Something in the world of floating have you stumped?
Show Highlights
The float industry has grown like crazy and no two centers are exactly the same. Some are opulent spas, others are small functional lounge type spaces with some tanks in it. Obviously price is a major factor in these designs, but what’s the range for the cost of a center? Certainly there’s a range, but you also want to make sure you’re not skipping out on important things like sound/water/saltproofing or proper ventilation. So how much is it really, all things considered?
Show Resources
FTS Product – Business Plan
Listen to Just the Audio
Transcription of this episode… (in case you prefer reading)
Graham: Today’s question is, “What’s a fair amount to budget for each float room’s construction, assuming middle of the road fanciness, but industry refined techniques, like green glue and double sheetrock, offset studs, waterproof flooring, FRP, a standard size, et cetera? Thanks.“
Ashkahn: A very polite question.
Graham: Yeah, it also assumes that we’re actually gonna give good answers.
Ashkahn: Hold your thanks, for a minute here. Let’s extend the question a little bit, to talk about a whole float center, because you can’t really-
Graham: Oh, I thought you were gonna talk about our lives, and what we did today. Just kind of make it a little more about us, then that floating would be nice.
Ashkahn: Because you need a lobby, you need someone to draw architectural plans. There’s a lot more that goes into starting up a float center than specifically just the construction of the float room.
Graham: And you need a float tank to put in the room.
Ashkahn: You need a float tank to put in the room. So I think it’s a little bit better to consider this in terms of your general start-up cost, which is also very much dependent on how many float rooms you’re building.
Graham: Yeah, and so this is an interesting one in itself, too. This idea of a cost per float room is a little bit deceptive, because each room that you’re adding on to your center gets successively less expensive to build out, both because you get bulk rates on the float tanks, as long as the contractor is already out on site, you’re kind of paying a fee just to have them out there, so when you’re building extra rooms, then it means that that labor gets cheaper, because they’ve already signed on for a contract, so your second room is going to be more affordable than your first. Your third room is gonna be more affordable than your first or second rooms, or all three are gonna get cheaper, depending on how you think about it. There are some economies of scale that kind of go into this, too.
Ashkahn: Yeah, and your lobby space also scales, I think, a little bit easier the bigger things get. Like the amount of extra space you need in your lobby for two float rooms instead of one is not as significant as having a lobby in the first place.
Graham: Right, yep. Yeah, exactly. So, in general though, for our kind of rule of thumb building out a new float tank center, we like to say estimate between $50-$100,000/float tank that you’re having in the center, assuming that you’re not offering any other services. That also includes having money in the bank after you open, so having some runway cash, and it assumes things going wrong, too. So having enough money set aside so that during construction you can actually pay for mistakes that are being made. And that’s a pretty big range, going from $50-$100,000 is of course doubling the budget of your float tank center, but that’s not even as high as you can go. You can easily spend a huge amount of money just decorating your lobby, and turn that into $200,000/tank that you have in your center.
Ashkahn: So those numbers kind of follow the assumptions that this question has. It’s assuming we’re not doing some crazy, insane marble walled lobby space, with beautiful interior design-
Graham: Which no one should ever do in a float tank center.
Ashkahn: … but it also assuming that you’re building the float rooms themself with some pretty substantial and serious construction, you know, the double layered sheetrock, good soundproofing, good waterproofing, all that sort of stuff. Still, the ranges can be just that big in terms of what float tank you buy. There are float tanks that are $50,000 more expensive than other float tanks, so that alone could cover that entire gap, depending on which direction you’re going, there.
Graham: Yeah, and if you’re getting up to the point where you’re paying in the $60,000 range for float tanks, you’re not even going to be able to get the kind of $100,000/room down in your final cost of the building, you know. So consider this, a lower to mid range for float tank centers, even though it sounds really high, saying that it’s going to be $300,000-$600,000 for a six tank center. It is a very large number. Again, that’s enough money to make sure that it’s actually done well, and depends a lot on your area as well, type of float tank, things like that. So there are a lot of variables, but that’s the range where you’re probably not cutting enough corners that you’re making your life miserable two years from now.
Ashkahn: Yeah, like if you were spending less than that, I would take a critical look at exactly what construction you’re choosing, and things like that. If you’re spending more than that, hopefully you know where it’s going. You’re buying pretty expensive float tanks, or you are deciding to spend a lot of money on marketing right off the bat, or you’re deciding to hire a really nice interior designer, or something like that. I will also say, when we talk to float centers after they have opened, they pretty much are in that range. Like when I talk to people, these are very much backed by not only us crunching numbers, and kind of working through construction costs, but it’s also backed by a lot of real world feedback we get from people when we see people open their float centers, and they look nice, and they did a good job. We ask them how much it took to open it that way, it’s almost always in that range, $50,000-$100,000/float tank.
Graham: Yeah, so we’ve been saying this for a long time. I think it was this last year’s industry report, maybe it was the year before, but when we were taking an average of all of the costs that it took centers to open per tank that they had, it came out to so close to this, it was within $1,000. It was like $49,000-$99,000 was the actual average that it cost all the existing centers per tank to open up. So check out the industry report as well, give us your good range. But it seems like although we were kind of just winging this and saying it offhand a few years ago, it’s turned out to actually be true, so hopefully that’s the case-
Ashkahn: Like most of our advice. It’s true after the fact.
Graham: Yeah, fortunately we’re very lucky, so I believe that compensates for the complete idiocy that normally issues forth from us. Any other details that we want to go into here, or that’s just kind of a good-
Ashkahn: I think that’s the good, rough idea of everything. I mean there’s a million details in all the construction, all that stuff-
Graham: And they can all change. Also, I’ll say I’ve heard of more centers opening that break that range on the high side recently, like in the last couple years, than before.
Ashkahn: Usually in pretty big cities, where the cost of everything-
Graham: Yeah, yeah, places-
Ashkahn: … is kind of a little bit more intense.
Graham: Yeah, absolutely, and then especially more towards downtowns of those cities, more towards big actual shopping districts, anything like that is obviously going to not only be more for rent, but more for construction, because you have to deal with all of your neighbors, and not interfering too much with public walkways, which you now have to pay money for, and things like that. Great, thank you. Thanks for the question. Again, big, broad, overview-type questions nice having out there, and if you have any others, go to floattanksolutions.com/podcast.
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