 2018 [16 favorites]

A little tidbit from the yoga studio I go to...
So, a yoga studio has paying customers for a few hours in the morning (before work and just after kids get dropped off at school) and then is empty till 5 pm, when the after-work crowd comes. The studio owner did a little hustle recently where she started renting out the empty space during the day to ballroom dancers who need a practice space, and found that she makes far more money from that than she does from the yoga.

Similarly, your playspace might be busy with babies from 10-1 and then empty from 1-4, and then you'll have a small after-school crowd. So maybe you can rent it out from 1-4? And evenings a yoga school could come in, or it could become a performance space?
posted by xo at 10:37 AM on February 25, 2018

Seconding that employing students can take a lot of effort and worry. Even when they're mature and enthusiastic and highly skilled, it can be really hard for them to remember that the real world exists outside of their own bubble.
posted by The Underpants Monster at 10:41 AM on February 25, 2018 [2 favorites]

We lived across the street from place like that, lived because it folded after one year. The main issue was cost for rent and staffing. It was targeted at a very specific group of urban parents (think organic food but also organic cleaning supplies etc) plus high quality art materials etc.
Also kids grow and inevitably needs change. Is your location somewhere with a continuous supply of kids or do most have one kid only ?
posted by 15L06 at 11:44 AM on February 25, 2018 [1 favorite]

The one place close to us (suburban Boston) that seems to survive does so because it's attached to a toy store that you have to walk through to get to the indoor playground. It's pretty hard to drag kids out of there without buying anything and at least they have the supplemental income from the retail side.
posted by lydhre at 12:17 PM on February 25, 2018

There was a place like this up the road from us. They charged $30 for your child to paint two plaster animals for one hour. It was dead during the week, hosted the very occasional birthday party on the weekend and was a bit busier during school holidays. I can count on one hand the amount of times I actually saw people there. I think they lasted 18 months. Rent is astronomical around here and they'd have had to be hosting parties around the clock to cover it. For the location, the numbers just didn't add up.
posted by Jubey at 2:22 PM on February 25, 2018 [1 favorite]

There might be a new business government office or non profit that can help you devise a marketing plan and provide cheap or free small business training FYI.

There is a place around here called Coffee and Scream that is part coffee shop, part playground. It's been around for a while so they must be doing something right :)
posted by Calzephyr at 2:45 PM on February 25, 2018 [1 favorite]

You might look at some of the places on this list to get a sense of amenities, pricing, marketing, etc. I can personally attest to the attractiveness of Habitot, Rain or Shine, and Kids Gym (formerly known as We Rock the Spectrum, I think). There are at least 18 places in a metro region of, what, 7 million people; does that give a sense of whether your city could support one over the long term? My experience is that they tend to cost about $15/kid with the first adult free and offer options for memberships or bulk tickets.

Key things about marketing will be figuring out how to market to an ever changing set of parents and how to retain clients even as the kids age. I think it will really help to get into networks of people who advise successive waves of parents (e.g., pediatricians, nannies, etc.) I think this will be most appealing in places where the weather is often bad and where people want to get their kids out of the house (e.g., where homes are small, where parents work from home), and also where people have a little disposable income.

Weekend birthday parties, definitely.

In addition to entrance fees, think about sales. You can sell everything from the daily needs that parents might forget (a water bottle) to consumables (fruit pouches, baby wipes) to things parents didn't know they needed (Kids Gym sells socks with non-slip plastic texture on the bottom for use on the trampoline) to ways they can take the experience home with them (e.g., dress-up clothes) to concessions (e.g., coffee) for the parents. If you could partner with a coffee concession, that would be great. I find almost zero places that manage to fully max out both attractiveness to parents/caregivers and attractiveness to children -- they either are a coffee shop with an afterthought of a play area, or they are a kids place that at best has coffee nearby. I don't know the economics on that; I'm just speaking as a user of these spaces.

Good luck!
posted by slidell at 4:35 PM on February 25, 2018

I just remembered about the success story that is a few suburbs over. It's an indoor/outdoor play centre with a cafe attached and an indoor studio that they rent out for toddler ballet lessons. This place has been a godsend during winter months and is always always jam packed. Their secret is that it's one of the few places that you can take your kids when it's raining. They charge a few dollars entry and probably make the rest of their money in pop tops and banana bread.

The kids can burn off energy, you can have a coffee. My little one also does ballet there and we can have lunch and coffee there after. A lot of mother groups meet there. Basically if you can offer drinks and snacks and somewhere your kid can have fun or a meltdown without getting dirty looks from patrons like you might in a regular cafe, you will be a massive hit with parents. I don't even think you need to offer arts and crafts. Coffee and somewhere to play is enough!
posted by Jubey at 4:36 PM on February 25, 2018 [2 favorites]

Your location matters a lot - different places have wildly different regulations regarding childcare. My parents used to run daycares here in Ontario, and the regulations were super strict, whereas a friend of mine has a sort-of artsy play/school in Australia and she has a lot of freedom to structure it as she likes. Do lots of research before you even start drawing up your plans. Another thing to be prepared for is wow kids can really wreck stuff at an amazing rate, you will need to be repairing/repainting/replacing stuff all the time so make sure you have a budget for that.
posted by 5_13_23_42_69_666 at 5:06 AM on February 26, 2018

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