February 20, 2023
Adam Hoeksema
The wedding venue industry has seen substantial growth in recent years, as more and more couples opt for destination weddings, outdoor venues, and unique and personalized experiences for their special day. Wedding venues typically offer a variety of services such as catering, decor, event planning, and entertainment. Some venues specialize in specific types of weddings, such as beach, rustic, or garden weddings, while others offer more versatile spaces that can be customized to the couple's needs and preferences.
I often drive by the wedding venue down the road from my house and wonder how profitable that business might be. I decided to do a deep dive myself to better understand the industry and profit potential for wedding venues and decided to write down what I learned along the way to share with you!
Here is what I plan to cover:
Along the way, I will be using our wedding venue financial projection template to help me organize the numbers behind the business and ultimately forecast the profit potential. We also have a free event venue business plan template which you can use to help organize your entire plan.
With that as the plan, let’s dive in!
Average Wedding Size
The average wedding size was 105 guests in 2021, according to The Knot. In 2019, the average wedding size was 131 guests.
It is important to understand the average wedding size and what capacity of wedding you want your venue to be able to serve. Obviously the larger the capacity you hope to serve the more expensive it will be to buy or build your wedding venue location. So we think you really need to start by nailing down what capacity you want to serve and then next we can decide on what type of venue to pursue.
Types of Wedding Venues
There are many different types of wedding venues. Some of the most popular wedding venues types according to The Knot include:
- Ballroom or Banquet Hall Wedding Venue = 20% of weddings
- Church Wedding Venue = 19% of weddings
- Barn Wedding Venue = 18% of weddings
- Historic home or building = 12% of weddings
- Country Clubs = 8% of weddings
- Hotels = 8% of weddings
- Waterfront Wedding Venue = 5%
With that breakdown in mind, let’s look at startup costs for wedding venues.
How much does it cost to start a wedding venue?
You should expect a new wedding venue to cost between $750,000 and $1,000,000 if you want to have the capacity to accommodate both wedding ceremonies and wedding receptions along with having a paved parking lot.
Obviously many wedding venues are dual purpose like a church, hotel or country club. In this article we are going to focus on venues where the primary purpose is to host weddings.
Cost of Building a Wedding Venue
Many wedding venues cost $750,000 to $1,000,000 to build from scratch according to venue owner and venue-owner coach, Kristin Binford.
If you are able to do much of the work yourself and don’t pave a parking lot, you might be able to build a venue for $400,000, but there are also many venues in the $1 to $3 million range.
How much space do you need for a wedding venue?
One of the biggest variables for the cost of buying or building a wedding venue is how much space you need. There are at least 4 space components to consider with a wedding venue:
- Space for bride and groom to get ready prior to the wedding
- Space for wedding ceremony
- Space for wedding reception / dinner
- Space for the dance floor
Average Space for Wedding Seating
The Midlothian Conference Center recommends 2,000 square feet to seat 160 guests for dinner.
Wedding Dance Floor Size
The Knot recommends 1.5 square feet of dance floor space for every guest. If we assume 130 people which was the pre-COVID average wedding size, then you would need roughly 200 square feet for a dance floor space.
Space for Wedding Ceremony
Lifeway Builders estimates that you need 15 to 17 square feet of space per person for a capacity of up to 300 people. This amounts to roughly 4,500 square feet if you want to be able to host a maximum ceremony size of 300 guests.
Once you include restrooms, prep rooms, and perhaps a kitchen for food preparation, I would estimate that you would need at least 8,000 square feet of space to be able to host both a wedding ceremony and reception for up to 300 people.
Cost to Build a Barn Wedding Venue
We estimate that it would cost roughly $360,000 to build a barn for a wedding venue.
Wooden barns are the most common type of barn for weddings and typically cost $45 per square foot according to Wedding Frontier. So if we assume that we need 8,000 square feet x $45 per square foot, we get a total cost of $360,000.
Additionally, Wedding Frontier estimates another $50,000 for a plot of land, and $80,000 to $100,000 for landscaping and furniture.
Cost to Refurbish a Barn for a Wedding Venue
According to Vogue Ballroom the cost to refurbish an old barn for a wedding venue could cost roughly $250,000.
So if you already own a barn and the property, refurbishment of your barn could be one of the cheaper options to get into the wedding venue business. If you don’t already own the property you will need to buy a property with a barn. LandSearch is an interesting site to be able to find properties with existing barns for sale.
Parking Space Requirements for a Wedding Venue
According to Lifeway builders you should have at least 1 parking space for every 2 people in attendance. So if your wedding capacity is 300, you will need to have 150 parking spaces.
You can assume approximately 100 parking spaces per acre of land that is used exclusively for parking. So you will probably need an acre and a half dedicated for parking.
Assuming you are going to pave a parking lot rather than just allowing people to park in the grass on the property, your parking lot can be a major startup cost.
How much does it cost to pave a parking lot?
According to Angi you can expect the following costs for a parking lot:
- Concrete Parking Lot - it costs between $4 and $7 per square foot to pave a concrete parking lot.
- Asphalt Parking Lot - it costs between $2 and $4.50 per square foot to pave an asphalt parking lot.
- Gravel Parking Lot - it costs between $1.25 and $1.80 per square foot to create a gravel parking lot.
If we assume that you want enough parking capacity to host 300 wedding guests, you will need 150 parking spaces which is estimated to require an acre and a half of parking lot space. There are 43,560 square feet per acre, so an acre and a half is 65,340 square feet. If we assume a $4 cost per square foot for an asphalt parking lot, you can expect to spend roughly $260,000 alone on a nice parking lot for your wedding venue. Ouch!
With this level of investment for a wedding venue, now we want to see how much revenue potential a wedding venue might be able to generate.
Wedding Venue Annual Revenue
We estimate that the average wedding venue in the United States generates roughly $467,000 in annual revenue. You can see our assumptions below:
Wedding Venue Prices
According to Wedding Wire, the average wedding venue cost was $6,000 in the US. Couples typically spent between $3,000 and $11,000 on the ceremony and reception venue(s).
Wedding Venue Events per Week
The average wedding venue hosts 50 weddings per year and has a total of 217 events per year according to The Knot Worldwide.
If we assume that the average wedding venue revenue is $6,000 x 50 weddings per year that is $300,000 in annual revenue for the average wedding venue, but we need to include the other 167 events that the average wedding venue hosts throughout the year. If we assume those are smaller events with an average venue revenue of $1,000 per event we can assume a total annual revenue of $467,000 for wedding venues.
Wedding Venue Expenses
Your typical expenses for a wedding venue will be:
- Advertising
- Bookkeeping
- Cleaning
- Rent
- Repairs and maintenance
- Staffing costs (event coordinators, servers, security, cooks)
- Equipment and Supplies (tables, chairs, linens, tableware)
- Insurance
- Utilities (electricity, gas, water, trash service)
Once you make estimates for your unique scenario of operating expenses you can enter them into our wedding venue projection template as seen in the example below:
Advertising a Wedding Venue
We found some data on ways to advertise your wedding venue. Of course, The Knot, is the giant in the wedding industry and you will likely want to advertise there. Some less common ways to advertise your wedding venue include:
Advertising a wedding venue on Pinterest costs between $2.00 and $5.00 per 1,000 views and between $.10 and $1.50 per engagement according to MuteSix.
EventUp
Posting your wedding venue to an event marketplace like EventUp ranges in cost from $150 to $200 per month depending on pricing tier.
Wedding Venue Insurance
For a $1,000,000 general liability insurance plan, venue owners can expect to pay $612 per year according to Insuranks.
Wedding Venue Profit Margin
We estimate that the average wedding venue can expect net profit margins between 10% and 30% depending on a variety of factors.
The wedding venue industry can be profitable, but since it is often just a portion of a larger business like a hotel, church, event center and restaurant, etc it is difficult to narrow in on how profitable the wedding venue portion of the business will be on its own and give you a rule of thumb industry standard. It is just so dependent on the specifics.
Wedding Venue Gross Profit Margin
We estimate that the average wedding venue should aim for 30% to 60% gross profit margins. This means that a wedding venue's cost of goods sold (labor and material cost) should be between 40% and 70%.
How Much can a Wedding Venue Make?
If we assume an average annual revenue for a wedding venue to be $467,000, then we can expect a well operating venue to generate between $46,000 and $140,000 in annual profit for the venue owner.
Wedding Venue Forecasting
To be clear, we are making assumptions on top of assumptions here, so in order to really estimate the potential profit for your wedding venue, we suggest that you use our wedding venue forecast template to create your projections based on your specific situation. Once you are done, you will be able to see how much profit your specific concept might be able to generate. For example, we created a projection for a full scale restaurant and event center in the forecast example below:
If you have any questions about creating projections for your unique scenario please let us know, we would be happy to help answer questions as best we can!
