Start a ghost tour business by following these 9 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 ghost tour business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
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 ghost tour business?
The actual cost of opening your business is quite low. This is because it is primarily comprised of walking people through various public areas. As such, you can start this business for $3,000 or less. This includes $500 for a professional website and $2,500 in advertising, including radio and newspaper ads. With permission, you may also advertise at some of the areas that you will be taking tours, creating a nice bit of community synergy. Beyond this, you can functionally operate the business from your home and simply meet customers at the appointed time, completely removing the need for any costly overhead or lease.
What are the ongoing expenses for a ghost tour business?
There are little ongoing expenses except for advertising (typically less than $200 a month). Your business can be run from home and requires no overhead or additional lease, so besides advertising, you are really just paying for the price of gas to drive to the tour site.
Who is the target market?
While you will have customers of all stripes, your target market is likely couples between the ages of 28 to 38. This is a group that is settling (or already settled) into the city for their foreseeable future and would like to either learn more about the city or to simply look at it through new eyes. If you are in an area that experiences lots of natural tourism, the tourists most interested in the ghost tours are likely to skew a bit younger (between 21-26).
How does a ghost tour business make money?
A ghost tours business makes money by charging a fixed fee for a one or two hour tour of the city. That fee is typically per person (though you may consider offering group rates).
How much can you charge customers?
Prices for ghost tours vary, but they are typically in the range of $10 to $50 per person. Your prices are often dictated by your local economy and the presence (or lack) of any competition. You may consider offering special pricing for children and small groups.
How much profit can a ghost tour business make?
The profit of a ghost tours business is determined by how many customers you have and how much you charge. For instance, for a business that charges $25 for an hour-long tour and sees eighty customers a week, you could make over $100,000 doing this. You are unlikely to make that much when you first start, but it may be worth doing this as a side job first to gauge its success. This is particularly easy as the best time for a ghost tour is in the evening!
How can you make your business more profitable?
Don't be afraid to make a spectacle of yourself. If you are willing to dress in ultra-goth attire, for instance, it increases your potential entertainment value. Reach out to local “ghost hunters” to help recruit more customers and possibly develop partnerships and networking opportunities. Finally, you may consider seasonal rates: ghost tours become more popular the closer it is to Halloween, so even a small rate increase during your busiest season can lead to bigger profits!
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your ghost tour business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
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?.
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: You can get $300 when you open a Chase Total Business Checking® account with qualifying activities. Learn More.
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.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a ghost tour 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.
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.
How to promote & market a ghost tour business
As mentioned earlier, advertising via radio and newspaper helps to raise awareness of your business, as does your professional website. Be sure to advertise on social media—the highly visual nature of social media makes it easy to showcase spooky photos of some of the tour destinations, and it allows you to seem more accessible to customers. While television advertising may be out of your budget, you can get free advertising by getting local news stations to report on your business and some of the local ghost legends you'll be talking about. Make sure to tell local hotels about your business—the concierge can spread the word about you to those staying at the hotel, and you may be able to work out a business arrangement with hotels that are part of your haunted tour.
How to keep customers coming back
You can attract customers through various promotions. This might include giving tickets away via radio station promotions, or conducting your own contests via social media. See if you can attract customers of businesses on your tour by advertising at those venues—a restaurant on your tour path may be happy to advertise for you in the hopes that hungry customers will come by after the tour. In terms of customer retention, one of the best things to do is to periodically change up tour locations, so returning customers always have something to look forward to!
STEP 9: Establish your 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.
Start A Ghost Tour 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?
This business is ideal for people who are already very familiar with local lore, including ghost stories. It's also good for those who have previously researched occult studies, as they will be able to discuss ghosts and hauntings in a more authoritative way. Finally, it's great for storytellers: part of these tours is not simply explaining what happened, but making customers feel like the tour guide is bringing the past to life.
What happens during a typical day at a ghost tour business?
On the actual ghost tours, you will spend one or two hours at a time walking groups of customers through the city, stopping in key areas and explaining the special connection these areas have with ghosts. When you are not conducting the actual tours, most of your time will be taken up by advertising and communicating (with city officials as necessary and prospective customers). You may also network with related businesses to help promote one another's work.
What are some skills and experiences that will help you build a successful ghost tour business?
Most of the skills and research you'll need for this are found at your local library. Ideally, your tour will have lots of info about very specific businesses and areas and why they are considered haunted. Your library is a great place to begin researching this and putting together a narrative of what you will tell your customers during the tour. You should also participate in ghost tours in other cities to get an idea of the features your own tour should include.
What is the growth potential for a ghost tour business?
The growth potential for this business is modest. In 2012, the Orlando Sentinel reported that ghost tours and their related industries bring in over $300 million per year, which marked a significant jump from what used to be a gimmick. The presence of reality TV shows where individuals explore haunted houses also helps sell the idea of this as an exciting adventure for your customers.
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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.
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 ghost tour business?
Try to make sure your tour is situated near the areas tourists frequent. That way, you get some “pick-up” customers in addition to people who have already contacted you. Make sure your tour integrates areas of general historic interest—this makes the ghost tour seem more real and also attracts history buffs. Finally, one tour tip that is not for everyone is to bring along your own ghost-detecting equipment, allowing you to make a theatrical show about the lingering presence of spirits in an area.
How and when to build a team
Most of the time, these businesses start out as solo operations. However, you may consider building a team if you have enough business that you must “stagger” tours and start them at different times. Alternately, because the heart of this business is storytelling, you may take on a partner who helps you craft compelling narratives to attract and enchant customers.