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By Greg Gerber
Editor, RV Daily Report
Celebrating its 50th anniversary this year, the Jellystone Park system has attracted considerable attention in recent years as one of the best franchise opportunities on the market, said Jim Westover, vice president of product development and sales.
For example, Franchise Gator lists the Jellystone Park system among its Top 100 business opportunities.
In 2017, Entrepreneur magazine ranked Jellystone Park No. 472 on its list of the 500 best franchises in North America. Two years later, the system has climbed to No. 202.
“We continue to grow based on the strength of our franchisees and the quality of our brand,” Westover added, noting that Jellystone Park was listed by Entrepreneur as the No. 1 opportunity in the camping industry for the third straight year.
Franchise Business Review magazine currently ranks Jellystone Park among its Top 50 franchises based on the fact it has received positive feedback scores from its current franchisees.
A total of 98 percent of franchise owners surveyed by the magazine indicate they would invest in a Jellystone Park again and 92 percent said they would recommend the investment to others.
Those numbers are so high because Jellystone Park executives maintain a solid working relationship with franchisees individually and through an active advisory council that provides feedback on corporate policies, ideas and new programs, said Westover.
Four ways to join
There are several ways for a prospective Jellystone Park owner to enter the system. The two most popular are by converting an existing campground or by building a new park.
Both options require a $10,000 initial franchise fee, which helps cover costs to evaluate the site and develop a plan to upgrade the campground to offer amenities Jellystone Park guests expect from the parks.
People can also reserve a territory for up to two years at a cost of $6,000. Then when the owner solidifies a plan to operate a campground, the reservation can be converted into a franchise agreement with an additional $4,000 payment.
A prospective franchisee can also join the system by acquiring an existing campground. People can check for any current opportunities at www.jellystonefranchise.com.
All prospective franchise owners must complete a review process, Westover explained. That includes a snapshot of the owner’s financial picture to ensure that he or she can execute the brand the way it needs to be done.
That generally requires a net worth between $400,000 and $500,000 as well as $200,000 in liquid resources.
Building a campground from the ground up may require as much as $5 million depending upon the location, number of campsites and amenities to be offered at the park.
When reviewing an existing campground, the company first looks to ensure the location is in an open territory at least 50 to 60 miles from another Jellystone Park location — a protection Westover said is one of the best in the industry.
Next, the company researches the particular market to ensure that it could support a Jellystone Park. The ideal market is one in which the average household income is in the upper middle class for that region. The location also needs to be able to draw support from up to 90 miles away.
While the prospective owner engages in due diligence to ensure Jellystone Park fits with his or her long-term goals, the company is busy assessing the park or location to see what upgrades may be needed, if any, to ensure the campground would offer guests the same type of experience they would receive at any other Jellystone Park.
Special attention is paid to the quality of bathhouses and water features, whether it is a heated pool, splash pad, water slide or on-lake feature like a Wibit.
To ensure their parks are kid-friendly and appealing, many campground owners add jumping pillows, mini golf, laser tag and Gaga ball pits, which are similar to confined dodgeball arenas.
“We evaluate the proposal similarly to the way a banker would,” Westover explained. “We look at what the business owner has already accomplished and whether he or she has the funding to fully support the business through its first few years.
“We also review character references to ensure the owner is likely to comply with our particular standards,” said Westover. “We award franchises. We don’t give them out.”
Once the contract is signed, the franchise staff works closely with the new owner to get the campground up and running quickly. A giant Yogi Bear™ statue is ordered along with new signage.
The owners and key staff members are then invited to attend a special training session to learn about the reservations software and bookkeeping system. They also get to attend Jellystone Park’s annual symposium, which will be held in Charleston, S.C., this year.
The Jellystone Park system has great working relationships with two third-party financing firms, Westover explained.
Paul Bosley, the owner of Business Finance Depot, serves as an intermediary between franchisees and banks. He works to assemble financial packages that have a high rate of success for funding, said Westover.
Bruce Hurta, with Fidelity Bank, is one of the top lenders for franchising with the Small Business Administration.
“Bruce will make sure owners don’t get in over their heads by borrowing more than he believes they can comfortably handle,” said Westover.
Jellystone Park assesses a 5% franchise fee on all park revenue. That fee is divided in to three separate funds:
- 3.5% is used to cover the system’s operating costs.
- 1% is pooled into a national advertising fund to promote Jellystone Park on various online and traditional media outlets.
- 0.5% is used to manage Club Yogi Rewards, the Jellystone Park loyalty program that works similarly to Hilton Honors in that members earn points redeemable for free nights and merchandise based on their expenditures.
With an online reservations system and app already in place, as well as high brand recognition, most Jellystone Park locations enjoy occupancy rates around 53% all months they are open, said Westover. But that jumps to 95% in the summer and most parks are sold out on holiday weekends.
Many campground owners generate additional revenue in the “shoulder seasons” just before Memorial Day and after Labor Day. Halloween-themed weekends are often a big draw and most campgrounds pack in guests through special events such as Yogi Bear’s birthday party, Mardi Gras, Christmas in July and the infamous Chocolate Weekend.
Return on investment
The Jellystone Park system is proud of its ability to generate a significant return on investment for park owners, Westover said. The average location generates $1.6 million in revenue on 180 sites with an average stay of 2.5 nights.
“That why we love the transient market,” he added. “When done right, it is a real cash generator with the average campsite bringing in $8,900 per year.”
While other private campground owners may opt to take an easier route to lease out sites on a seasonal basis to get a $4,000 payment upfront, Westover said Jellystone Park owners often turn over the same sites multiple times every year.
That generates considerably more revenue over the course of the same season. Heated and air-conditioned cabins can easily bring in $150 per night.
In fact, the average Jellystone Park sees a net operating income of 25 to 40 percent of earnings before interest, taxes, depreciation and amortization — an excellent rate of return compared to restaurants that average 10 to 15 percent, or 20 percent if they are on top of their game, said Westover.
“Our system is designed to attract families in the 25 to 44 age brackets with a median household income of $70,000 annually,” he added. “We are really in the entertainment business. So, once we get families to visit a Jellystone Park location, we offer enough activities to get them to stay, play and spend inside the park.”
Because of the transient nature of the resort’s business model, it generally requires more staffing to run a campground than others of similar size. However, due to economies of scale at a certain sales volume, the parks generate substantial profitability, Westover explained.
The added labor costs are typically covered by fees for ancillary income such as Yogi Bear merchandise, which generally brings in nearly $30,000 per campground.
Activities in the park, such as pottery painting, zombie hunts and ninja warrior courses, have additional fees associated with them and can account for 8% of all revenue. Sales of supplies, snacks, toys and equipment at the camp store bring in another 8%.
Rentals of golf carts, bicycles, paddle boats and other toys can also bring in additional income. Some parks also feature video arcades.
Many Jellystone Park campgrounds serve food and some have even opened a Nathan’s Famous restaurant within their parks to serve kid-favorite comfort foods like hotdogs, burgers and fries.
“All of these add-on items work to enhance our guests experience staying at a Jellystone Parks,” Westover explained. “We do our best to keep guests in the parks and entertained.”
More information about specific figures can be found at www.jellystonefranchise.com.
Jellystone Park locations make good neighbors
One of the biggest selling points to local officials and zoning boards is that Jellystone Park locations tend to attract higher-income families looking to have a good time. The parks also employ a number of local residents of all ages.
“Cities have started reaching out to us to try selling themselves as a great location for a Jellystone Park,” said Westover. “They understand the economic impact one of our parks can have on the local area.”
He noted that research shows the average person visiting a Jellystone Park also spends $42 outside the park.
“When you refuel an RV, grab lunch, and enjoy a local activity, it really puts money back into the community quickly,” he added.
Prospective owner’s workshop
People who have an interest in owning or operating a campground now have the opportunity to learn what it will take to partner with one of the most recognizable brands in the outdoor hospitality industry.
Jellystone Park will be hosting a workshop April 27 at the Phoenix Airport Marriott. The full-day meeting will provide an overview of the hospitality industry in general and the Jellystone Park franchise specifically. Participants can speak with current franchisees and meet with corporate executives to get questions answered.
Registration is $75 per person, and includes complimentary lunch and dinner as well as a Jellystone Park gift bag for each attendee.