How do you start an escape room business?

You start an escape room business by creating a business plan, planning your resources and finances, and registering as a business entity. Escape rooms have become a booming industry, but you don't want to start this business without a plan.

The first step is to research, determining if there is a target market for an escape room business in your area. Typically escape room bookings come from:

• Social outings with family or friends

• Private events like birthday parties, bachelorette parties, and other celebratory events

• Corporations or other businesses looking for team-building events

• High schools, colleges, or universities

• Clubs looking to organize social events

Corporate clients are typically the most profitable, but they can also have more particular requirements than other customer groups. You may want to consider having additional amenities for corporate events and large groups like:

• Conference room (for meetings beforehand or after to discuss the event)

• Projector or TV for presentations

• Food and drink packages

Another consideration you will need to keep in mind is whether or not you want to have an appointment-only business or if you want to accommodate walk-in players. If you want to focus on walk-in players, finding a location near a shopping mall or other high-traffic areas may be a good idea.

It is important to remember that locations with a high possibility of people walking by and seeing your business will also come with a heftier price tag. With an idea of how you want your business to operate, you can now dive into the specifics of the business. For example:

• Will you franchise or create a new brand?

• Will you build your rooms or buy ready-made rooms (theme and puzzles only or fully turnkey)?

• How many escape games and rooms will your business have (e.g., will you have multiple rooms with the same game so players can compete against each other)?

• Which themes will your business use?

• What is your marketing strategy?

• What type (and how many) employees do you plan to have?

• How do you plan to build your rooms, and who will undertake the work?

To answer some of these questions, you will want to research your competition and determine the following:

• What themes are they using for their games?

• What types of players do they seem to target?

• What are their key/most effective marketing channels?

Now that you know how to set up your business, it is time to plan your resources and finances. If you have decided to build a new escape room brand, you will have complete freedom to execute your business plan how you see fit. While this can be exhilarating, it can also be quite daunting.

You will need to have resources for the following, and you will need to decide what you will outsource and what you will hire for directly:

• Legal

• Accounting

• Building engineer

• marketing/graphic design

• Room design

If you go through a franchise, the franchisor will guide you through setting up your escape room, training your staff, and other setup requirements. You will also likely have access to their legal, accounting, and marketing teams to assist with promoting your business.

One of the biggest and most important resources you will need to decide on is the location of your business. You will need a convenient and easily accessible location if you want more corporate clients. If you want more walk-in players, you will need a location near a high-traffic area.

• Lighting

• Internet

• Electric

• Painting

• Flooring

• HVAC

• Bathrooms

In addition to one-time costs, you will need to account for your ongoing monthly expenses like:

• Rent

• Utility bills

• Payroll

• Consumables (e.g., cleaning supplies, toilet paper, hand wash)

• Insurance premiums

• Merchant fees for processing card payments

• Monthly or annual fees for services (e.g., accounting)

• Prop maintenance or repair

• Marketing and advertising expenses

Next, you must register, license, and insure your business. Registering your business means deciding if you will operate as a sole proprietor, partnership, or limited liability corporation (LLC).

The primary advantage of an LLC is that it reduces your personal financial risk. A sole proprietorship is simple to set up, as is a partnership if you're going into business with other people. However, both of those structures leave you exposed to any financial liability that might come up from operating your business.

Once you have decided how you will operate, it is time to choose a business name. You want something unique and easily identifiable related to the industry or business. Once you have a short list of names, you can go to www.uspto.gov to see if they are available.

In addition to registering your business, you must ensure that you have the appropriate insurance coverage. At a minimum, you will need to have general liability insurance. This coverage protects your client's physical property and protects you if something happens while operating your business.

While not required, it is recommended that you also have the following insurance policies:

• Worker's Compensation: This covers employee medical costs and a percentage of their lost wages if they are hurt on the job.

• Professional Liability: This helps to pay for work oversights that can result in a financial loss. For example, if someone says you didn't deliver the services you said you would provide, they can ask you to pay for any losses. Professional liability can help cover the costs of defending your business or fixing the problem.

You will also likely need to obtain permits and licenses before operating. These will vary based on location, so it is a good idea to reference your state's licensing and permitting requirements. Keep in mind that there may be additional city or county requirements.

At a minimum, you will likely need to obtain a Certificate of Occupancy (CO). This confirms that all building codes, zoning laws, and government regulations have been met. If you rent or lease the property, the landlord will be responsible for obtaining and providing the CO.

Once your business is registered, and your permits are in place, you are ready to get building and get your customers through the door. Whether you have decided to purchase the turnkey themes or do a DIY, you can now get the rooms ready for use. Plan the game and puzzle flow for how players move through the game.

Determine how one part of the game will need to the next and how the players will be guided along. Sort all of these out before opening your doors for business. You should also remember that what may be "obvious" to you may not be to someone else, so make everything as self-explanatory as possible.