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bpmattress

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I am trying to find space for a new hall. I know I need at least 7000 sq ft to have 6 pro tables, 10 drop pocket tables, bar, restaurant seating, gaming machines, etc. to service the market. The space I found is 9000 sq ft. (more than enough). The rent, however, would be $10K per month. I doubt that the hall can support this cost. I've read warnings on other threads that "rent can be the killer". Does anyone have an opinion as to whether an average producing room can support this rent and still turn a profit?
 
Figure your nut

bpmattress said:
I am trying to find space for a new hall. I know I need at least 7000 sq ft to have 6 pro tables, 10 drop pocket tables, bar, restaurant seating, gaming machines, etc. to service the market. The space I found is 9000 sq ft. (more than enough). The rent, however, would be $10K per month. I doubt that the hall can support this cost. I've read warnings on other threads that "rent can be the killer". Does anyone have an opinion as to whether an average producing room can support this rent and still turn a profit?
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There are too many equations missing to answer the question.

For starters:
10K/ month = $335/day income
$335/day income w/ 16 tables = $25/day/table
At $8/hour table time, 3 hours/table/day are needed to make rent
That's 50 hours/day table rental to make the rent.

Now over-guesstimate, utilities, licensing, labor (including FICA), phone, cable, internet, cubby hole money for table upkeep, advertising and an extra $1000/month just cuz. Don't forget the monthly payment for your biz loan.

Will your food, liquor, cue, accessories, repair and clothing sales support it?

Good luck with whatever you can figure out. Alot depends on your draw area, competition, league popularity and what type of room you want, upscale, middle of the road or low end. Most RO's I know want do keep the rent under $10/sq. ft. and preferably at $8 or less. Your quote is at about $13.35/ sq. ft.

One thing nice about pool rooms is that they don't need to be in a high visibility location. The players will find it if things are done right. It does need to be in a location where the players/customers will feel safe.

Hope this helps.

PM me for any questions you may have.
 
Sounds like you are opening a room just like mine. I have 7600 square foot with 17 tables, retail area. But I would be scared with rent at $10,000 a month. I would choose a smaller place if I were you. Like in a strip mall where you could expand to the next bay a few years down the line if you are making that kind of profit. Wondering what kind of income do you expect per month and if that is included? Plus you have to figure you dont need to GROSS that amount, you need to PROFIT :grin: that amount in markup to pay that salary. Good luck in your venture, you are quite the risk taker in this economy, but risk takers have the biggest chance of scoring big if you make it!
 
I'm in a high traffic, tourist area where visibility could add traffic to the hall. I expect to bring in $1500 to $1800 per day in the register with 50% coming from liquor sales. I also expect to see a decent return on video gaming, which this space allows. The food is to keep customers in the room. Ther is only one other pool hall in my market and they are doing these kind on numbers. I will be far enough away that we should not compete for the same customers. His rent is only $5K per month and he's doing fine. The area I'm trying to enter has few places that are large enough to support a room and the cost per square foot for the space are in line with other available space. I feel this is the area that is best suited for the room. I'm just concerned that the rent factor could make it difficult to make a profit. I'm only looking to extract $100K per year out of the business for myself and my partner combined. I'm hoping someone could share an opinion if this is a correct, minimum expectation.
 
Yikes!

bpmattress said:
I'm in a high traffic, tourist area where visibility could add traffic to the hall. I expect to bring in $1500 to $1800 per day in the register with 50% coming from liquor sales. I also expect to see a decent return on video gaming, which this space allows. The food is to keep customers in the room. Ther is only one other pool hall in my market and they are doing these kind on numbers. I will be far enough away that we should not compete for the same customers. His rent is only $5K per month and he's doing fine. The area I'm trying to enter has few places that are large enough to support a room and the cost per square foot for the space are in line with other available space. I feel this is the area that is best suited for the room. I'm just concerned that the rent factor could make it difficult to make a profit. I'm only looking to extract $100K per year out of the business for myself and my partner combined. I'm hoping someone could share an opinion if this is a correct, minimum expectation.
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Yikes is my first impression.

1) I don't know off any pool room that tourists flock to. An occassion tourist happens but they have the bug. Tourists don't normally go to rooms.

2) Any room opening competes with other rooms. Players aren't afraid to drive to play on good equipment and get treated well.

3) Yes, the rent could easily make profit a difficulty but so could many other factors, like trying to pull out $100,000/yr.

4) Sir, please run the numbers and layout a business plan. When doing so, be pessimistic, very pessimistic. Sure, you expect $1500 to $1800 in sales, what if you only do half that? Can you make it?

5) What is your background? I've seen many pool players think that they can run a pool business and fail because although they have a pool background, they don't have a business background. Do you know what your projected food costs will be, projected liquor costs, how many table hours do you have to average/day, how do you plan on getting customers to put that amount into the cash register, and so on...

Until you do an honest, soul-bearing business plan and KNOW where your heading, my opinion is that it is a bad idea. Telling what you expect into the till is far from telling the how you plan to get it there. It is good that you have found out what the other room is doing. That is part of putting together a comprehensive plan. NOTE: the competition's rent is half of what you are proposing. That means they have only $60,000 in rent/year and yours will be $120,000. That's is one reason why they are probably doing well.

If you don't want to put the work into a business plan, then I absolutely say NO.

I'm being a bit harsh with you as I would rather you be upset with my response and opinion, than to see you go into business with high expectations only to go broke and lose your investment.

I think you will be hard-pressed on this forum to find a present or former owner to give you the green light with what you have given for information.

PM me if you have questions.
 
I pay $23.00 a sq foot and my place is 10,000 sq feet everyone told me I couldn't make it. I have been open 3 years now in the worst economy we have ever seen and I am making a profit. You might want to check your numbers because when you add all the little odds and ends up you will probally need to make around $2300 a day to break even.
 
I appreciate someone saying that the rent factor is not the make or break for a room. When you suggest that $2300 is a break even, are you saying gross sales or net profit? I calculate that I would need $1500 to $1800 gross sales to cover the total nut. I have considered all expenses on the high side.
 
Thanks for your input. I have run businesses before, including pool halls. I think I have a comprehensive plan that is realistic. I know from careful research that this location is perfect for my mid to upper room which would be nicer than my competition. My location would also be more available to more customers in my market. I feel that the 16 million tourists that frequent my area would add to my business plan due to the visibility of my proposed location. I would hope that some would come for a drink and snack, if not for the pool. My question was only... can a room with 6 pro tables, 10 drop pocket tables, 30-40 video games, bar that seats 15-20, and full diner like menu produce $1800 in gross sales per day. Although I had pool halls in the past, I'm reaching out to the existing owners to discover if this expectation is realistic and achievable. There would be no debt service and the expenses in this area are less than other markets. The partners would also be working employees of the hall minimizing the payroll end. All but i employee would be parttime, minimum wage + tips employees and only for the hours of high traffic.
 
I think 2300 gross per day. How much do you think your electric will be per month? Here some expense that I didn't think of rags,toilet paper, paper towels,and brake age of glasses and dishes..
 
These numbers make my stomach turn. Of course, I'm in a small town.
you might consider starting smaller. You climb a tree from the ground up.

Best of luck.

Danny
 
have you thought about purchasing? ....commercial spaces are on the cheap right now ...a bit hard to get funding, but banks like to show that they are looking to fund this type of stuff since the tax payers gave them billions ....

just a thought.
 
bpmattress said:
Thanks for your input. I have run businesses before, including pool halls. I think I have a comprehensive plan that is realistic. I know from careful research that this location is perfect for my mid to upper room which would be nicer than my competition. My location would also be more available to more customers in my market. I feel that the 16 million tourists that frequent my area would add to my business plan due to the visibility of my proposed location. I would hope that some would come for a drink and snack, if not for the pool. My question was only... can a room with 6 pro tables, 10 drop pocket tables, 30-40 video games, bar that seats 15-20, and full diner like menu produce $1800 in gross sales per day. Although I had pool halls in the past, I'm reaching out to the existing owners to discover if this expectation is realistic and achievable. There would be no debt service and the expenses in this area are less than other markets. The partners would also be working employees of the hall minimizing the payroll end. All but i employee would be parttime, minimum wage + tips employees and only for the hours of high traffic.
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If you have all this pool room/ business experience, why do you need to ask the questions of this forum? You would know the answers. You obviously have doubts about the rooms ability to be successful to the degree you want. Also, you are complicating your chances of success by having a partner. Do you know the failure rate of small retail business partnerships? Close to 98% over a 7 year period. Why take that additional risk?????
 
speedi said:
If you have all this pool room/ business experience, why do you need to ask the questions of this forum? You would know the answers. You obviously have doubts about the rooms ability to be successful to the degree you want. Also, you are complicating your chances of success by having a partner. Do you know the failure rate of small retail business partnerships? Close to 98% over a 7 year period. Why take that additional risk?????
Click to expand...

I was just going to write the same thing! Dump the partner- the two of you will never do things the same...it always ends badly.
 
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