Think about how much you think you might spend. Then triple it.
Think about how much time you'll think you'll spend on it. Then triple that as well.
Quoted from pookycade:3. It will become more of a burden on you than you can possibly imagine right now until it is entirely financially self sufficient (years).
If you don't have supplemental income to help support yourself and the business, plan to eat a lot of PB&J's for the next few years.
Quoted from pookycade:6. You will constantly be dealing with repairs, expensive repairs that will additionally suck your time away and cause you headaches because you don’t want to be THAT arcade that has half the games down.
You'll also have to keep thousands of dollars of tools, supplies, and parts in stock. A game that isn't earning is a waste of space (and rent).
Set aside at least $5k for all the miscellaneous startup costs, fees, insurance, etc.
Plan to set aside enough to cover 30-90 days of expenses, including payroll.
There are a lot of expenses involved before even getting to the fun stuff of a business.
Talk to a lawyer to help set up some of the legal stuff.
Setting up an LLC will help protect you in case the business gets sued or goes bankrupt.
With an arcade, plan to do a lot of redemption games. Non-redemption games don't earn a whole lot. Think about how you want to handle tickets and prizes, and how much that will cost, and how to balance that against earnings so that you're still making money.
Try to focus on games that people wouldn't really have access to at home. Or, familiar games, but giant size. Also, people seem to like bowling games and carnival-style games (at least in my area).
Good luck