Bounce houses have become a top-rated children’s entertainment option in recent years and are a surprisingly effective business model. A savvy business owner can make pretty good money in this field due to low overhead and expenses. Some may even fund these companies by themselves.
If you’re interested in starting a bounce house, the information below can get you on your way. It includes data about necessary equipment, potential expenses, and successful marketing. You’ll get the required skills to start your bounce house business without any specialized training.
1. Budgeting and Planning Your Finances
Typical startup costs for bounce houses range between about $1,700 to close to $250,000. These widely varying prices range between a delivery-based bounce house business and an open-air establishment. Let’s break down some of these expenses to help you understand these costs:
- Bounce House Purchase: About $1,500 for a basic model to up to $2,800 for a combo unit with multiple rooms and other amenities, such as party planning and arcade games.
- Delivery Vehicle: You’ll need a truck or van to haul your deflated bounce house, including a trailer where you can place the house between gigs.
- Amenities: Typically, you’ll need to spend a few hundred dollars on chairs and tables, as well as food and drinks, for your bounce house gigs.
- Facility Options: Depending on where you operate, you can expect facility charges of several thousand dollars for rental or purchase.
- Insurance and Licensing: Expect to pay hundreds or thousands of dollars in insuring your bounce house business, including vehicle licensing fees.
- Operating Costs: You’ll need to cover employee expenses and insurance as well as energy costs for inflating the bounce house and cleaning supplies between each use.
Financing options include personal and business loans, bonds, venture capitalists, friends, and family members. Sit down with these financing professionals and budget out your business. Cover all your expenses for several months to ensure you have time to find a customer base.
Next, you need to consider customer costs for your business. Delivery businesses charge between $125 to $250 for a four-hour rental. Charging $250 and doing two gigs a day will earn you $500 daily or $2,500 per week. Your profit margin is usually around 70% for this business type.
When renting a storefront, charge about $8 to $11 per child to make good and consistent money. Rental periods should be about an hour to ensure that kids can come and go quickly. Private businesses for up to 20 children should at least start at $250 and cover a four-hour period.
2. Handle All the Legal Steps
All businesses must follow specific steps when starting. These include things like licensing your business and registering it properly. The steps below can help you get your bounce house business started and ensure that you get the best results for your needs:
- Register Your Business Name: Pick a clever and fun name for your business, such as “Bounce ‘R Us,” and register it with the proper legal authorities. These include state and federal trademark professionals, as well as online platforms. You want a business name that lets you build a website around it.
- Create a Legal Entity: Choose whether you want a sole proprietorship, partnership, LLC, or corporation. Register your business with state and federal groups, including registering for taxes. Doing so can ensure that your business is appropriately handled.
- Start Business and Credit Accounts: Create separate business savings and credit accounts where you can place your income. Doing so helps to separate your personal finances and streamline accounting. It also helps make your business more professional and legally safer.
- Get Your Licenses and Permits: Find what state licenses and permits your area requires for a bounce house. Often, these include safety training in case any children get hurt. Keep these licenses and permits up to date to avoid threatening your company.
- Obtain a Certificate of Occupancy: If you plan on buying or leasing a space, you need a Certificate of Occupancy (CO) to show that you have met all building and zoning laws. Hire an inspector to make sure you get this certificate. Doing so will prevent you from getting shut down.
Insure Your Company: Try to get umbrella insurance to protect your bounce house company. This extra liability coverage will protect you if children get injured in your houses. It will cover legal expenses and ensure you can stay open after an injury.
These critical steps help you start your bounce house business and minimize legal issues. Just as importantly, they protect you from serious financial complications. Once you’ve handled them, you can market your business and start making some money.
3. Marketing Your Company
Bounce house rooms require some skillful marketing to stand out from other companies. That’s because many people have jumped into this field, thinking they can thrive. Thankfully, there are several steps that you can take to help your business stand out:
- Create a Social Media Presence: Get on all social media channels and start marketing your new company. Interact directly with parents and even children to engage their interests. In this way, you can make sure people know about you.
- Produce Advertising Copy: Traditional advertising methods still work, such as billboards, radio ads, television spots, and newspaper space. Add a few of these ads to your marketing campaign to reach more customers and thrive.
- Hold Free Bounce Room Days: Before your big opening day, hold a few “free bounce” days for the area. Advertise these heavily and film videos to share online. Parents will get a chance to try your services and may be more likely to work with you in the future.
- Plan for Big Days: Birthday parties, holidays, and other big-event days may bring more customers to your bounce house. Try to plan around these days by offering big sales on discounts for significant parties. During slower periods, encourage sales like discounted bounce room hours to attract more customers.
Once you start getting some business, you can gauge whether you want to expand. Expansion is a wise option if there’s a massive demand for your services. Making sure that you develop intelligently is critical because it can mean the difference between success and failure in every field.
4. Expand Your Service Options
When expanding your bounce house services, make sure you do so wisely. Expanding too quickly may threaten your profit margin and imperil your business entirely. Typically, there are a few steps you can take to improve your profitability, including:
- Expanding Bounce House Number: Typically, you can anticipate about 2-4 rentals per week per bounce house. Expanding your bounce house number will increase your profit potential, though you’ll need extra vehicles to haul these items between gigs. That adds to your expenses and must be planned very carefully.
- Offer Party Services: Expand to include slides, dunk tank, carnival fun, face painting, food, concession stands, and even interactive games. Note that these extra items will cost money and may require extra licensing and certification. Talk with your local authorities to learn more.
- Integrate Laser Tag and Arcades: If you have a large indoor facility, consider adding laser tag and arcade games. These expand your services and potentially attract more customers. As with other party services, these extra expenses require careful planning to manage correctly.
- Camp-Based Options: If your area has day and summer camps, market to them and provide specialized attractions. These can include bounce houses for younger kids and more specialized games for preteens and older. You can provide daily rental or even entertainment for the camp’s full duration.
With each of these service expansions, you’ll likely need to hire more employees and invest in new equipment. Make sure your budget can handle these new expenses before expanding. A controlled and reasonable expansion is better than one that’s too fast. You can try out these different options to see how well they work and adjust them, as needed, to ensure that you feel comfortable with them.