Opening An Arcade in 2025: How to Do it and How Much it Costs

 

The Rise and Return of Arcades

Back in the 1980s, arcades were the ultimate hangout spot for gamers, offering a lively space to gather and play. As home video game consoles grew in popularity, traditional arcades gradually faded. However, recent years have seen a resurgence driven by ticket redemption games, nostalgia for classic gaming, and innovative new titles that aren’t available at home. Today’s arcade audience spans generations—from Baby Boomers to Gen Alpha—and demand for in-person gaming experiences is projected to rise steadily from 2025 to 2032.

Why Open an Arcade?

Launching an arcade offers numerous advantages. Not only does it create a dynamic entertainment venue for all ages, but it also serves as a profitable amenity for larger establishments like movie theaters, bowling alleys, and hotels. Arcades bring people together, promote social interaction, and generate reliable recurring revenue. In this article, we'll explore the practical steps and business potential behind opening your own arcade with support from Bodiluo.

How to Open an Arcade

1. Develop a Business Plan

Begin by identifying the type of arcade you’d like to open and conducting market research. Consider startup costs, operational expenses, and competitors in your area. Many successful arcades combine additional revenue streams, like a bar or café, to attract diverse audiences and increase profitability. A well-prepared business plan will serve as your roadmap and can help attract potential investors.

2. Secure Funding

Initial funding is necessary to cover costs such as leasing a venue, purchasing equipment, and hiring staff. Options include personal savings, business loans, grants, or private investors. Though less expensive than other entertainment businesses, opening an arcade still requires significant capital, particularly for game machines, which often make up over half the startup budget.

3. Choose a Strategic Location

Location is critical for an arcade’s success. Look for areas with high foot traffic, ample parking, and proximity to family-friendly or nightlife destinations like malls, resorts, or college campuses. Avoid selecting a spot based solely on low rent; visibility and accessibility to your target audience matter most.

4. Obtain Permits and Licenses

Regulations vary by city and state, so it’s essential to secure all required business licenses and permits. Register for an EIN via the IRS for tax purposes, and if you plan to serve food or beverages, acquire health and safety permits accordingly.

5. Purchase Games and Equipment

After securing your location and permits, invest in your arcade equipment. Decide on a mix of game types, from redemption and video games to virtual reality and racing simulators. Install a card-based system for game access and consider adding a prize redemption counter to increase customer engagement and loyalty.

6. Market Your Arcade

Create a marketing strategy that blends social media campaigns, local partnerships, events, and traditional advertising. Generating buzz before your grand opening is crucial, particularly if your venue isn’t located in a high-traffic area. Promotions, tournaments, and community events can also drive traffic.

7. Open Your Doors

With your staff trained and games operational, host a soft launch to gather feedback and fine-tune your services. Consider customer suggestions and monitor performance closely in the first few months. As your business grows, reinvest profits into new games and attractions to keep visitors returning.

 

Types of Arcades

When planning your business, decide which type of arcade fits your goals and market:

• Bar Arcades: Classic arcade games paired with food and beverages, targeting adults through nostalgic appeal and events.
• Modern Redemption Arcades: Featuring the latest simulators, VR games, ticket redemption machines, and prize claw machines, these are popular with younger crowds and families.
• Family Entertainment Centers: Combining arcades with attractions like laser tag, mini-golf, or bowling to cater to groups and families.

Costs of Opening an Arcade

Startup expenses depend on factors like arcade type, location, and game selection. A modest arcade typically requires under $300,000 (excluding construction), while larger complexes like Dave & Buster’s can exceed millions. Key expenses include game machines, venue rent, labor, utilities, and marketing. Don’t overlook ongoing costs like maintenance, staffing, and utilities when budgeting for your arcade.

Benefits of Opening an Arcade

• Recurring Revenue: Regular customers and loyalty-driven ticket redemption systems encourage repeat visits and steady income.
• Low Overhead: Once initial investments are covered, overhead remains relatively low compared to other hospitality businesses.
• Compatibility with Other Attractions: Arcades pair well with movie theaters, bowling alleys, hotels, and bars, enhancing the overall entertainment experience.
• Community Engagement: Arcades foster a welcoming, inclusive environment for all ages, encouraging social interaction and word-of-mouth marketing.
• Entertainment Value: More than a business opportunity, arcades deliver memorable fun, creating lasting impressions for guests and boosting adjacent sales in multi-use venues.

Start Your Arcade with Bodiluo

If you’re passionate about gaming and ready to invest in a rewarding, high-energy business, an arcade could be the perfect venture. Bodiluo offers comprehensive startup solutions to help you establish your arcade with ease. From business planning support to equipment sourcing and operational guidance, our team is here to simplify your journey and maximize your success.