Camping is an excellent recreational activity that’s steadily grown in popularity over the years. Over 48 million households in the U.S. went on camping trips in 2020, an increase of roughly 14% from the previous year.
Purchasing a campground franchise can allow you to tap into the rapidly growing industry and create an extra revenue stream for you. However, before you buy a campground, here are some essential factors you should consider.
Location
Location is undoubtedly the most important factor you should consider before you buy a campground. When picking a location, ask yourself the following questions:
- What tourist attractions are present in the area?
- How many visitors does the area receive annually?
- What’s the area’s population?
- Is the park accessible?
Ideally, you’ll want to buy a campground that attracts a high number of well-paying visitors. Additionally, it should be accessible. Franchisors usually have various campgrounds for sale. View all the available locations and pick a favorable one that’s guaranteed to give you high returns.
Campground Size
Campgrounds come in a variety of sizes. While some campgrounds can only accommodate a few campers, others can accommodate hundreds of them. When considering an ideal campground size, ask yourself the following questions:
- How many employees will you need to help run the campground or RV park?
- How many camping spots do you want to manage?
Once you’ve answered these questions, you’ll be able to determine the ideal campground size for your business. The size will also be significantly influenced by the number of visitors the area receives.
Overall, the larger the campground, the higher the number of visitors it can accommodate, but the higher the operational costs, and vice versa.
Amenities
Before buying a campsite franchise, check out the features offered at the campsite. Nowadays, providing a barebones location where guests can set up camp isn’t enough. Guests expect campsite owners to go the extra mile and provide amenities like Wi-Fi, hot showers, laundry rooms, restaurants, water park features and more. Cooking amenities are also essential because 78% of campers participate in outdoor cooking while camping. Not only can offering these amenities help you attract more clients and allow you to charge a premium, but it can also promote guest loyalty.
Personnel
Buying a campground isn’t a one-person job. It’s usually a joint effort. If you’re looking into purchasing a campground, you’ll want to work with an experienced team. Some of the people you’ll need to work with to facilitate the transaction include:
- Real Estate Agents: They can help you find and identify suitable campgrounds. They can also relieve you from handling paperwork.
- Bankers: They can help you with financing if you plan to take out a loan to invest in the franchise.
- Inspectors: They can examine the power, plumbing, and more to ensure everything is in working order.
Financing
Buying a campground is a significant investment. Often, it requires financing to pay for franchising fees, marketing, and other expenses. If you’re approaching a bank for financing, you’ll need to have a solid business plan. Ensure your business plan can prove to your potential lender the campground’s estimated profitability and occupancy rates. Additionally, ensure you can show other revenue streams not reliant on the campground.
Alternatively, you can seek debt financing from the seller. Some sellers offer flexible payment terms that are more favorable than bank financing.
Overall, buying a campground franchise is an excellent way to supplement your revenue streams and increase income. But, before you buy a campground, consider the factors above when deciding to venture into the business. Give LSI a call today to help you make a sound decision.