Are you dreaming about a venue, business planning to open a venue, or actively operating a wedding venue? Then you may be wondering— Is opening a wedding venue a profitable business?

It's a question a lot of people today have, especially due to the recent boom in the opening and building of wedding venues across North America.

As a wedding venue owner myself and a coach to wedding venue owners, I've been blessed to have hundreds of in depth conversations with perspective, new, and very established wedding venue owners. You'll be really interested to hear some of the things that I've learned about how much wedding venue owners make.

Venues may not be as profitable as they look

Many more venues than you expect, even the ones that look seemingly successful or are hosting a lot of events, are barely breaking even or losing money.

From the outside, this may be very hard to see. You're seeing venues that have built beautiful spaces, that have most of their Saturdays booked.

But what you're not able to see behind the scenes is when a venue owner has taken on a lot of debt, is inefficiently running the business, isn't able to charge enough based on their location or service level to be profitable, and isn't at a high enough volume to get over the heavy-duty fixed costs in this business.

By and large wedding venue owners are a very optimistic group of people. I like to joke with venue owners that you have to be half crazy to get into this business, because who else would build a building and hope someone rents your Fridays, Saturdays, and Sundays.

However, what that looks like from a profitability standpoint is that often venue owners are spending nearly all of what's left at the end of the year, or what would be left at the end of the year in terms of profit, on additional projects or expansions to "keep up with the Joneses."

With venue owners, our venues will never be “done.” The venue will be ready to host events, but we will always have more great ideas.

Most wedding venue owners start out working for free

What's unfortunate that so many don't understand is that many new wedding venue owners are working for free. Even if the business is breaking even or making some profit, the venue owner is often not taking a salary.

Often it's thought, "Well, next year will be better” or “Next year will be the year without big projects." But that happens year after year, and then more and more venues open and the market becomes more saturated.

Even though from the outside it looks like an easy, fun, profitable business in many cases, that's just not true.

Start up costs are very significant

This is a capital-intensive business. You will need money to start a wedding venue. As much as I don't love to say that, and while there are some financing opportunities out there, the truth is that a wedding venue is a business that takes significant capital investment.

There are other event-related businesses such as becoming a photographer or a DJ that require some capital investment in terms of equipment, but opening a venue is not at all comparable.

Building a new-build, ground up, not even that fancy venue, usually starts in the $400,000 to $500,000 range and up, and that's including doing a lot of the work yourself.

Many venues are in the $750,000 to $1 million range, and a lot more than you think are in the $1 million to $3 million range.

It's a capital-intensive business and there's no way around that if you're going to open a venue. If you want to have a pretty backyard for weddings and simply want to invest in tables, chairs, and other basic necessities like liability insurance, we're talking about comparing apples to oranges.

Debt will affect your profitability

Owning a wedding venue can be a very profitable business, but not if you take on too much debt.

Sometimes, I have really hard conversations with prospective venue owners. They're thinking about getting into the business, and the numbers they're considering spending are big.

One thing that's sure about this business is once you've spent it, it’s spent. Perspective venue owners need to understand that overspending in this industry is a significant problem. The more debt you take on, the more debt you have to service, and the more challenging it will be for your venue to be anything other than a low paying job where you are working for free (especially after considering taxes.)

I say that with love, but it's true. This business is a lot of work, and if you get in over your head in terms of debt and assume you'll book 50, or 100, or 150 weddings a year, you could find yourself working nonstop and breaking even. That's just not where you want to be.

Fixed costs are high

There are several different models in this business and on this point, I want to speak to venue-only venues. If your business is not all-inclusive or a venue plus catering businesses, your venue will have high fixed costs. It’s expensive to build that beautiful building, maintain it, and keep it running.

For many venues, the major fixed costs—like your loan note, your insurance, your fixed-staff costs, etc—total up to a bigger number than you would think. It costs much more to run this business than many would expect. But once you get past that point, variable costs are relatively low. After you cover your fixed expenses, this business becomes much more profitable, much quicker.

So, the name of the game here is high volume with really great service, keeping a solid eye on expenses.

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Most venue owners reinvest a large percentage of profit each year

Even when a venue is profitable, the wedding venue owner is not just putting all that cash into their own pockets.

At my venue, Haue Valley, we just spent $250k building a brand new bridal suite. We have spent significant amounts on projects every year since we opened, but the kicker is they all produced a solid return because we thoroughly understand our market and how to build our business around market demand. (These projects were not “guessing” at how to book more weddings like many venue owner projects.)

We are not alone in the pursuit of making our venue better every year. As a venue owner, you are always going to want to add something new or make some aspect of your venue better.

New projects, like adding an outdoor ceremony space, require venue owners to reinvest their profits

There's no doubt that we have made our space even more appealing to our ideal couples, but it comes at a cost. However, we're careful to also account for the kind of income we want to make in this business, even after investments.

We'll always be investing to some degree in our businesses, but just like spending too much to get into the business, every decision to spend more money has to come by answering the questions:

Am I sure I'm solving the right problem?
Will this help me book more weddings?
Will this help me provide even greater repeatable service?

You’ll need to save some of what you make

We are in an exceptionally strong economy right now, but that's not always going to be the case.

It's important to consider—do you have the cash reserves and can you sustain at a significantly lower number of weddings next year or the following if the market changes?

A venue that relies on a hot wedding market and has to book hundreds of weddings a year just to cover expenses will not stay a viable business forever.

It’s definitely possible to make money as a wedding venue owner

My final point is that while lots of new venue owners are working for free, some wedding venue owners are making a great income. If you build your business to grow and scale, based upon market demand, it is the kind of business where you can make a great salary and actually have massive freedom.

However, most venues don't build their business to scale and most venues are leaving money on the table. You've got to begin with the end in mind when you're building this business.

To learn more about that, watch my free masterclass for venue owners: click here

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Are Wedding Venues Profitable? The Truth About What Owners Make