Acumen Research and Consulting, a global provider of market research studies, in a latest published report titled “Go Kart Market (Type: Electric Type, Gasoline Type, Petrol Type; Application: Indoor, Racing, Recreation, Others) – Global Industry Analysis, Market Size, Opportunities and Forecast, 2018 - 2022”, estimates that global go kart market is expected to reach the market value of around $88 million by 2022 and is anticipated to grow at a CAGR of around 2.5% in terms of revenue during the forecasting period 2018 – 2022. Go-kart racing is a leisure activity for individuals and families. As people spend more time on relaxation and sports, demand for go-kart racing also rises. The go-kart industry is mostly relied on financial conditions and collapses during the recession as people refrain from spending on leisure and entertainment activities. Go-kart racing is an optional expense for people of different sector. Consequently, downstream demand is dependent on the level of disposable income that individual earns. When disposable income is huge, consumers are more willing to spend money on leisure activities such as go-kart races. In 2018, per capita income is expected to increase, presenting a potential opportunity for this industry in near future.
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North America Held Largest Market Share
In the last decade, go-karting industry has experienced resurgence in recognition from different sector mainly because of the adrenaline-producing rides for thrill-seekers at the same time being a popular family activity. United States has a huge number of go karting tracks which is the major reason it governs the market in terms of revenue. The average per capita income of people in North America is higher as compared to the other economies in the world, and hence has higher spending capacity. Additionally, prime manufactures of go kart are headquartered in North American region, principally in the United States, which is an added advantage. Moreover, according to the American Society of planning officials survey of “American fads” edition January 1961 report on leisure activities' potential impact on public policy, it pointed to go-karts as an up-and-coming trend. Ever since, go kart sport has given a platform to drivers to make a good career and can participate in as big as a Formula One’s elite competition level. Besides, tracks of go kart share a business category with bowling alleys, amusement parks, miniature golf courses, gaming arcades, and roller skating rinks, collectively recognized as the family entertainment center industry. Europe is the second largest region for go kart market followed by the emerging economies of Asia-Pacific namely India and China.
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Demand From Emerging Nations Expected To Support Market Growth
According to a consumer perception survey undertaken in six different countries, namely China, Brazil, Poland, France, Turkey and the United States, majority of citizens are reported to be getting more interest in different racing sports and adventures activities currently than they did several years back. Also people living in other emerging countries such as India, Saudi Arabia, South Korea, and more are becoming aware about the benefits offered by this sport such as mental health, and quality time spent with the family. Besides, in many countries of Europe, the average income of an individual is growing healthy which is a major aspect to boost the go kart market in the region.. These factors indicate the increase in demand for go kart in developing nations during the analysis period and represents great opportunity for market expansion during the forecasting phase.
Factors Affecting Revenues
The boom in go-kart industry is directly proportional to the average income of an individual and the GDP of a country. The industry witnessed a collapse during recession as people didn’t had money to spend on entertainment or leisure activities. On the other hand, the industry began to recover foothold in 2013 as the economy recovered. With improving earning levels over the years, the majority of the share was coming from sports racing activities. Technological advancements of karts in 2016 ensured additional safety so that different age groups began to choose go-karting as a recreation outlet. Profits did not reach to an estimated level as companies attempted to attract customers by offering cheaper club memberships on multiple races and discounts. This strategy led to comparatively lower profits, according to analysis by Acumen.
Regulatory Issues May Increase Business Investment
For setting up a go kart business, one needs a NOC from local authorities. Most of the local authorities have set strict regulations against activities that could create noise pollution and may lead to disturbing residential premises. Moreover, some countries like California only permit racing tracks for sports like go karting and stringent norms about governing track characteristics is present in New jersey. Local bodies can additionally set regulations that mandate protective barriers to ensure the safety of spectators from tracks. Enforcing, different safety procedures for drivers and go karting staff also led to increase in capital investment. Additionally, one needs to store gasoline and other fuels in a specific way, and may need insurance coverage, consequently increasing the capital investment and lowering the profits. Thus, act as a restraining factor for go kart industry.
Latest Technology Supports Go Green
TeamSport Go Karting, the Britain’s biggest indoor-karting operator, has just opened Britain's first green go-kart venue. Just a short walk south of Tower Bridge in London, the double-storey 750m track has been produced in an old industrial unit in Bermondsey, and the karts themselves are fully electric and completely silent. Ultra-light, they offer astonishingly abrupt acceleration. Each one can reach speeds of up to 40mph on the straight and costs around £6,000. In fact the karts, especially developed by Enfield-based Biz Karts, are so powerful they outperform their traditional petrol-engined cousins.
Business Concentration For New Players
Setting up a go-kart establishment is comparatively simple, so lots of new businesses popped up over the years following the recession owing to the factors like go-karting doesn’t require huge spaces. Moreover, small businesses capture about two-thirds of go-kart revenues. Each of these companies usually possesses only one go-kart business. The financial outlay is also reasonable, and you can anticipate seeing returns in a little time. One can set up operations close to already established recreational centers and capture many of the same customers. Conversely, one might need to invest more capital since these locations are often costly. Consider locations where construction costs and lease are available at lower prices.
The major players profiled in the report include Karter Brothers, Roketa, Runmaster, Thunder Motorsports, BIZ Karts, Alpha Karting, Gillard, Barlotti, Bowman Automotive, Anderson Racing Karts, Margay Products Inc., PVP Karting Frame, Rotax, Tal-Ko, Bizkarts, American SportWorks, Baja Motorsports, and others.