Business Origin and Structure: Game Arcade Center - Paper Example

Published: 2021-08-18
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Boston College
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Service delivery is one of the most profitable businesses around the world to invest capital. Any entrepreneur who seeks to become successful in business should follow the right business structures to attain the best (2002, p. 4). In my case, I choose to venture into arcade game center which is a service delivery entity. This is a start-up business where I will be offering gaming services to young people and game lovers. I have background knowledge of gaming techniques which I wish to put into practice in my business entity. The game arcade center will be a sole proprietor structure where I will be running all the affairs of the business.

Game arcade center is an easy business to start and run, as one person will enjoy a sole proprietor, the benefits of the business, unlike other business structures. The licensing of the business is cheaper compared to other business. Another advantage of a game arcade center is that it has little legal requirements. At the same time, there is need to acquire a noise regulation license since I will be playing music at the arcade center. This business venture is targeting young people who are seeking entertainment avenues. Gaming is a common way of having fun among the young people. With a gaming arcade center, I will provide an ageless taste of games. More importantly, I will be targeting young children; therefore my investment will mostly be in less violent games. However, as the business expands and new opportunities expand I will provide a mix of all type of games. This is to increase revenue collection and builds a business name out of the entertainment industry.

Market Research

Competitor Analysis

Gaming business has numerous competitors ranging from online gaming stores to gaming arcade franchise. However, the market is not flooded, hence the need to invest in the gaming industry. The market has not been adequately tapped; there exists an opportunity in the gaming market which prompts a gaming arcade center business. The area of set up has only gaming center which provides only video games. Setting a gaming franchise will be more competitive in the market. Through this gaming arcade, there will be less to worry about in competition. However, the greatest competition comes from online gaming stores which provide a variety of games. They are also cheaper compared to games in the arcade center. Also, there are little maintenance costs since the games are played through the internet. This is the likely competition that the startup business will face. Besides keeping up competitor's low pricing, the business is also expected to face branding challenges. This is due to the similarity in games in the current market. However, to cope with the stiff competition in the market, the startup business will be based on customer loyalty, branding and discount to manage the current low prices in the market (2002, p. 70).

Demand for Service

The gaming centers mostly target youngsters who generate the highest revenue in arcade game centers (2003, p. 378). This is due to their adventurous spirit which the old people have lost touch with due to family responsibilities. The demand for the service is classified as follows

Young Professionals: according to recent statistics, young male professionals are the most consumers of gaming services. This group mostly spends time playing games after work sessions to blow away work stress. This group is key in a gaming arcade since they have more money to spend which leads to an increase in revenue generation.

College and High School Students: this group mostly has a lot of free time which is mostly spent on gaming centers. Most students spend time exploring things they did not enjoy when they were children. They may not have a lot of money as the first group but they play an important role in a gaming arcade since they are large in number.

Children: Mostly gaming centers target children since they provide the greatest demand in the market. However, they have limited time in going to arcade canters due to restrictions by parents and lack of money. Despite that, they cannot be ignored since they bring revenue in a business venture. The parents mostly regulate the demand for gaming services in this group but they are the most consumers of the gaming network.


Amount Needed

The total finance needed for the startup business totals to $67,500. The investment is required at the beginning of the business venture. The below table summarizes the expenses and the investment plan for the money.

Arcade Game Center


Business Cost

Wiring $700

Art Design $3,000

Marketing $2,000

Licenses $1,300

6 Months Space Rent Deposit $18,000

Total Business Cost $25,000

Business Total Assets

Cash At Hand On Opening Day $1000

Wages $5,500

Current Assets $6,500

Long-Term Assets

Computer Installments $30,000

Network Cabling $3,500

F&F $2,500

Long-Term Assets $36,000

Total Assets $42,500

Total Capital Required $67,500



Savings And Funding $27,500

Two Year Bank Loan $40,000

Total Capital $67,500

Source of Finance

The investment funding will be from bank loans, savings and borrowing from friends. As the business grows, capital will be generated from the profit acquired by the business (2014, Para. 4). At the same time, any additional expense after the start-up business will be financed from owners savings. Business liabilities will be separated from the owners, that is, any loss incurred will not affect the owner of the business.

Marketing Strategy

In getting the service to the market, the good strategy requires being formulated to reach more people. Gaming arcade center being a service delivery business requires good advertising strategy to reach the targeted market. This is achievable through print media advertising through captivating messages. Another way of marketing is setting up award-winning competitions which seek to attract professional game players. Being a startup business, a large amount of money set for advertising will be used to set up a great reception on the opening day of the business. This is to attract more customers on the first days; this will ensure that the business name will be associated with quality service delivery. To curb competition, discounts will be given to loyal customers (2001, Para. 3).

Another critical area of marketing is the use of online marketing; this is a useful strategy since one can determine the size of the market reached. Online marketing is an effective method of reaching out to the young people. This is in the case of a game arcade center since most of its target is young people. A great number of young people mostly spend their time in the internet making it a good platform for marketing. Internet and online marketing is an interactive platform which gives businesses an opportunity to get feedback directly from their consumers. Through this one can make necessary changes according to consumer taste and preference.

Pricing Strategy

The best pricing strategy seeks to maximize business revenue at the same time maintain a competitive nature in the market. For this, the best strategy is a competitive pricing where charges will depend on the market price (2008, p. 34). Charges will be in cash per hour bases to maximize revenue for the business. This will help in maintaining a competitive nature in the market. Price reductions will be regulated by the management according to the time market requirement. Summary

Arcade game center is a very lucrative business as compared to other small business set up. With the right marketing and management strategies, the business will earn maximum revenue. The startup business is targeted to be operational and self-sustainable within three months. The manager of the business at first will be the owner who will work with one employ until the business expands. This is to reduce expenses of the business at the initial stages of the setup. It is expected a slow economic growth for the first few months of the business set up with little recession. This shows that minimal profit is expected at first, but at a later date, profit projections will be high. It is in the best interest of the business that accounts be balanced at the end of every business day for accurate bookkeeping records. The objective of business is to make as much revenue as possible at the end of the day.


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