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It takes a bit of time to work ‘how much a small animation studio costs to run?’
Thanks for stopping by our site all about the business of animation with tips, articles and video courses helping aspiring animation entrepreneurs to launch their own animation studios.
Below I share a quick answer to the question of studio costs, before looking at how you would arrive at a more accurate and bespoke figure to help guide your own studio plans.
How much does a small animation studio cost to run?
A small animation studio of 3 to 5 people, in the UK costs between £6k to £20k to run per month.
There are of course wide variations depending on staff experience and whether they are permanent, part-time or freelance. Studio location can impact rental or mortgage costs. Stop-motion typically requires a larger space. Where as digital animation opens up the possibility of remote working which can reduce overheads. Also a studios niche and the competition can impact the amount of marketing spend required to sustain animation studio enquiries.
Stormy Studio, a successful animation studio I founded myself back in 2014, typically costs around £7k per month. This is with a small permanent staff, cool coastal studio space, regular marketing spend and scalable freelance team. This approach ensures we are able to take on large projects on an adhoc basis and continue to steadily grow the business.
I setup this site, startastudio.com to help others plan and launch their own animation viable startups.
How do I figure out the cost of running a small animation studio?
Whilst we answer lots of this in our advanced start a studio course I’ve also shared the key steps to figuring out how much it costs to run a small animation studio below.
How much does it cost to start a small animation studio?
1. Figure out your animation studio setup costs
First up, you need to work out the costs of starting your own animation studio.
What one off hardware and software costs might you have, what are the company registration costs, one off domain name costs, required insurance costs, can you initially work from home, or given the Covid-19 pandemic does it make sense to work with a remote team for ever? If you need help with this or other steps then our Advanced start a studio course might be of interest.
2. Work out your running costs
Next, work out the expected day to day running costs for your animation studio. Electricity, heating, software subscriptions, insurance, webspace, cloud storage. If not working from home initially what rent, and buildings insurance is there. If you’re planning on bringing on an employee or freelancer straight away include this cost. What marketing costs do you expect to have?
3. What are your living costs?
It’s a simple thing but takes time to sit and work out properly. Whilst, I’m sure you could make do with eating a pot noodle once a day and ignore every social occasion for the next 5 years. It’s probably sensible to assume you might want to maintain a certain quality of life eat a take away pizza and see some friends once in a while.
Figure out what your own living costs are. This not only helps with planning your studio but help you weigh up when the time is right to take the leap and start your own studio.
4. Add it all together
Now take all the above, broken into monthly or annual figures. Add it together and you’ll have a good indication of the amount of revenue your studio needs to generate for it to be sustainable. i.e. the amount needed to run a viable animation studio.
This will then provide some insight into the bare minimum your studio should charge for your animation studios services. It of course takes time to figure a viable approach that ensures your business can grow. As a quick reference I’d take your expected daily costs and multiply it by 2.5 to give a good starting point for your studio day rate.
I do however, recommend you aim to market and win business for your studio due to expertise in a niche and quality of work rather than competing on price.
5. Business plan template
As you’ll see from the above steps, figuring out an answer to ‘how much does a small animation studio cost to run’ takes a bit of time and effort. To make it easier for those serious about planning and launching a studio, I created a bespoke 10-page business plan template and online video course.
The recent launch of the PS5 and the surrounding clamour proves that the demand for games consoles is as hot as ever, but mobile games are rocketing in popularity too.
The evolution of smartphones and broadband technology has meant that mobile games have never been more convenient and accessible. Wherever you are, it’s now possible to play without the need for additional technology with titles such as Minecraft, Pokemon Go and Fortnite all available on smartphones.
This dovetails nicely with the move to mobile play in the gaming industry with more options than ever to play slots, bingo and casino games on a handset.
A Combined Approach
Mobile games aren’t in competition to the rest of the gaming industry; developers work together on projects which span multiple channels. The necessary skills are often identical, with the games design fundamentally the same as those required for casino play.
Mobile developers and animators are notoriously involved in the gaming industry, where gambling companies and gaming companies are always hiring to generate new and exclusive slots and games. Speaking to a contact at Party Casino and their mobile casino team, they were emphatic at the importance of hiring the right person to customise both the games themselves and the marketing materials for them.
Gone are the days when slots and casino games were flat and uninspiring. Players expect more from modern slot machines; the top titles have immersive graphics and crystal-clear imagery that wouldn’t look out of place on a mobile game. Developers and animators from mobile gaming frequently cross over, helping to deliver slots and gaming designs that meet – and surpass – players’ expectations.
Encouraging Mobile Play
Some estimates suggest that globally, the average person spends at least 22 hours on their portable device every week. It provides the perfect opportunity to play slots, rather than hauling out a laptop or firing up the desktop PC.
The interest and expansion in mobile gaming have led to more players showing enthusiasm about playing slots on their phone. Providers now automatically offer an option to play on the go when releasing new slots, with titles that are compatible with iOS, Windows and Android. This type of gaming has evolved to become expected and standard, a move which would have been unlikely without the increase in mobile games.
Although in some locations such as Las Vegas, brick and mortar casinos remain popular, the ability to enjoy the action on portable devices has made slots and games accessible to a much more comprehensive range of players. There are some who would feel apprehensive about setting foot in a physical casino but have no hesitation in playing online.
Quick Play on the Move
When mobile games first became possible, players had to download enormous apps to store locally on their phone. This meant that a quick game of slots would become a prolonged hassle if you didn’t have the software already installed and up to date.
Mobile games which could be played online changed the landscape forever, and now it’s commonplace. Most slots and gaming takes place online without the need to download the whole game. This saves precious storage space on the phone, but also makes the game quick and easy to access; all that’s needed is an internet connection.
These games have come a long way in a relatively short space of time, but as technology continues to develop, you can expect to see more of the same. Gaming and mobile play have become highly sought after and providers that want to stay relevant understand they need the best in the industry to make their products competitive.
