2011: Lessons Learned from the First Quarter

April 1, 2011 No Comments

The first quarter of any year usually sets the tone for the rest of the year and 2011’s first quarter has been quite interesting.  The major events unfolding as this issue of Tourist Attractions & Parks goes to press are the uprisings in North Africa (Libya in particular), the horrible earthquake disaster in Japan and the resulting potential nuclear power plants meltdowns, and several United States being forced to deal with their huge deficits (pension benefits owed in particular.) These events are already having an effect on world and national economic conditions. The word that sums it all up is “uncertainty.”

Gas has already reached $4/gallon is some areas of the United States, and is expected to go higher.  However, the amusement industry is starting to show some life.  Shows held during the first quarter, especially the Amusement Expo, were busy and attended by those who were interested in expanding their businesses. Interest rates are still low and great financing and leasing deals are available industry wide. The last nine FECs that my company (Frank) opened over the past five months are doing fantastic and above projections. These facilities are something new and are quickly capturing market share.  The owners (and investors) are happy they jumped in and will reap the benefits through the next several years as their competitors sit back and scratch their heads.

The Food and Amusement Industry

Food is still the sector that the amusement entertainment industry needs to improve on.  Having the Amusement Expo overlap with the Pizza Expo was a great idea. It was evident from those food franchise owners who walked over to the Amusement Expo that they are interested in adding our games and attractions to their businesses, but they are not permitted by their franchisor.  The franchise industry needs to recognize that games and FECs can be an asset to their businesses.  This is very logical to us, so it is evident that we need to take the lead and educate that industry.  Subway has already become a leader in working with the amusement industry. These food franchises spend a lot of money on advertising their brands.  Now, all we need to do is come up with a food-FEC business model that works for both sectors.  Discounting has to be a major part of this model, as our industry is the best at offering birthday party and group discount packages.  Including quality food, a name brand, and great value would provide FECs with a competitive advantage.

The restaurant industry is also concerned about higher gas prices.  In the last quarter, casual dining was up but they also need an additional draw to get people out of their homes.  A few of the smaller chains have already embraced the FEC industry and added games and FEC attractions to their business model.  As an example, Ultimate California Pizza, a chain of 17 pizza restaurants in and around Myrtle Beach, N.C., has added a full FEC component to one of their pizza restaurants that has proven over the past year to be very successful. They have added 50 games, mini-bowling, Lazer Frenzy, birthday party rooms, a full bar, and a takeout/delivery pizza service (on a revenue-share basis with Alpha-Omega Amusements.)

Fast food is also taking a look at our industry because soda has become the number one new target, as the anti sugar/calories groups go after this sector. Low calorie meals are now in fashion once again.  For example, Olive Garden/ Red Lobster’s owner came out with “Season 52” (upscale with piano bar) where every item is less than 500 calories.  California Pizza Kitchen now puts the number of calories on every menu item.  “Gluten free” is now even being offered at baseball games.

Getting back to the amusement entertainment industry, FEC owners and other industry sector owners (bowling, skating, laser tag and waterpark,) should be asking questions such as, “Would I eat at my facility?”  “Would I take my family to eat at my facility?” If the answer to either is “no,” take a look at how well Disney is at food. They offer good food with good service even though they have a captive market. They strive to excel at every aspect of offering a positive guest experience.

Overall, what we have learned from the first quarter is that food, in combination with redemption and merchandise dispensing games, makes a powerful combination.  All sectors of the out-of-home leisure industry can take advantage of this. Regional amusement parks are already leading the way and there is much we can learn from the park industry in this area.  Zoos, aquariums and children’s museums are also slowly moving in this direction.  Another question our industry should be asking is, “What industry is going to be more aggressive in pursuing the other?”  History shows that our industry rarely takes the lead when it comes to looking for new markets. Perhaps now is the time for our industry to get aggressive and take action to self-promote itself? –

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Sponsors

S&S Worldwide

Large Park amusement rides.

Qubica

Sells capital equipment to bowling centers.

Tokens Direct

A wide variety of tokens.

Adventure Golf

Miniature golf courses, consultants, architecture and design.

Family Fun Corp.

Waterpark walls for rivers, bumper boat and splash down pools.

Barron Games

Redemption air hockey games.

Nieco Corp

Nieco automatic broilers.

GloCones

Flashing cotton candy cones.

Klopp International, Inc. (Playmeter)

Quality coin counters and sorters.

Embed

Provides innovative IT products and services with a primary focus on card-based solutions and database applications for the leisure and retail industries.

Action Lighting Co.

Lighting supplies.

SnowMasters

Evaporative snow systems.

Xtreme Inflatables

Repair and service for all inflatable products.

Challenger Industries

Sports surfaces, carpets and mini-golf surfaces.

Formula K Raceways

Go-karts, kiddie cars and bumper boats, go-kart parts and tires.

Friedman Group Ins.

Insurance for amusement devices.

Sureshot Redemption

One-stop source for prize redemption counters at entertainment centers.

Poly Products

Tables, benches and related products. Green products for a green world.

Aquaventronics

Research and development of interactive water games for use in the commercial amusement industry.

Knight Equipment

Drive cables for ferris wheels, Tilt-A-Whirls, Rock-O-Planes and many others.

Jane Farrell Turf and Carpets, Inc.

Commercial carpet, printed and decorative patterns, loop and cut-pile construction. Wall coverings in fluorescents, Class A fire rated. Colored turf, both traditional and neon colors.

West Coast Netting, Inc.

Experienced netting manufacturer on the leading edge of innovation.

Belson Manufacturing Co.

Park and recreation outdoor furniture and equipment.

Wapello Fabrications

Inflatables and portable amusements.

Muncie Novelty Co., Inc.

Admissions, financial equipment, printing and tickets.

Precision Dynamics (PDC)

Wristbands with no hidden costs, Radio Frequency Identification (RFID) Wristband System.

Gerber Manufacturing, Ltd.

Outdoor furniture, benches, picnic tables and grills.

Splashtacular

Manufacturer of waterslides

CFX Composite & Effects

Special effects make-up and prosthetics

Wisdom Industries, Ltd.

Amusement ride manufacturer, new and used rides.

Rio Syrup

Over 250 flavors, syrups and concentrates for shaved ice, sno cones, shushes, food colors. Now featuring Hawaiian Flower Cups.

Hamilton Manufacturing Corp.

Manufacturer of unattended entry systems and change machines.

Omega Carpets

Printed carpeting for all your facility needs.

Bulbtronics

A premier source for lamps, LEDs, batteries and lighting-related and electrical products.

Store on Wheels

Importer and distributor of quality toys, lighting and novelties. Cater to the amusement, retail and entertainment industries.

Comstock – Castle Stove

Commercial cooking equipment.

Namco

Namco America is a premier manufacturer of coin-op arcade attractions, ranging from the hottest titles like Crazy Typhoon and Jumpin’ Jackpot to classic game-room experiences such as the Pac-Man 25th Anniversary upright that features Pac-Man, Ms. Pac-Man and Galaga. Specialized pieces such as Wonka Sweetland and Flamin Finger are favorites too! For arcade gaming fun, Namco America is your answer.

Tube Pro

Waterpark tubes.

Sacoa

Designed and manufactures PlayCard, the rechargeable debit card system.

Extreme Engineering

Industry leader in zip lines, climbing walls, jumper systems and adventure products.

Funovation

Laser maze challenge

Spectrum Sports

Climbing walls, ropes courses, go-karts and more.

Lil Orbits Inc.

Food equipment, donut machines and vendor carts.

Subway

Fresh food and sandwich options.

Master Pitching Machine

Batting cages and pitching machines.

R&R Creative Amusement Design

Designers of unique themed parks, attractions and environments for the entertainment business.

Spectrum
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Extreme Engineering
Funovation
Rebound Unlimted, Inc.