to read the total review - Foundations Entertainment University

A Solid
Foundation
FEC Seminar Program Attracts a Diverse
Group of Future Tradesters
F
oundations University, the school
for would-be amusement facility
operators, defies the old adage
about those who can do and those who
teach. The sharp and experienced consultant instructors who run Foundations do
both, teach and work in the real world, and
do them well.
The three-day series of intense workshops is put on by the industry’s cream of
the crop including well-known writers and
speakers Frank Seninsky, Randy White,
Jerry Merola, Alan Fluke and Peter Olesen.
During their most recent session in
Arlington, Texas, RePlay editor Steve
White sat in on the first day’s classes and
attended an evening field trip to nearby
Alley Cats Bowl and Putt Putt Golf, all to
get a first-hand taste of what it’s like to be
a would-be investor eyeing the amusement
industry as a new career. Classes on day
one focused on design and development of
the facility.
Attendees included existing owners of
single facilities looking to expand, newcomers to the amusement biz including
some from as far away as Nigeria, current
operators of bowling facilities and restau-
rants and even owners of semi-related
businesses including a kid’s dance studio
looking to incorporate an entertainment
component to their current services.
“We’re here to go forward to the next
step of your project no matter what stage
you’re at currently,” explained Jerry
Merola of Amusement Entertainment
Management. “We’re here to help each
other.”
Merola went on to say that new businesses must have a solid foundation on
which to build and grow, but that can be
difficult to get in a business like amuse-
This year’s first of three Foundations University sessions drew 30 attendees plus speakers and sponsors to the three-day educational seminar
in Arlington, Texas. Two more sessions are scheduled for Kansas City and Chicago.
April 2008 • RePlay Magazine • Page 65
Foundations
Foundations co-founder Randy White of the White
Hutchinson Group (right) talks about the need for proper
planning to future FEC owner Gordon Duell of New York.
Independent FEC consultant Martin “Bud” Umbach (center) of Recreation
Solutions visits with fellow Foundations attendees Heath and Laura Hanoch, who
plan to open an entertainment facility in Oklahoma.
everybody else away,” said White.
“You can’t be all things to all people. You end up not being special to
anyone.”
Some facilities, by instituting a
changing of the guard at sundown,
have managed to attract at least two
of these different segments. For example, Dave & Buster’s caters to
John Garrido of Brunswick Amusement Mafamilies by day and young adults in
chine, a Foundations sponsor, stopped during a
the evening. But you still have to fobreak to explain their new line-up of games to Brian
cus on a core customer, and not sacMurphy of New York.
Jerome and Christina
rifice that business in attracting a
Bello came to Foundations
secondary
market, because conall the way from Abuja,
sumers have so many entertainment
Nigeria, where they hope to
open an entertainment destichoices today.
nation.
“Leisure time is today’s real currency,” stressed White. “So consumers have exceedingly high expectacording to veteran
tions. Remember, most of you, especially
consultant Randy
the guys, are not your customers, and that
White of the White
can be a problem when you are trying to
Hutchinson Group
attract families. You have to learn to see it
based in Kansas
from your guests’ point of view.”
City with a satellite
White strongly counseled the future
office in the Middle
FEC operators to take their time in develEast.
oping initial concept, business plan, market
Those markets
Foundations’ Jerry Merola (left) with two key FEC suppliers and
research, projections and proposed maninclude young chilFoundations sponsors, Charlie Schlageter (center) of QubicaAMF and
agement structure before simply throwing
dren
(eight
and
unBrad Feinman of Creative Works.
open the doors and expecting customers to
der), families (with
come pouring into the facility. Conducting
kids five through
ments that is “still a mom-and-pop indusa feasibility study, he added, is crucial to
12), at-home moms (with kids five and untry.” Foundations, he added, grew out of a
determining if a facility will succeed.
der), tweens and teenagers and young
need to develop and foster solid opera“Saying there’s nothing in my town for
adults. The conventional wisdom says
tional standards for family entertainment
families to do is not a feasibility study,” he
there is only a slight overlap here, and the
venues.
furthered. “Remember, it costs the same to
teens and tweens are mutually exclusive to
put a facility anywhere, except for the
all four of the other categories, at least if
Target Markets
land. You can only size these projects
they are going to be in the facility at the
down so much. Four bumper cars don’t
There are five basic target markets in
same time.
work.”
so-called location-based entertainment, ac“You attract teens, and you will drive
Page 66 • RePlay Magazine • April 2008
Foundations
Foundations co-founder Frank Seninsky is all smiles as he
takes a break to talk with fellow instructor Alan Fluke, an industry veteran who consults on operations.
Frank Seninsky explains the value of tickets,
tokens and prizes with a little help from
Foundations attendees Jennifer Woodring of
Austin, Texas, and Mario Fotino of Riverside, Ill.
Alan Fluke challenges Foundations attendees to think creatively with a game of mental twister.
“Innovation is always a critical factor,” Alan said.
In looking at a prospective area in
which to operate, raw population data is
not enough to go by. Any good feasibility
study should look at the number of children, the growth of that group, average
family income, distribution of wealth and
the number of at-home mothers. That’s because the top 20% in terms of income account for 50% of money spent on food
away from home, and the top 40% account
for as much as 75% of that pie.
“I think that’s who I might be looking
for,” said White.
Attractions and Games
The right mix of games and attractions
is determined by a facility’s target market,
meaning that a kiddie pizzacade buys different games than a Dave & Buster’sstyle LBE.
That may seem pretty logical, but
these types of locations may also share elements not so obvious, for instance a beer
license. “Beer is a dad pacifier,” said
White. “If he can get a beer, dad will be
Page 68 • RePlay Magazine • April 2008
more willing to go.”
Yet dad isn’t necessarily the right target for a facility’s marketing, either. Mom
and the kids play a more crucial role in deciding where to spend the family’s entertainment budget. “The whole decision
making process has changed,” said White.
“Moms and the kids are in charge.”
As noted earlier, families also expect
more bang for their leisure buck, a trend
that is sometimes referred to as New
Luxury and readily apparent in the highend theming common in modern dining
and entertainment facilities. “People are
willing to trade up and pay more for a
better experience,” said White. “You are
really competing for people’s time, not
money.”
Attractions aren’t necessarily the only
draw to a location. Service can be equally
important. But it’s essential to get the attraction mix right because the failure rate
in the amusement industry is as high as
that of its fellow trade, the restaurant business. Close to 60% of new businesses
close in their first three years of operation.
Frank Seninsky of Amusement Entertainment Management gave a detailed presentation on both large format attractions
like rides and coin-op games, the latter an
element of any entertainment facility that
may not bring people in the doors but will
certainly boost the location’s revenue.
“When somebody comes to your FEC,
they have made a commitment to stay up
to two and a half hours in your facility,” he
said. “Your job is to make sure they have a
good time while getting a fair value for the
average per capita spend on entertainment
in that area. That amount should probably
be the equivalent to an afternoon at the
movies.”
Explaining redemption, Seninsky said:
“We buy prizes wholesale in this industry.
So people give you quarters, and you give
them nickels back (in the form of prizes).
They think they’re getting quarters back.
The best part is they say, ‘Thank you.’”
As part of his presentation, Seninsky
explained his successful theories about
workhorse games, using tokens for promotion and discounts, point values and the
pitfalls of marking up prizes, plus the benefits of using a debit card system and the
delicate balance between a game’s play
appeal and the number of tickets it rewards.
True Crime
Cash and inventory management are
crucial factors in any FEC or similar entertainment business, particularly considering
the amount of money and prizes that flow
through a location on any given day. Ensuring that all that money and inventory is
accounted for is just as important as get-
Foundations
Signs to look
for include
revenue
growth trailing attendance
growth,
shortages and
overage in
cash reconciliation, sales
and game
play meter
readings that
don’t jive and
unexplained
Alley Cats and Putt Putt’s Bryan Weatherford, an amusement industry vetmerchandise
eran who oversees marketing and promotions, gave Foundations class memdepletion.
bers a tour of the impressive Arlington facilities.
Solutions,
ting customers in the door.
according to Merola, include treating to“Thieves come in all shapes and sizes,”
kens and tickets like cash, reconciling
advised Merola. “Staffing may be the bigsales and activity reports regularly, trackgest risk you take. People may look pering inventory closely, establishing strong
fect on paper and be anything but that.”
inventory controls and developing strateTheft comes in many different forms
gies to restrict the influx of outside tickets
including cash, redemption merchandise,
and tokens.
food and beverage and services like unau“Keys are your number one problem,”
thorized free game play and rides. Any
said Merola. “Lost keys should be a minor
and all of these drive up the cost of doing
offense. Not reporting lost keys is all about
business and thus negatively affect profits.
termination.”
Page 70 • RePlay Magazine • April 2008
A simple answer is to have everything
set on key code locks with codes that are
regularly changed for security. Other suggestions from Merola included closely
monitoring any ongoing relationships between staff and regular customers (there
may be something more going on) and securing prizes and promotional items.
Foundations concluded its first day with
a presentation on safety by mini golf guru
Peter Olesen and some interesting brain
twisters by Alan Fluke intended to stimulate creative thinking.
“This business is about using basic
ideas and taking them to another level,”
said Fluke. “Innovation is always a critical
piece of the puzzle.”
Day one covered a lot of ground, and
participants concluded by checking out a
local FEC, Alley Cats Bowl and Putt Putt
Golf (see related story elsewhere in this issue), all in the spirit of seeing some of their
classroom principles put into action. Days
two and three focused on operations and
management.
Foundations University will hold two
more sessions this year, one in Kansas City
(May 6-8) and a second in Chicago (July
15-17). To learn more, check out their website at www.foundationsuniversity.com. ◆