P2 Final Cluster Report

To: IBC Associates
Joe Fox, Tom Marchese, Catherine Penrod, Tammy Reynolds, Scott Wright
From: MID001 Team 6
Rhett Braglin, Austin Doubikin, Shanna Fasano, Diana Kenney, Austin Smales
Date: April 14, 2016
Subject: A Feasibility Analysis of Splash Soakers
______________________________________________________________________________
In the attached report to Copeland Associates on April 14, we provide a feasibility analysis of
opening a children’s entertainment service facility located in San Antonio, Texas called Splash
Soakers. The results of this feasibility analysis is critical in evaluating the success of Splash
Soakers’ unique business concept. The store’s feasibility was conducted by examining five areas:
● In-Depth Environmental Analysis
● Unique Business Concept
● Operational and Marketing Strategy
● Demand Forecast
● 5-Year Financial Projections
The in-depth environmental analysis was performed on the children’s entertainment service
industry. The analysis was performed at a macro and micro level in order to understand how the
unique Splash Soakers’ business concept would function in the industry. Researching a specific
operational strategy to be implemented was critical to gain a deep understand of the functionality
of the business. The Splash Soakers’ brand was formed to create a clear integrated marketing
solution across the San Antonio region in order to reach the forecasted number of customers who
are likely to demand such service. As a result of the analysis, the feasibility of Splash Soakers is
determined through creating a realistic five year plan.
In order to support Splash Soakers’ unique business concept, various Appendices are attached
including, but not limited to: a PESTLE Analysis, competitor pricing charts, a Business Model
Canvas, a Brand Pyramid Model, store floor plan, and the Square POS System.
Thank you for the opportunity to create our own business and analyze practical feasibility of the
concept. Any feedback and recommendations regarding Splash Soakers is greatly appreciated.
Feel free to contact us with any questions at (614)749-4185 or SplashSoakers@gmail.com.
Sincerely,
MID001 Team 6
Rhett Braglin, Austin Doubikin, Shanna Fasano, Diana Kenney, Austin Smales

Prepared for
Copeland Associates
Joe Fox
Tom Marchese
Catherine Penrod
Tammy Reynolds
Scott Wright
Prepared by
MID001 Team 6
Rhett Braglin
Austin Doubikin
Shanna Fasano
Diana Kenney
Austin Smales

Introduction
Market Analysis
Laser tag history & performance
Target Market
Competitor Analysis
Mission Statement / Vision Statement
1
2
5
12
Information Strategies
Business Concept
Marketing Strategies
Demand Forecast
Financials
Conclusion
12-15
11-14
10-11
18-19
15-17
20
4
3-4
21-23Bibliography
Table of Contents
Appendix B: PESTLE Analysis
Appendix A: Industry Analysis
Appendix C: Porter’s 5 Forces Model
Appendix D: Competitor Pricing vs. Splash Soakers Pricing
24-25
29-30
26-28
31

Appendix E: Business Model Canvas
Appendix F: Perpetual Map
Appendix G: Observed and Inferred Consumer Measures
Appendix H: Brand Pyramid
Appendix I: Employee Work Schedule
Appendix J: Splash Grass Information
32
33
36
37
Appendix L: Floor Plan
Appendix K: Business Process Model
Appendix M: Information Strategies
Appendix N: Marketing Strategies
Appendix O: Surrounding Competitors
Appendix P: Facility Images
38
40-42
39
47
44-46
48-49
35
34
50Appendix Q: Splash Soakers Waiver of Liability
Appendix S: Breakeven Point
Appendix R: Financials 51-56
57
Table of Contents
Appendix T: Website Images 58-59

Figure 1: Splash Soakers Logo
Figure 2: Percent of Laser Tag Establishments
Figure 3: Market Segmentation
Figure 4: Laser Tag Industry Revenue in Millions
Figure 5: Consumer Spending Outlook in Trillions
Figure 6: Bexar County Age Population
1
2
3
4
Figure 8: Laser Legend Logo
Figure 7: Laser Quest Logo
Figure 9: Facility Image
Figure 10: Arena Image
Figure 11: Water Gun with Logo
5
7
8
7
7
3
2
Figure 13: Water Shoes with Logo
Figure 12: Water Vest with Logo
Figure 14: Front View of Facility
Figure 15: Bird’s Eye View of Facility
Figure 16: Salary of Employees
7
8
7
9
8
List of Figures
Figure 17: Fluid Smart Water Meter 10

Figure 19: Marketing Mix
Figure 20: Age Demographics of US Facebook and Twitter Users
Figure 21: Pandora Ad
Figure 22: Pandora vs. Spotify Age Demographics
Figure 23: Primary Demand Forecast
11
12
14
15
Figure 25: Map of Competitors in 42 Mile Radius
Figure 24: Demand Forecast Algebraic Equation
Figure 26: Forecasted Customers and Revenue per Year
Figure 27: Weighted Amount Spent per Year
Figure 28: Capital Budgeting Decision Making Criteria
15
17
16
18
17
14
13
Figure 29: Revenue and Net Income 19
20
List of Figures

EXECUTIVE SUMMARY
Splash Soakers is a children’s entertainment service facility that incorporates water gun tag to
an official competitive arena setting. Splash Soakers is an innovative concept that allows
children to play in a high-stakes environment. This report analyzes the feasibility of our
business. Featured in this report is a children’s entertainment industry analysis, a deep
explanation of our unique business concept, operational and marketing strategies, a consumer
demand forecast, five year financial projections, and additional supporting documents in the
Appendices.
Environmental Analysis
Through in-depth research of the children’s entertainment industry and a closer analysis of the
laser tag arena industry, it is determined that the industry is growing and barriers to entry are
low. The environmental analysis presents an opportunity for Splash Soakers seeing as it has
low concentration and a moderate level of competition.
Business Concept
Splash Soakers is a children’s entertainment service that provides an alternative to traditional
services. No business in the industry offers such an interactive experience for children to play
with water guns in an official environment. Data limitations presented difficulty to the feasibility
study; however, we know Splash Soakers has the opportunity to disrupt the industry by its
unique business concept.
Strategy
In order for Splash Soakers to function feasibly, up-to-date information systems are
incorporated into the operations. Customer perception of Splash Soakers will be determined by
our efficient operational strategy. These customers will be directly targeted through an
integrated marketing communications plan that will gain significant reach of our target market
through the various platforms.
Demand Forecast
Extensive primary and secondary research determined a practical demand forecast. The
primary data from three local benchmarks is highly transferrable to Splash Soakers. The
secondary data received was limited due to the figuring out exact behavioral psychographics of
potential customers. By finding the estimated number of customers Splash Soakers will serve
per day and how much they will spend on each visit, it is forecasted that year three revenue will
be about $2,812,615.
Financial Projections
After borrowing $324,241 from the bank in order to start Splash Soakers, predicting year three
revenue, and researching real expenditure estimates the feasibility of Splash Soakers is
determined. This report in its entirety reveals feasibility support to the Splash Soakers business
concept.
Conclusion
Based on an environmental analysis, an unique business concept, strategic operational and
marketing plans, forecasted demand estimates, five year financial projections, and relevant
supporting appendices it is predicted that Splash Soakers will not be a feasible business in the
children’s entertainment service industry.

The purpose of this report is to assess the overall feasibility of an innovative business concept
called Splash Soakers, located in San Antonio, Texas. Splash Soakers is a water tag facility
operating in the children’s entertainment service industry. Forecasting demand through primary
and secondary scenarios was critical to understanding the functionality of Splash Soakers.
Based off the information derived from the demand forecast and further analysis, it is predicted
that Splash Soakers will not be a feasible business concept in the children’s entertainment
service industry.
1
INTRODUCTION | ENVIRONMENTAL | CONCEPT | STRATEGY | DEMAND | FINANCIALS | CONCLUSION
Introduction
Figure 1: Logo
Overview
The children’s entertainment service industry is made up of a variety of industry sectors.
Children seek out entertainment alternatives in many recreational facilities such as:
● amusement parks
● arcade and food complexes
● family fun centers
● water parks
● laser tag arenas
Each of these entertainment alternatives differentiate themselves and are explained further in
Appendix A with specific environmental trends laid out in Appendix B. The children’s
entertainment service industry sector that is most relatable to the Splash Soakers’ business
concept is laser tag. Splash Soakers’ business concept is essentially a water laser tag service
facility. However, Splash Soakers remains unique to the industry because there are currently no
water gun tag facilities in the market.

2
The majority of the laser tag industry’s market is made up of 43% of individuals aged 11 years
old and younger, and an additional 23% is made up of individuals between ages 12 and 15 (Ibis,
2015). The customers of the laser tag market use the laser tag facilities as venues for events like
birthday parties, group parties and corporate events. According to Ibis, birthday parties
accounted for 55% of the 2014 laser tag industry’s 245.7 million dollar revenue stream. Group
parties and corporate events make up 26% and 10% of the total revenue. Group and corporate
events usually take place on the weekdays to boost revenue during the week, since birthday
parties are mostly held on weekends (Ibis, 2015).
The laser tag industry consists largely of
locally operated businesses, the market is
highly fragmented throughout the United
States. Texas, the chosen location of
Splash Soakers, accounts for 7.2% of the
nation’s total laser tag industry
establishments (Ibis, 2015). This is the
second highest market-concentrated state in
the country, falling second to only California
at 9.8%.
(IBIS World, 2015)
Market Analysis
Figure 2: Percent of Laser Tag Establishments
(IBIS World, 2015)
Figure 3: Market Segmentation

3
Laser tag was invented by George
Carter in 1984 in Dallas, Texas (Hall,
2015). Carter invested $50,000 to create
a prototype of his business concept in
1981 (Hall, 2015). In 1983, he borrowed
$300,000 from bankers and formed
Photon Entertainment in Dallas by 1984
(Hall, 2015). Carter’s original business
plan was organized around charging a
fee for an allotted time in the arena
playing laser tag. In today’s industry,
laser tag still has significance in Texas
as it has the second highest percent of
facilities in the US (Figure 2).
Figure 4: Laser Tag Industry Revenue
(millions)
Laser tag arenas in the U.S. are the
lowest earning of the children’s
entertainment services industry, earning
$245.7 million in revenue. That being
said, it is the fastest growing sector with
a 4.2% forecasted annual growth rate by
2021, as seen in Figure 3, and the most
profitable venture earning between 15-
40% operating profit margins (Ibis,
2015). During the economic recession in
2009, industry profit margins suffered a
historic low of 9.5% to 23.4% in 2014
(Ibis, 2015). However, as a result of an
increase in consumer confidence
(Figure 4), the laser tag arena industry
has “expanded at a rapid rate over the
past five years” and is forecasted to
continue growing. In fact, the number of
industry establishments in the United
States grew at an annualized rate of
5.5% over the five years to 2014 to 950
locations (Ibis, 2015).
Laser Tag History
Laser Tag Industry
Performance (IBIS World, 2015)
Figure 5: Consumer Spending Outlook
(trillions)
(IBIS World,
2015)

4
Splash Soakers is a new innovative collision idea to the children’s entertainment service
industry that incorporates water to an official, competitive environment similar to laser tag.
Concentration in this sector is low with only one major company, Laser Quest, accounting for
only 5% of sector revenues and 47 chained locations (Ibis, 2015). Majority of laser tag arena
customers are under the age of 15 (Ibis, 2015). The decrease in the number of adolescents
age 10-19 pose a threat to laser tag, but Splash Soakers will combat that through attracting
an older demographic as well as children (Ibis 2015). Our weekly specials are crucial to
create revenue Monday-Thursday alongside our popular weekend nights. Since Splash
Soakers is mainly targeted to younger kids, having strong weekday specials to bring in the
specific age group is important. The aggressive nature of the service attracts more boys than
girls, but both genders contribute significantly to the industry. Customer traffic is mostly
accounted for during birthday parties; however, walk ins contribute as well. The laser tag
arena children’s entertainment sector in the U.S. presents a sound benchmark to Splash
Soakers’ unique business concept.
Target Market
Splash soakers will target male and female customers aged 5-14, but is not limited to this age
range. Our number one customer will be boys and girls aged 10 and up who are physically active
and have already established a social life with friends. Considering that our target market will
have no source of income, Splash Soakers will need to appeal to their parents. The parents that
we will be targeting will need to have higher than average disposable income and willing to spend
money on leisurely experiences. Being located in the within the city limits of San Antonio will be
valuable to our business as consumers last year spend $10.3 million on recreational activities and
out of town trips (SimplyMap, 2016). In conclusion we will be targeting a demographic of children
aged 5-14 with parents that spend spend higher amounts of money on recreational activities.
Splash Soakers is a water tag facility targeting children ages 5-14 years old where they
experience recreational games in a fun, safe and competitive environment. Our number one
customer will be boys and girls ages ten and up who are physically active and have already
established a social life with friends. (from facility section)
Source: San Antonio EDF

5
What we are currently seeing with Laser Legend is that they offer arcade services and glo
golf in addition to their laser tag arena. Promotional deals that this company offers are party
planning sections. Laser Legend offers multiple different party packages that is giving
customers a wide variety of options. Not only does Laser Legend offer 4 different types of
party planner packages, but also event enhancements to add onto your party, 3 weekday
party packages, and a separate party menu. Laser Legend also offers team building
packages, school education packages, private lock in parties, overnight lock ins and
conference center (See Appendix D for specific prices).
Laser Quest currently is offering their customers
birthday packages and promotional events
throughout the year. Laser Quest also offers
packages for youth groups, sports teams, and
corporate groups. Splash Soakers will provide a
venue for school field trips and educational
programs as well. Laser Quest also offers
customers to join a players club. Laser Quest
ranks as our biggest competitor due to having
two locations in San Antonio, along with 6 in the
state of Texas and 47 around the country. This
gives them an advantage because of their well
established brand. (See Appendix D for specific
pricing)
Competitor Analysis
There are two Laser Quests in San Antonio and one Laser Legend. These are Splash Soakers
main competitors. Our proximity is relatively close and this is because similar competition is
driving in similar customers to our area. Splash Soakers is a different concept than laser tag,
but we are all aiming for a certain type of customer to walk in the doors of our facilities
Figure 7: Laser Quest Logo (Laser Quest)
Figure8:LaserLegendLogo
(Laser Legend)

6
The business concept is an indoor water tag arena where customers get to play 20 minute
games while enjoying a new and exciting form of entertainment. Splash Soakers concept came
from the fact that children like to play in a competitive environment, such as laser tag, but they
do not get to truly engage physically in the game. There are higher stakes involved in playing
water gun tag when children get soaked by their competitor’s water gun. No children’s
entertainment facility offers this type of experience. For only $9.00 children can get a totally
water soaked game of fun! Even though our target market is children 5-14 years old, anyone
ages 5 and up can come to Splash Soakers to relax, get exercise and make a memory that will
last a lifetime!
Now, what is the customer experience? The customer experience is very important here at
Splash Soakers. When you first walk in the door music fills your ears with the sounds of
summer, and you are greeted by one of our employees. Minors accompanied by parents are to
sign a waiver of liability before the children play, in order to make them aware of the physical
nature of the game and the assumption of risk associated with the game (Appendix Q). You
then will be directed to the register if you are not with a group, or to the private rooms if it is an
event. Once you have changed into the water shoes and desired outfit for the arena, let the
games begin. You will put on your water tag vest, enter the arena and go to the water filling
station and fill up your water gun. The teams are put onto two different sides of the arena behind
large inflatable blockades. Referees will countdown to start off and the timer will begin. After the
game you will head back to the changing room where you put your shoes in a bin and dry off.
Customers then can hang out and enjoy some food from the concession stands or play another
game of water tag! To satisfy parents or anyone who is not competing we will have a concession
area for food and beverage (non-alcoholic) as well as glass panels that the arena will be in to
provide an optimal viewing experience. Since we will be targeting a younger demographic our
staffs relationships with the children will be vital to success. Our staff will be highly interactive
and even participate with the kids to provide a more entertaining setting for customers to be a
part of.
Overview
Mission Statement
“At Splash Soakers our mission is to
make every day an obligation-free
summers day. Rain or shine Splash
Soakers will strive to bring the fun of
summertime games into organized and
recreational competition.”
This mission statement embodies what
Splash Soakers is all about. Leveraging the
heat of Texas and available water sources
we strive to create summertime fun year
round.
Vision Statement
“Splash Soakers vision is to become the
preferred after school hangout by
bringing together traditional outdoor
summer games with friendly
competition and an outstanding, but
soaking wet, customer experience.”
At Splash Soakers our vision is to become
the preferred facility for birthday parties and
recreational gaming. We want to
revolutionize family entertainment centers
by providing an experience that cannot be
found anywhere else.

7
Splash Soakers Facility
Our facility has three indoor arenas that are
covered by SplashGrass turf. SplashGrass
has a drainage system underneath, which will
be provided by Dupont ForeverLawn. Having
a turf facility will allow the look and feel of
being outside have a longer lasting effect
while having a complete drainage system for
the water being used during games. For
images of the SplashGrass and details on
how it works see Appendix J.
Inside our facility, we have our arenas, a
concession area with pizza, appetizers,
snacks and drinks. There is also a parent
watching section behind a glass half wall that
has couches, tables, WiFi and charging
stations. Splash Soakers is a fun and
entertaining place for birthday parties and
group events. Our facility also provides 2
private rooms to accommodate large groups
for events.
Equipment
Since we are an indoor water tag arena we will have to have a different types of equipment for
the customers to use during games. Our three main pieces of equipment are a water tag vest, a
squirt gun and water shoes.
The inventory for water guns
will be 140. This allows us to
have full sets for when every
arena is in use (60) and three
sets to hand out to the next
group (60). Then leaves us
with an extra set (20) for when
a squirt gun malfunctions or
might break.
The inventory for water vests
will be 120. This will enable
us to give 60 customers a
water vest and have 60
water vests for the next
group of customers. Having
a whole second set of vests
allows time to drain and
prepare for upcoming
customers. to play.
For our water shoes we
purchased an inventory of
360 shoes. This gives us
enough for 6 full sets. The
process for the shoes is the
customers will take them off
into a bin. Employees will
take the shoes, place them in
sanitizing water and hang
them for the next group.
Figure 9: Facility Image (Gatsplat, 2015)
Figure 10: Arena Image (Gatsplat, 2015)
Figure11:WaterGun
(Alibabas,2016)
Figure12:WaterVest
(Alibabas,2016)
Figure13:WaterShoes
(Alibabas,2016)

8
Location
Splash Soakers will be located at 210 SW
410 San Antonio, Texas 78227. Texas was
chosen because the state is populated with
the third most children aged 0-14 after Utah
and Idaho. (Simply Map, 2014)
The facility size is based off of surrounding
laser tag facilities. According to Ann Kessler
from Laser-tron, “laser tag arenas under
5,500-7,000 square feet will not attract
repeat customers from teenagers and
adults” (Loopnet,2016). For that reason, and
since we are targeting children rather than
teenagers and adults, we have a
commercial size facility that includes 3
different water themed arenas around 4,500
square feet each. The smaller arena will
generate more interactive gameplay. Also,
according to Kessler, “arenas under 3,500
square feet require a minimum of 150
square feet per person” (Loopnet, 2016).
Overall, our facility will be at least 20,000
square feet with remaining space being for
lobbies, changing rooms, bathrooms, and
areas to accommodate non-participating
guests.
The San Antonio facility will be leased for at
least five years of business. The average
range of pricing per square foot in the San
Antonio area is from $12-18 per square foot.
The Splash Soakers’ facility is 20,000
square feet and is priced at $13 per square
foot. This amounts to $260,000 per year.
Splash Soakers location is in an area
surrounded by businesses and
restaurants. This area of entertainment is
beneficial to Splash Soakers because it is
already bringing in customers to the
surrounding area. Figure 15 above shows
the different stores located around Splash
Soakers.
Figure 14: Front View of Facility (LoopNet, 2016)
Figure 15: Bird's Eye View of Facility Location (LoopNet,
2016)

9
Employees and Labor
Splash Soakers will staff employees based on the number of children available to play in the
arenas and be paid based off averages compared to our local competitors. There will be a
manager/ assistant manager on site at all time during operating hours. Managers will conduct
interviews and look for applicants that are high in energy and morale, and have some degree of
background working with children. Generally Splash Soakers will hire college aged kids during
seasonal operation. These members will be paid at an hourly rate along with an assistant facility
manager and a general manager that will be paid based on a salary.
Splash Soakers will staff employees based upon the amount of kids playing in the arena at a
time. The maximum capacity is 60 children playing at one time with 6 employees responsible for
every 10 children. Additionally we will have 2 more focusing on the preparation for children to
begin playing; this will include all sales and equipment management and facility upkeep. These
employees will be paid a dollar more than state minimum totaling up to $8.25/hour (Texas
minimum = $7.25/hour) because we will expect higher engagement with customers and take
higher care since they will be ranging from 5-14 years old. Tips will be accepted by parents if
they wish to do so. There will also be a General Manager of the facility who will make $48,000
dollars a year, and an Assistant Manager making 10.50/hour based respectively on the average
for our competitor laser tag facilities. Appendix ## shows average compensation for Laser
Quest and there are two of these facilities located in the San Antonio Area.
Figure 16: Salary of Employees
Source: Glassdoor 2015

10
Informational Systems Strategy
Splash Soakers has specific criteria that needs to be met for our POS system. The system
that this company is looking for must have the following criteria: tracks customer orders,
customer feedback, inventory tracking, analytical tracking along with a sleek and clean look.
Point of Sales System
Our company will be using Square for its designated POS system. Square fit our company’s
profile the best due to everything that this system offers. Splash Soakers is using the Square
stand which has a sleek finish to it while holding an iPad Air for processing. This stand has a
spin feature that allows the customer to see their water tag package cost before paying. Square
accepts all major credit cards and for every credit card swipe Splash Soakers is charged a
2.75% fee. SquareUp also has an analytics dashboard that tracks which water tag packages
are the most popular, what percentage of customers are coming back and how much a new
customer spends and how much a returning customer spends. It also will break down total
sales weekly, monthly and yearly while comparing each and Splash Soakers will also get a
daily email of a summarization of the business from that day. Splash Soakers also opted in for
the $15 a month for each service to keep a customer directory and a customer feedback. This is
important to the business because we are constantly having promotions to increase weekly
revenue. Having a customer directory allows us to send promotional emails and keep track of
our returning customers along with maintaining our loyalty program. Having a customer
feedback portion in our POS system is incredibly crucial for this business because it is an
entertainment facility. The constant need of the feedback from a customer's experience is
important to improving Splash Soakers. Square is also compatible with other programs, which
is beneficial to the company because it will be using Xero to keep track of all accounting.
With Square it makes every transaction for a customer as secure and simple as possible. At the
point of a swipe Square encrypted transactions and tokenizes data once it hits the servers.
Square has a algorithms to review and stop malicious activity. PCI Data Security Standard
(PCI-DSS) is the layered security system that Square card processing adheres to.
Supply Chain Management
To avoid shortages of water or food we will
need to have a supply chain management
with our suppliers. This SCM system will work
so that it monitors our water levels and orders
shipments. As far as food, we will have to
take manual inventory and place shipments
as needed with vendors, as our SCM for
water supply will be of the utmost importance.
Figure 17: FLUID Smart Water Meter (FLUID)

11
The insight behind this company's business concept concerns want to bring a more realistic
approach to traditional laser tag and summer time games. The concept of Splash Soakers is
an indoor water gun arena that brings play, competition and fun together in one place. This
company is solving the problem of the lack of water entertainment. Splash Soakers is giving
the city of San Antonio the opportunity to have a place to be entertained with water in many
different group settings.
The segment of the market Splash Soakers will focus on is regular priced games, corporate
events, birthday parties, youth groups and sports teams. Splash Soakers target market is
moms and their children aged 5-14 that come from above average income families and enjoy
being active. The size opportunity that this company is potentially very large. The growing
success in one city in Texas could very well lead to the growing success of multiple Splash
Soakers in the state of Texas. This is based off of the opportunity that our competitors Laser
Legend and Laser Quest. That being said those two are our main competitors. There are two
Laser Quests in San Antonio and one Laser Legend. Our company feels that being close to
local similar competition will be beneficial to our business because it is already attracting a
similar market to ours.
The logo that Splash Soakers has generated incorporates 3
brand specific colors. The logo itself was created to incorporate
the water aspect of the business with the water droplet.
Attached to the water droplet is a cross section that represents
the shooting, of squirt guns, that will occur during gameplay.
The Splash Soakers Slogan is “Soak or be Soaked” which is
meant to bring to life the competition aspect of the business.
This was generated in to be entertaining and catch the
attention of our younger consumer demographic.
Branding and Logo
Slogan: Soak or be Soaked
Marketing Strategy
Over 75% of revenue in the laser tag industry comes from laser tag activities (IBIS, 2014).
Since Splash Soakers main activities will involve water, our chosen SCM is an Internet of
Things item called Fluid, a smart water meter. Fluid is easy to install by clamping it around a
pipe and plugging it in. Then use the app to connect to WIFI and create a signature for each
water fixture in our facility. With this system we will be able to monitor how much water is
being used each day and from what part of the facility. It will be able to let us decipher our
bathroom water vs. our water tag arena water usage. Once Splash Soakers gets to use this
for a couple of weeks we can see how much water we are using on average and even learn
how to conserve water in our facility. Fluid will also be detecting leaks in the facility that will
allow it to be fixed in a timely matter without wasting money.
Figure18:SplashSoakerslogo

12
Business Concept
The insight behind this company's business concept was the desire to bring a more realistic
approach to traditional laser tag and summer time games. The concept of Splash Soakers is
an indoor water gun arena that brings play, competition and fun together in one place. This
company is solving the problem of the lack of water entertainment. Splash Soakers is giving
the city of San Antonio the opportunity to have a place to be entertained with water in many
different group settings.
Segmentation, Target, and Positioning
The segments of the market Splash Soakers will focus on is regular priced gaming, corporate
events, birthday parties, youth groups and sports teams. Splash Soakers target market is moms
and their children aged 5-14 that come from above average income families and enjoy being
active. The size opportunity that this company has is very large. If Splash Soakers becomes a
feasible business concept that generates high demand for another location, the possibility for
another facility is realistic.
The company is targeting two types of consumers, moms and kids. The psychographics of each
target are moms and kids from an above average income family, who are active and enjoy laser
tag.
After looking into each of these factors, Splash Soakers decided to emerge itself into the San
Antonio, Texas market. This is due to the fact that Texas is populated with the third most
children aged 0-14 after Utah and Idaho. Splash Soakers is also going to leverage the high
weather temperatures. Having a place to cool down will be essential in Texas and will help draw
in customers.
Marketing Mix
Figure19:MarketingMIx

13
Social Media
We are currently in the era of a social media revolution. Businesses constantly need to market
their product and communicate to their customers. With the continuous growth of social media
that makes it a perfect marketing and communication tool for a business.
Facebook is Splash Soakers main source of social media, which is allowing the business to
reach customers in the San Antonio region. Splash Soakers currently has a Facebook page with
specials offers seen in Appendix #. Through Facebook Splash Soakers is able to post all
promotional events that are taking place throughout the week, along with special offers. The
Splash Soakers page allows customers to “like” it, rate their experience, view pictures of the
facility and have direct access to the website with all prominent information for Splash Soakers.
Splash Soakers is also following the trend of using Snapchat geofilters for their arena. Using a
snapchat geofilter is a fun and exciting way to market Splash Soakers. Kids are constantly
”snapping” where they are at and this is an effective and easy way to draw younger kids
attention to the facility. (add in info article) If you take a look at Appendix N, you can see images
of each marketing strategy. It’s no surprise that marketers have been paying attention to
snapchat’s promising developments. As reported in eMarketer in January 2016, more senior ad
buyers are planning to begin advertising on snapchat than any other social media site as seen in
the chart above. Nearly 100 million users visit this platform a day and of this amount 26 million
are ages 12-17 and 60% are made up of 18-32 year olds (Social Media Examine, 2016). Splash
Soakers could benefit from being advertised by an up and coming social media site like
Snapchat. With the vast majority of Snapchat users being either in our target market, or young
adults with children in our target market, this would be beneficial to getting our name out there.
Figure 20: Age demographics of US Facebook and Twitter
users
With Splash Soakers Twitter
profile, we plan on tweeting our
daily special offers and deals to
keep our consumers aware and
alert. Past businesses have had
a great deal of success in
marketing their promotions
through twitter and Splash
Soakers will as well. With 332
million active users, gaining
more followers will give us the
opportunity to branch out and
build an even larger network of
reliable consumers.
(Statista, 2014)

14
Pandora Internet Radio
Splash Soakers has purchased advertising through internet radio. From extensive research it is
seen that internet radio is in high demand. Choosing between Pandora and Spotify came down
to the percentage of users by age. Since Splash Soakers targets moms and children, the
decision was to advertise with Pandora since 21% of users are aged 35-44 years old and 11%
13-18 years old. (Statista, 2014) These percentages are much higher than Spotify for the age
demographic Splash Soakers is targeting. Pandora’s campaigns are by age, gender, music
genre and location which gives Splash Soakers the ability to create a profile of the customers
that the ad will be reaching. Splash Soakers is purchasing a Pandora ad for 20 ad plays a day
for 9 months.
Print and Digital Advertisements
Through San Antonio Magazine, Splash
Soakers will purchase one full page print ad
that will be posted once every month for a
year and a leaderboard on the website’s
homepage and relevant channel pages such
as Best of City, Events, and Travel web
pages. This will be beneficial to Splash
Soakers due to the large amount of people
that this magazine reaches which is 122,110
month readers. This is including the 90,000
print readers, 25,100 website visitors and
7,000 opt-in monthly newsletter readers.
Splash Soakers will purchase an ad in one of
the most popular newspapers in San
Antonio, the San Antonio Express News.
This newspapers reaches over 1 million
readers daily through print and digital. The
ad will be a *one inch, black and white
advertisement twice a week for a year. This
will promote our weekly deals and events.
The San Antonio Express News reaches
1,130,900 adults between the print ad and
online website each week. On a monthly
basis it is getting 29 million page views.
(Hearst, 2015)
Advertising
Splash Soakers has purchased 2 different billboards along the major 410 highway in San
Antonio. With this purchase the company is hoping to attract moms who are driving kids to
practices, friends houses and school. The billboards are in the surrounding distance of 42
miles around the Splash Soakers facility. The distance was chosen based on the information
that people are willing to drive 42 miles for entertainment facilities.
Figure21:Pandoraad

15
Name Laser Quest San
Antonio 2
Laser Quest San
Antonio 1
Laser Legend
Location San Antonio, TX San Antonio, TX San Antonio, TX
Average Customers
(Weekday vs Weekend)
100-800 150-900 20-500
Average Transaction 2 games ($18) 2-3 games
($18-$27)
2 games
($13)
The primary demand forecast was conducted through phone interviews with management
personnel of local San Antonio benchmark competitors. Laser tag facilities are the closest
competitors in the children’s entertainment service industry to Splash Soakers’ unique business
concept. There are two franchised locations of Laser Quest in San Antonio and a Laser Legend is
in the area as well. Laser Quest San Antonio 2 displays an average of 400 customers per day and
customers are estimated to play two games of tag in their facility, ringing up their total to around
$18 spent per visit (Emily, Laser Quest San Antonio 2, Personal Communication, March 22,
2016). Laser Quest San Antonio 1 has more traffic of about 471 customers per day due to the
movie theatre in the area in which “people will sometimes stop by and play a few games before
heading to their movie if they have time to kill” where customers play two to three games per visit,
estimating to be $22.50 spent (Megan, Laser Quest San Antonio 1, Personal Communication,
March 22, 2016). Laser Legend sees on average 226 customers per day, playing about two
games per visit, accounting for $13 per transaction because one game is $8 and each additional
is $5 (Sam, Laser Legend, Personal Communication, March 23, 2016). Averages were calculated
by acknowledging that weekend numbers account for Friday, Saturday, and Sunday while
weekday numbers account for Monday, Tuesday, Wednesday and Thursday.
Using the information obtained, Splash Soakers will see, on average, 365 customers per day.
These customers will typically purchase two games which is $18 per transaction. At an average of
365 customers per day and $18 per transaction it is predicted that Splash Soakers will earn
$6,570 per day. Splash Soakers will be open 322 days out of the year, similar to indoor laser tag
facilities, which results in $2,115,540 sales per year (Bederka, 2015). The following process is
represented below in an algebraic equation:
Demand Scenario Primary Research
(Personal Interviews, March 2016)
Figure24:Demand
ForecastAlgebraic
Equation

16
Demand Scenario Secondary Research
Calculation: 620,406 X .143 = 88,718
Step 1: The average annual attendance to
laser tag is 369,289 customers (IAAPA,
2015). 28% of these customers attend one
day out of the year, which is 103,401
customers annually (IAAPA, 2015).
Step 2: According to IAAPA, customers are
only willing to travel 42 miles to laser tag
facilities (2015). There are 6 laser tag
facilities within 42 miles of Splash Soakers,
see figure # (Google Maps, 2016). So,
103,401 multiplied by the 6 facilities is
620,406 Texans who go to laser tag in San
Antonio one day out of the year.
Through secondary research of the
number of people that attend laser tag at
least one day out of the year, and people
who enjoy recreational swimming, the
consumer demand for Splash Soakers’
unique business concept has been
determined to equal about 45,245
customers a year or $903,114 in revenue.
Calculation: 45,245 X 19.96 = $903,114
(Google Maps, 2016)
Step 4: According to IAAPA, the average
amount spent at a facility during each visit
is $19.96 (2015). If there are 45,245
customers at each visit spending $19.96,
Splash Soakers is predicted to earn
$903,114 in revenue per year.
Figure 25: Map of Competitors in 42 Mile Radius
Step 3: By Splash Soakers entering the
market, there will be seven competitors,
giving Splash Soakers 14.3% market
share. 14.3% of the 620,406 Texans who
go to laser tag in San Antonio is 88,718
customers per year.
Procedure
Calculation: 369,289 X .28 = 103,401
Calculation: 103,401 X 6 = 620,406
Step 4: 88,718 San Antonians would be
expected to go to Splash Soakers a year if it
were a laser tag facility; however, Splash
Soakers’ unique business concept is focused
around water entertainment. 51% of people
swim at least six times a year and enjoy
recreational swimming. 51% of 88,718
customers, with the majority being children,
results in 45,245 customers visits a year for
Splash Soakers’ unique service.
Calculation: 88,718 X .51 = 45,245

17
Demand Scenario Matrix
The purpose of the demand forecast is to determine how many customers Splash Soakers
will get on average per year. This number is key to forecasting the feasibility of the company.
The demand scenario was predicted through researching who will come to the facility and
how much these customers will spend per visit which predicts the average annual revenue.
Overall it is predicted that Splash Soakers will make about $1,359,402 per year through
70,545 customers and will reach this forecasted demand by year three of business based off
of the trend of most children’s entertainment service industry start-ups.
The primary research is weighted at 35%
because the benchmarks used were
specifically laser tag facilities. Although laser
tag is the nearest competitor to Splash
Soakers’ business concept, it is clear that
Splash Soakers will attract a slightly different
customer than laser tag.
There are a few other limitations that the
primary research benchmarks had. Laser
Quest is currently the top laser tag company in
the industry, accounting for over 5% of industry
market share (Ibis, 2015). As a new, start-up
business this makes it hard to compare to
Splash Soakers. Additionally, Laser Legend
they offers an arcade and mini golf meaning
not all of their customers were for laser tag. As
a result, the primary research found is
weighted at 35% importance.
Scenario Weight Customers/Year Weighted Average
Customers
Weighted Average
Revenue
Primary
Research
35% 117,530
Customers/Year
41,136
Customers/Year
$740,439
Revenue/Year
Secondary
Research
65% 45,245
Customers/Year
29,409
Customers/Year
$586,828
Revenue/Year
Total 100% 70,545
Customers/Year
$1,359,402
Revenue/Year
Figure 27: Weighted Amount Spent Per
Visit
Figure 26: Forecasted Customers and Revenue Per Year
Primary Research Scenario Secondary Research Scenario
The secondary research is weighted at 65%
because there is more information available
to reveal specific psychographics of the
ideal Splash Soakers customer. In addition,
exact numbers related to Laser Tag
industry demand were taken from the
International Association of Amusement
Parks and Attractions through a survey they
held in 2014. The secondary demand
forecast is also specifically tailored to
consumers who enjoy recreational
swimming. This is a significant
psychographic to Splash Soakers because
that is what makes the business concept so
unique, the ability to be entertained with
water. As a result, the secondary research
acquired is a more relevant benchmark to
the Splash Soakers facility.

18
Financial Analysis
After analyzing the start up investment needed to operate, financial statements, capital
budget, required rate of return, and the break even point it is clear that Splash Soakers will
not be a feasible business to operate. Specific financial statements are laid out in Appendix
R.
Figure 28: Capital Budgeting Decision Making Criteria
Investment
The initial investment needed to start
Splash Soakers is $949,943. 70% of the
investment needed is available by
Copeland Associates and the other 30% is
loaned from the bank. $949,943 is
determined as the amount needed to start
based on the estimated start up expenses
to open the facility, pay for the cost of
goods sold, and the price for marketing.
Net Present Value
Internal Rate of Return
Payback Period
Referencing Figure 26 below one will see
that our Net Present Value of Splash
Soakers is negative $8,165. That is the
current value of the company after
analysing our budgeting over the next five
years. Our change in net working capital
was the main driver in making the value of
the company negative.
Looking at Splash Soakers IRR, the
company does look promising to invest in.
This is largely due to our terminal value of
the company. In the first year of the
company Splash Soakers will be losing
over $500,00. That number cannot be
overlooked, but looking into the future
Splash Soakers begins to generate more
revenue creating attractiveness for our
investors.
In order for Splash soakers to pay off the
initial debt with start up cost and first year
cash flow it will take approximately 4.31
years. Referencing Appendix R on page 60
you will see that the company’s first year
cash flow is negative which drives our
payback period to be longer than desired

19
Financial Analysis
Break Even Analysis
Feasibility
The break even point reveals at what point
in Splash Soakers’ operations will start to
make a profit and how many customers
they need in year one to do so. By
recognizing what expenses were variable
and fixed a contribution income statement
was formed for year one of business.
Splash Soakers needs 50,797 customers in
year one in order to begin to make a profit.
Next, the contribution margin ratio was
determined as 92%, this is the percent of
sales that needs to be covered after all
variable expenses have been paid. The
contribution margin ratio is used to
determine that $898,555 is needed the first
year in order for Splash Soakers to begin to
make a profit. The calculations are laid out
specifically in Appendix S.
Growth in Demand
As seen in Figure 29, the growth of Splash
Soakers’ revenue is constant at a rate of
4.2% per year. This number is based off the
laser tag industry’s projected annual growth
rate (Ibis, 2015). By year three, Splash
Soakers will make the forecasted demand
of 70,545 customers a year and $1,359,402
in revenue. By this time the net income
earned will begin to level off.
Figure 29: Splash Soakers’ Revenue and Net Income
Unfortunately, Splash Soakers is not a feasible business concept. Using our capital
budgeting analysis, the negative Net Present Value means the value of revenues is less
than the cost it is to start up the business. This may very well be the reason this innovative
concept has not yet reached the children’s entertainment service industry. Splash
Soakers’ unique business concept is not financially forecasted to disrupt the industry.

20
If Splash Soakers were a feasible business, or ends up being feasible in the future, plans to
expand the facility outdoors would be underway. Expansion could provide for an opportunity to
capture more customer demand resulting in higher revenues. Locating in San Antonio, Texas
is a practical location for outdoor expansion because of the warm climate. Another option for
Splash Soakers’ future is to incorporate better technology in the water gun and equipment that
the children use. Since Splash Soakers is such an innovative business concept it is important
for the business to keep up with technological trends and plan for expansion.
Future of Splash Soakers
Conclusion
Figure 30: Logo
This report assesses the overall feasibility of an innovative business concept called Splash
Soakers, located in San Antonio, Texas. Splash Soakers is a water tag facility operating in
the children’s entertainment service industry. After performing educated demand forecast
scenarios, building the concept’s brand and operating strategy, and projecting financial
statements over the first five years of business, is has become clear that Splash Soakers’ is
not a feasible concept. In this case, brainstorming such a unique alternative to today’s
traditional forms of children’s entertainment was not enough to form a feasible business
concept.

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https://www.whitehutchinson.com 22

Amusement parks are the highest earning of the entertainment sectors at $14.8 billion in 2015
that capture a market segment of 25.6% of domestic children consumers under the age of 18
(Ibis). This entertainment sector operates internationally and nationally. The top three
amusement park companies in the US are Walt Disney, Six Flags, and Universal Parks &
Resorts (Hoover’s, 2015). Major companies abroad include Compagnie des Alpes in France,
Merlin Entertainments in the UK, and Parques Reunidos in Spain (Hoover’s, 2015). The
industry has strong performance due to an increase in domestic and international visitors as
well as the increase in consumer spending (Hoover’s, 2015). In the U.S. the industry is highly
competitive due to the “the top four players in this industry accounting for 89.5% of total
industry revenue” (Ibis, 2015).
Major arcade and food complexes include Namco Entertainment, Dave & Buster's, and CEC
Entertainment, also known as Chuck E Cheese's, which all operate domestically (Hoover’s,
2015). The market is segmented with 32% of the consumers being under the age of 17 (Ibis,
2015). Technological advancements and the increasing consumer preference for video games
makes for a highly competitive environment and a low growth rate of 1.3% as compared to
other industry sectors (Ibis, 2015).
Family fun centers have only 9% of their market segmented towards children under the age of
15, but the facilities are catered “particularly to parents with children under the age of 12” (Ibis,
2015). Leisure time and the awareness of health and wellness among families contribute
highly to the 3.8% growth rate (Ibis, 2015). U.S. families are becoming more health conscious
and the “increasing awareness of the need for exercise, weight control, good nutrition and a
healthy lifestyle among adults and children is having a positive effect on… recreational
centers” (Ibis, 2015). This industry sector has a low concentration with no company taking up
more than 5% of sector revenues, causing a medium level of competition (Ibis, 2016).
The children’s entertainment service facility is characterized by many different service sectors
including: amusement parks, arcade and food complexes, family fun centers, water parks, and
laser tag arenas. Each sector is diverse in how they function, their earnings, and their expected
annual growth rate.
(IBIS World, 2015)
24

The water parks sector of the industry is global with the two major companies being SeaWorld
Entertainment, Inc. and Walt Disney. Majority of the sector appeals to children with 30.6% of
domestic visitors being under the age of 18 (Ibis, 2015). International tourist appeal and the
industry. Each children’s entertainment sector is depicted in Figure 1 with their respective 2015
revenues and their predicted growth rate for a five year forecast period. Critical trends related to
politics, economics, society, technology, law, and the environment in the industry are laid out in
detail in Appendix A.
25

When analyzing the macro-environment of the children’s entertainment services industry, political,
economic, social, technological, legal, and environmental trends must be considered. These broad trends
shape the national environment which these facilities operate in. The PESTLE Analysis below is tailored
to the laser tag industry and discusses trends which focus on some specific business operations within
the children’s entertainment services industry.
Politics
The water laser tag industry has a national obligation to abide by trends as well as regulations in today’s
politics. The political divide of views on gun control affects how parents view their children playing with
imitation weapons. In fact, “a survey found that about 60% to 80% of boys play with aggressive toys at
home, including guns. About 30% of girls do” (WebMD, 2015). Parents are sometimes hesitant about
desensitizing their children to weapons and exposing them to violence. Sheila Hageman, an author,
teacher, and mother of three was disturbed after taking her children to laser tag and replied “for me, a
mere month after Veteran’s Day and the Paris terrorist massacre… [and] after the San Bernardino
massacre, I feel just as confused over whether children playing with toy guns is problematic or innocent
fun.“ (2015). However, some parents are not as sensitive on the subject of guns and enjoy taking their
children to recreational facilities for entertainment and physical activity, which contributes to industry
growth.
Economy
Children’s entertainment services’ success is largely influenced by economic factors such as per capita
income, consumer leisure spending, consumer confidence index, and consumer demand. Ibis World
affirms that “a rapid increase in per capita income, fueling stronger consumer spending, is expected to
boost revenue growth” specifically within the laser tag arena industry in the U.S. (2015). In fact, “industry
revenue grew at an average rate of 2.6% per year to $245.7 million over the five years to 2014, including
a 0.6% uptick in 2014” as a result of higher consumer confidence (Ibis, 2015). Consumers are becoming
more confident in their spending habits which is beneficial for the industry according to the consumer
confidence index (Ibis, 2015). Consumers are also finding it easier to access credit which contributes to
increased leisure expenditures (Ibis, 2015). Increases in these economic factors has caused the laser tag
arena industry specifically to grow financially and globally. Revenues have increased and “there are
currently more than 275 sites in Europe, almost 40 sites in Latin and South America, and over 50 sites in
Australia” in the laser tag arena industry alone (Ibis, 2015).
Social
Playtime and entertainment is a huge part of childhood. Children today enjoy innovative alternatives to
traditional entertainment facilities and since the “availability of leisure time has increased past five years”
parents are spending more on their children (Ibis, 2015). Parents spend the most on their children’s
recreational time during special events and birthdays; in fact, “industry operators generate about 50% of
revenue through reserved parties” (Ibis, 2015). Children’s entertainment service “venues experienced
growing demand as consumers increasingly sought high-value entertainment options such as laser tag”
for their children (Ibis, 2015). Some facilities put effort not only into appealing to the children consumers,
but the parents as well. Laser Blast in Valencia, California appeals to busy parents by putting “in Wifi so
parents could work at these tables, a big TV also so all local games could be watched from these tables”
while their children play or celebrate (2015). However, a concern parents have with their children playing
Politics
Economy
Social
26

these facilities are problems with being able to keep an eye on their children, parents can become
stressed out with they do not know what their children are doing (Laser Blast, 2015).
A major social concern parents have for their children, specifically in the U.S. today, is childhood obesity.
Childhood obesity is a major social issue within the U.S. because “approximately 17% (or 12.7 million) of
children and adolescents aged 2-19 years old are obese” and families are increasingly becoming more
health conscious (CDC, 2015). Children’s entertainment facilities have an advantage of facing this social
issue because they present an opportunity for children to get physically active. Laser tag facilities
specifically have noticed an “increased awareness and interest in physical activity and health” which
have aided participation rates (Laser Blast, 2015). From a business perspective, “active communities
also prove to be attractive places for businesses to locate” especially when they contribute to the trend of
physical activity (CDC, 2015).
Technological
Society today is highly involved with high-technological advancements. High-technology is especially
appealing to today’s generation of children who are growing up spending their leisure time playing with
technology devices at a higher level than ever before “the point is that personal technology, such as
laptops and tablets, are taking up playtime for children age 7-15” (Westgarth, 2014). Specifically in the
laser tag arena industry in the U.S. a high-technology gadgetry environment appeals especially to
children consumers who are use to spending their time playing with technologically advanced devices or
toys. Laser tag arenas “must have up-to-date technology to run a game efficiently and be competitive”
(Ibis, 2015). Technology also plays a major role today in marketing these facilities to the public and
acquiring customer loyalty. Marketing strategies that focus on creating an online presence have been
incorporated in business plans for entertainment facilities such as paintball games. Creating and online
presence on through websites, blogs, and advertisements “is the most cost effective way of reaching the
Company's targeted audience” (Hill, 2013). Technological trends will impact both industry operations and
marketing strategies.
Legal
Business within the children’s entertainment industry have to abide by federal and state tax
responsibilities, acquire relevant licenses and permits, follow the the Fair Labor Standards Act for
employees, and make their facilities safe for children to use. Tax responsibilities vary based on company
earnings, licenses are distributed by local authorities, and employee-employer standards must be
followed legally (Ibis, 2015). When the industry’s target consumer are children, safety concerns are a
major trend, business have a legal duty to house safe facilities. It is a key factor for success in the
industry for operators to “regularly maintain the facility to ensure safety and cleanliness, which are crucial
to customer perceptions about the facility” (Ibis, 2015). In children’s entertainment facilities that operate
with water, chlorine and water health must be regulated for “public safety, including state-mandated
regular maintenance and inspection of features” (Ibis, 2015). In addition, the amount of water circulating
must abide by lifeguarding requirements (Steinbach, 2014). Legalities within the industry vary by state
laws and specific business operations.
Technological
Legal
27

Environment
The major environmental topic for a water operated children’s entertainment facility is the drought that is
happening in parts of the U.S.. The National Oceanic and Atmospheric Administration (NOAA) is taking
the lead in implementing the National Integrated Drought Information System (NIDIS) which updates
weekly drought conditions in the U.S. (USDA, 2016). Today, drought concerns are highest in West,
specifically California (USDA, 2016). Therefore, water operated facilities should strongly consider
business in the the California region where emergency conservation regulations took effect in June to
meet Governor Edmond Brown Jr.’s water saving mandate (State of California, 2015). Drought conditions
in the U.S. present the largest concern for a water operated children’s entertainment facility.
Environment
28

Supplier Power
Concentration within the laser tag arena industry is low in the U.S. (Ibis, 2015). Low concentration has
implications on supplier power within the industry. The industry lacks many franchised facilities since
“operating multiple facilities does not significantly reduce operational or labor costs” (Ibis, 2015).
Suppliers have limitations over geographical region and shipping costs which makes non-chain business
facilities characterize the industry (Ibis, 2015). Local and independently operated laser tag facilities
make up most of the industry with the exception of Laser Quest, accounting for 5% of industry revenue
in 2014.
Laser tag arenas are generally homogeneous in the service they provide, which makes the buyer's price
sensitive to the competitors in the industry. Although “a higher price for participating at one facility may
deter them from playing there”, buyers go to these facilities for birthday parties and special events 50%
Appendix C: Porter’s 5 Forces Model
Taking a closer look into the children’s entertainment services industry, the micro-environment is the
environment in which businesses operate. This external analysis is mostly geared towards the laser tag
arena industry sector as this is the most similar to Splash Soakers’ unique business concept. Analyzing
the micro-environment addresses a range of issues of competitive rivalry within the laser tag arena
industry. The Porter’s Five Forces Model lays out supplier power, buyer power, competitive intensity,
threat of new entrants, and threat of substitute services within the children’s entertainment services
industry, specifically focused on laser tag arenas.
Supplier Power
Buyer Power
Figure #: Porter’s Five Forces Diagram
29

of the time so their are willingness to buy increases at these times (Ibis, 2015). Laser tag targets a
younger demographic of buyers, but since laser tag competes with all forms of entertainment such as
paintball, as children get older they may become more likely to replace their time playing laser tag at
paintball facilities (Ibis, 2015). There are a large number of entertainment substitutes that could
potentially attract buyers. Buyers are more likely to go to locations that are of easy access generally in
high foot traffic areas (Ibis, 2015). Lastly, customer service plays a major role in any children’s
entertainment service, a better reputation often means more patrons, so it is critical for employees in the
industry to contribute a positive experience to keep buyers loyal (Ibis, 2015).
Competitive Intensity
Competition within the laser tag arena industry in the U.S. is medium with a steady trend of remaining
moderately competitive (Ibis, 2015). Since majority of the industry is characterized by non-chain
operators, competition is set apart internally and externally. Internal competition focused on the facility’s
overall maintenance “arenas with poor maintenance… reflect lack of care, and even pose safety risks”
which potentially detracts customers from using that facility (Ibis, 2015). External competition comes
from others forms of entertainment which children are likely to spend their leisure time and parent’s
disposable income doing such as going to the movies, family fun centers, amusement parks, spending
time on the internet, and many other forms of entertainment. In order to differentiate from the
competitors, some facilities may offer a variety of themes or unique decor for added appeal (Ibis, 2015).
Splash Soakers in particular has a unique entertainment concept that incorporates water to the
environment.
Threat of new entry
The laser tag arena industry is attractive for entrants in the U.S. because “the barrier to entry is low for
the lazer tag arena industry” (Ibis, 2015). The largest barrier start up companies must overcome are the
initial investment costs in which “equipment averages around $72,000, while decorations average
around $85,000”; but, “laser tag arenas generally have a full return on investment within 12 to 18
months” (Ibis, 2015). Finding an appropriate location for business is generally associated with high-
traffic areas, where facilities to rent or build are easy to find (Ibis, 2015). Since the industry is growing
and there is a low concentration of facilities, entering into the industry is an attractive option for start ups.
Substitute products
Laser tag facilities are roughly the same in the entertainment service they provide for children and
families. The low market share concentration and high number of non-chain operators mean that there
are many facilities that offer the same laser tag experience since the “top four companies in this industry
account for no more than 20% of revenue” (Ibis, 2015). In addition, finding alternative methods of
entertainment is easy to do since there are so many options available. The high availability of
substitutes within the industry can present a threat to some operators, so it is important to differentiate
from the competition through business concepts and the internal environment of the arena.
Competitive Intensity
Threat of New Entry
Threat of Substitution
Appendix C: Porter’s Five Forces Model
30

Appendix D: Competitor Pricing vs. Splash Soakers Pricing
Laser Quest Pricing
Laser Legend Pricing
Splash Soakers Pricing
31

Appendix E: Business Model Canvas
32

High Price
Low Price
HighQuality
LowQuality
Appendix F: Perpetual
33

OBSER
VED
MEAS
URES
DEMOGRAPHICS BEHAVIOR
● Younger (5-14)
● Females/males
● Mothers, children
● Lives in San Antonio
● Above average income
● Frequent spender of their
disposable income
● Regularly spends time at places
of entertainment
● Enjoys social functions
INFER
RED
MEAS
URES
LIFESTYLE ATTITUDES
● Physically active
● Likes to go out and enjoy time
with friends
● Enjoys group events at
entertainment sites
● Interested in regulated game play
● Enjoys new and fun
entertainment
● Likes to play laser tag
● Thinks shooting-style games are
exciting
● Loves meat
Appendix G: Observed and Inferred Consumer Measures
34

Appendix I: Employee Work Schedule
36

Appendix J: Splash Grass Information
37
After speaking with Amy from ForeverLawn Splash Soakers will be using Splash Grass
because it is the most efficient way to have grass indoors for this arena.
The concrete in the building will be topped with a 2 inch foam that has a netting. The netting
allows the water to be drained from the synthetic grass that is on top of the foam. This foam
makes it a comfortable area in case of any falls. The drainage system will go through the grass
and netted foam onto a pipe that drains through the building to the plumbing outside. This
system has been used in many different indoor areas with concrete floors. Amy provided us
with this information explaining that experts would come and install all of the grass and pipes
with plumbing. Splash Grass then can even set up the FLUID smart water meter on the pipes
with the drainage.
(ForeverLawn)

Appendix K: Business Process Model
38

Appendix M: Information Strategies - POS System
The image above is an example of one of the features Square gives us with our system.
Splash Soakers will be able to know the average spend of customers, the average visit of
customers and new and returning customers. The image below is how our Square system
will be set up at our register.
(SquareUp)
(SquareUp)
40

Appendix M: Information Strategies - KPI Dashboard
The graph below will monitor our sales per square foot as the years go on. Seeing
that the trendline is upward sloping value the business could potentially look into
expanding the the size of the facility as it seems promising to bring in more revenue.
The graph below is going to help us understand the seasonality of our company for
each quarter. Considering that kids are in school during the first two quarters we will
see less sales in that time frame. The drop from the third quarter to fourth quarter
could be indicating that the weather could be affecting our consumers desirability to
come to our business. Overall this table will monitor consumer trends.
41

Appendix M: Information Strategies - KPI Dashboard
The graph below represents the average of how much money in sales that
each Splash Soakers employee is projected to generate per year. This allows
Splash Soakers to see how much money each employee is responsible for
generating. Splash Soakers will be able to monitor the workload of the
employees by amount of money they make for the business, thus gaining an
insight to when employees should be added or subtracted. Moving forward, if
the average sales per employee exceeds $180,000, an additional employee
will be hired to balance the workload. Also, if the sales per employee falls
below $100,000, individually underperforming employees will be subject to
termination until the workload is once again above $100,000 per employee.
Overall, this will monitor employee workload and efficiency.
42

43

The image above is an example of one of the many special offers that Splash
Soakers will have during the year. The image below is a screenshot of Splash
Soakers facebook page. It is shown how the special offers are promoted on the
page.
44

This image is an example of what the Splash Soakers Pandora ad will look like on the
Pandora website via a computer. The ad will pop up on the left along with an audio during a
commercial.
45

The image above is Splash Soakers twitter handle, this is also being
used to send out promotional deals, reach kids and moms, and
remind customers of weekly offers. The image below is what our
geofilter for Snapchat will look like on the pictures.
46

Appendix O: Surrounding Competitors
47

48

49

SPLASH SOAKERS WAIVER
·READ BEFORE SIGNING·
RELEASE AND WAIVER OF LIABILITY, ASSUMPTION OR RISK, AND INDEMNITY AGREEMENT
(“AGREEMENT”)
In consideration of participating in the SPORT OF WATER TAG I represent, that I understand the nature of
the Activity and that I am qualified, in good health, and in proper physical condition to participate in such
Activity. I acknowledge that if I believe event conditions are unsafe, I will immediately discontinue
participating in the Activity. I fully understand that this Activity involve risks of serious bodily injury, Including
permanent disability, paralysis and death, which may be caused by my own actions, or inactions, of others
participating in the event, the conditions in which the event takes place, or the negligence of the “releases”
named below; and that there may be other risks either not known to me or not readily foreseeable at this
time; and I fully accept and assume all such risks and all responsibility for losses, costs and damages I
incur as a result of my participation in the Activity. I hereby release, discharge, and covenant not to sue
SPLASH SOAKERS, its Respective administrators, directors, agents, officers, volunteers, and employees,
other participants, any sponsors, advertisers, and if applicable, owners and lessors of premises on which
the Activity takes place, (each considered one of the “RELEASES” herein) from all liability, claims,
demands, losses, or damages on my account caused or alleged to be caused in whole or in part by the
negligence or the “Releases” or otherwise, including negligent rescue operations; and I further agree that if,
despite the release, waiver of liability, and assumption of risk I, or anyone on my behalf, makes a claim
against any of the Releases, I will indemnify, save and hold harmless each of the releases from any loss,
liability, damage, or cost which any may incur as the result of such claim I have read this RELEASE AND
WAIVER OF LIABILITY, ASSUMPTION OF RISK, AND INDEMNITY AGREEMENT, understand that I have
given up substantial rights by signing it and have signed it freely and without any inducement and
assurance of any nature and intend it be a complete and unconditional release of all liability to the greatest
extent allowed by law and agree that if any portion of this agreement is held to by valid the balance,
notwithstanding, shall continue in full force and effect.
Printed Name of Participant: _____________________________________ DOB: __________________
Signature: _________________________________________________ Date: _____________________
PARENTAL CONSENT (Required for participants under the age of 18) AND I, the minor’s parent and/or
legal guardian, understand the nature of the above referenced activities and the minor’s experience and
capabilities and believe the minor to be qualified to participate in such activity. I hereby release, discharge,
covenant not to sue and AGREE TO INDEMNIFY AND SAVE AND HOLD HARMLESS each of the
Releases from all liability, claims, demands, losses, or damages on the minor’s account caused or alleged
to have been caused in whole or in part by the negligence of the releases or otherwise, including negligent
rescue operations, and further agree that if, despite this release, I, the minor, or anyone on the minor’s
behalf makes a claim against any of the above Releases, I WILL INDEMNIFY, SAVE AND HOLD
HARMLESS each of the Releases from any litigation expenses, attorney fees, loss liability, damage, or cost
any Release may incur as the result of any such claim.
Printed Name of Parent/Guardian: ________________________________________________________
Signature: _________________________________________________ Date: _____________________
Appendix Q: Splash Soakers Waiver of Liability
50

Appendix R: Financials - 5 Year Projected Balance Sheet
51

Appendix R: Financials - 5 Year Income Statement
52

Appendix R: Financials - Capital Budgeting Analysis
53

Appendix R: Financials - Amortization Schedule
54

Appendix R: Financials - Start up cost
55

Appendix R: Financials - Ratios
56

Appendix S: Break Even Point
57

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