From Startup to Success: Financial Tips for New Escape Room Owners
Hello, future escape room moguls!
Starting an escape room business is an exciting journey, but as any seasoned owner will tell you, it’s also a financial rollercoaster. From the initial investment to ongoing expenses, getting your finances right from the start can make or break your business.
Whether you’re about to launch your first room or just getting started with the planning, here are some essential financial tips to help you navigate the challenges and set your escape room up for long-term success.
Start with a solid financial foundation
One of the most important things to remember when starting out is to set up a strong financial foundation. This means creating a detailed budget and understanding your startup costs, which can include everything from venue rent to game design, equipment, and insurance.
How to do it:
Create a startup budget: List every possible expense and make sure you have a clear picture of how much money you’ll need to get your escape room off the ground.
Secure funding: Depending on your budget, you may need to secure a loan, seek investors, or use your personal savings. Consider looking for funding options specifically designed for small businesses, like grants or business loans.
Track your cash flow from day one
Cash flow is the lifeblood of any business, and escape rooms are no exception. At the beginning, it can be tricky to predict how much revenue you’ll bring in, especially if you’re still building your customer base. But knowing how to manage and track your cash flow will give you the clarity you need to avoid financial stress.
How to do it:
Use accounting software: Start with a tool like Xero to track your income and expenses. This will help you see exactly where your money is going and ensure that you’re staying within budget.
Plan for the lean months: Escape rooms often experience fluctuations in bookings, with slower periods between seasons or after the initial buzz of your opening. Be prepared by setting aside cash reserves.
Don’t underestimate taxes
Taxes are a reality for all businesses, and understanding your obligations from the outset will save you from costly mistakes later. Whether you’re VAT registered or just starting out as a sole trader, it’s essential to know how to manage your tax responsibilities.
How to do it:
Set aside money for taxes: A common mistake for new business owners is not budgeting for taxes. Set aside a percentage of your revenue each month so you’re ready when tax season arrives.
Keep track of your expenses: Certain costs, like game design or marketing, may be deductible from your taxes. Make sure you’re keeping good records, as this will help reduce your tax liability.
Monitor key performance metrics
Tracking the right financial metrics will give you the insights you need to make smarter decisions. You don’t need to be an accountant to track important numbers, but understanding your key performance indicators (KPIs) will guide you toward sustainable growth.
How to do it:
Focus on profitability by room: Understand how each escape room is performing. Which ones are bringing in the most revenue? Which ones need some adjustments?
Look at occupancy rates: Keep an eye on how often your rooms are booked, and use that data to optimise staffing and marketing strategies.
Track customer retention: It’s often easier and cheaper to keep customers coming back than to find new ones. Analyse repeat bookings and customer reviews to understand what’s working.
Build a financial plan for the future
While it’s essential to focus on the present, you also need to think ahead. As your business grows, your financial needs will change. Having a plan for expansion, whether that’s adding more rooms, increasing staff, or even opening a second location, will help you avoid financial overwhelm down the line.
How to do it:
Create a 12-month financial forecast: Predict your sales, costs, and profits over the next year. This will help you stay on track and adjust as needed.
Consider future investments: As your escape room grows, you’ll likely need to reinvest in equipment, technology, and staff. Plan for these expenses now to ensure you have the cash flow to cover them.
Let me help you on your journey
Navigating the financial side of your escape room business doesn’t have to be overwhelming. I’ve been in your shoes — running my own escape room and helping others do the same — and I know that with the right financial strategies, you can make your business a success.
If you’re ready to get your finances in order and ensure long-term growth, let’s talk! I can help you set up your financial systems, track your progress, and make data-driven decisions that will take your escape room to the next level.
Ready to unlock your escape room’s financial potential?
If you’re looking for a financial partner who understands the ins and outs of the escape room industry, I’m here to help. Let’s chat about how we can make your escape room business thrive with a free consultation.
Chi / Sam
Your Escape Room Bookkeeper
