How to Start a Bounce House Rental Business

Being in the party rental industry can be a challenging enterprise to say the lease, but knowing how to start a bounce house business can make that challenge a little easier. The bouncy houses are inflated and have plenty of space on the interior for kids and adults to jump around and have a good time. With proper care and supervision, a bounce house can be a long-term investment. If your community could use some good old-fashioned fun, then maybe this is the business venture for you.

It all begins with a long-term investment perspective. A quick look at the inflatables manufacturers today will give you a lot of marketing hype and promises of a fast return. Some bounce house businesses may see a fast return and quick profits, but it usually takes about 3 years for a business like this to become stable.

1. Start Slow, Build Big

The advantage of a bounce house business is that it can be started with a low initial investment. This means that anyone with a small amount of capital can begin their business. The only problem with a low initial investment is that it typically translates into lower profit percentages as well. If executed properly, however, this business opportunity can start slow and build big.

2. Build Some Muscle

A good-sized bounce house is going to weigh 150-200 pounds when it is deflated. You’ll also need to have equipment on hand to inflate the structure and then maintain the air flow. This may mean that you’ll need an employee or two to help you out, which means filing for tax identification numbers. You can’t really hire independent contractors in this area because the nature of the IC is that they’re allowed to complete a job to your standards in their own way.

3. A Cleaning Machine

The biggest advantage that a bounce house business can have is to create a 100% hygienic atmosphere. This means that you’ll need to properly clean all of your inflatables after they have been used. It also means that if your inflatables get wet, you’ll need to have space available where they’ll be able to dry so that mold and mildew don’t develop.

4. Get Your Licenses

Once you’ve obtained your inflatables, you’ll also want to obtain your business licenses. This means you’ll need to approach your local Department of Revenue of similar entity to apply for all licenses and permits. If you are putting up your inflatables in certain locations within your community, you may also be required to have specific day-of-use permits to obtain as well.

5. Insurance Is Your Friend

Although a bounce house can be a lot of fun, it can also be the cause of an injury. If you’re not properly insured and a child bounces out of the house and breaks an arm or a leg, then you could be on the hook for medical, pain and suffering, and other costs if you are deemed to be negligent. Having general liability insurance and a comprehensive set of riders based on all of the inflatables that you purchase will help limit your liabilities. Make sure you have a safety waiver on hand for everyone to sign to further limit your liability.

6. Make a Business Plan

You’ll need to know how much rental rates are for inflatables in your community or region. Some regions are very expansive because they are rural in nature, which means your market coverage could include towns that are over 100 miles away. If you are the only provider, then you can set your own rates. If you have competitors in your field, however, you’ll need to know what their rental rates are so that you don’t price yourself out of business. Even if you’re the only inflatables business around, knowing what others charge will help customers feel like you aren’t trying to fleece them. It might seem like a good idea to undercut the market, but all this does is create profit deterioration for the entire industry.

7. Consider Security Deposits

If people are renting your equipment, then they need to be taking care of your equipment. This means that you’ll want to have a policy concerning security deposits for your customers. A security deposit is 100% refundable if your bounce house is returned to you in good condition. If there is damage that occurs, however, a security deposit will help keep your business in the black because you’ll have funds available to help pay for repairs.

8. Get Set Up For Sales Tax

Most jurisdictions require a bounce house business to collect sales tax. This is because the business is considered to be part of the rental industry. You’ll need to charge whatever your local sales tax rates happen to be and that can get complicated if you operate in multiple communities. Some states require sales tax based on your home jurisdiction. Others require sales tax based on where the customer lives. You’ll need to know the laws to make sure you’re collecting the right amount because otherwise you might be on the hook for some big expenses when it’s time to file taxes.

9. Have a Great Grand Opening

Give yourself about one month to market for a grand opening of your rentals business. Have special rates that can be charged and use the opportunity to attract some attention to your business. Make sure you have future pricing structures laid out and perfectly clear for the people who attend your grand opening so they don’t get some sticker shock.

10. Have Fun

Knowing how to start a bounce house business means knowing how to have fun. Your inflatables are being rented because people are looking to have a great time. With a great attitude, hygienic equipment, and a variety of bounce houses to use, people will have fun and come back to you when they want to have more fun.

Although the business model for a bounce house business can be repetitive, it can also be profitable. Price out inflatables, know your competition, and then get to work creating a solid business plan. In doing so, you’ll be creating the foundation of success that your inflatables business will need.

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