At a recent conference, I took part in a discussion. We discussed common issues that many operators encounter when managing a game room. I recall the challenging start of my Family Entertainment Center. There are some important things I wish I had known before starting. At that time, a significant concern, or perhaps an obsession, was the fun and exciting aspects of starting this venture. This included expected earnings and the types of attractions to add. Pricing, packages, and the game/attraction mix were all meticulously planned. However, several critical elements were either missed or inadequately addressed in the planning process.

The Importance of an Arcade Game Tech

A game tech was one of the biggest things I overlooked and didn’t emphasize. I want to highlight the importance of your game tech. It’s crucial to highlight the importance of having a dedicated game technician. Operating a location without one is, in my opinion, one of the biggest mistakes an owner can make. This isn’t just an observation. From my own experience and past mistakes, I can say that I also opened my center without this key player. Ultimately, operating a modern entertainment venue without game technology is extremely challenging. It’s like sending a baseball team onto the field without a pitcher. 

This job is as important or more important than ANY other position in your location. A good game tech will make you (or save you from losing) lots of money. This should be your MVP, and you should take the time to hire well in this position and pay this person well. Don’t skimp here. Don’t think you can find someone who “likes tinkering.”  You want someone who can work on the small parts of the game or repair the board. This person can fix issues at the component level. They will help you save a lot of money. 

The Reality of Game Maintenance: New Isn’t Always No-Problem

Myth: They are brand-new games that will likely be fine for a while. So, as a new facility, I don’t need to worry about this immediately.

Fact: Even brand-new games will have issues, and downtime costs your business real dollars per hour.

Someone once told me, “Running an arcade without a game tech is like running a kitchen without a cook.”  This is absolutely right! There are even courses available for learning how to fix games. Not only should you send your game tech to a class like this, but you, as an owner or manager, should also attend. How can you manage or evaluate your game tech’s performance if you don’t know what they should do? What if you can’t talk to them about how games work? As a good manager, you should have a basic working knowledge of EVERY position in your center. You should not only be able to hop in when busy and assist a cook in running a POS, but you should also be able to perform basic repairs and troubleshooting. 

The True Cost of Downtime: Why Speedy Shipping Matters

Another mistake I made involved shipping parts. It may seem unusual, but your choices here can actually cost you more money than you think. I hate to admit it, but it took me a couple of years to figure out that 9 out of 10 times, the cost per hour of a game that is down or not working usually costs more money than the cost of overnight parts. Ideally, you should have some spare parts on hand. Your distributor should be able to inform you about the parts they recommend keeping on hand. There are certain parts that you should ALWAYS have in stock. But, if you need to order a part for a game, you should know approximately how much that game makes on average per hour. Then, evaluate that cost per day of potential revenue losses versus the cost of overnighting or 2-day shipping.

You will likely find that even though spending $100 on shipping a $13 part seems ridiculous, the $113 will be lost if your game is down for a couple of days. This was a jagged pill for me to swallow. I HATED paying so much for shipping, but once you evaluate the actual numbers, it makes total sense. You might think your customers will play differently. However, you don’t want broken games in your game room. This is especially true on weekends when you have the most visitors. 

If you give your guests the perception that “they always have broken games,” there is also a cost. After discovering this, I implemented a policy that the game room had to be 100% before the weekend. If a game couldn’t be fixed before the weekend, it needed to be removed from my game room floor. This typically motivated my game techs to get the games fixed quickly, as they are often not enjoyable to play. I also shared my game reports with them. This way, they could compare revenue and shipping costs. They could then make better decisions about shipping parts.     

Setting Up Your Technician’s Hub: A Dedicated Workspace

Speaking of game techs, when planning your center, please plan a location for your game techs to work. Often, this is overlooked. I realize that space is often a premium, but it’s so much better for a game tech to have a workbench and their own space in the back rather than trying to fix games in front of your guests. Ensure that you outfit this space with the necessary tools, spare parts, a computer, and a phone. I couldn’t tell you how many locations I find the game tech in, even if they have a small closet, if they have space. Often, this detail is not on the architect’s or designer’s mind. Looking back, I would have planned a better space for my game techs and a closer/better storage space for my back stock of redemption goods. These spaces will impact your business and are often overlooked in planning.       

Maximizing Revenue: The Strategy of Game Rotation

The last thing I wish I had known before opening my business was when to eliminate games. As someone with hoarding tendencies who is also very frugal, it’s hard to convince yourself to get rid of that old game that still makes you $1,000 per year and may have no trade-in value. It doesn’t seem financially sensible. And often, owners tend to convince themselves that more is better. But the locations that have removed those low-earning games tend to see an overall increase in their game room revenue as a whole.

I would recommend having an annual conversation, at a minimum, with your distributor to discuss the performance of your bottom 10% of games and receive their recommendations. As a general rule, the lifetime of a video game is typically 3-6 years, and the average lifespan of a redemption is 5-8 years. Some games may not follow this rule. However, you should plan to change your game room often. Remove the games that earn less money. More is not always better. 

Think about your games like a car purchase. If you purchase a car, drive it for a few years, and then trade it in while still maintaining low mileage, you will have a decent trade-in value that you can use toward a new car. If you are still driving your 1995 Ford Explorer with 300,000 miles on it, you likely will not get much, if any, trade-in value, as there isn’t much resale value in that car anymore. You may even have to scrap it, even though it still runs (kind of). Additionally, the maintenance cost exceeds the value at a certain point. The most successful arcades will trade in their games while still having a trade-in value. If you are operating these very old games…. it’s time to eliminate them. They are hurting your bottom line and making your location look outdated and old.   

Fostering Key Relationships: Your Vendors as Partners

I hope that someone reading this will learn from my mistakes. Hire a fantastic game tech and take good care of them. Give them the tools and space to keep your game room in working condition. Get broken games off your arcade floor. Don’t worry about the expedited shipping costs without considering and comparing them to the loss in game room revenue: plan and stock spare parts. Eliminate low-earning games and regularly refresh your game room. Create lasting relationships with your vendors, as the good ones will support and guide you and want to see you succeed.  

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