Owning a campground isn’t as easy as new owners would like to think that it is.
Constant maintenance, pest control, customer service, and guest attendance are crucial to having a successful campground business.
In fact, many new owners go out of business within the first year if they can’t pay back the campground’s cost or pay themselves from the revenue.
Here are a few reasons why campgrounds are likely to go out of business:
Your campground’s location is incredibly important for fostering a great atmosphere and drawing visitors to your grounds.
Campgrounds with lakes, walking trails, canyons, or other natural wonders or attractions are crucial to bringing in consistent revenue from your guests.
Therefore, bad weather, barren landscapes, and uncomfortable climates are big reasons why many campgrounds fail:
Weather & Climate
Plotting your campgrounds in a hostile environment – such as a dusty desert or muggy swamp – wouldn’t be a great idea to keep business running.
However, even some mild climates can come with their share of problems.
Campgrounds that are situated up north might be great in the summertime, but more often than not will have to close their doors for the entirety of winter. That leads to six months of no guests or revenue (unless you allow year-round RV camping).
If your summer is lean, you might not recover financially during the winter month hiatus, and that can put a campground out of business.
Campgrounds lacking in attractions are less likely to have annual returning guests.
Some campgrounds are just a plot of land and get by on visitors who need a quick place to sleep, but that doesn’t create a consistent customer base. Therefore, it is important that your campground is near or has attractive landscapes and natural resources.
Most campers expect places to walk, swim, play games and meet other campers when they go on vacation.
Campgrounds that do not have these – or poorly maintain the resources they do have – are more likely to go out of business.
Even with beautiful natural resources nearby, a campground needs to have a quiet, comfortable atmosphere that makes campers feel relaxed and surrounded by nature.
Loud, dirty, or crowded campgrounds do not have that relaxing atmosphere and will result in a negative experience for visitors and guests.
Local Activities & Sightseeing
Just like natural resources, a campground without local activities, fun locations, or sightseeing to entertain guests during their stay is more likely to just be a quick place for travelers to sleep.
Campgrounds that are a waystation aren’t necessarily worse than others, but they don’t have as many guaranteed returning campers year after year.
Furthermore, they usually only get one night out of their campers rather than an entire vacation’s stay, whether that be a weekend or a full week long.
Waystation campgrounds that only get customers for one night at a time are more sensitive to lean summers, but they also have much less to maintain on their property.
2. Starting from Scratch
Campground owners that start from scratch on a new plot of land without any amenities or buildings can fail within the first year.
If your plot of land, loans, and expenses exceed your first year’s income, it can be really difficult to pay yourself that first year, and often campground owners will either become discouraged or run out of money.
Therefore, many new campground owners will invest in already-operating campgrounds for a larger sum of money in the hopes that it will give them a leg-up on their first year’s income.
Loans & Revenue
Many new owners will take out large loans, spend a large amount on the land and repairs to the campground, and not have enough money left to pay themselves at the end of the first year.
Between paying employees, maintaining grounds, updating or upgrading facilities, and providing amenities for their campers, new owners will often run out of money or go out of business in the first year.
As we’ve mentioned, buying pre-owned is usually a better way to prevent going out of business within the first year.
This is because established campgrounds will already have a dedicated camping crowd that returns to the same location each year and does not require the high start-up costs that a brand new plot of land will require.
Pre-owned locations also usually cost quite a bit more than an empty plot of land, but new owners hope that their first year of income will reimburse that initial cost.
Still, poorly operated or maintained grounds can fail even with a pre-established set up and existing facilities.
3. Attendance & Reputation
The reputation of a campground is crucial to getting campers to choose your location over the competition.
Most campers will read reviews or look at photos of the grounds before deciding to use that location as their vacation spot or waystation for a night.
Therefore, a bad reputation can often determine the fate of a campground.
As we mentioned earlier, a campground atmosphere is a huge plus to keeping campers happy and coming back year after year.
Rowdy, drunk, disruptive, or rude guests can ruin the experience of many other campers that come in contact with them.
Most rowdy guests will show up during local events or festivals and crash at your campground, but if they bring the party back with you, your reputation and attendance could dive.
Accidents & Lawsuits
One of the biggest dangers to a campground’s reputation is the knowledge that an accident or lawsuit took place because of something that happened on the premises.
Injuries, deaths, or disasters will stain a campground’s reputation and could potentially disrupt attendance and, therefore, revenue for the campground.
While it is possible to come back from an accident or lawsuit without going out of business, some can really test campers’ trust in the grounds and the owners.
Lack of Attendance
A basic lack of attendance and loss in revenue is the standard reason for a campground to go out of business.
However, what is it that is causing a lack in attendance?
This could be due to unseasonable weather, the inability to pay for a vacation during a financial crisis, or an outbreak of certain pests every few years that can deter campers from getting outside.
Either way, a lack of enough attendance will always put a campground out of business.
4. Animal Activity
Animals are part of nature, but not everyone gets along with the local wildlife.
Dangerous or annoying animals can ruin a camping experience each and every time.
With enough bad experiences, a campground can end up with fewer and fewer guests each year.
Animals like bears or coyotes are not always dangerous but can be nuisances to campers when they invade a campground.
Even getting into the trash or making a mess of a campsite while the campers are away can drive away customers year after year – especially if previous campers report those instances.
Furthermore, dangerous animals can lead to those injuries or accidents that we talked about before, which could close down your campground for good.
Finally, dangerous animals can be a threat to pets that are with you during your stay, which could potentially lead to disaster if not properly managed.
Insects & Pests
More nuisance than a danger, an influx of insects and pests can really ruin a camping trip for everyone.
Fire ants, hornets, skunks, raccoons, and other animals are just the beginning of the difficulties of prolonged stays in the outdoors.
Not only can this drive guests away, but the maintenance of these animals (such as pest control) can be costly.
If not properly removed the first time, you can bet that those pests will be back each year.
5. Natural Disasters & Damages
The cost of repairs after a natural disaster such as a tornado, hurricane, earthquake, or even a pretty bad thunderstorm can quickly add up depending on where your campground is located.
Wildfires especially are pretty destructive to a natural landscape.
If your campground is hit by a natural disaster, collecting insurance and paying for repairs can take up the whole camping season.
This can halt attendance and therefore revenue, thereby putting campgrounds out of business pretty quickly.
6. Change of Ownership & Policy
One of the biggest reasons that campers return to the same grounds every year is tradition.
When a family goes on vacation, they tend to choose a location that they like, that is close to home, and has owners or policies that fit well with their own camping lifestyles.
New owners or new policies can disrupt those traditions and, therefore, the influx of campers because of it. For example, if a campground allowed dogs, a dog-loving family will continue to come every single year and enjoy the benefits.
If under new management the campground no longer allows dogs or takes down the dog park fences, those families who must bring their dogs on vacation with them are going to move on to a different campground.
This is the case for any major policy change. Taking away swimming hours or camping dates that a family chooses every year is just as deterring.
If policy changes are incredibly drastic, such as no longer allowing RV camping or campers to park on the property, it could be the end of the campground altogether, taking away a majority of their revenue.
Furthermore, new owners that are disagreeable, rude, or who don’t care about their campers can often give the campground a bad reputation. This is just as likely to reduce attendance and therefore profits.
7. Fluctuation in Rates
Like new owners and policies, returning campers will become disillusioned or upset with your campground if unfamiliar (and expensive) prices greet them on their vacation.
Amenities like laundry services or goods at the general store that spike in pricing can deter even the most devoted of fans at your campground.
It is important to maintain a baseline price and stick to it. While there are instances where prices must go up (such as for inflation or during financial hardships), it is important to try and keep them reasonable for the families who visit your grounds.
While many owners think that increasing their pricing will only help to increase their profits, they might be surprised at just how quickly it can drive customers away.
Without proper accessibility and policy, campgrounds will not be able to attract large amounts of customers.
Tent camping isn’t for everyone, and actually, it is more common now for families and couples to camp with an RV or camper or even out of their renovated van.
Because of this, most campgrounds have hookups, pumps, amenities, and supplies for their campers to make sure that they can utilize their RVs and vehicles to their best features.
If a campground is strictly tent camping, it is far less likely to make as much money as one that allows recreational vehicles – especially because campsites that have water and electric hookups can be priced higher per night.
Furthermore, campers don’t always remember to bring everything or need to replace something in an emergency. That’s where the general store comes in.
Goods and supplies should be priced reasonably in order to keep campers happy.
Finally, rental cabins and trailers are a great way to pull in more revenue per night and can keep your campers coming to your grounds longer each year, even during the cold and winter months.
It is important to remember that accommodating your guests is a great way to stay in business.