Do you want to open a video game store? If YES, here is a complete guide to starting a video game store business with no money or experience .
Ok, so we’ve provided you with a detailed example of a business plan template for a video game store. We also took it a step further by analyzing and writing a sample video game store marketing plan backed by actionable guerrilla marketing ideas for video game stores. In this article, we’re going to go over all the requirements for starting a video game store. So put on your entrepreneur hat and let’s move on.
Why open a video game store?
Starting a video game store business is very easy, especially if you are very fond of video games. Passion for video games is very important as you need to keep up with industry trends for new video games and be able to speak with authority about the products in your store.
If you are convinced that this is the type of business you want to do, there are several factors that you need to consider before you can successfully launch and launch your video game business in the United States of America.
First steps in a video game store. The Complete Guide
- Industry overview
According to the Global Games Market Report, in 2016, gamers around the world generated nearly $ 100 billion in revenue, with their percentage increasing by 8.5%. than the one that was created in 2015. Mobile games have surprised analysts by overtaking PC games to capture the largest market share in the world, generating nearly $ 37 billion in revenue.
China accounts for a quarter of all global income. Therefore, analysts expect the global market to not only grow an average of 66% but also reach nearly $ 120 billion by 2020, with mobile games accounting for at least $ 53 billion in total revenue. .
According to an analysis by the Entertainment Software Association (ESA), in 2014, more than 135 million games were sold in the United States of America, generating $ 22 billion in revenue, for a total of 46, 5 million sales over this period. billion USD
The data showed that the average gamer was a 35-year-old adult, 44% of whom were female, contradicting the popular belief that most gamers are men. The video game industry employed more than 146,000 people in 36 states of the United States of America.
According to statistics, around 155 million Americans play video games because there were at least two active gamers in each household. 42% of Americans who are regular gamers spend at least 3 hours per week playing video games.
The increase in this statistic is due to the fact that parents and guardians who previously viewed video games as an exciting activity but now saw them as a means of communication and bonding with children and preferred to watch TV or games. movies. The popularity of favorite video games (board games, social games, action games, puzzles, and card games) is almost evenly distributed across all areas.
Globally, APAC territories will generate nearly $ 47 billion in revenue, or 10%. Increase: China, which topped the United States of America in gaming revenue, accounts for nearly $ 25 billion in total, compared to the $ 24 billion expected by the United States.
The PC market in China has slowed its growth – a growth of 4%, reflecting its decline after the 16% growth of the previous year, and this is due to the fact that more people in China now prefer mobile games to PC games; As a result, there is a growth in the mobile market, which is expected to reach $ 10 billion, up 41% from $ 7.1 billion the previous year. The Chinese gaming market is expected to reach $ 29 billion by 2020.
The North American market is the second largest region with more than $ 25 billion in revenues in 2016, up 4.1% from the previous year. The growth of this market is mainly driven by the mobile segment. However, console revenues remain stable as they are gradually digitized. In Europe, the gaming industry has developed more in the east than in the west.
The slow growth in Western Europe can be attributed to the slow adoption of mobile games by serious and mid-sized gamers. Latin America is far behind the others as it has just recovered from a severe economic downturn that caused its exchange rates to fall. However, due to the improving economy, it will receive $ 1.4 billion from mobile games.
According to IBISWorld, the video game industry in the United States has an average revenue of $ 44 billion, growing 4% between 2011 and 2016. There are more than 35,000 video game companies in the United States. United of America. it employs more than 187,000 people.
Industry demand is expected to increase as more customers are expected to receive new consoles and games. The reason the market is so huge is that it is not limited to just young men, but also women and customers of all ages. More and more people will play more and more games online, thus increasing the industry’s revenue.
The video game industry experienced robust growth between 2011 and 2016, and revenues are expected to be stable at 4% during this period due to economic growth which has resulted in increased disposable income, most of which them increasing their discretionary spending. items such as video games and accessories.
Market study and feasibility study on the launch of the business game store
- Demography and psychography
The demographic and psychographic makeup of those who visit video game stores is not just about young men, but also about women and consumers of all ages. This means that the average gamer is not just a teenager or young adult male, but the average 35-year-old adult and can be male or female.
So this means that the demographics of those who visit a video game store to buy games (hardware or software) are not limited to a group of people, but cover everything.
List of niche ideas in the video game retail industry that you can specialize in
In the video game store segment, there isn’t much of this industry; however, large video game stores, due to their financial capacity, may offer more than one niche or even all niches compared to a small video game store.
Focusing on a niche is a good way to set yourself apart and compete as a small video game store, especially if you are just starting out. Therefore, some of the niches that a video game store might decide to focus on are:
- Sell physical games and software
- Sale of consoles
- Sale of video game accessories
- Online sale of games and software
- Sale of used games and accessories
- Sale of old games
The level of competition in the video game store industry
The video game industry is a multi-billion dollar industry and there are so many operators causing fierce competition in the industry. Large video game stores can still compete with small video game stores because they can generally open more than one establishment, they attract more customers.
Most video game store owners generally have a beneficial relationship with video game developers and publishers to help bring the game to consumers.
List of famous brands in the video game retail industry
While this can easily identify video game developers and publishers, a video game store business tends to be a very different ball game; in addition, its facilities are spread over several sites. Some of these brands are the ones that have enjoyed phenomenal success in this industry due to several factors such as; their marketing and advertising strategies, their game inventory or their seniority in the industry.
Therefore, some of the major video game stores in the United States of America are;
- Pink goriila
- Xbox game store
- Game x change
- Play N Trade
- Slackers CDs and games
- Rhino Video Games
Players now have more options for choosing which devices they can use in the games of their choice. as content of the games. This has allowed the game industry to grow, especially when business models and platforms have been aligned, and this alignment is forcing the video game industry to evolve into a full entertainment franchise, thus finding more ways to ensure customers stay engaged and generate more revenue streams.
The video game industry’s revenue is split between PC, console and mobile games. However, revenues from games such as virtual reality (VR) are steadily increasing and consumers will start to replace their spending with other types of games for this game, as virtual reality is expected to change not only in the way consumers interact. between them, but also interact with the content. Thus, most of the revenue generated by virtual reality will come from sales of hardware, content for viewers, and live viewing formats.
The growth of the video game industry is primarily driven by a combination of game development and publishing. This means that video game developers, unlike in the past, can now develop games without the need for funding from publishers. In addition, improved processing devices with faster speeds and improved graphics have made end users more enjoyable from their games.
Money is made in the video game industry by selling hardware that makes it easy to play games like PCs, consoles, game consoles, remote controls, virtual cannons, and gamepads. The software is another way to earn money as it is a real video game which can be purchased via CD / DVD, mobile app or even download. Finally, infrastructure (network, Internet and connectivity) and supporting technologies are another way to make money in the video game industry.
Start your video game store business from scratch or by purchasing a franchise
There are several advantages and disadvantages of starting your video game business from scratch. Starting from scratch, you are in charge of your entire business and can easily change your strategy mid-term to adapt to changing economic trends. However, even if you are solely responsible for your business, you can easily be overwhelmed with all the details and attention that your new business will demand, especially when it comes to handling paperwork.
Buying a franchise is a decision you will need to think carefully about. You need to do a thorough research on the company where you are going to buy the franchise. However, with a franchise, you don’t have to worry about how to advertise or advertise your business as this will be dealt with along with other aspects so that you can only focus on running. of the company. However, you should know that you will not be responsible for certain key decisions affecting your video game store.
Threats and potential challenges you will face when starting a video game store business
Like any other business that faces threats and challenges, a video game store business makes no difference; As an entrepreneur, you should be prepared to deal with all the threats and challenges that may arise when starting or running a business.
Some of the threats and issues that you may face when working in a video game store in the United States of America are; intense competition in the industry, an increase in the number of mobile gamers who will see customers buy less gaming hardware and accessories or even software because they can download any game they want from their mobile phones, the economic downturn in which consumers will spend less and the arrival of a competitor offering the same services in one place. Threats and challenges will always exist, and how you manage them as an entrepreneur will determine the success or failure of your video game store.
Opening of a video game store Legal issues
- Best entity to use in a video game store
There are currently four types of legal entities. The United States of America for those who are going to start a video game store, and they are; a sole proprietorship, partnership, corporation and limited liability company (LLC).
The only property of a legal person is that which is managed by a single person who is responsible for the whole business – assets and liabilities. While this is a great option if you are starting out small, if your business goes into debt you will be held personally responsible. A partner legal entity is a partnership of two or more partners who have formally agreed to do business. All partners jointly make decisions and are equally responsible for any debts the business may incur.
A company is created when certain people decide to start a business that will be considered separate from them. There are generally two types of companies – S and C – and both have their own advantages and disadvantages.
A limited liability company (LLC) is also a form of legal entity that is considered separate from the owners, just like a corporation. Most entrepreneurs usually apply for this type of entity due to tax breaks and other benefits.
Catchy Business Name Ideas Suitable For Video Game Store Businesses
Having a catchy name for your video game store is very important, so you need to take this aspect very seriously; customers not only love a unique and creative name, but a name that they can easily remember and identify.
Here are some catchy titles that you can choose from for your video game store;
- Game Changers Inc
- Best game store
- Quad Core Video Games
- Virtual video game stores and software
- Succulus video players
- Vintage video games
Having a business insurance policy for a video game store is very important as it will protect you from any liability that you may incur in the course of your business activities. Your insurance policy will prevent you from having to pay out of pocket if your products are damaged or stolen, or if your store is injured. While it is very important to have basic insurance policies, you should seek the advice of an insurance agent or broker to find out which insurance policies are best suited for your business. video game store.
Below are some of the basic insurance policies that you will need to purchase if you intend to open your own video game store in the United States of America;
- General insurance
- Liability insurance
- Workers’ compensation insurance
- General disability insurance
- Health insurance
- Professional liability insurance
Protection of intellectual property rights / registered trademarks
A video game sales company that sells games (hardware and software) to end users. This means that video game stores are retailers and therefore do not participate in the production of games and therefore do not need to create material that would need to be protected against theft by filing a privacy protection claim. intellectual property. However, there are some big video game stores that make games and therefore will need to apply for a PPI, but this is not common.
Most entrepreneurs who own video game stores are generally looking to protect their logo, slogan, or sounds, and therefore need a lawyer to file an PPI for them with the USPTO.
Do i need professional certification to run a video game store?
A video game store business is all about buying and selling video games (hardware and software), which does not require special skills and therefore does not require an entrepreneur to obtain professional certification. However, there are associations that you can join to build your video game store’s reputation when you need to build relationships with industry players such as video game developers and publishers.
List of legal documents required to run a video game store business
The United States of America is very strict about starting a business; this means that companies must have all the necessary documentation with them. Lack of proper documentation is considered a very serious offense, which can lead not only to having to pay a huge fine, but also to being banned from engaging in such activities again.
Therefore, before you jump into the video game business, it is important that you know what documents your government requires of you. You can also consult a lawyer with experience in the video game industry to help you determine the documents you need to conduct your business in the United States of America.
Here are some basic documents you will need before you can start or launch your video game store;
- Registration certificate
- Operating contract
- Business license and permit
- Business plan
- Insurance policy
- Non-disclosure agreement
- Agreement agreement
- Hiring contract
- Sales permit
- Employer Identification Number (EIN)
- Federal tax identification number
Financing a video game store business
Even if you are passionate about running a video game store but don’t have the necessary funding for your business, your business will likely remain an idea. This is why it is absolutely imperative to have a business plan, because finding start-up capital is what an entrepreneur should do, as not all entrepreneurs can afford to run the business they have in mind. with the means available.
A comprehensive business plan is not only intended as a document to help guide your actions and decisions, but also to show those you intend to use as seed money how serious you are. in the business and how you will repay them.
As such, some of the options that you may need to explore to find seed capital for your video game store;
- Raise part of your start-up capital through personal savings and the sale of shares
- looking for loans on favorable terms from friends and family
- apply for a loan at a commercial bank
- collect money from investors and business partners.
Choosing the right location for your video game store
Decide where to find a video game store. Business is very important because you have to be in a high traffic area for people to come to your video game store for a video game or its accessories. Areas with heavy foot traffic include malls, movie theaters, malls, and large grocery stores, and other similar places teens, young adults, and adults can visit.
Some of them use their video games. keep the business from your home and if this is the option you intend to go for then you will need to create a responsive and secure website as most of your customers will be making payments through your website and therefore want be sure their contact details kept safe. In addition to selling your products through your website, you will need to sell through a combination of online platforms such as online auction sites and e-commerce platforms, and even through your media platforms. social.
Create a detailed technical team in a video game store
In order to get all the technical and human resources needed for a video game store, it is important that all the requirements such as finances are in place. Having the necessary funds will allow you to allocate what you need to run your business successfully.
When purchasing the equipment and supplies you need to run a video game store business, you may need to source wholesalers online in order to get good prices on the games you will buy. . However, it is imperative that you do your research on the games that you are going to buy, especially the ones that you will buy in bulk.
This is because if the games are not popular and you buy in bulk, you will not only have a hard time selling the games, you will be tying up capital for unnecessary actions. You can also do business with certain games and consoles, especially online auctions, flea markets, yard sales, and thrift stores. Make sure everything you buy is in good condition so you don’t ruin your business reputation.
Therefore, most of the equipment that you will have to sell in your video game store; consoles, game consoles, games, game systems, joysticks, consoles and virtual guns. You will also need a credit card, office supply, and cash register dispenser.
The employees you will need to successfully run a video game store business; General Manager (Owner), Administrator and Human Resources Manager, Business Development Manager, Marketing and Sales Directors, Store Manager, Customer Service Manager / Administrator, Accountant / Cashier, Cleaners, Security Guard and Official Driver.
Hence, this means that you will need at least eleven key employees to effectively run a video game store business.
Service process in a video game store business
A video game store business that purchases video games and related products and sells them to customers. You may need to buy these products in bulk, so you will have to go online to find wholesalers who can offer you a lot. You can also visit your local used games and consoles website.
When you receive used products, you can offer cash or trade credits, determining which option you use based on name popularity, age, and physical condition. the state of these games.
Starting a commercial marketing plan for a video game store
- Marketing ideas and strategies
Marketing is one of the primary means of generating income for a business, and any business that has been set up to generate profit knows that it needs to engage in activities that should not only recoup its initial investment. , but also to ensure that the company is able to reach everyone. their goals and objectives.
Before creating marketing strategies, it is important to do market research. A market research will allow you to study the market you are about to enter, from your target market to your competitors and other stakeholders, and determine what they expect from you and what you should expect from you as well. them.
Once the market research is completed, effective marketing strategies can be created that will allow you to enter and gain a fair share of your target market, which in turn will allow you to compete favorably with your industry competitors. Some entrepreneurs typically seek the services of a marketing consultant with the necessary industry experience to help them develop effective marketing strategies that match their business goals and objectives.
To make sure you stand out in the industry and gain significant market share, you will need to combine several strategies, such as placing ads in print and visual media, and using online platforms such as your website, Facebook and Instagram to sell your video games and anything else you plan to sell in your video game store.
So some of the platforms that you can use to effectively market your video game store;
- Formally introduce your video game store to industry stakeholders and potential customers in your target market by sending an email
- place advertisements in local newspapers and technical magazines, as well as on radio and television stations
- using online resources using platforms such as your website, Facebook, Twitter, Instagram and Google Plus to advertise and market products on your video game store.
- Get into direct marketing and sales by hiring an experienced and knowledgeable marketing and sales team
- Be sure to advertise your video game store in popular game forums and blogs
- Make sure your video game store is listed in online directories and even in the yellow pages
Video game store expansion strategies. Notoriety and brand image
Building Bran’s brand awareness is seen as a huge business, and companies, regardless of their segment in the industry, are willing to spend huge sums of money each year to ensure their branding is consistently communicated to them. their customers and the overall target market.
No one starts a business and wants to promote themselves. If, for example, you own a vintage video store, you will need to maintain interest in your target market at all times by running promotions indicating the existence of your video game store.
Today the Internet has made advertising not only very cheap, but also very effective. You can choose a section of your target market and focus on them, especially if you have a niche product. You can also try a combination of online and offline advertising strategies to make sure that you can boost your brand and build awareness that you want.
Below are the platforms you can use to improve the quality of your brand: as well as to promote your video game store;
- Use social media platforms like Facebook, Twitter and Instargam to grow your video game store
- Advertise on the player forum and blogs
- Build a website and constantly publish your video game store
- Distribute flyers and brochures in targeted locations
- Install a billboard to advertise your video game store