According to recent statistics from the International Association of Amusement Parks and Attractions, there are approximately 300 amusement parks in the United States. If you add other types of attractions to the mix, like museums, zoos and science centers, the number increases to 30,000. The amusement park industry stimulates the economy with both dollars and jobs, generating an average annual economic impact of $55.5 billion, and 600,000 year-round and seasonal non-exportable jobs.
That’s big business. It is also a very competitive business, and recent investments in the industry are increasing competition even more.
On the business side of the industry, it is expensive to operate an amusement park. There is an often-quoted industry statistic that when planning for the construction of a theme park, developers should anticipate investing $100 per expected first-year guest. In other words, if developers want to attract one million annual visitors, the upfront investment to expect is $100,000,000. The figure only accounts for construction, not the actual cost of operating. An upfront investment of this magnitude emphasizes why profitable retail sales is so important for an amusement park’s ongoing success.
IT Solutions to Optimize Retail Profits at Amusement Parks
Amusement parks generate some revenue from ticket entry, which can sometimes be as high as $100 per person. They also generate revenue from retail operations inside the park: food, souvenirs, and other retail items. The overall revenue generated by amusement parks is eye opening with annual consumer spending on amusement parks projected to reach $27 billion by 2019. With this much revenue potential on the line, the technology used to support retail operations has to be kept in top working order. There is no room for downtime.
When considering the costs of operating an amusement park and the technology needed to keep things running smoothly, Key Services’ Business Development Manager Ed McMillan has a story about Point-of-Sale (POS) equipment any retailer will benefit from reading.
Not so long ago, McMillan was making a visit to a large amusement park client for Key Services. The park operator was using a top brand of POS equipment in all of the stores at the park, as well as all of the standalone stores around the United States.
“The revenue generated per hour for POS systems is critical for amusement parks, because it makes up a large part of the revenue,” said McMillan.
The software used in the POS equipment became problematic, because it was updated at a rapid pace to keep up with changes in the industry. Consequently, the POS hardware was slowly becoming obsolete and would soon no longer be compatible with future versions of the software.
“Our client was told they would need to replace all of the POS hardware at the hefty cost of $14 million,” explained McMillan. “That investment is why they approached Key Services for a second opinion.”
Key Services develops an $880,000 solution to a $14 million expense
Key Services had been a trusted partner with the amusement park for five years. McMillan tapped into the expertise of Key Services’ engineers, who specialize in repairing branded, non-branded and obsolete technology, which helps extend the life cycle of the technology.
“Our customers have access to our ISO 9001 certified technicians and engineers and a state-of-the-art repair center,” said McMillan. “Our technical staff averages sixteen years of industry experience and has been compiling a repairs knowledge base for the past decade. I turned to our engineers who came up with a solution offering faster memory, a faster hard drive, and faster processor.”
The Key Services engineers also created technical guidelines for modifying the POS main system board. Once the machine was fast enough to use the new software, the client was able to use the updated software without having to buy new equipment.
After the solution was developed, McMillan looked at the client’s overall technology repair and maintenance operations and uncovered other high costs. Here are a few issues he found.
- Technicians were not trained in diagnosis and part repair.
- Technicians could only swap out entire systems instead of conducting repair.
- Calls to the hardware provider averaged $700/hour.
“Our client had a service team of 28 technicians who could complete installations but could not repair the hardware,” said McMillan.”
To resolve this challenge, McMillan said Key Services flew a lead engineer to the client’s largest location to spend a week with the technicians. After the visit, the Key Services engineer team developed a training program including live technical support and video training. The training showed technicians how to diagnose the problem, remove the part needing replacement, and install a replacement part. In turn, technicians sent the broken part to Key Services for repair and inventory.
“When someone asks me how Key Services is different than other managed services providers, I tell them this client story,” said McMillan. “It’s one of many success stories that highlight our value. We are experts at what we do, and we pride ourselves on being trusted business partners.”
Can Key Services help you unlock simplicity for your business? Let’s start a discussion. Please call us at 336-768-4400 or visit www.key-services.com.