So, You Want To Open A Haunted House? Part 2
(continued from So, You Want To Open A Haunted House?)
The next number you need for your business plan is build and operation costs. Before you can price your construction, you must design the attractions. I say attractions, because I am a true believer in the multi-element event. You need to break your fright experience into at least two pieces, so you can sell people something to eat or drink in between the two. Today I don’t design any attractions larger than 3,000 sf, but I want you to have 3-4 of these to start, and more later. Again, the why is a longer discussion, but for one thing you can charge more for four 2,000sf haunts than you can for one 8,000sf haunt. The costs are the same and that extra ticket money goes directly to your bottom line.
When building a haunted house, the sky is the only limit. I promise it will take you every dollar you can lay your hands on plus more to build you haunted house. So, you must set a budget and sick to that budget! It will take you between $20 and $35 a square foot to build your attractions. You may be able to shave those numbers slightly by building it yourself, or buying a used attraction from someone, (there are several available for sale on the Hauntrepreneurs.com website), but you can easily blow that budget by buying a bunch of expensive animatronics. It is live actors that scare people. Large animatronics are great eye candy, provide wow power and work well as misdirection, but they rarely scare that 21-year-old male, the hardest to frighten in a haunt, and who should be your target for scares. Animated pop ups, air/water blasts are fine, but real scares are done by actors, and actors are cheaper, at least in the short run, than animatronics.
Actors can make or break a haunted house and they are hard to find, especially good ones, so look everywhere. Pay them minimum wage unless they have experience and increase their wage each year. You have to schmooze, groom and coddle your staff. Offer performance perks, feed them, make sure they know how important they are to your success. Do whatever it takes to keep the great ones, however, you must retain control. They must stick to the design of the haunt. There is little room for ad libing. One actor standing in a hallway not letting people pass can destroy the quality of the show and will bottleneck you into the parking lot. Both are profit killers. By the way, unless your company is a 501c3 charitable organization, it is not legal for you to use volunteer labor. And why would you, when the actors are so key to your success? If you are a real a business, then you should pay your employees! If you cannot afford to pay your employees, then you really aren’t in business. Even a non-profit haunted house needs to make a profit. Otherwise what is the point of opening the “fund raiser?” If charitable haunts would approach their haunted event as a for-profit business, they would make more money for the charity than they do as a non-profit haunted house.
The last question is what to charge. This will depend on your market, the economy and the location. Start high and offer discounts early in the season, to drive early attendance. Decrease the discounts as October 31st approaches. I recommend opening on the last Saturday in September, and then Friday and Saturday only thought the first Saturday in November. You can pick up the Sunday before Columbus Day, and may be Halloween night, depending on your market and how it falls this year. Haunting is a date thing, so you open when people would go on dates. People will come when you are open, and any other nights just increases payroll.
Attendance is typically exponential, in that every weekend should double in attendance. So, the more people you can get in the haunt early, dramatically increases the final head count. Just make sure the attractions can handle the number of people you are driving to your door. Design the haunts to provide a great show for a constant line of people through the haunt. You will not need that capacity all the time, but if you don’t have it when you do need it, you will have long waits in line, and no matter how cool your haunt is, if people waited 4 hours to get in, they will not be happy. I also highly recommend timed ticketing for your event. This solves a lot of problems and flattens out the nightly attendance curve where everyone arrives at 9pm to go through your haunts. Again, lots of reasons why to do this, just trust me.
Once you put all of this in a business plan, it will tell you how much capital you need to open. I wish I could tell you where to find the money to open your fright event, but I have already tapped all the good sources a long time ago. You are on your own! When you get to the end of your business plan, the place where is says how much money you will make, make sure the bottom line says “obscene profits!” if it doesn’t say “obscene profits,” then rework the business plan until it does. Add a haunted house to the offering so you can increase your ticket price, increase your advertising to drive more attendance, or do both, but don’t start a business that is not, at least on paper, highly profitable. Why would you?
My last piece of advice is to make sure you have enough to money not only get open year one, but you also you have some cash in reserve to make it to year two. The costs for a haunting business is front loaded. You have to pay for props and walls and equipment. It is year two when the high profits start kicking in. If you don’t have enough money in reserve to overcome a bad year, some mistakes you will make, bad weather, or an unforeseen mishap, then you are done before you even get to year two. It is much better to wait until next year or the year after that and make sure you have everything you need to be profitable from the start. If you really took a close look at haunts across the county, many of them are not profitable. They use volunteer labor, don’t include their time in the profit and loss statement, and still just scratch by with minimal proceeds.
Opening a Haunted Event is not a get rich quick scheme, the window for making money is very small. There are easier ways to make a living, but there is no business that is more fun than scaring the crap out of people! Done properly, with the multi-element approach, timed ticketing, paid staff, $3 per head spent in advertising, great location, build cost control, high capacity, great actors and enough capital to make it to year two, a fright event can be very profitable. Haunting is a creative outlet like no other. I have been helping people get started in the haunt business for over 40 years now it is my true passion. If you love horror and scaring people, then Haunting could be in your future as well!
Originally published on Themed Attraction
