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Outdoor garden rooms, pools, and kitchens have become more popular and more grand in recent years, and this trend of suburban outdoor living has now reached the playset industry. An increasing number of parents are purchasing custom playsets for their children -- and they’re paying significant sums for the playsets. For business owners, this trend represents both immediate and sustained opportunity.
Custom playset businesses are often included in the broader category of Outdoor and Sports Gear, which the Denver Post reports is a $2.9 billion industry that’s remained over the past couple years. Donald Hoffman, who owns a custom playset business, notes that his sales have slowed a little as the housing market has slowed down. The customers who are ordering swing sets from him are getting larger and pricier ones, though.
Who is this business right for?
Many business owners who start custom playset businesses enjoy woodworking and being outdoors, which makes creating swing sets in backyards a natural choice. Gabriel Millan says that the smiles kids have when they see a new swing set is another added bonus for him, and it likely is for most other business owners.
What happens during a typical day at a custom playsets business?
Custom playset business owners and employees spend a lot of their time building playsets and installing those playsets. When not actively constructing or putting together a playset, business owners pick up supplies and help customers custom-design their playsets.
What is the target market?
Parents are the target market for a custom playset business. Most customers are parents who have discretionary income and live in suburbia, where backyards afford space for swing sets.
How does a custom playsets business make money?
A custom playset business makes money by selling playsets. Sometimes an installation fee is charged as a separate cost, and sometimes it’s included in the price of a playset. In a few cases, customers may choose to install a playset themselves so that there is no installation fee.
What is the growth potential for a custom playsets business?
Most custom playset businesses have a single location where they make playsets. Some businesses offer installation only throughout the local area around their workshop or factory, while other businesses partner with playset installers so they can serve customers throughout the Continental U.S. (and occasionally Canada, Alaska and Hawaii). A few businesses grow to have their own stores throughout the U.S.
CNY Playsets in East Syracuse, NY is a typical small custom playset business that serves the surrounding community. Swingsets Lancaster offers delivery and installation throughout the Continental U.S., and Adventure World Playsets partners with dealers in several states.
What are some skills and experiences that will help you build a successful custom playsets business?
While business owners should have some basic woodworking and handyman skills, an advanced knowledge of carpentry isn’t necessary to start a custom playset business. Business who don’t already have these skills can gain them by either enrolling at a local vocational school or working for a playset installation business in the area.
In order to ensure that custom-designed playsets are safe, business owners should familiarize themselves with the ASTM International standard F1148. This is a voluntary standard for home playground equipment. Kids Creations makes ASTM-certified playsets and explains why this standard is so important.
For help with the actual designing of custom playsets, business owners can look at what other companies are offering and consult books like Backyards for Kids, Homesthetics.net, and Paul’s Playhouses have a number of design ideas that can be incorporated into designs.
What are the costs involved in opening a custom playsets business?
Opening a custom playset business that has an online design platform like CedarWorks’ requires a substantial investment, for the custom web design work is expensive. Business owners don’t need such a fancy website, though.
Business owners who have limited capital can get started for very little if they already have the necessary tools and a workshop (or garage). Business owners need:
- Tools for constructing and assembling playsets
- A vehicle for transporting playsets to installation sites
- A space for building individual parts
- Marketing materials
Those who don’t have these things can keep their costs minimal by purchasing used tools, renting a pickup truck when they need one, and working outside on fair-weather days. Marketing materials can be as simple as a few business cards and flyers when first starting out.
To make sure customers don’t cancel orders, business owners can require an upfront deposit. The deposit can be used to purchase any necessary building materials and features (e.g. slides).
What are the steps to start a custom playsets business?
Once you're ready to start your custom playsets business, follow these steps to ensure that your business is legally compliant and avoid wasting time and money as your business grows:
- Plan your business. A clear plan is essential for success as an entrepreneur. A few important topics to consider are your initial costs, your target market, and how long it will take you to break even.
- Form a legal entity. Establishing a legal business entity prevents you from being personally liable if your custom playsets business is sued.
- Register for taxes. You will need to register for a variety of state and federal taxes before you can open for business.
- Open a business bank account. A dedicated checking account for your custom playsets business keeps your finances organized and makes your business appear more professional to your customers.
- 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.
- 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.
- Get business insurance. Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
- 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.
- Establish a web presence. A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers. Save 15% when you create a business website with Weebly.
Select your state below for an in-depth guide on completing each of these steps in your home state.
Where can I 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.
What are some insider tips for jump starting a custom playsets business?
Parents who purchase custom playsets pay a premium price for durability, customization, and service. Businesses that focus on these will find that past customers frequently recommend them to other parents. Therefore, custom playset businesses should:
- Only offer playsets made from high-quality materials that’ll last
- Offer as many customization options as is possible
- Spend as much time with customers as is needed
How to promote & market a custom playsets business
Word of mouth is the most effective way to grow a custom playset business. Other effective advertising methods include selling through a website and/or catalog. Many business owners avoid selling through traditional retailers because they mark up the price and don’t offer the same level of personable service.
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How to keep customers coming back
A custom playset business can set itself apart from the competition by offering unique features that other businesses don’t have. Placing toys in towers and creating themed playsets, for example, will distinguish a business.
How and when to build a team
Most custom playset businesses start out with at least one employee, for installation goes much faster when there are two people to handle large parts. Additional employees can be added as demand grows and the need arises.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a custom playsets business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Maintain Personal Asset Protection
Don’t think that just forming an LLC, or any other type of business, will save your personal assets in case of a lawsuit or other matter by itself.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your LLC is sued. In business law, this is referred to as piercing your corporate veil.
Two of the simplest steps that will protect your business, and yourself, are to:
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.
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.
Certificate of Occupancy
A custom playsets business is generally run out of a workshop. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a custom playsets business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your custom playsets business will be in compliance and able to obtain a CO.
Custom playsets businesses should consider requiring clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and so on.
How much can you charge customers?
John Lapp, an Amish custom playset business owner, sells basic playsets for $375 and fancy ones for as much as $3,000. Other businesses sell custom models for $5,000 or more. Barrett Brown, who owns CedarWorks, sold one playset for $40,000.
Installation usually runs between $200 and $700, although it can be more for larger playsets.
What are the ongoing expenses for a custom playsets business?
The ongoing expenses for a custom playset business are minimal. They include rent (if leasing a workshop), utilities, vehicle costs, and any advertising expenses.
How much profit can a custom playsets business make?
The profit potential for a custom playset business is substantial. John Lapp sold around 700 playsets in a single year, which would have generated a revenue between $262,500 and $2.1 million depending on how fancy those playsets were.
How can you make your business more profitable?
A custom playset business can increase revenue by offering maintenance services for playsets and/or providing moving services for larger playsets. CedarWorks also makes indoor play spaces, which may appeal to some customers.