Okay, here is a summary...
Billiards club with a monthly membership fee located in the center of DFW. Grapevine would be a nice location.
The club uses the league night business model but caters to the pool players need.Leagues are handicapped and non handicapped, for 8-ball, 9-ball, straight pool and one pocket. Payout for top three finishes.
The club will hold regional tournemament stops and sell temporary memberships to spectators.
Instructional clinics offered on weekends. Private lessons available.
The place would have nice well maintained tables, lockers, pro shop and a bar. Atmosphere would be conducive to competition... no smoking, loud music, poker or darts. Nice viewing area to watch matches. Big screen TV at the bar with an overhead view of main playing table and the occasional sporting event.
And most importantly, clean restrooms!!!!
It's a great idea, but I'm just not sure it works. I don't mean to rain on anybody's parade. Look, I'm a Banker (Chief Credit Officer) and I review small business and business plans all day every day. I finance 2 country clubs and it's a tough business model.
Don't get me wrong, if a billiard club was available where I live, I would join.
I don't know the DFW pool scene, but lets say 100 pool players in the DFW would join this club. And, lets say they pay $100/month membership fee. That's $10,000/month. Rent would run somewhere around $9 to $12 per square foot (could be a little off on the number cause I'm not that familiar with the DFW market). Let's say you keep it relatively small at 5,000 sq ft (that's about the size of Chesters in OKC). Annual rent is anywhere for $45,000 to $60,000. That would result in monthly rent of $3,750 to $5,000.
Lets assume utilities run somewhere around $800 to $1,200 a month. One of the room owners might comment about whether this number is in the ball park.
You will have to have some insurance. I really don't know what it would cost, but let's assume $500 month.
You have to have someone running it. Lets say its open 16 hours a day and you only have 1 person working per shift. You pay them $12/hour times 16 hours is $192 a day times 30 days a month is $5,760/month. That's not even counting the stuff employers have to pay.
Now you have to buy the equip. Lets say you put in 10 tables. Purchase, delivery, and set up is $5,000 per table. That's $50,000. Let's say you have other equip/misc of $20,000. We'll assume the leasehold improvement on the building will be covered by the landlord if you sign a long-term lease, with your personal guaranty of course. You have $70,000 in equipment you have to pay for. If you could charge a one time up front membership fee in addition to the monthly fee, you pay for it that way. If not, lets say a bank finances 80% of the purchase price for 5 years at 5% interest. That's $1,052/month in payments.
This is just rough numbers, but believe me when I say there are always costs and monthly expenses that are overlooked in the planning stage.
Monthly income $10,000
Less:
Rent (5,000)
Utilities (1,200)
Insurance (500)
Wages (5,760)
Loan Payments (1,052)
Monthly cash (3,512)
I know I've been pretty negative about this idea, but I actually like the idea. It's just not a business model that works. The key to success is having enough upper-middle class professionals who really like pool and are willing to pay for a private billiard club. The reason I say upper-middle class is because they have the disposable income to support this business model. I'm just not sure any market has enough of them to make it work.
In the 80's and early 90's up-scale pool rooms targeting upper-middle class was the thing. That didn't workout to well.
Chesters is one of the most successful pool rooms I've seen. I've never seen their books, but it appears to me, where they make it work is APA and BCA pool leagues and Friday/Saturday nights when the the place is packed with a bunch of snot nosed kids (want-to-be badboys) spending their parents money.
Another way to do something would be to find 20 to 25 people who have cash (cash is key). You find a smaller place and only put in 3 tables (7ft, 9ft, and snooker or 3c). Each person has to put up their share of the cash (upfront) to buy the equipment. NO DEBT. Each month they would have to pay their share of the monthly expenses. You couldn't have anyone working. The place would be locked up and each person would have a key (could be a key pad). Each person could come and go as they wanted 24/7. You could have refreshments, but that can be a nightmare. Who keeps it stocked? What if someone drinks 60 beers a month and another guy only drinks 3. I guess you could be on the honor system.
Another potential problem is someone may begin to think they are subsidizing someone else's pool. Lets say person A can only make it out 3 times a month but person B plays 3 times week. Do they pay the same each month? The other thing is each person would have to have the financial mean to pay their fair share of the monthly cost. I'm sure there would be a lot of people who would say "I'm In" but when it came time to write a check they couldn't.
I think the key to this model is finding enough people who would rather have this set up than their own table at home.
Just my thoughts on it.
Steven