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For Free: Your Own Arcade - Not Kidding
SirPeale:
--- Quote from: 1hookedspacecadet on February 03, 2005, 11:25:23 pm ---1. Did he give you the financials? Does the (6 week old) business support itself today or are they still floating part of the monthly costs? Is it making enough to cover all costs today?
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No *specifics*, no, but a very good idea of what it's currently pulling in. Since the guy that owns the building, and the guy that started the arcade are partners in this venture, those costs are either being met, or almost being met. There might be a small loss. Since they're partners, the owner (Craig) isn't charging rent.
--- Quote ---2. Did you get into that much detail? Such as what are the current costs and income? Do they have someone working the arcade or are they watching the shop currently?
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It's been open on and off for the last six weeks, due to comitments elsewhere. Nick's been opening the place up at night (from about 3-8/9) sometimes three days a week, sometimes four.
--- Quote ---3. The renovation is a killer. Would they waive the rent during that time? I would not even think of jumping into something like that until the renovations are complete as that will pretty much kill the biz for the duration.
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That's a good question, and one I didn't think to bring up. Since the renovation will be taking place quite soon, it's more than possible that the new owner will take over after it's done.
--- Quote ---4. You say you would need to cover the expenditures for 6mo which makes it sound like the biz is NOT turning even a $1 profit per/mo.
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Most businesses don't start turning a profit until they're well established. As this has just gotten off the ground six weeks ago, they've got a ways to go.
--- Quote ---5. If it IS covering the total cost of operation including a goober to run the counter, then it may be worthwhile as you can work a second gig until you can get it turning a better profit. This also depends on your contratual obligations - The lease would be one of them, you would want to figure out what, if the biz closed tommorow, wouldyou have to keep paying and for how long?
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The lease is for a year; so if the business fails, yes it would have to be paid. However; the space may be sublet.
SirPeale:
--- Quote from: 1hookedspacecadet on February 03, 2005, 11:32:07 pm ---...if you are able to get some machines in there that you own, you will presumably double the take (assumming a 50-50 split onthe rentals) for each machine you bring in. Then you roll you online stuff into the business for a little more $$, then the multitude of other ideas you have....
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We spoke about this very topic, thanks for bringing it up.
It's actually in my best interests to have *most* of the machines the operator's. Here's why: I move more machines of my own in, the operator isn't making money. He then moves his machines out, leaving me with *squat*. Down the road, if successful enough, this may not be a problem (just move more machines in)
As for the online gaming, the building houses a T1 line. Can you say 'very low lag?'
RetroJames:
It may be then that the biz IS turning a profit in that since they are not applying the rent to the cost of operations yet.
RetroJames:
--- Quote from: Peale on February 03, 2005, 11:40:54 pm ---
Here's why: I move more machines of my own in, the operator isn't making money.
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RetroJames:
Oh yea, see if they have a high dropout rate intown...may add to daytime sales... :)