Hi all

[Okele]

It's safe to say I am new here, look 1 post! Five years ago I was in the process of starting a LAN center with a friend. His parents were going to finance, and everything was hunky dory. Until....he decided to join the Navy, and the parents said "nevermind." Well I am back to planning again, as a few friends of mine have reinvigorated my interest. We have been brainstorming for the past two weeks on features we would like to have in the LAN center. Please let me know what you guys think:

1. Starting with 24 computers. Standard it seems.

2. Having two rooms, one with the computers, and one with really hip nice furniture and a "starbucks" like decor. Set-up with wireless access(see point 3.) The idea behind room 2 is to attract the girlfriends/wives/husbands/boyfriends of the folks playing games in room 1. Basically a social area with a coffee machine, some nice lighting, and the ability to use an ipad, nook, etc. for reading or whatever. What will this do? It gives the other half a place to be while the other is in playing games. Cost on this is fairly low, and maintenance with the exception of cleaning would be pretty low as well. My thought is, attract the ladies and the guys will come(no pun intended, you dirty minded people.) Advertising for this could be loads of fun too.

3. In-store only Ipad/Nook/kindle rentals. Based on a couples rate, the gamer pays a slightly higher rate and the other half gets the use of the Ipad etc. 

4. Working in a deal with a landlord for us to purchase a solar power array, and offering him/her an option to keep the array should the business fail or we decide to move-on before lease terms are completed. This eliminates our actual electric bill as it would be wrapped into the loan we would be seeking. Making the bills less of a headache.

These are a few of the ideas that we have generated just in the last few days, and they seem to be really primed in our heads. Also, some thoughts on locations we are looking at would be helpful too.

Location 1:

Near a Naval Base in the middle of nowhere, local population 24K, has all the big stores minus Best Buy, and will soon have a Walmart Supercenter to replace the old one. Cost on sq/ft is around 1.00 per sq/ft.

Location 2:

Mountain community. Highly traveled area, about 60K residence, and resistant to big business. 40% of population is apparently divorced middle-aged men with nothing to do.

Location 3:

In a parking lot with the highest volume Walmart Supercenter in an area with 4 of them. Near the mall, best buy, Lowe's, etc. 2 locations available, 1800 sq/ft, and a 3000 sq/ft.


That's it for now, will check back in tonight before work. Thanks in advance for any information.


Oh and another thing I forgot. We plan to add a free service once a month or so to teach kids how to build computers. I have a rep from a popular boutique willing to come down on his own time to actually do the classes. This isn't etched in stone, but the company is likely where we're getting our pc's from.

[Alomax]

Welcome to the forum!  Here's my opinion :

1) Also the reason a lot of places fail. Go bigger. See here for why.

2) This is a great idea, and the large part of the reason why people go to hang out at LAN centers is the social environment. However, you either need to monetize the space those people are in somehow (charge for wifi would be a start, but not enough), or you need to be big enough that the rest of the place can earn enough to cover that area that isn't generating any revenue.

3) This is a very intriguing idea. I would simplify it and just charge a flat rate for the device, and offer a discount if it was rented along with the purchase of time on PCs.  Also some theft concerns here. A magnetic tag and sensor gate at the door would help a great deal.

4) I haven't run the actual numbers, but this is potentially a losing strategy unless you have a great deal on solar panels.  Solar is great, but you're going to need to power a lot of equipment, and you're going to need to do it every day.  Do you have enough roof space to generate enough power? Is it sunny where you are the majority of the year?

Location thoughts:
1 - would only work well if you focused on the traffic from the base.  ie : limit it to 18+, try to get a liquor license
2 - Could work well depending on your exact location (visibility) and if the demographic is correct (get actual demographics)
3 - Walmart is great for eyeballs, but what is the surrounding residential demographic like?

[johnlarson]

Welcome here - operating a LAN center can be great.

1. If you start with 24, have enough room and assets to to go to 40 stations as soon as possible.  Unless you have another source of income, 24 will not be enough.  I suggest 40 stations with room to grow.

2. I think having a coffee shop sort of area separate from the game area is excellent.  I would have this at the front entrance and the PC area in the back.  This could serve as a waiting area if ever needed.

3. I am not sure how well renting these items out would go.  Maybe selling used ones.  We let wives and girlfriends play for free ("bring them both", we say).  We are 18+ and near military bases.

4. I am not sure when the solar would pay off, 15 yrs?  I would not get a loan for all of that.


Location 1:  Near a Naval Base - This would be my top choice, but that is my market, plus I sell items with "Military Financing".

Location 2:  Mountain community. Highly traveled area -  It is all about the people.  If you are more family based, then this is better.

Location 3:  In a parking lot -  It is all about the people.  If you are more family based, then this is better. 

A visible location is always a plus.  Being near other forms of entertainment like bowling alleys, theaters and restaurants is always a plus.

You will want at least 2,500 sqft.  My first location was in 1,200 sqft and it was too cramped and small. 


That's it for now, will check back in tonight before work. Thanks in advance for any information.

I think any type of classes during slow times is a plus.  Free or Paid.

[Okele]

Welcome to the forum!  Here's my opinion :

1) Also the reason a lot of places fail. Go bigger. See here for why.

2) This is a great idea, and the large part of the reason why people go to hang out at LAN centers is the social environment. However, you either need to monetize the space those people are in somehow (charge for wifi would be a start, but not enough), or you need to be big enough that the rest of the place can earn enough to cover that area that isn't generating any revenue.

3) This is a very intriguing idea. I would simplify it and just charge a flat rate for the device, and offer a discount if it was rented along with the purchase of time on PCs.  Also some theft concerns here. A magnetic tag and sensor gate at the door would help a great deal.

4) I haven't run the actual numbers, but this is potentially a losing strategy unless you have a great deal on solar panels.  Solar is great, but you're going to need to power a lot of equipment, and you're going to need to do it every day.  Do you have enough roof space to generate enough power? Is it sunny where you are the majority of the year?

Location thoughts:
1 - would only work well if you focused on the traffic from the base.  ie : limit it to 18+, try to get a liquor license
2 - Could work well depending on your exact location (visibility) and if the demographic is correct (get actual demographics)
3 - Walmart is great for eyeballs, but what is the surrounding residential demographic like?

Hi Alomax,

First thanks for the reply, and I actually downloaded the ballpark estimator yesterday.

1. Ya we were talking about that last night actually. Will probably bump it to 40, depends really on finances.

2. This is where the vending machines will be. It is also a good way to get the couples to interact once in awhile, keeps the other half from getting mad. Been there done that.

3. I should have noted that the flat rate was a forethought. If we choose the Walmart location, this will be a draw for associates on lunch break, which is at almost every hour of the day. So there will be people who come in without a partner.

4. We are currently looking at a space that is approximately 3000 sq ft. Plenty of roof space for panels. I live in the desert in Southern California, and generally we see clouds less then most people see a tornado. The Walmart in the parking lot is on Solar and they rarely have issues. The idea behind the solar panels is to get away from having to pay seperate bills for everything. It also gives us a nice bargaining chip with the landlord should we need to break the lease for any reason. Also going to try negotiating the lease down a little bit too, as it seems it's sitting at 1.75per sqft.

Locations:

1. The only space available is in the largest shopping center on the main street that runs through the base. Getting a liquor license seems a little costly, not too mention having to spend money on a real bartender. Even for just beer. Not too mention, not really sure how drunk service people would react to someone kicking their butt in a round of BF3.

2. It's a well traveled town, granted there will definitely be down time when it snows. And we are looking into the demographics.

3. I currently work at the Supercenter. With 400+ associates, half of them are gamers of some kind. Which is why we are looking hard at this location. They know people who know people, who know people, you get the idea. Plus with lunches and what-not nearly every hour, it almost guarantees some kind of business every day. Not too mention if the management wants to have a meeting there.

Thank you for your response, it is highly appreciated. Hope I answered some questions.

[Alomax]

Glad you got the spreadsheet, be sure to start building on top of it and putting in things unique to your location(s)!

Re: Drunk people - Assholes will be assholes weather they're drunk or not.  Not really much you can do about it.  The kind of environment you foster will dictate how alcohol could dis-inhibit people.  The reason I frequently try to talk people into this is if you can get the license and have a fun place, the markup on alcohol can be INSANE.  Even if you just have moderately priced drinks you can turn a tidy profit.

It seems to me that the Walmart location is your best bet. I say this because you revealed you already have a social anchor in the area : you. Social anchors and word-of-mouth are the most powerful tools you can use to grow your business.  And nobody is more enthusiastic about telling people about their cool new business than the business owner(s).   That said, still do your research, find out what kind of people live in the ~10 mile radius.

[Okele]

We have decided to opt for the location in the same lot as Walmart. There are a few other things that have been proposed as well.


1. Microsoft Surface tables. Con: Price Pros: wow factor, 1v1/2v2 Starcraft/Warcraft tournaments, it's new and trendy, which should bring in a few people. We are thinking an extra $1 or two on top of the normal fees. We are also thinking of putting one up front, with wheels so it can be used for playing multiplayer board games like monopoly(just a thought.) I did some napkin math and it would require utilization of 3 hours per day for a full year to pay one off. Doesn't seem to be to unreasonable, problem comes down to the $7600.00 price tag. Maybe a pipedream?

2. Regular bookcases, filled with regular books also for the lounge. Adds a little bit of a classic feel to it, and broadens the spectrum for potential customers. Could charge like .50 cents an hour to read them. I can get some books fairly cheap through a friend who owns a used book store, so cost is fairly small.

3. Cloud storage. Has anyone played around with this? Would seem like a less expensive alternative to having a file server in the building. Not to mention freeing up some room.

[Alomax]

1) No. The "wow" factor* should be given only cursory attention, IMO.  Touchscreen technology can be very useful, but in terms of software development, it is still in it's infancy.  The software (OS, games, apps) all have to be redesigned from the ground up in terms of usability or they are just frustrating to use.  Windows 8 is a step toward utilizing this tech better, but everything else is even further behind. 
I don't know if you've ever tried to use a desktop-sized touchscreen continuously for more than 5-10 minutes, but your arms fatigue quite quickly.  If you really want to try and implement this idea, I would highly recommend building a DIY multitouch interface and finding some cool software to run on it, rather than spring $7500 that could be used to pay for ~5 PCs. http://www.maximumpc.com/article/features/maximum_pc_builds_a_multitouch_surface_computer

2) Charging by the hour for books is something I doubt anyone will ever pay for.  Charging a general one-off fee to be able to sit there, lounge, read, use wifi, that would make more sense IMO.

3)  No. Cloud is a buzz term used to describe a myriad of services and technologies that are mostly only applicable to websites and corporations that operate with 100's of terabytes of data that need no specific geolocation.  To use a remote storage solution ("cloud") in a LAN, you would need ~2TB of storage, with a tremendous bandwidth allowance, and an internet connection that can operate at near Gb/s speed. I guarantee you it will cost more than the ~$2500 it will take to build a very nice server with RAID1 storage and bonded NIC cards. And the server will last you ~3-5 years without upgrades.


* Wow factor : Anything in the business that exists for the purpose of making customers go "wow, that's cool!".  This is different and separate from general interior design aesthetics that make the business look nice.