How to Start a Nerf Arena

Start a nerf arena by following these 10 steps:

1. Plan your Nerf Arena
2. Form your Nerf Arena into a Legal Entity
3. Register your Nerf Arena for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Nerf Arena
6. Get the Necessary Permits & Licenses for your Nerf Arena
7. Get Nerf Arena Insurance
8. Define your Nerf Arena Brand
9. Create your Nerf Arena Website
10. Set up your Business Phone System

We have put together this simple guide to starting your nerf arena. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

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 will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

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 Nerf Arena Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

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.

What are the costs involved in opening a nerf arena?

Your Nerf arena will require a significant amount of space, either indoor or outdoor, and equipment. Total costs depend on a number of factors, including: whether it will be an indoor or outdoor facility, what type of “courses” you plan to offer customers, and how large of a staff you plan to employ. Start-up entrepreneurs recommend a budget of $30,000 to $75,000, depending upon the specifics of the arena and the region in which you reside.

Consider the following when planning your budget:

• Lease building - a minimum of 2,000 to 5,000 square feet is recommended.
• Build-out and decor for arena course - $5,000 to $10,000
• Insurance - cost varies depending upon a number of factors. Seek the advice of a trusted insurance agent.
• Nerf guns, ammunition, eyewear, and colored vests - guns range anywhere from $15 to $75. Ammunition refill packs can run upwards of $40.
• Point of sale/management software - items - $3,000 to $9,000

While this is a fairly new idea in the entertainment industry, several Nerf arena owners are now offering franchise opportunities. Entrepreneurs who lack relevant experience are encouraged to consider these options when constructing their business plan.

What are the ongoing expenses for a nerf arena?

Nerf arena business owners report an annual ongoing expenses of $155,000 to $230,000, depending upon the size and scope.

Ongoing expenses include the following:

• Lease
• Utilities, phone, etc
• Payroll
• Marketing and printed material
• Insurance
• Business management software upgrades and credit card fees
• Miscellaneous supplies
• Routine maintenance, repair, and replacement of equipment

Who is the target market?

Fortunately, Nerf arenas are the type of adventure that appeals to individuals of every age group. Your core audience will be aged six to fourteen. However, many facilities have found that, with the right course design and equipment, much of their revenue is derived from corporate groups looking for a fun way to solidify business teams and reward employees for their hard work.

How does a nerf arena make money?

Nerf arenas generate revenue from each individual that visits the establishment. A majority of the business’ income will come from groups that reserve the space for a birthday party or company event.

How much can you charge customers?

Customers are charged per hour, with a national average of $8 to $12 per hour. Rounds generally last three to five minutes, allowing players to get in twelve or more rounds in an hour. Admission includes basic Nerf guns and ammo, with the option to upgrade for additional fees.

How much profit can a nerf arena make?

Annual profits depend upon a number of factors. A well-designed facility of 3,000 square feet, has the potential to generate profits upwards of $50,000 annually in the first three years.

How can you make your business more profitable?

To maximize profits, maintain a facility that keeps up with the latest trends and a course consistently changes. Boost excitement for Nerf gameplay by implementing the following strategies:

• Offer something different and exciting on the weekends. Blacklight play has proven popular at other facilities across the country.
• Market to schools and churches in your area, offering your facilities for team sports practice during off hours.
• Host tournaments and consider starting a Nerf league.
• Offer food and drink.
• Focus on large parties and group events.
• Include other entertainment options, such as an arcade, to attract those who aren’t interested in Nerf battles.
• Mobile Nerf gameplay will attract an additional demographic and is a great service for families wanting to host birthday parties at their homes.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your nerf arena is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

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!

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.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money 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.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

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 Nerf arena. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

Certificate of Occupancy

A nerf arena is generally run out of a large indoor or outdoor space. 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 nerf arena.
• 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 nerf arena will be in compliance and able to obtain a CO.

Liability Waivers

To avoid liability and potential lawsuits, Nerf arenas should have their clients sign waivers, such as this sample waiver form.

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.

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.

Is this Business Right For You?

An individual who enjoys working in a fast-paced, entertaining environment would be the ideal candidate for this business venture. Nerf arena entrepreneurs should enjoy interaction with customers of all ages and backgrounds, bringing out the kid in all of us.

What happens during a typical day at a nerf arena?

A Nerf arena owner will spend a good deal of time actively playing with customers, as interaction with customers is priority number one. Visitors who walk away with a smile on their face will not only become regular customers, they will share their experience with others in the community. Direct involvement in game play will safeguard against injury. Additionally, it will offer your team an opportunity to note customer feedback, adjusting business strategies accordingly.

In addition, your Nerf arena team will need to:

• Place vendor orders when supplies run low
• Routine maintenance and cleaning of arena and equipment
• Safety check of course and all equipment
• Conduct market research regularly to ensure your business keeps up with the latest trends
• Schedule parties and host events
• Implement marketing strategy and network within the community
• Accounting and administrative duties

What are some skills and experiences that will help you build a successful nerf arena?

Experience in the entertainment industry, particularly one involving gameplay, would prove beneficial. This would help ensure the safety of your clients and offer a clearer understanding as to what visitors expect from your facility.

Attention to detail and strong leadership skills are critical for the entrepreneur seeking long-term success and growth. Additionally, since your days will be spent interacting with customers and staff, sound social and communication skills will be paramount to your success. This will assist in networking and implementing a marketing strategy and will leave a lasting impression on your customers, ensuring a more positive experience. If you do not have business management experience and knowledge, consider taking a basic business course at your local college.

Battlefield Sports University is a wonderful resource for those starting out in this industry. They offer insider tips on everything from marketing to technical advice and industry trends.

What is the growth potential for a nerf arena?

Nerf guns have regained popularity over the last decade, offering entrepreneurs a unique opportunity to invest in a fairly new business venture. This growing trend, however, has yet to reach many cities across the U.S. Those who possess both vision and drive can expand their enterprise to entertain Nerf gun enthusiasts in every major city.