How to Start a Bounce House Business: The Complete Guide
With popularity on the rise, many people want to know how to start a bounce house business. As one of the leading providers of commercial bounce houses online, we wanted to create a complete guide that will get you started on some key ideas that you should think about before moving ahead.
There are many things to consider - getting the right equipment, understand profit potential, legal structure, and how to market your new venture. You will find all of that information in this guide.
Starting a bounce house business can be a great entrepreneurial endeavor as either a side business or a full-time venture. Bounce house rentals have soared in popularity in recent years and are almost everywhere you look - at birthday parties, local community events, and corporate outings.
But that's not to say it is going to be easy! There are a number of things to consider before starting your business, mainly the profit potential. It is important to understand what your up-front costs will be, and have an idea of how long it may take to turn a profit based on a number of bookings your business can handle.
Sample Cost Analysis
There will be some up-front costs to your business that we will go over in detail, but to understand your profit potential long-term, here are some numbers to consider.
Your revenue potential will essentially be a function of how many bounce houses you have in your inventory, and how often you can rent them out. To start off with some conservative numbers you can use the following:
$85 per bounce house rental x 1.5 bookings per week = $127
Each commercial bounce house is $1,499, which means it would take you roughly 12 weeks to pay off each bounce house. Each local market can be different though - there are parts of the country where you can command as much as $150 to $250 per bounce house for each booking, which would change your numbers significantly.
Let's say you decided to start off with three bounce houses. We offer a nice discount on this bundle for $5,699. That could increase your weekly earnings to just over $380, and would take just over three months to pay off. After that, you would start to turn a nice profit each week.
The beauty about bounce house businesses is that they are easily scalable. If you start off slowly with just one to three houses, the investment will be minimal. If things start to grow, then you can expand as you see fit. There are major bounce house rental companies that have over 50 houses in their inventory, which you can imagine builds up the profit potential.
Getting the Right Equipment for Your Bounce House Business
In order to make sure you can service your clients properly, and not incur any unforeseen costs, it is best to make sure you have the right tools. Here are a couple of important concepts to understand:
Commercial vs. Residential Bounce Houses
Some owner-operators might be tempted to buy residential bounce houses for their business because they are far less expensive. Typically our most popular residential models sell for $500 - $700, while the commercial bounce houses start at around $1500. Trying to save the extra $800 - $1000 can be a big mistake! There are key differences between residential and commercial models. Below are two main points to consider:
- Commercial bounce houses are built differently - They are typically much larger and built with stronger materials. This is meant to withstand prolonged use and can last as long as five years. Residential bounce houses won't last very long if they are being used by hundreds of children each weekend.
- The manufacturer's warranty is better - Typically most manufacturers will not offer a warranty on residential bounce houses if they are used for commercial purposes. Additionally, the majority of commercial bouncers come with a minimum one year warranty and sometimes upwards of three.
If you are serious about your business you should not take any chances buying products that are not suited for your use. It will likely cost you more money in the long run than you saved initially.
Additional MaterialIn addition to your bounce house you will likely need to purchase a few more items that you should consider:
- Blower: You can view our complete selection here
- Extension chord: If the area of the bounce house is not located near a power source you will likely need this
- Generator: When there is no power source a generator becomes necessary
- Hand Truck: This will help move some of the larger bounce houses
- Cleaning Materials: Vacuum and other products to clean and sanitize your bounce houses
- Misc Items: Sand bags, stakes, cones, duct tape
Miscellaneous Up-Front CostsAside from purchasing your first commercial bounce house, starting your business will require some upfront costs that you should be aware of. Here is a list of things you should consider researching beforehand:
- Insurance: You want to make sure you are protected against any liability in the event of an injury. This will depend heavily on the kind of policy you purchase and what state your bounce house business will operate in.
- Business Incorporation: It makes sense to set up your bounce house business as an LLC or an S Corporation both nationally and in your state. LegalZoom is one of the best resources. Count on costs ranging from $149 - $349.
- License to Operate: Some states and municipalities require a license in order to operate a bounce house business. You can check out this guide for more information.
- Website: You will definitely want to set up a website. There will be a fee to register your domain, keep a monthly hosting plan, and to design your site. If you can do it all yourself this should not exceed more than $150 - $250.
- Advertising: You will want to set aside a budget to advertise locally in order to get your first customers. This could be as little as several hundred dollars or much more depending on how much money you are willing to invest to get your business up and running.
- Legal Material: In order to protect yourself and your business from any kind of litigation, it makes sense to have a standard contract and liability waiver that you will have customers sign before booking your business.
Researching The Market
Starting a bounce house business could be an incredible opportunity if your local market is underserved. Conversely, it might be a tall order to wiggle your way into an already crowded market. There are a few ways to approach this.
The CompetitionYour first order of business is to find out how many businesses are actually offering bounce house rentals in the geographic area that you want to initially service. Luckily that is quite easy to find out these days by doing a local search on Google or Yelp. Some key things that you want to take notice of:
- How many businesses are offering bounce house rentals? Remember they also could be party rental services that are offering multiple products, not just bounce houses.
- What prices are they charging? Find out what the going rate is per booking, which will give you an idea of your profit potential as well as how competitive the market may be.
- How well is the competition presenting itself? Are their websites professional looking, or do they look very out of date and confusing? That may be an opportunity to differentiate yourself.
Once you have taken stock of what the market looks like then you can start determining whether a real opportunity exists.
Marketing Your Bounce House Business
In order to get your first customers, you need to let them you know you exist! Local marketing has completely changed, largely because of the Internet. It used to make sense to take out a few ads in the Yellow pages and other local magazines, but that simply isn't the case anymore.
If you aren't connecting with your customers online then you are missing the boat. Your first order of business will be to get your online affairs in order. Here are a few key ideas to get you going...
You Need a Website
A website has turned into the modern business card. When people are searching for bounce house businesses online you want to make sure that you show up. More importantly, you want to make a good first impression. There is nothing worse than seeing a poorly-designed website. It gives the impression that you are not serious about your business, and it is likely that potential customers will turn to your competition who has done a better job.
That being said, it is much easier to have a clean, fast, and professional looking website than ever. We recommend setting up your site on Wordpress. More than 25% of websites are now powered by this publishing platform. You can also try Squarespace, but there is much less flexibility with designs and add-ons to your site. Wordpress has a thriving developer community that has endless design templates and plugins to make your site even more powerful.
Overall, you want to make sure you are putting your best foot forward with your website design. Use quality photography and make sure it is easy to navigate. Most of all, explain why customers should trust your service and make it easy to get in touch with you to schedule a booking.
People Need to Find You Online
What is the first thing that you do when you are looking for a local business?
You most likely answered typing your query into Google, which is what the majority of people are doing when they research local businesses to hire. Therefore, you want to make sure that when someone types in X Bounce House Rentals, you are going to show up.
This means setting up business profiles for Google, Yelp, and other local resources. This is a great article from SEMrush to help you understand how you can optimize your results in search engines and other local online resources. Overall, you want to make it easy for potential customers to find your website when they are doing research for their next party.
Local Advertising Can Be Extremely Effective
Online advertising technology has gotten extremely advanced, and local businesses can pinpoint their potential audience with greater accuracy than ever before. When you are first starting out in your bounce house business it will make sense to set aside a budget for advertising in the beginning. Your goal is to book new business, impress your clients, and have them spread the word online and in their local community.
Right now the best bang for your buck will likely be Google and Facebook. They are the two most-used websites out there, and they offer the best advertising products for local businesses.
You can read up about Google's Adwords local program here. The key reason why Google is so effective is because you are capturing a potential customer at the moment of intent. If you are able to serve up a relevant advertisement to a mother who is looking to find a local bounce house business for her daughter's 7th birthday party, you can make sure that you show up. The only downside is that pay-per-click advertising has gotten very competitive, and you could be competing against other bounce house businesses for those spots. The best thing to do is to set aside a test budget and track very closely how much you are paying for new leads.
Facebook offers a different local advertising product, which you can read more about here. They allow you to target various demographics and geographic locations with impressive precision. You can offer deals, drive people to your site, and various other methods. Facebook is constantly making their technology more effective, which is why it has become a preferred choice for local marketers.
Additionally, you could experiment with local deal sites like Groupon in order to book your first set of clients.
Get Involved in the Community
Another effective tool in promoting your business is good old-fashioned networking. Get a bunch of professional-looking business cards printed from a service like Vistaprint, and get prepared to pound the pavement!
There are plenty of ways to get creative with this approach. One way is to make sure you are connected with local companies that are associated with your bounce house business. For example, there could be party rental companies that don't offer bounce houses, and you could make sure they know you are available to supply them if the need arises.
Additionally, you could get involved with local organizations like The Rotary Club. Anything you can do to make yourself visible to members of your community will help keep your bounce house business in their minds if they eventually will need your services, or a friend of theirs asks.
Wrapping it Up - Will You Take the Dive into starting a Bounce House Business?We've covered a lot! By now you have a general overview of steps you should consider before starting your bounce house business. Here is a brief recap:
- Size up the opportunity - evaluate your competition and the going rate for bounce house rentals in your area. This will determine your profit potential.
- Get the right equipment - a commercial bounce house is a must for your venture. You can see our selection of discounted inventory here.
- Don't forget about miscellaneous costs - there could be a few things to consider outside of just purchasing your bounce house.
- Have a local marketing plan - people in the local market need to know your bounce house business exists so they can hire you!