What is the most profitable business in Paintball?

[luke]

A question for those who know......
Where would one make the best money in the Paintball industry?
Manufacturing
Retail
Retail w/field?

[irbodden]

I am assuming companies like WGP and WDP are some of the most profitable in the bussiness.

Small manufacturers and fields make next to nothing, I know alot of the fields I played at back home, the owners have lost money running it since before they can remember..

[kosmo]

Real Estate

[Bolter]

McDonalds burger cartons.

[booyah]

scenario feild owners.

i was talking to the guy who owns hell survivors in MI... at the monster game they raked in a profit of nearly 500k.

they own the land, they had 5k people there(20 bucks ahead) they had a 40 dollar per case paint profit (60 bucks for a case of zap) and the fills were a HUGE profit since they own the compressors... a fill card was 25 bucks for about 5 good fills...

they run scenario and big games all the time and make a bundle

do the math, say half the folks who paid entry bought paint (2500*40=100,000) where they really average over a case per player plus the entry (5000*20=100,000) plus camping fees for folks who stay on their land (like 50 a head)

[manike]

Paint.

Manufacturing and selling.

[tony3]

I do know, last june, challenge park had over 200k booked in private games

[luke]

Manike,
In reguard to paint sells, is it from the manufacturing or retail point of view?
Also, in what order would you put the three I listed?

[Kevmaster]

after working in it for a year and a half. two groups get screwed: Fields, Manufacturers. ONE Group gets money: DISTRIBUTOR. National Paintball, PMI/RPS. The guys who sell to all the fields make the money.

Exception though, is that the largest company is likely Brass Eagle, although nobody else publishes their financials, I cant believe NPS posts net profits around $10M per year

But as Tom always says, dont get into the business to make money, you wont

[fcpchop]

it kinda sux that TK doesn't make so much money like other paintball companys exspecialy since he has the best company:D

[Kevmaster]

oh..of your three:

manufacturers
store w/ field
store

stores alone dont make money for the most part, as most of the money comes from paint sales...and most fields are going byop

[BajaBoy]

Paint and Big fields. (Aka Skirmish usa is swimming in the money)

[Fred]

gotta be the distributor, then the paint makers...

you might do ok if you can get enough customers at a store, but you won't make it big unless you can also have a successful field.

Even Exotic Sportz had to close one shop IIRC, and they own Hell Survivors.

[magman007]

2 biggest moneymakers are Barrels, and Paint. Those bring in the most money.


I was speaking with tom, and he said if he could do it all over again, he would have just made barels. they are the easiest to make, and to make them well is not hard either

[snoogans]

I'd have to say tanks, like nitro and co2 because you absolutely have to use them so the demand is high. that's why they are usually pretty expensive.

[ShooterJM]

I gotta agree with manike and go with paint on this one. RP Scherer HAS to be doing well.

There are few competitors who actually manufacture it, it's required for the sport no matter what marker you use, and people use it all the time (ie it's not like an oring or squeege).

[Thordic]

RP Sherer makes 90% of its money on non-paintball stuff :)

[ShooterJM]

Yeah, I meant their paintball division.

But figure that most of the equipment and training was already subsidized by their other divisions.

I mean, they didn't even really have to purchase new encapsulation machines. Just standard size 70 rollers.

[AutomagRT1483]

I'd have to say manufacturing. Making all them paintballs has got to rake in some big time cash. ;)

[Wooosh87]

I owned a pro shop for two years and never made enough profit to bring home any serious money. Every penny went into bills, restock, rent, wages, taxes, etc. It was the worst investment from a business standpoint. I had fun, and didn't have to have a real job for over two years. But, it was not profitable enough to even keep the doors open, and I was the second largest store in my state!
To make a store work you need more than just paintball. I was the only shop in my state that was exclusively paintball. Ever other shop had skateboarding etc.
Fields can make money, but it depends on how it is handled. I had the sheer luck of being able to use 20 acres of land for free for our field. Between the up keep of the land, portable toilets, netting (that costs a fortune to do correctly), staff, paint, rental equipment, air fill stations (co2 and nitro) a booth or shed, and the actual material to make the fields was very expensive. It cost me more to open a field than it did to get my pro shop. Netting alone was over $3,000.00 between the netting, poles, wire, hard parts and stuff. Plus it took many man hours to get correct. Making the fields took months and thousands of dollars. From renting bulldozers to buying material to use for bunkers and clearing the land it was a hassle. Then came the rental equipment and supplies. Add another $3,000 to $5,000 just for that stuff. Last time I checked the records we had over $38,000 invested in the field alone. We had airball, speedball and 3 woods fields. Nice place too. Was it worth it? No, not at all.

As for paint manufacturing, they don't make the money you think they do. RPS makes their money in medical manufacturing, I.E., Tylenol and pills. Paintballs are only manufactured around the medical stuff when they make the time. Also, distributors do make money off of selling paint, but not to the extreme that you think they do. Here is how it all works.

Lets use Draxxus for an example.

They, (Draxxus) buys the ingredients for the fill, shell and coloring. They also have to purchase the bags, boxes, etc., to package the paintballs. They then have to have these shipped to the manufacturer. Manufacturer than produces the paintballs, packages and ships the product. That is a lot of middleman stuff to contend with. This all has to be factored into the final price of the product. It is actually cheaper to manufacture the product than it is for all the shipping and transportation involved.

So if say, I, a retail dealer buys one case of paint for $30 from NPS. NPS maybe makes $3.00 off of that one case. big whoop. But, they do sell thousands of cases a month, and that can add up. I retail it for $40. I make $10. But, I have to pay $4 shipping on that case so my profit went down to only $6. Did I use a credit card to make this purchase? add 3% tax and fee's to that now. So another $.90 is removed from my profit margin bring it to $3.10. That is squat to make on any retail product. I had to sell 100+ cases a week to make a marginal profit from paint. You do make out better when you buy in bulk form from the distributor, but not that much better, maybe $2-$4 per case.
Plus, case's of paint take up so much room, are heavy to ship and are a pain to move from store to field. Paint was a nightmare.
Guns suck on profit too. Especially with stores on the Internet selling the exact same one for less than you buy it from the manufacturer for. How can I compete with that? These were the sole reasons I closed my business, I could not compete with online retail.

Were is the money at? Air fills. I made a killing from CO2 and nitro.
1 bulk 50 lb. CO2 cylinder costs me $14.00. I can get 40+ fills off of that one cylinder. I charged $2 and $3 per fill. Do the math. Say I did nothing but 20oz fills off of one CO2 cylinder at $3 each. I did 40 fills. That is $120.00. Now subtract the original cost of the cylinder at $14.00 and I have $106.00 in pure profit off of one cylinder. I went through 10 cylinders a week in the shop alone and another 5 at the field per day. Money, pure money.
Nitro was bit different or me. I had bulk cylinders at $40 each. I had a booster that could suck each bulk tank down to below 500 psi before I couldn't get a good 4500 psi fill. I could effectively get 30-50 fills off of one cylinder at $4 fill. So I netted an average of $160 on fills. Take out the cost of the cylinder at $40 and I had an average profit of $120.00. But, the nitro was always used for testing guns ad general screwing around, so it got used without being paid for. So lets drop the gross total down to $80.00 per cylinder, and I kept 5 cylinders on hand always.
So, air fills are were the moneys at people, at least from a retail point of view. could go on for hours about profit and loss.
Oh, and just because a gun costs more doesn't mean the retailer makes more. Usually the opposite. So cut your local retail some slack n that next big purchase. Don't ask for any deals, it only hurts you in the long run when he is forced out of business.

Rob

[Wooosh87]

I forgot to mention one little thing about owning a shop...Insurance. It is a scam and expensive. The only insurance that I could get on my pro shop was the same as the local gun shop. Paintball is considered the same as a al firearm when it comes to insurance. I payed over $5,000 a year for insurance that I never even had to fall back on. I lost $10,000 in pofit in two years for some paperwork...

Paintball is not profitable on the lower, "Mom and Pop" retail side. I have mad amounts of respect to any one that has a local pro shop or field that makes money. The big fields make money because they are big. It's like comparing a Gm or Ford car dealer to one of those "fly-by-night" used car dealers on the outskirts of town. The more youinvest, the more you stand to gain.

[mag-hatter]

if you were in smart parts right now you'd be raking it in :(

[luke]

Wooosh87,
Thanks,that was a good read. You confirmed my original thoughts about retail. Not much has changed over the last 10 years. I set up a small business 10 years ago, and it never got off the ground because of the profit margin and competition with the Internet (among other things).

I was hoping the market changed because I own some property that I believe will soon be eligible for rezoning and would like to capitalize on the situation. I do have a plan, I'm just not exactly sure how far I'm going to take it.
Time will tell.

Thanks for your input....

[Meph]

My vote goes to National with Gino! That's who I have to label under who I think is most profitable.

I won't even go into detail, or even how much this guy has to piss away. I'll just put it this way. He has an empire. And if right now Gino was instantly gone with National.... it's doubtful that even half of all paintball companies would be able to survive.

[Mutilus]

Originally posted by Meph
My vote goes to National with Gino! That's who I have to label under who I think is most profitable.

I won't even go into detail, or even how much this guy has to piss away. I'll just put it this way. He has an empire. And if right now Gino was instantly gone with National.... it's doubtful that even half of all paintball companies would be able to survive.

Meph this is true, but I believe this guy is asking which way to go to start a business not which one makes the most money (unless I am wrong) Well the way it breaks down retail is as follows

Marker Parts 75% margin
Barrels 50% margin
Accessories 45% Margin
Soft Goods 30% Margin
Markers 5% Margin

With that in mind you stand to make the most by selling parts retail. But the overall dollar value is probably more on selling whole markers.

The guys that make the money know how to diversify.

Manufacturers can make a good profit if they have a quality product and can offer the best margin to the retailer

Fields can make good money if they offer something that noone else can offer.

Distributers - well only one of them makes obscene money (Gino) but everyone else does okay.

Retail - is very hard to make money without a huge investment and a very knowledgable staff.

I would say teh best thing would be to distribute everything and manufacture you own products and a new business will do fine. That is how Gino made his money, I am sure lightning could strike twice.

Sorry if I am incoherent, and of course this all just my opinion and I could be wrong.

[Kevmaster]

Gino makes his money, no doubt about it, they're doing just great up there in Jersey.

However, he doesnt come CLOSE to the power of Brass Eagle. They may not show off as much at tournies with three to four big rigs, but they dont care about tournies the way Gino does. As much **** as BE takes, they're doing something right and if any one of yall had the option of CEOing BE or any other pb company, I hope you would choose BE. Goddam they are loaded

oh, yeh, they grossed 110 MILLION last year and pulled in 10MILLION in profits....by the way

[Gumby]

Yikes.

[Meph]

And to think. With 10million pure profit. You think some of that would be put back into the markers to make them actually of good quality? Huh, go figure. Ah well.

Then again as you said, if I CEOed Brass Eagle. There'd be a lot of changes!

[GoatBoy]

What's the margin on the insurance, guys?


As was said earlier, it's the insurance companies that make off like bandits.

[Kevmaster]

insurance companys dont make off like bandits, imho, if you get one lawsuit about a kid losing one eye, its worth $300-500 Grand. If they lose BOTH eyes, its easily 2-3 mil. Good luck paying that one off out of your operating budget.

[Wooosh87]

Originally posted by Meph
My vote goes to National with Gino! That's who I have to label under who I think is most profitable.

I won't even go into detail, or even how much this guy has to piss away. I'll just put it this way. He has an empire. And if right now Gino was instantly gone with National.... it's doubtful that even half of all paintball companies would be able to survive.

Meph, you are correct is saying that Gino is swimming in money. He has gone from simple retailer to worldwide distributor in a few short years. He has a head for business like no one else. But, he has not done it with paintball alone. He has many other business ventures that support him. His father has also helped out. But, yes National has to be one of, if not the most powerful business in paintball today.

[Jeffy-CanCon]

From what I have seen:

manufacturing
field
retail

A field can make decent money. Even small fields can make a profit, though not usually enough to let the owner quit their day job. The irony is that you open a field to have a decent and convenient place to play, but if it is successful, you never get time to play any more.

Retail stores tie up a lot of the money in inventory, which is hard. Paintball stuff doesn't go bad, mostly, but it does go out of fashion. Got a lot of barrel plugs? Vents lenses? Still got a Mega Z, Tippman FA, or VM-68 on your wall? Too bad for you. From what I have seen, retail stores are often connected with fields, and serve more as a way of attracting and keeping players than anything else. They are the in-town/weekday face of a field.

I have seen successful field owners get into manufacturing, but not the other way around. That says enough to me.

[raehl]

There really isn't phenomonal money in manufacturing or distribution anymore, at least not moreso than in any other industry. Obviously if you own a company that moves hundreds of millions in profit every year you're not going to be poor, but the days when paintball business people were making out like mad bandits are over.

Things have become commodities, and competition has pushed margins about as low as they can go and still keep the businesses going. And the manufacturers have been putting some serious investment back into the sport as well.


I think one of the few ways you can get into the industry now and make a decent profit on it is, as others have mentioned, scenario game promotion. You'll need to know what you're doing and deliver quality, but the payoff to investment is pretty good.

Fields don't make much money. Stores make less. In all honesty, most paintball retail stores don't deserve to be in business - paintball players tend to be young and internet savy and there's just no reason for them to pay the added costs of having a store when they can order online. I know retailers ***** and moan about how they pay more for stuff than they could get it on the internet, but it's their own fault they're trying to sell a service (a local point of sale) that no one really wants.


I will say that if you set out to do a field RIGHT from the ground up you could be turning some good profit in a few years. That means you get the land to expand, you set up good processes for handling customers, and you deliver a quality service. If you just grab some land the local farmer isn't using and run out of a shack you'll never really get anywhere.


- Chris

[luke]

I'm in the process of starting a small shop to do some customizing and some "light" manufacturing. But, what really got me thinking about putting in a retail store was that I own (free and clear) a house/property that may be eligible for rezoning do to new roadway the city has underway.

When the city is finished, half the traffic we currently have coming into town will be passing by my house. I thought without a monthly mortgage payment on a peace of commercial property I might be able to survive.

It wouldn't take much to convert the house to a store, and I figured I could do both, manufacturing and retail all under the same roof. But, perhaps that might be spreading myself a little thin.


I don't expect to get rich I just want to quit my day job.:D
I do appreciate everyone's input, keep it coming.