Americans love to camp. Approximately 9 million households in the U.S. own an RV and the average owner travels in their RV at least two weeks out of the year. With the expected growth of the RV and camping industry, it's estimated that half a million new RVs will be sold by the end of 2021. In fact, 20% more campers will be looking for a place to park their motorhomes, travel trailers, and fifth-wheels in the next year.
If there has ever been a good time to start a campground business, it is now. There is a lot to consider when starting any new small business and a campground business is no exception. You will need to confront all the practical and legal issues around starting your new business, plus you will need to learn how to manage the accounting and tax aspects of your enterprise.
This guide provides a starting point to help you plan your own campground business and get it set up and operational.
Operational Considerations for Your Campground Business
Like most small business endeavors, the best way to start your campground is with a business plan. Factors to consider include:
- What type of campsites to include
- Where you will base your campground
- What additional income streams you can establish
- What you should budget for
Types of Campsites
The first thing you will need to consider is the type of campsites you envision for your campground. You may decide to accommodate one, several, or all of the following:
- Tent campsites offer a "roughing it" experience. Guests pitch their own tents and bring everything they need to be self-sufficient. Tent campsites do not provide electricity or running water, although public restrooms and bathhouses may be provided on the premises.
- Boondocking sites offer RV camping without connections to the water supply, electricity, or the septic system.
- Partial RV hook-up campsites offer tent campers and RV campers both water and electricity but no RV sewer hookups. Shower and toilet facilities are provided.
- Full RV hook-up campsites offer RV campers electricity, water, and sewer connections. Many also offer cable TV and WiFi connections. Bathhouses are also usually available at full hook-up campsites.
- Glamping (glamorous camping) sites offer an extra layer of comfort and elegance to the camping experience. Glamping can include anything from extra-luxurious tent or RV camping lots to sites with alternative structures like well-appointed cabins, yurts, treehouses, or even converted grain silos and covered wagons.
Location for Your Campground
You will need to find a location for your campground. If you are starting your campground from scratch, considerations include:
- Finding sufficient land to house your campground: You will want to find a desirable location with nice landscaping, perhaps near natural amenities like a lake, mountains, and/or hiking trails.
- Utilities availability: You will want to make sure you can hook up water, sewer, electricity, and gas to your campsites and facility structures. You may also want to make sure you will have cable TV and internet access.
- Land use regulations and zoning: County and municipal ordinances vary on location, density, and allowable use for undeveloped parcels of land, including campgrounds. You will want to make sure you can get the necessary campground construction permits to build out your sites, as well as additional structures like an administrative office, a bathhouse, a swimming pool and pool house, laundry facilities, and a playground.
If you are looking to purchase an existing campground, you may want to work with a real estate broker that specializes in RV park and campground purchases.
Additional Income Streams to Consider
Along with any of the natural recreation opportunities that come with the location of your campground and the add-ons like picnic tables and fire pits that you will probably provide for free, you might want to offer additional options for guests, such as kayak rentals, guided canoeing trips, or fishing tackle and bait sales.
You might also consider selling propane gas and firewood. Some campground owners run a convenience store offering essential items like some food staples and toiletries. Now is the time to consider any additional services or products you might want to offer your guests.
Creating a Budget
Undertaking a cost-benefit analysis before embarking on your new venture is one of the keys to having a successful campground. After planning for how you will cover your startup costs, you will want to consider your pricing for each lot and what your expenses will be.
Private campgrounds charge anywhere from $30 a night for an RV site to more than $150 a night depending on the location and amenities. Most RV parks offer discounts for weekly, monthly, and annual rentals. How much you take in each month will depend on how big your park is, what the going lot rental rate is in your area, the amenities you offer, and whether you will be open year-round or will have to close for the winter months. You will also want to take into account potential revenue from ancillary income sources like boat rentals or firewood sales.
Once you calculate your anticipated revenue, you need to consider:
- How much money you will need on hand for net working capital
- What your operating expenses will be
- When you can expect to get to your break-even point
- What your monthly overhead costs will be
Getting Your Campground Business Started
After you complete the planning stages, it is time to consider the operational aspects of your business. You will need to:
- Create a legal structure for your campground business
- Market your park to travelers
- Plan for the day-to-day operations of your campground
Picking a Legal Entity for Your Business
You will need to decide what type of legal entity you wish to create. You can choose to be a sole proprietor (or form a partnership if you have a business partner), form a limited liability company (LLC), or file as a corporation. Each choice has pros and cons. Most campground owners go with a limited liability company (LLC) or a corporation to limit their personal liability and lend credibility to their business venture, but it is best to consult with legal counsel and a tax expert to determine which entity is best for you.
After you form your legal business entity, you will need to obtain a federal tax identification number (you may also need a state tax identification number depending on where your campground is located). Once you have the federal number, you can open up a dedicated business bank account, enter into contracts, and operate your business under your corporate name.
Marketing Your Campground
RV parks are reporting a record number of reservations and urging campers to book in advance as campgrounds are filling fast. This is good news for new campground owners - RV owners and campers need more places to stay - but only if those campers have a way to find you. You need a good marketing plan.
Your campground is going to need a website and some sort of reservation system. Your website should show a map of your facility, list your amenities, and tag your campground on Google maps so vacationers can find you.
There are untold numbers of Facebook, Instagram, and other social media groups devoted to the RV and camping lifestyle. Participants share advice and recommendations for their favorite campgrounds all the time. This is one business where word-of-mouth advertising can make all the difference in occupancy. Garnering great reviews on sites like campgroundreviews.com is marketing gold for campground owners.
You may want to consider joining an RV park network. Campers pay an annual membership fee in return for discounted site rates. Affiliated campgrounds get the benefits of being part of a network that is professionally marketed to millions. Two of the most popular RV membership networks are Good Sam and Passport America.
You may also want to consider buying an RV park franchise. While costly to join - KOA's franchise fee can be as much as $30,000 - franchise networks employ robust marketing and maintain membership rosters that could well make joining them worth the investment. Some of the better-known campground franchises are:
You can also work with a company like Southeast Publications to create and print your RV park guest guides for free - they make their money by selling ads on your guest map - and list your facility on their popular mobilerving.com app.
Considerations for Your Campground Operations
Before you have your business all set up and the campsites filling up, you are going to need to put a plan in place to run your day-to-day business. You will need office help, grounds maintenance staff, and people to run your convenience store, bait shop, kayak rentals, etc.
You might want to consider hiring work campers for some of these positions. Work campers are individuals who live in their RVs and are willing to work for a free lot rental with or without a reduced salary. Some jobs that work campers typically do include:
- Camp host
- Activities director
- Maintenance worker
- Off-season caretaker
- Gate attendant
- Front office staff
You are also going to need to take care of the regular accounting tasks associated with running a small business. Skynova can help you keep track of your income and expenses with our accounting software, while our work order software allows you to keep up with maintenance around the campground.
For those side gigs that produce additional income streams, you can also use Skynova's purchase order template for goods - such as the merchandise to stock your store or bait and tackle you might sell to your guests - and issue sales receipts.
Skynova Can Help Your Campground Business Run Smoothly
There is no doubt that the campground business is booming across America. While opening a campground may be the opportunity of a lifetime, you will be devoting a lot of time and money to the hard work of getting your new park off the ground. The one aspect of your business you shouldn't have to worry about is how you are going to manage your accounts.
Skynova's business templates and suite of software products are designed for entrepreneurs like you. Geared specifically toward small businesses, our easy-to-use systems let you quickly take care of your accounts so you can get back to running the business that you love.