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International Karting Industry Buyer's Guide

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INDOOR INFO

PLANNING FOR SUCCESS WITH INDOOR KARTING
By Peter F. Olesen, P.E.

KNOW YOUR MARKET AND CONCEPT
Do your research carefully. Getting started with a proposed indoor go-kart facility can be very daunting. There are many decisions that should be carefully considered before spending great sums of money. These include the most important one of all, which is determining the type of operation you propose to develop. Unless you are independently wealthy, you want to make a profit on the venture. This means that you must make the decision based on reality rather than with your heart. As I have said before, failing to plan is planning to fail. You must build and operate a facility that will attract sufficient business year in and year out to realize this profit.

Any operation will require careful planning, sufficient funding, the right location, ongoing dedication to marketing, staffing, and sound business practices to assure success. If your target market is too small, your business plan flawed, marketing program incorrect, guest relations not properly handled, you can rest assured you won’t be in business very long. Lack of detailed information concerning your market, business plan, commitment and general knowledge concerning the industry can turn off investors in a hurry.

SERIOUS KART RACING PROGRAM:
If you intended to establish a program targeted to serious adult kart racing, you will need to have a larger population base and stronger marketing program to create sufficient cash flow for survival. Too many facilities have failed because people were too focused on their dream and not on reality. Be careful whom you listen to. Check out existing facilities that are successful, not successful and those that have failed. Try to see the reasons for each occurrence. Wanting to succeed is great, planning to accomplish it is a necessity and having the dedication to accomplish it a challenge that must be addressed continuously.

A serious racing program needs a number of people committed to making it work. This includes the program manager that sees to the track and equipment are ready for the guests to participate in the planned racing program, that a workable schedule is established and maintained and the track and associated operations are properly staffed with qualified personnel.

Someone must be marketing the facility and program year around. New packages, events and programs must be created to maintain interest. Methods must be developed to increase interest and participation in the racing program. Group events, leagues and corporate team building programs can all serve to expand attendance. Keeping such programs moving successfully takes the on-going effort of a dedicated group sales coordinator.

It is certainly possible to create a racing program where drivers pull into the pits and change karts in order to create Enduro-type competition. Computers can create cumulative timing scores by following the driver from kart to kart. Electric karts can be more closely adjusted to operate at the same speeds than can a batch of gasoline karts.

No single concept is perfect. Each community is different and the approaches taken have to be a combination of past experience and examples of successful operations. Input from local racing groups can be a valuable source of ideas for programs that will attract their members.

Care must be taken to have a broader base to work from, as the total market that can be addressed may need a different approach. Most facilities will have to attract more than the serious karters in the community.

Weigh carefully everything you hear or read on the subject of indoor kart racing. Not everyone who professes to be an ‘expert’ will be giving you sound advice concerning your specific location and proposed operating model. Some are selling equipment, some are selling design services and some may believe strongly in a given approach because it may the only way they know.

Look at the failed operations as well as the successful ones. This may be the best source of information you can obtain prior to making your decision. Avoid making the mistake of knowing everything while actually learning nothing.

Summer can be a traumatic time for indoor facilities in much of the US. Serious racers will be concentrating on competition tracks with their won equipment. Other entertainment facilities with outdoor operations will also take a portion of your business. This means that you have to build a better mousetrap so to speak. Comfort and appearance are both very important if you want to protect your bottom line.

Open karting and novice racing events can increase total revenues and develop a broader base of regular attendees. Repeat business is a must for success.

BROAD GO-KART PROGRAM COMBINING SERIOUS RACING AND RECREATIONAL KARTING:
In most markets, it would be far more advisable to develop a facility that could operate serious karting plus family karting under a realistic schedule. This can result in not only generating higher revenues, but also creating a greater potential target market for more serious kart operations. This brings up the reality of adding additional revenue opportunities by including arcades, mini-land bowling and other attractions into the site mix. Meeting rooms can be utilized for group events, team building programs and related corporate programs. They can also serve as birthday party rooms if a family approached is used.

The ongoing development of electric karts brings a greater flexibility to indoor karting. It is true that heavy kart usage will involve two sets of karts to enhance battery charging, but each kart can be operated over a wide range of speeds by the push of a button. This permits the same karts to be used by serious adult competitors as well as inexperienced children and adults.

The average customer at concession go-kart tracks starts to get arm weary or board after three to four minutes. This allows the pricing of individual kart runs to be more reasonable for walk-ins. This also allows more people to ride during non-serious racing sessions. Having the additional attractions in the building can greatly increase revenue and extend the length of stay.

Make certain that whatever format you choose and whichever go-karts you select, that you have thoroughly investigated your specific state and local regulations with respect to track width, helmet, roll-bar and seat belt requirements. Some jurisdictions have specific requirements concerning types of track barriers and pit gates. Others have noise and air quality standards that they enforce. Fire escapes and stairways also become an issue when karts are operated on the second floor or higher.

It is very important that you take a long hard look at your proposed concept, site location, proposed budget, time schedule, target market, projected revenues and operating expenses and related items before you dive into the marketplace.

SELECT THE RIGHT LOCATION
Select the right location — it must be easily accessible from major streets or highways. People won’t come to sites that are hard to find. Being on a major roadway can lead to impulse business. This must, of course, be weighed against the cost of the land and/or building.

The building site must not be foreboding in terms of neighborhood or the appearance of the building itself. In today’s society, people like to feel secure in driving to a site and parking in a safe location.

Check zoning and building code requirements carefully before buying or leasing. Watch for fuel storage and sprinkler requirements. Code requirements for parking may also be different for your proposed use. The site should have sufficient parking on-site, to meet any building code requirements for proposed use, as well as to meet parking demand you project.

Any building you consider should have sufficient space for your projected track and the additional space required for point of sales, administrative office, rest rooms, maintenance area, fuel storage (check out fire codes carefully), dressing rooms, staging area, viewing area, snack bar, eating area, staff locker room, meeting rooms and space for additional attractions.

BUILDING AND TRACK SPECIFICS
Space requirements for a basic track layout should be 15,000 to 20,000 square feet. Longer tracks or multiple tracks will require more space. For most locations, we would suggest a minimum of 30,000 square feet to house the total operation assuming it would be a race oriented facility with minor additional attractions. The building dimensions should have at least a 120-foot minimum width to permit a road course configuration. Columns should be spaced at least 25 feet on center, though we would prefer 30 feet or more.

Double-check the insurability of the specific building for your proposed use. Establish the utility demands and costs of the building as it stands. Have professionals review the building plumbing, roofing, and mechanical systems carefully. If you propose to use gasoline, methanol or propane-powered karts, be very aware of CO requirements. Check out the air handling requirements of your proposed use to be certain you have capacity for air conditioning in the summer and heating in the winter. This can be a very expensive item in meeting air quality standards in any community.

The floor plan of the building is important. The entrance, placement of point of sales, retail area (if one is planned), dressing rooms, viewing area, snack area and the placement of track pits, maintenance area and fuel storage as some of the specific areas that must be considered.

TRACK BARRIERS
Track barriers should be carefully evaluated. Please move beyond manufacturers claims for their products. Check out any new products to verify that they do what the manufacturer or his retail marketers say. This is to verify both good and bad aspects of each system.

As a track design firm staffed with professional engineers, we still feel that the steel plate – automobile tire barrier systems is the safest and most forgiving system on the market at this time. It has demonstrated energy absorption not found with other systems and doesn’t require repositioning after impacts, if properly installed. Over time, it will require far less attention than any other system used.

GENERAL COMMENTS
Make good use of experienced consultants. This can make the difference between success and failure for many potential facilities. You need someone who can see beyond the dreams and an identify reality. The pennies spent can result in dollars saved in construction and earned during operations.

Be creative in advertising within your facility. Sell advertising on the karts, the walls on the backside of the track and elsewhere in the building in order to increase revenues or to reduce costs. Walls can also be decorated with grandstand photomurals or large racing-oriented photomurals.

If you decide to proceed with developing a facility, keep in mind the fact that you need to keep them coming back and at the same time constantly seek to find ways to increase the appeal of your facility. Broadening the attractions you provide within your facility will increase your target market and enhance the drawing ability.

ABOUT THE AUTHOR: Peter F. Olesen is President of Peter F. Olesen and Associates. The company performs feasibility studies, track and other attraction design and related services for a wide range of indoor and outdoor competition and concession go-kart facilities, as well as complete family entertainment centers. To date, the firm has performed projects in 37 US states, Brunei, Canada, Mexico and Puerto Rico. For more information call 847-253-1515, fax: 847-253-1532 or e-mail to: pfolesen@flash.net.

END

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Kart Marketing Group, Inc.
Post Office Box 101
Wheaton, IL 60189 USA
Telephone: 630-653-7368
Fax: 630-653-2637
Email: karting@msn.com

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