America’s passion for amusement parks
If you are going to run an amusement park business, this article may give you some useful information.
What is the Amusement Parks Industry?
Amusement and theme park companies operate mechanical rides, water rides, games, shows, themed exhibits, refreshment stands and other attractions. Establishments may also lease space on a contract basis.
The Secrets behind Disney's $2.2 Billion Theme Park Profits
Disney (DIS). Disney is the king of theme parks, with the iconic Disneyland still setting the bar for the genre. Disney owns and operates the world's most popular and profitable theme parks. It's dominant in California and Florida, but it's also expanding in Asia and seeing success in Europe.
The amusement parks of his era had few rides that parents could enjoy with their children and they were often dirty and unsafe. Disney changed that by integrating his rides with stories which had become famous in his blockbuster movies. It marked the start of a process which now fuels the profit-making power of Disney’s parks.
Walt Disney (DIS), the world’s largest theme park operator, is following a similar path. Disney tripled its investment in its resorts business between 2008 and 2012, spending a total of $9.2 billion to, among other things, refresh Fantasyland at its Magic Kingdom Park in Orlando and build attractions such as Cars Land at its Disney California Adventure Park in Anaheim.
No longer was a roller-coaster a winding track in mid-air. Instead, Walt’s version was a runaway mine train integrated into a mock-up of the mountains from Bryce Canyon National Park in Utah.
A good time to be an amusement park operator
It's a good time to be an amusement park operator. Amusement park companies are climbing up the coaster hill, and investors are enjoying the ride. America’s passion for amusement parks is white-hot these days, driven by elaborate new attractions, sophisticated pricing schemes, and a desire to get out of the house-but not too far from home. “You would think that a business whose proposition is selling entertainment that requires disposable income would not do well” just now, says SeaWorld Chief Executive Officer Jim Atchison. “The reality is consumers have found great value in these kinds of experiences.”
Parks are now the highest-margin business. Overall attendance at America’s approximately 400 parks and attractions has increased almost every year during recent times. Declines in 1994 and 2003 can be attributed in part to very cold, very wet summers and in 1998 due, again, to some poor weather and fewer visitors from Asia.
The Amusement Parks industry is experiencing significant growth as revenue and profit margins continue to expand amid brightening economic conditions. As consumer sentiment improved markedly over the past five years, more Americans increased leisure spending, resulting in higher amusement park attendance and greater in-park spending. Industry growth is expected to continue over the next five years as a number of drivers continue to have a positive influence on the industry. The additional infusion of tourist dollars is expected to bolster revenue for regional and destination amusement parks. The industry will also benefit as global unemployment rates decline, the US economy improves and consumers continue to spend money, particularly on recreational activities.
