How the year went at my own arcade

arcadehero December 30, 2010 22

As long time readers of this site are aware, I own and operate my own arcade in Utah. I opened up back in June 2008 and it’s been a wild ride but I have managed to stay afloat despite the continually bad economic conditions. In lieu of recent negative news regarding the closure of Arcade Infinity in SoCal(which has quickly become one of the top stories here at Arcade Heroes), I figure that I may as well share some positive news from my own perspective and perhaps with some feedback we can get a glimpse into how other operators are faring out there at the moment. I can’t speak for anyone else otherwise, so here’s how business has been for me, including the top 10 games of the past three months.

This was the first full year I had at this particular location, which is inside a mall. When we started, we were on the outside with our only neighbor there being a Red Robin restaurant. We nearly had to close our doors but after the move things turned around and we’ve been slowly progressing ever since. I feel that it’s still not the prime location – the mall management refused to let us pick a better spot, with more floor space or close to what we had previously and put us down the “dead hallway” that every mall seems to have. At 1400 sq. ft. I don’t have a lot of floor space to deal with and we’ve crammed as much as we possibly can together. I have 26 cabinets on the floor at the moment, including a few larger games such as a House of the Dead 4 super deluxe, a Terminator Salvation Deluxe, a Blazing Angels, 2 Stern pinball machines and a Movie Stop (my only redemption game). I also have a full-sized air hockey table here. Then there is a small PC LAN of 8 machines which take up a small room. When I moved I had to get rid of some cabinets to fit everything in – I had to sell my T-Mek (one of my personal favorites) and I have four dead cabinets taking up space in a small backroom, including a Tsunami motion cabinet which I am beginning to part out.as for new content I did add a few new games to the floor this year – Terminator Salvation, Dungeons and Dragons: Tower of Doom, a Strikers 1945 II, a four slot NeoGeo board (the sound died on it though) and an Astro City 2 cabinet featuring Street Fighter II- Hyper Fighting. That was actually put on location by some serious Darius fans who want to help raise funds to purchase a Darius Burst: Another Chronicle, just to show you how serious some people are about that game in the US. I also swapped a Marvel Vs. Capcom out with a Street fighter III 2nd Impact as I had many requests for SF3 although I could only manage the version behind 3rd Strike. Also MVC’s battery died out not long after that so I needed something in that cabinet. I do hope to rectify both of those games soon, with a 3rd Strike upgrade and a new Marvel Vs. Capcom 2 cabinet.

So that should give you an idea of the situation we’re in. I’m not going to publish complete numbers here as that wouldn’t be wise for certain reasons but I can say that this past year has been the best of the two and half that we have been open. Every single month has had higher earnings than the same month last year – this month of December for example, has made $1000 more than last year and it was the best month we’ve ever had. Previously our best month happened in August this year – December 2010 barely edged August out. Many people assume that the PCs would be the best earning feature of my business since those include brand new games such as Call of Duty: Black Ops but the arcade has consistently outearned the PCs every month this year and not by small margins either – the arcade will earn 3-4 times as much as the PCs per month. The PCs do have more regulars than the arcade does however and they will spend more time here than the arcade players do. There is often crossplay, where PC players will buy tokens or arcade players open an account and buy PC time.

Either way, we’ve been making it work without a significant redemption aspect, which is unusual in today’s marketplace. There is plenty of room for improvement I admit but it’s from my own experience running this business that I get very irritated when I see comments like the arcade is dead in the US. Every weekend I see my arcade play host to people who fill it up from wall-to-wall enjoying themselves so no one is going to convince me that what I see with my own eyes is a lie.

Here are the top 10 games for the past quarter at my location (Oct-Dec; 1 token =25¢): Terminator Salvation(4 tokens to start, 2 tokens to continue) , Fast And Furious:Tokyo Drift(2 tokens; 2 units which are kitted inside of old Crusin’ USA cabinets), Blazing Angels(3 tokens to start, 1 to continue); House of the Dead 4 (2 tokens to start, 1 to continue); Big Buck Safari (depends on the mode you choose but standard trek is 3 tokens); Air Hockey (2 tokens); Chase HQ2 (3 tokens to start, 1 to continue); Shrek pinball (2 tokens); Indiana Jones pinball (2 tokens) and Street Fighter II- Hyper Fighting (in an Astro City 2 cabinet; 1 token). Terminator started strong since I got it in May and it has remained consistent ever since. I’m quite happy with it. It constantly attracts crowds of people whom swarm around it watching others play, which is one of those things arcades are great for. Before it, Tokyo Drift was my best earning game, despite it being the kit version. I’ve often wondered how much better a dual racing setup would do if I had the original dedicated version. Blazing Angels is impressive seeing how it’s one of the few single player games I have and it’s available on several consoles. It draws in older players more than some of my other new games which tend to attract kids and teens. The only problem it has is that the solenoid keeps dying out, at this point I’ve given up on it since GlobalVR takes forever to send parts out and I’ve already replaced the faulty item twice. Chase HQ2 has also done well – it’s single player and it doesn’t have a lot of name recognition, nor many features to draw people back to it but it is fun. I also want to take a moment to stress something here that I often mention on Arcade Heroes. As I look at this list one thing stands out promptly, something I’ve known for a long time – newer games are the real life blood of the arcade. 8 of the 10 games on my list were made within the past four years. The drawback to them was the initial cost as they are all rather expensive and most of them I purchased using the SBA loan that I started with – something I’m still making payments on and will be for a while. For the arcade industry to survive and thrive, we need not just new games but also ones that small operators can afford.  That would seem obvious in a recession but I think it’s just good business practice all around, regardless of the economic environment. Fortunately we are seeing progress in this regard, with more games offering different configurations at different price points that cater to venues of different needs as opposed to a one-size-fits-all cabinets and prices. I also strongly feel that a system like Taito’s NESiCAxLIVE tailored towards the US market would be a godsend, delivering fresh content on a more frequent basis at a lower cost to venues and it could save space too, which is something I’m interested in now more than ever. As that doesn’t exist yet I’ll be happy to see more kits come along, another trend that appears to be picking up steam once again for this next year. I already hope to get my hands on one low cost kit come early next year when it’s released.

Anyways, onto the bottom three games: Crystal Castles, Ninja Gaiden, and Warlords (cocktail edition). Both Ninja Gaiden and Warlords made less than $20 each over three months, CC barely made it above $20. I charge 1 token on each and even let four people play on one token with Warlords but it’s not low enough to really interest people in playing. Warlords is the oldest game I have in the arcade though so graphically it doesn’t attract anyone and the game’s attract mode doesn’t really help lure anyone in either. I honestly never expected it to do that well as the classics will have a tough time getting very far today. Ninja Gaiden has been ported to everything under the sun but also the cabinet I have it in isn’t too great. It’s also probably the most difficult game I have – just a few weeks ago I had a customer threaten my life over the lack of a punch button, which I assured him doesn’t exist in the game, it’s simply ‘Attack’ but he was convinced that it had a punch and kick button and I was cheating him out of his childhood memories. Not the highlight of my year, that’s for sure.

I’ve seen people who talk about wanting to open arcade locations display complete shock when they find out that classics really don’t do that well but it’s no surprise when you think about it. People have played the classics over and over for years and on many different systems. They can play many of the games on the phone that they carry with them into the arcade, so the appeal a classic used to have is diluted by the oversaturation of the concept on the market. It’s one reason why the industry crashed back in ’83 in the first place – everywhere you turned you could get Asteroids or Pac-Man, and that was only a couple of years after those games hit the arcade. On occasion I will have an older game do really well – more than once CarnEvil surprised me by making more than newer titles like Big Buck Safari, Chase HQ2 and even House of the Dead 4. There is an issue with it resetting at random however that I have been unable to figure out and that has hurt it’s earnings as the year has gone by, it’s probably the HDD and I need to work on converting it over to a Compact Flash card. Also I should mention that I have an original 4-player TMNT which did really well this quarter – it was 12th place in overall earnings right behind Movie Stop and just ahead of Street Fighter 3. It has a screen problem that I’ve had a lot of trouble trying to fix which is certainly a hinderance to it’s earnings.

In case anyone is curious about the Movie Stop, that actually placed 11th on the list. It really has never been a top earning game but part of that might have to do with the content I’ve put in it. I’ve tried a variety of DVDs, Blu-Rays and some video games but it’s really hit and miss as to what interests people. It does have to compete with some other instant redemption games within the mall, so perhaps there’s a little bit of that going on too.

The most original title I have, The Act: An Interactive Comedy suffered a bit this year due to a bad screen and it’s primary controller failed. I was able to temporarily fix it with a trackball which it used for several months but I was finally able to obtain a proper spinner in the last part of the year. With a new screen and controller it has fared a little better on a weekly basis although it’s still not a strong earning game. It landed in 18th place out of 24 in the 4th quarter earnings which is disappointing but I might move it around and see if that helps it a little. Even with instructions people have a hard time giving it a chance unfortunately but for those that do they often come back and play it again. I’ve also noticed that people will play this right after they watch someone else play it – the other person breaks the ice on it I suppose. I may also add a second screen to it down the road as a way  to draw attention to it but that’s not high on the priority list for now.

The most disappointing game this year however has been Dungeons & Dragons: Tower of Doom. I bought it back in September for $200 and I had always heard that people loved this game. I even asked players about it beforehand and while the sequel, Shadow Over Mystara gets higher marks, ToD was highly regarded as well. Unfortunately, no one seems to care for the game after I brought it on location and set it next to my Gauntlet. During December it fared so badly that Crystal Castles brought in more tokens than it did, even after I changed the credits to give you two credits per 1 token. I will try and find a Shadow Over Mystara cart and cross my fingers that it will do better but now I’m wondering if I should have purchased the cheaper Xybots the seller had instead.

I’ve tried out a few things to try and interest customers in playing more games but so far I’ve had limited success with them. Namely we started trying out an Achievements system. This is something that Doc Mack of the Galloping Ghost Arcade shared with me and I thought it was a great idea. I know they’ve had great success with it since they started but for me it started off great and then fizzled out fast. I posted signs all over the place about it and labeled games that have achievements but for the most part no one participates in it. I’m not going to give up on it yet, I think it just needs some refinement with some booklets and better prizes for people to purchase, maybe an online app of some kind to assist in tracking progress. At the very least when it did start out it caused a lot of people to give Warlords a shot.

I’ve also been making sure to keep customers up-to-date via Twitter and Facebook accounts. It might not be much, but it’s one way to keep in touch with regulars and hopefully attract some new ones.

Another endeavor I started this year was placing posters and arcade flyers all over the place. Shows like IAAPA and Amusement Expo really help in this regard and I’ve obtained enough to cover the walls behind the desk area and then some. It’s really just to help the store look more interesting than it did with white walls and black lights. I also do it in part to help customers see that there is a lot of arcade content available, sometimes I get feedback on what interests them but on occasion I get a weird question where I am asked if we have all of these games at the store. I certainly wish that I did but it’s a question I hear about once or twice a month that always leaves me scratching my head.

As for 2011, I’ve got some plans to continue changing up the game line-up where I can afford to do so. It’s obvious that I need to get rid of a few of the low earning games and put in some new content people will find more attractive. I hope on obtaining both a working Marvel Vs. Capcom 2 (when MvC1 was working it did pretty well) and a Street Fighter III 3rd Strike(often requested as players complain about 2nd Impact) within the next few weeks; there also are possibilities for a couple of other games that I’m looking at but I will refrain from discussing those in detail until I’m sure I can grab them and we’ll have to wait and see what sort of new games make their way to the market this next year too. Terminator Salvation was a definite “must-buy” and it’s proven itself as a quartercruncher since the day I got it. I also still want to get a bemani or other music game but finding the right game at the right price is often a challenge. There is also the issue of floor space for the moment as I would have to sell something else off to make space for something like a DDR. But I have a few things in mind for that, so it’s not a big deal.

I’m confident that 2011 will be better than 2010, although there are things making me a little nervous such as gas prices going up again and other energy concerns which can put further strain upon business. But as it is right now, I think we will continue on through next year, steadily improving business. I hope to see continued trends on the games side of more games at lower prices. The more content that is available to us smaller operators gives a better chance of getting somewhere.

And of course if you are ever in the area then please drop by and play some games – it’s called The Game Grid Arcade. But if you never make it to Utah then make sure you support your local arcade. We don’t need to see anymore situations like Arcade Infinity happen.

Just so it’s not me touting some positive news here, if any other operators wish to chime in about how their year has been, feel free to leave a comment!


22 Comments »

  1. RJ Amusements December 30, 2010 at 7:44 pm - Reply

    I am the owner, tech support, and only employee of around 130 Coin Operated machines in the Great State of New York. I’m 26 years old and I have been in business since March 1, 2004. I truly love every minute of what I do. In regards to business 2010 has been my best year to date. With the help of Crane machines with quality merchandise, My ATM Network, and my new Rock-Ola Rockstar LX digital jukeboxes I have increased business 9.1% over 2009. Even with such positive news I need to tell the bad as well. I’ve had to continue to work my full time job I’ve held since 2002 and I have been turned down multiple times when trying to get a business loan to consolidate credit card debt. Even though I make enough money to pay a loan payment an arcade game or a pool table doesn’t have any value in the eyes of a bank, but thankfully with the help of my family I’ve managed through another year.

    • arcadehero December 30, 2010 at 7:50 pm - Reply

      Thanks RJ! Running routes in New York has to be a challenge and hopefully business keeps improving for you so you can dump the full-time job. I had a part time job up until July this year when I was laid off, so I know how that side of it goes.

  2. Drew December 30, 2010 at 9:53 pm - Reply

    Really enjoyed hearing this story. I’ve been secretly wanting to start a combination arcade and retro cafe for years and after reading your post and checking out the “set up” videos of you preparing to open in the mall on your website I think I may actually look into what it takes to get started.

    I’ve got two arcade machines in various states of disrepair in my garage that I currently have neither the expertise nor the money to fix. Do you spend a lot of your time repairing games yourself?

    • arcadehero December 30, 2010 at 10:03 pm - Reply

      I’m glad the material on the websites have helped you out!

      I do spend some time repairing games – not an awful lot of time but it depends upon the issue. I took electronics in high school but I forgot most of that; otherwise my expertise has been minimal and I’ve been learning as I go along, getting tips from others and using other web resources such as the KLOV forums and Arcaderepairtips.com. Always check and see if the symptoms your machine has are common issues with that game or board first and often you can find step-by-step help. If it’s uncommon that will take more work and research but overall I think it’s valuable to learn as much as you can to fix the issues yourself as sometimes problems are actually simpler than they appear and it will save you money.

    • RJ Amusements December 30, 2010 at 11:00 pm - Reply

      Repairing an arcade game can be an easy fix, maybe a bad microswitch so credits aren’t being given on the game or it could be something much harder. The best advise I can give is ALWAYS upgrade. Spend that extra 20 bucks as possible to add a muffin fan to a cabinet which runs a little warmer, or screens on the bottom of a cabinet so mice can’t get into them. Remember when a place closes at night (even the cleanest!) an arcade game is a nice warm spot for a mouse at night. Also any non light gun games I would try to put an energy efficient LCD in it also take the time to upgrade bill acceptors to take new currency, nothing worst than not being able to take a customers money. Megatouch games, Jukeboxes, Big Buck Hunter, really any PC based game you need to add more RAM Memory, It will run faster and more efficient. Remember these arcade game manufacturers are in business to make money, they use minimal amounts of quality product when constructing an arcade game. Look at the Deal or No Deal cash box by ICE. Terrible design. coins get stuck in all for corners as your trying to dump it. A megatouch bar top game (force edition) comes with only 64mb of ram! Upgraded to 1gb and now when you connect it to a jukebox as a selector of songs it runs smooth without hiccups or slow screen movements. You need to look at a piece of equipment and think upgrade and what will make your life easier and keep your customer happy! The name of the game is up time. not down repair time. Good luck!

  3. DaFonz December 31, 2010 at 12:05 am - Reply

    It’s good to hear arcade operator’s experiences with running an arcade. You would think that the arcade manufacturers would use better quality components considering how much they charge for their games.

  4. editor December 31, 2010 at 9:38 am - Reply

    Agree – thanks for sharing the review of the first year – wishing you all the best for the coming new season.

    It is this information that many in the amusement trade work hard to suppress – along with the issues of manufacturers cutting corners with shoddy manufacturer and build quality – there is an issue regarding the reality of the business environment, and what could be done to increase it.

    The service and support side of the business has been kept in the shadows purposely – the hope is that with the impact of the changed distributor sector that the reality of the business model will change.

  5. DarkTetsuya December 31, 2010 at 2:40 pm - Reply

    great article!

    With the recent news about Arcade Infinity’s closing, I was beginning to wonder if there were any arcades that *did* survive the recession… glad to hear things are going well!

    I still dream of the day where I can open an arcade of my own…SEGA recently gave away a DX Gunblade NY, which I wound up winning so it’s a start I suppose lol.

  6. Kamran January 1, 2011 at 12:34 am - Reply

    awesome article, long live the Arcade!

    Try to get your hands on SSFIV Arcade Edition and a couple other fighters (BlazBlu, KOF98 UMFE or KOFXIII, Tekken TAG 2) and build a competitive scene is my suggestion for you.

    • arcadehero January 1, 2011 at 10:12 am - Reply

      As much as it would be great to have something like SSFIV AE (I’ve had a few requests for it), it’s way to expensive to ever justify the cost. I don’t know how other small locations manage it without getting some sort of killer deal. Those other fighters may be possible though – I’ve very curious to see if Namco will give Tag 2 a competitive price as opposed to T6 which was also much too high for a fighter. It would be great if Taito could develop NESICA for the US market, then it would be easy to get some of those games, far cheaper too.

      I am working on getting a couple of older, but often requested fighters. Hopefully by next week I’ll get those taken care of. 🙂

  7. editor January 1, 2011 at 5:30 pm - Reply

    Well so many of you think you can run an arcade – why not try?

    Here is a test of your Adam skills:
    http://www.newgrounds.com/portal/view/529292

  8. Foxx January 4, 2011 at 8:10 pm - Reply

    I’ve been reading this website for a few years now and it’s exactly what people need to hear and learn about arcade scenes in the US and all over the world. It would be a dream if NESICA could come to the US and make games more accessible to operators and future arcade owners. Hopefully they’ll catch on soon and see that there’s a strong interest outside of Japan.

    Thanks for taking your time out to report all the awesome news you come across. It’s very much appreciated and I’m sure you’re inspiring people to open up locations and getting the numbers back up where they belong! Arcades are dead my a**!

  9. editor January 5, 2011 at 9:00 am - Reply

    Thanks and a Happy New Year too you Foxx

  10. Shapey Fiend January 7, 2011 at 1:30 pm - Reply

    Seems to me you should upgrade Hyper to SSF2T before you change out the SF3 board since it’s a higher earner.

    Interesting to read about the retro stuff not doing well. That and pinball are the things that tend to interest me most, but then I’d be excited about say, Robotron, but completely disinterested in D&D.

    A Neo Geo should be an interesting experiment. Bung Metal Slug X, Puzzle Bobble and maybe a fighter or two in there you could find out a bit more about what the audience likes without wasting floorspace.

    • arcadehero January 7, 2011 at 1:55 pm - Reply

      I came across an offer for a 3rd Strike cart so I’m just waiting for that to go through.

      I’ve done a lot of “testing the waters” by swapping boards. I tried out an Street Fighter Alpha in the cabinet for a week and it did terrible; I had Magical Drop II in the NeoGeo for a while but it wasn’t played often (I still might try it out in a different cabinet using a 1 slot board I still have), same with a Ninja Combat. I swapped NC out with Samurai Shodown and suddenly the cabinet started doing really well. I wouldn’t mind getting Puzzle Bobble or Magician Lord one of these days. I’ve tried Bad Dudes and Oriental Legend 2 but neither of those did terribly well. I have Toki and Tengai boards but I haven’t given them a proper chance yet. I’m a little wary of Tengai since it has some gratuitous cleavage and I get a lot of parents with kids coming in. I was just thinking that it’s too bad that Sega never developed a NAOMI multi-cart unit, a four slot one of those would have been wicked.

      I haven’t completely given up on retro stuff – I forgot to mention that TMNT landed in 12th place which is quite good. Especially considering the fact that it’s from 1989 and the monitor has this issue with the red cutting out all of the time that I have been unable to figure out. I would like to fix or replace the monitor and then upgrade to a Turtles in Time on that eventually. I also have a Strikers 1945 II that does decent business, less than the NeoGeo but more than Gauntlet. A lot of people think it’s 1942 since I have a 1942 marquee on it but they play it anyways.

      I also am going to try and improve our achievements system as a way to bring up the classics. Today I have been working on some “Starcade challenges” to come up with a score to beat in 60 seconds and I can use that on a lot of the older games since the newer ones don’t always show a score during gameplay.

  11. programmerX January 8, 2011 at 1:48 pm - Reply

    Have you thought about adding a merchandizer? I think a stacker club or barber cut – stocked with good stuff like a dsi xl or an itouch – would earn well.

    • arcadehero January 8, 2011 at 1:56 pm - Reply

      I have been thinking about something along those lines once I sell my Movie Stop. I’ve been looking at some mini-cranes to save space but I’m open to some other merchandisers.

  12. KyohakuKeisanki February 15, 2011 at 7:43 pm - Reply

    What happened to being the only arcade in the world with a working Sega R-360?

  13. VulcanApollo August 15, 2012 at 10:52 pm - Reply

    Your site is great and thanks for sharing such great info! I’ve always wanted to start an arcade myself, and it’s nice to see you still kicking it, even when people say it’s dead. No matter how good console gaming has become, nothing gets me than seeing all those cabinets, the sound, the flashing lights, and having the pocket stuffed with quarters.

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