How to Start a Puzzle Business

A puzzle business refers to a company or enterprise that specializes in creating, designing, manufacturing, and selling puzzles. Puzzles are a popular form of entertainment that challenge individuals to solve problems, exercise their minds, and have fun.

The puzzle business can involve a wide range of puzzle types, including jigsaw puzzles, crossword puzzles, Sudoku, logic puzzles, brain teasers, and many others. Companies in the puzzle industry create puzzles of varying difficulty levels, themes, and designs to cater to different age groups, interests, and skill levels.

The puzzle business can include both physical and digital puzzles, with many companies offering a combination of both. Physical puzzles are typically sold in stores or online, while digital puzzles can be accessed through websites, apps, or other digital platforms.

The puzzle business can be highly competitive, with companies constantly innovating to create new and exciting puzzles that appeal to consumers. Successful companies in the puzzle industry must have a keen understanding of their customer’s preferences, a strong design team, and effective marketing strategies to stand out in a crowded marketplace.

A puzzle business belongs to the toy and game industry and available statistics show that the worldwide toys and games market is expected to reach US$275 billion in 2021, representing a $22.5 billion rise between 2020 and 2021.

Steps on How to Start a Puzzle Business

1. Conduct Market Research

Conducting market research is an essential step when starting a puzzle. First, you are expected to identify who your potential customers are, and then you are expected to determine their demographic characteristics, such as age, income, and location.

Next, you are expected to analyze their pricing, services, and marketing strategies to determine how you can differentiate your business. Conduct surveys or focus groups to understand what customers are looking for in a puzzle business. Ask about their preferences for products, pricing, and customer service.

You should also determine the design and cost of each product and the overhead costs associated with running the business. Analyze pricing strategies used by competitors to determine what pricing structure will be most competitive and profitable for your business.

Lastly, based on your research, you should develop a marketing plan that targets your ideal customers and highlights your unique selling points.

a. Who is the Target Market for Puzzle Business?

• Children and teenagers
• Adults
• Seniors
• Gift buyers
• Puzzle enthusiasts and collectors.

b. Is Puzzle Business a Profitable Business?

Yes, the puzzle business is considered a profitable business, because the global toys market size was USD 129.45 billion in 2020 and is projected to grow from USD 141.08 billion in 2021 to USD 230.64 billion by 2028.

c. Are There Existing Niches in the Industry?

No, there are no existing niches when it comes to the puzzle business because the puzzle business is a niche idea in the toy and game industry.

d. Who are the Major Competitors?

• Zynga Inc.
• Electronic Arts Inc.
• PopCap Games Inc.
• Big Fish Games Inc.
• PuzzleSocial Inc.
• Playrix
• King Digital Entertainment plc
• Disney Interactive Studios
• GSN Games
• GameHouse
• WildTangent, Inc.
• Arkadium
• Legacy Games
• iWin
• Oberon Media
• SpinTop Games
• Reflexive Entertainment
• Puzzle Workshop
• WorldWinner
• MumboJumbo LLC.

e. Are There County or State Regulations or Zoning Laws for Puzzle Businesses in the United States?

The regulations and zoning laws for puzzle businesses in the United States vary by state and county, so it is important to research the specific regulations and requirements in your area. In general, puzzle businesses may be subject to zoning laws related to the type of building or location where the business is located.

For example, certain areas may be zoned for commercial use only, or there may be specific regulations regarding parking, signage, and building codes.

Additionally, some states and localities may require puzzle businesses to obtain certain licenses or permits to operate legally. These may include business licenses, sales tax permits, and permits for specific types of activities, such as hosting events or selling food and beverages.

Please note that it is important to consult with local officials or an attorney who is familiar with the regulations in your area to ensure that your puzzle business is in compliance with all applicable laws and regulations.

f. Is There a Franchise for Puzzle Business?

No, there are no franchise opportunities for the puzzle business.

g. What Do You Need to Start a Puzzle Business?

• A Feasibility Report
• Business and Marketing Plans
• Business Licenses and Permits
• Production facility
• EIN (Employer Identification Number)/Federal Tax ID Number.
• A Corporate Bank Account
• Equipment, Machines, and Supplies
• Employees
• Startup and Working Capital

2. Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.

Some of the catchy business name ideas suitable for a puzzle business are;

Creative Puzzle Business Name ideas

• Imogen Smith® Puzzle Company, Inc.
• Max Patel® Puzzle Company, Co.
• Isabella Taylor® Puzzle Shop, Inc.
• Oscar Brown® Puzzle Company, Inc.
• Emily Johnson® Puzzle Company, Inc.
• Luke Davies® Puzzle Store, Inc.
• Amelia Williams® Puzzle Company, LLC
• Nathan Turner® Puzzle Company, Inc.
• Lily Thompson® Puzzle Company, LLC
• Daniel Mitchell™ Puzzle Company, Inc.
• Sophie Robinson® Puzzle Farms, Inc.
• Joshua Clarke® Puzzle Store, Inc.
• Olivia Green™ Puzzle Company, Inc.
• Samuel Edwards® Puzzle Company, Inc.
• Charlotte Parker® Puzzle Farms, LLC
• Harry Carter® Puzzle Company, Inc.
• Grace Lewis® Puzzle Company, Inc.
• Isaac Wright™ Puzzle Company Shop, Inc.
• Lucy James® Puzzle Company, Inc.
• Dylan Walker® Puzzle Company, Inc.

3. Register Your Business

a. What Type of Business Structure is Best for Puzzle Business?

The ideal business structure for a puzzle company is determined by a variety of factors, including the size of the company, the number of owners, the level of personal liability the owners are ready to accept, and the tax consequences of the various business structures.

However, we normally recommend a limited liability company structure. This is so because an LLC is a hybrid corporate form that provides the flexibility of a partnership while also providing its owners with limited liability protection.

An LLC can have one or more owners, and the owners are not personally accountable for the debts or liabilities of the business. This business form is frequently used for small to medium-sized organizations.

b. Steps to Form an LLC

• Choose a Name for Your LLC.
• File Articles of Organization.
• Choose a registered agent.
• Decide on member vs. manager management.
• Create an LLC operating agreement.
• Comply with other tax and regulatory requirements.
• File annual reports.

c. What Type of License is Needed to Open a Puzzle Business?

• General Business License
• Seller’s Permit
• Building Permit
• Fire and Safety Permit
• Zonal Permit
• Signage Permit

d. What Type of Certification is Needed to Open a Puzzle Business?

You don’t need any certifications to open a puzzle business.

e. What Documents are Needed to Open a Puzzle Business?

• DBA
• EIN
• Business and liability insurance
• Federal Tax Payer’s ID
• Certificate of Incorporation
• Business License
• Business Plan
• Operating Agreement for LLCs
• Insurance Policy
• Zonal Permit
• Signage Permit

f. Do You Need a Trademark, Copyright, or Patent?

Yes, it’s important for a puzzle production business to consider obtaining both trademarks and copyrights. A trademark can protect the name or logo of your puzzle brand, while a copyright can protect the creative expression of the puzzle itself. A patent may also be worth considering if your puzzle includes a novel or innovative design or mechanism that you want to protect from being copied by competitors.

Registering a copyright can give you the exclusive right to reproduce, distribute, and display your puzzle, as well as the ability to sue others who copy your work without permission. If your puzzle includes a unique mechanism or design, you may be able to apply for a patent to protect it from being copied by others.

4. Cost Analysis and Budgeting

a. How Much Does It Cost to Start a Puzzle Business?

The cost to start a puzzle business can vary widely depending on factors such as the size of the business, location, equipment, and supplies needed, staffing costs, marketing expenses, and more. However, a rough estimate could range from $80,000 to $350,000 or more, depending on the size and scope of the business.

b. What are the Costs Involved in Starting a Puzzle Business

• Legal and administrative costs (the cost of obtaining business licenses and permits, registering the business, and consulting with attorneys and accountants): $2,500
• Equipment and supplies: $75,000
• Staffing costs: $35,000
• Rent/lease: $65,000
• Marketing and advertising costs: $3,000
• Insurance costs: $2,800
• Miscellaneous Expenses: $5,000.

c. What Factors Determine the Cost of Opening a Puzzle Business?

• The type of the puzzle business
• The size of the puzzle business
• The choice of location
• The required licenses and permits
• The cost of hiring and paying a business consultant and attorney
• The cost of branding, promotion, and marketing of the puzzle business
• The cost of furnishing and equipping the puzzle
• The cost of the insurance policy covers
• The cost of registering the business
• Source of your supplies and ongoing expenses
• Cost of recruiting and training your staff
• The cost of the purchase and customizing of uniforms
• The cost for the grand opening of the puzzle business.

d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

It is not necessary to build a new facility for your puzzle business, but if you have the required finance, it will pay you to build your own facility. The truth is that building or reconstructing a facility for your puzzle business will give you the opportunity to come up with a facility that will perfectly fit into your overall business goals and vision.

e. What are the Ongoing Expenses of a Puzzle Business?

• Manufacturing and production costs
• Shipping and fulfillment
• Marketing and advertising cost
• Website and e-commerce expenses.
• Rent and utilities
• Employee salaries and benefits
• Legal and accounting fees.

f. What is the Average Salary of your Staff?

• CEO/Founder – $70,000 per year
• Product Designer – $55,000 per year
• Production Manager – $52,000 per year
• Operations Manager – $50,000 per year
• Accounting and Finance Manager – $45,000 per year
• Sales and Marketing Manager – $42,000 per year
• Quality Control Staff – $40,000 per year
• Customer Service Executive – $30,000 per year

g. How Do You Get Funding to Start a Puzzle Business

• Raising money from personal savings and sale of personal stocks and properties
• Raising money from investors and business partners
• Sell shares to interested investors
• Applying for a loan from your bank/banks
• Pitching your business idea and applying for business grants and seed funding from the government, donor organizations, and angel investors
• Source for soft loans from your family members and friends.

5. Write a Business Plan

a. Executive Summary

Toney McCarron® Puzzle Production Company, Inc. is a puzzle production company that will be based in Charlotte, North Carolina, and specializes in creating high-quality puzzles for enthusiasts of all ages. Our puzzles feature original designs and unique themes that set us apart from competitors in the industry. We are dedicated to providing our customers with a satisfying puzzle experience and exceptional customer service.

Our team consists of experienced puzzle designers, production experts, and customer service representatives who are passionate about puzzles and committed to excellence. We use only the finest materials and state-of-the-art equipment to produce puzzles that are challenging, fun, and visually stunning.

We have established a strong online presence through our e-commerce platform and social media channels, and we are constantly seeking new ways to reach and engage with our customers. We believe in the power of puzzles to bring people together and promote mental wellness, and we are proud to be a part of this vibrant and growing industry.

b. Products and Service

Our product line includes a variety of puzzle types, including jigsaw puzzles, 3D puzzles, and puzzle accessories. We also offer custom puzzle design and production services for corporate clients, schools, and other organizations.

c. Mission Statement

At Toney McCarron® Puzzle Production Company, Inc., our mission is to create unique and challenging puzzles that bring joy and satisfaction to our customers. We are committed to using high-quality materials and innovative designs to produce puzzles that are not only fun to solve but also visually stunning.

We believe in the power of puzzles to promote mental wellness and bring people together, and we strive to create products that reflect this philosophy.

Vision Statement

Our vision is to be the leading puzzle production company in the industry, known for our exceptional quality, innovation, and customer service. We aim to expand our product line and reach new audiences while remaining true to our core values of creativity, excellence, and integrity.

d. Goals and Objectives

The goals and objectives of a puzzle business are to design and produce a variety of puzzle types, including jigsaw puzzles, 3D puzzles, and puzzle accessories for corporate clients, schools, and other organizations.

e. Organizational Structure

• CEO/Founder
• Product Designer
• Production Manager
• Operations Manager
• Accounting and Finance Manager
• Sales and Marketing Manager
• Quality Control Staff
• Customer Service Executive.

Marketing Plan

a. SWOT Analysis

Strength

• Unique and innovative puzzle designs
• High-quality materials and production processes
• Strong online presence and e-commerce platform
• Dedicated and experienced team members
• Custom puzzle design and production services.

Weakness

• Limited brand recognition compared to larger competitors
• Relatively high production costs due to the use of premium materials
• Limited distribution channels outside of online sales.

Opportunities

• Growing demand for puzzles as a form of entertainment and stress relief
• Expansion of the product line to include more puzzle types and accessories
• Partnership with popular brands or licensing agreements to create themed puzzles
• Targeting new audiences, such as schools or corporate clients.

Threats

• Competition from established puzzle production companies
• Economic downturns or market fluctuations that impact consumer spending
• Fluctuating prices of raw materials, such as cardboard or wood
• Changes in consumer preferences or trends.

b. How Do Puzzle Businesses Make Money?

Puzzle production businesses make money by selling puzzles to customers. The revenue is generated by the sale of the puzzles themselves, as well as any accessories, such as puzzle mats or storage solutions.

Additionally, puzzle production companies can generate revenue through custom puzzle design and production services for corporate clients, schools, or other organizations. These services can include creating puzzles with specific themes or branding, customizing the packaging, or producing puzzles in large quantities.

c. Payment Options

• Credit and debit cards
• PayPal
• Apple Pay and Google Wallet
• Gift cards and store credit
• Installment payments
• Cash on delivery.

d. Sales & Advertising Strategies

• Sell directly to customers through our own website or e-commerce platform, and also use social media and digital advertising to promote their products and reach new customers.
• Targeted advertising
• Offering a referral program
• Offer a discount code to customers who refer a friend or provide a free puzzle for every five referrals.
• Running limited-time promotions
• Attending trade shows and events related to puzzles or games so as to showcase the company’s products, network with potential customers, and get feedback from industry experts.
• Collaborating with other brands or artists to create co-branded puzzles or limited-edition designs
• Offering custom design and production services to corporate clients, schools, or other organizations
• Develop Relationships with Retailers.

Financial Projection

a. How Much Should You Charge for Your Product/Service?

The price of puzzles in the US can vary widely depending on the size, complexity, and materials used to make the puzzle. On average, a basic 500-piece jigsaw puzzle can range from $10 to $20, while more complex puzzles with 1000 or more pieces can cost upwards of $30.

Specialty or custom puzzles, such as wooden or 3D puzzles, can range from $20 to $100 or more. Additionally, limited edition or collectible puzzles can have higher price points.

b. How Much Profit Do Puzzle Business Owners Make a Year?

The profit of a puzzle business owner can vary significantly depending on various factors such as the size of the business, sales volume, pricing strategy, and overhead expenses.

c. What Factors Determine the Amount of Profit to Be Made?

• The capacity of the puzzle business, the type of puzzle they are selling, and their sales volume
• The location of the puzzle business
• The management style of the puzzle business
• The business approach of the puzzle business
• The advertising and marketing strategies adopted by the puzzle business.

d. What is the Profit Margin of a Puzzle Business?

According to a report by IBISWorld, the average profit margin for puzzle and game manufacturing businesses in the US is around 5.6% of revenue.

e. What is the Sales Forecast?

• First Fiscal Year (FY1): $280,000
• Second Fiscal Year (FY2): $340,000
• Third Fiscal Year (FY3): $490,000

6. Set Up your Shop/Office

a. How Do You Choose a Perfect Location for Puzzle Business?

• The demography of the location
• The demand for puzzles in the location
• The purchasing power of businesses and residents of the location
• Accessibility of the location
• The number of puzzle businesses in the location
• The local laws and regulations in the community/state
• Traffic, parking, and security et al

b. What State and City is Best to Open a Puzzle Business?

• Portland, Oregon
• Denver, Colorado
• Atlanta, Georgia
• Los Angeles, California
• New York, New York
• Miami, Florida
• San Jose, California
• Austin, Texas
• Seattle, Washington
• Chicago, Illinois

c. What Equipment is Needed to Operate a Puzzle Business?

• Die cutting machine
• Puzzle press
• Puzzle board made of cardboard, wood, or other materials.
• Puzzle blade
• Puzzle design software
• Packaging materials such as boxes, plastic bags, and any other materials needed to package and protect the puzzle during shipping and storage.
• Printing equipment
• Adhesive materials.

7. Hire Employees

Whether or not to hire employees for a puzzle business depends on the size and scale of the operation. If the business is small and operates on a small scale, it may be possible for the owner to handle all aspects of the business on their own. However, as the business grows and sales increase, it may become necessary to hire employees to handle various aspects of the operation.

8. Launch the Business Proper

Launching a new business is key to how successfully the business can gain traction in the market space. So, you must make sure you organize a launch party that will attract people living in the location.

a. What Makes a Puzzle Business Successful?

• Choose a good location to launch the business
• Make sure your products and services are top-notch
• Throw an open house grand party before officially opening the puzzle business
• Be deliberate with your marketing sales approach
• Encourage the use of word of mouth to promote your puzzle business
• Leverage all available online and offline platforms to promote your puzzle business

b. What Happens During a Typical Day at a Puzzle Business?

• The business is open for the day’s work
• The facility and equipment are cleaned and ready for business
• Puzzles are designed and produced
• Customer’s requests are taken, and they are attended to (puzzles delivered to them)
• Marketing/website upkeep
• Supply ordering
• Administrative duties
• The business is closed for the day.

c. What Skills and Experience Do You Need to Build a Puzzle Business?

• Creativity skills
• Attention to detail
• Excellent quality control skills
• Excellent sales and customer services skills
• Interpersonal skill
• Accounting and bookkeeping skills
• Business management skills
• Design skills
• Manufacturing experience
• Work experience in the games and toys industry
• Experience in managing people.