Start a cave tours business by following these 10 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your cave tours business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Check out our How to Start a Business page.
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a cave tours business?
Initial costs include permits for the business, commercial insurance, and administration costs. Admin costs can include everything from website expenses to accounting software. Cave tour owners also need to account for transportation and equipment. Most owners won't need to open an office though, unless planning to operate on a larger scale. They can likely carry any equipment they need in a van and then conduct tours from the location itself.
What are the ongoing expenses for a cave tours business?
Ongoing expenses include marketing costs, insurance, and equipment replacement/maintenance. Owners may also need to pay employees, fix vehicles, and renew their business permits or licenses.
Who is the target market?
The target market can be anyone who wants to explore and learn more about the caves in various parts of the country. The demographic will need to feel comfortable in tight spaces and accept the dangers of moving around in an underground space. For this reason, you may want to market your tours to adults or allow shorter tours for children 12 and over in case a customer panics.
How does a cave tours business make money?
Cave tours will typically charge per person for the privilege of having a guide in a subterranean space. They may also offer special group rates to large parties who want to take the tour together.
How much can you charge customers?
Tours for a cave tour can run anywhere from $15 to $30 per person. You can look to see what other operators are charging in your area before setting prices based on the expertise of the guide and the length of the tour itself.
How much profit can a cave tours business make?
Because the overhead is so low, business owners will likely have a strong profit margin of at least 60%. So if 100 people per week take a tour at $15 each under this model, the business owner will make $900 in profit.
How can you make your business more profitable?
Consider forming member groups for more daring expeditions, or selling merchandise with your business name printed on the products.
What will you name your business?
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Cave Tours Business Name Generator
When registering a business name, we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability.
It's very important to secure your domain name before someone else does.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your cave tours business is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
Open net-30 accounts
When it comes to establishing your business credit, net-30 vendors are considered the way to go. The term "net-30," which is popular among vendors, refers to a business credit arrangement where the company pays the vendor within 30 days of receiving goods or services.
Net-30 credit terms are often used for businesses that need to obtain inventory quickly but do not have the cash on hand.
Besides establishing business relationships with vendors, net-30 credit accounts get reported to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended: Read our guide on the best net-30 vendors so you can start building business credit now, so you never have to worry about cash flow in the future. Keep in mind that poor cash flow is the #1 reason businesses fail!
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
How to promote & market a cave tours business
The promotion of the business will depend on the purposes of your cave tours. Paid internet advertising and paper flyers in public space (e.g., coffee shops, outdoor supply stores, etc.) will likely be the best ways to get you started. Use professional photos of the interior of the caves you’ll be exploring on the website or on flyers. However, whether you're advertising a glamorous picnic or a death-defying dive, potential customers should be aware of the potential dangers of caves.
How to keep customers coming back
Owners may want to attract customers by offering them a discounted rate for their first trip. To retain customers, the guides should be charismatic and the tours should be well organized from start to finish.
Still unsure about what kind of business you want to start? Check out the latest Small Business Trends to help inspire you.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use.
Recommended: Find the best phone system for your business; check out our review of the Best Business Phone Systems 2021.
Start A Cave Tours Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
People who have a strong spirit of adventure and a passion for caving. Owners should want to share their love of exploration with customers while inspiring them to test the limits of the natural world.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a cave tours business?
The vast majority of time will be spent organizing and conducting the tours. Owners will also need to set aside time to market the business, handle customers, and perform administrative duties (e.g., bookkeeping, scheduling, etc.)
What are some skills and experiences that will help you build a successful cave tours business?
The ideal owner should be an explorer who has already mastered the available network of caves. They should have some degree of emergency training and a strong sense of direction. Ideally, they should also have experience with cave diving in case they want to share their skills or need to use them in the event of an emergency.
What is the growth potential for a cave tours business?
Cave tours are a unique business that can attract thousands of people throughout the year. The growth potential is largely dependent on the natural caves in the area. If the caves are already a big tourist attraction, then a cave tours business stands to grow based on the built-in beauty of the caves. However, cave tours can still become popular even if the formations aren’t the most noteworthy feature in your area. If the tours are planned correctly and conducted by expert guides, then owners will likely find room to grow.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Learn from other business owners
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a cave tours business?
Owners should first want to learn more about what it takes to start a business in their area. Caves may be located on national parks, and business operators may need special permissions to provide tours. There may be a limit to how many people can fit inside a single cave or protection rules that forbid people from certain areas.
Owners should have an idea of how they want to operate their business before they begin asking officials for permission. For example, owners may want to give short tours for those with limited mobility or night tours for customers who want an extra challenge. They'll need to account for emergency situations in case someone begins to panic or is injured during the tour.
Once an owner knows they have the green light, it’s time to research their competition. This will not only give you an idea of potential scheduling conflicts, but it helps you see how to make your business different. For example, you can consider giving lessons to people on how to vertical cave as a part of the tour. Or you can set up private tours where couples can enjoy a romantic dinner underground (if space allows). You can even consider themed events, such as having people dress up as pirates to search for buried treasure.
Now is a good time to check the reviews of other businesses in the area and learn more about how people feel about the current tours being offered. If they’re being given by perfunctory guides who do little more than read off a script, then you can structure your business to provide people with a much more entertaining experience. This tip is especially useful if the caves in your area aren’t particularly impressive, and you need a way to make them more exciting.
How and when to build a team
Owners will likely want to give the tours themselves rather than spending the money on unnecessary salaries. As the business grows, owners can consider hiring additional guides. Look for people who are friendly, personable, and extremely experienced with caves. They should be able to remain calm under pressure, so customers have a better chance of feeling comfortable in an uncomfortable space.