If you’re an avid camper or RV traveler, you may be daydreaming about owning a campground. Based on your time at camp sites, you probably have a few ideas about how you could outperform the competition and provide a better camping experience. But before you consider taking on such a huge venture, you may be wondering, how profitable is a camp site business? Will you earn enough income to be able to run your campground full-time? Here’s an overview of how much you can expect to earn as an RV park or camp site owner.
How Profitable Is a Camp Site Business?
How profitable is a camp site business? The profitability of a campground depends on a number of factors. Location plays a role in how successful a campground will be. Choosing a city or town that gets enough tourism to support your business is important. Your camp site should be close to local attractions and activities as well. If you’re too far from the action, it may be hard to attract campers.
Weather is another important consideration. In some areas of the country, you might only be able to operate your campground seasonally because of harsh winter weather. This gives you less time to host campers, which could impact your revenue.
The amenities you have on-site determine how much you’re able to charge and make each season. A night at an average RV park or campground usually costs $25 to $30. But premium camp sites with upgraded facilities like a swimming pool, cabana, hot tub, gym, and clubhouse can charge guests up to $80 per night. Hosting events like concerts and retreats can also help draw visitors to your campground and enable you to increase your rates.
How Much Can You Earn As a Camp Site Owner?
How much you can earn as a camp site owner depends on the nightly rate you charge and your occupancy level. According to RV News, the average occupancy rate for campgrounds with full RV hookups is about 70%. If you want to start a rustic camp site without hookups for tent campers, your occupancy rate could be as low as 25%.
If you can improve your camp site and get your occupancy rate up to 70%, you can make a lot of money as a camp site owner. Assuming you charge $50 per night and have 30 spaces, you can earn $1050 in revenue every day. That’s $31,500 per month.
However, you’ll have to account for your start-up and operational costs, which will reduce your take-home pay. The national average income for RV park owners is about $50,000. But if you pay off the land and own your RV park outright, you could earn anywhere from $60,000 to $90,000 per year depending on your operational costs.
Start-Up Costs Impact Your Profits
Unfortunately starting an RV park requires a significant upfront investment. First, you’ll need to buy a plot of land big enough to accommodate guests. On average, you can fit about 10 RV spaces on one acre of land.
The cost of an acre of land varies by state. The most expensive place to buy land is New Jersey, where just one acre costs nearly $200,000 on average. But there are plenty of states where you can still get cheap land including Wyoming, where an acre costs just $1,558. If you don’t have the capital you need to buy land outright, you may be able to get a land loan or small business loan.
Once you’ve secured a piece of land in a good location, you’ll have to build RV spaces with hookups (unless you’re running a rustic tent campsite). RV News reports that campground owners spend about $3,000 on each new parking spot they build. You may also want to add amenities to your campground that will entice guests to come stay, such as a clubhouse or pool. When all is said and done, you could end up spending $100,000 or more to get your camp site up and running.
If you don’t want to do all the work yourself, you could buy an existing campground. But keep in mind buying an established business may cost more than going the DIY route. Based on these startup costs, it will probably take you several years to recoup your initial investment.
Don’t Forget About Operational Costs
Operational costs will also eat into your profits. Most campground owners have to hire a few seasonal employees to help them run the business. You may also have to pay for landscaping if you don’t have the time to do it yourself. Business insurance and utilities are additional costs you’ll need to factor in.
Before you jump in headfirst and start a camp site business, it’s important to make a detailed business plan. Figure out how much money it will take to build and operate your camp site. Make sure your projected revenue based on tourism rates in your area is enough to cover these costs and leave you with a profit (unless you’re willing to forgo a salary for a while).
Have you ever considered starting a camp site business? Let me know in the comments section below!
Vicky Monroe is a freelance personal finance and lifestyle writer. When she’s not busy writing about her favorite money saving hacks or tinkering with her budget spreadsheets, she likes to travel, garden, and cook healthy vegetarian meals.