Two or three noraebang in one building is nothing unusual. Customers come on foot.
Often there are only a few in a whole city, and customers come by car. You first need to picture who comes, from how far, and on which days.
Where the Korean population is concentrated
According to Pew Research Center, there are about 1.8 million Koreans in the United States, with about 530,000 living in California and about 140,000 in New York State. By metropolitan area the figures are as follows. Pew's figures differ slightly from edition to edition, so read them as approximate scale.
| Metropolitan area | Korean population | Metropolitan area | Korean population |
|---|---|---|---|
| Los Angeles | about 330,000 | San Francisco | about 52,000 |
| New York | about 210,000 | Atlanta | about 51,000 |
| Washington, DC | about 93,000 | Philadelphia | about 41,000 |
| Seattle | about 67,000 | Dallas | about 33,000 |
| Chicago | about 61,000 | Riverside (CA) | about 32,000 |
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How large the market is
- United States overall — The number of karaoke businesses was counted at 1,537 in 2019 and 1,431 in 2020 (IBISWorld, cited by Statista). Official figures after that are in paid sources and we could not verify them.
- Korean noraebang — The list of Korean noraebang in the U.S. that we compiled covers about 300 venues in 33 states. During our research we confirmed closures more often than new openings.
- The trend in Korea — The number of noraebang in Korea fell from about 33,000 at the end of 2017 to 25,990 in July 2024 (Korea Times). It is safer to assume that the change in the culture of company dinners is having a similar effect in the Korean community in the U.S.
On the claim that "K-pop is bringing in crowds of non-Korean customers"
That expectation is widespread, but we did not find any reporting by major U.S. media that gives figures on how much non-Korean patronage of private-room karaoke in the U.S. has grown. We recommend that you build the business plan so that it breaks even on Korean and Asian customers alone, and treat any other customers as extra.
What venues charge for a room
These are hourly room rates of actual venues, taken from published price lists and media coverage. They were checked at different times, so you need to check current rates yourself.
| Area | Rate | Notes |
|---|---|---|
| Manhattan Koreatown, New York | from $36–$40 | For 4–5 people. Some venues charge extra for additional people |
| Koreatown, Los Angeles | $20–$50 | Some venues set a food and drink minimum (about $100); some offer an unlimited flat rate on weekdays |
| Dallas area | from $29–$35 | Large rooms up to $110 |
| Charlotte (NC) | $30–$120 | $30 for a 7-person room, $100–120 for a 25–30-person room. Deposit of $20 per room |
| Portland (OR) | $8–$14 per person | A venue that charges per person, not per room |
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There are no public statistics on room occupancy. The most accurate method is to go in person on Tuesday, Friday and Saturday nights to competing venues in the area you are considering and count the occupied and empty rooms.
Benchmarks for estimating profit and loss
- Occupancy cost — Occupancy-related costs for U.S. full-service restaurants are 5.7% of sales (median, 2024) (National Restaurant Association). There are no statistics specific to karaoke, but treat it as a warning sign if base rent plus common charges exceeds 10% of projected sales.
- Worked example — If total monthly rent is $15,000, that is $180,000 a year. To keep that within 10% of sales, you need annual sales of $1.8 million. That level of sales is not easy to reach with ten rooms.
- Industry rules of thumb (weak basis) — Figures of 10–15% net profit margin for bars, 25–30% labor cost and 20–25% liquor cost are repeated on industry blogs. The original research is not identified, so use them for reference only.
- Drinks and food — The common view in the industry is that the profit comes from food and drink sales rather than room charges. If you plan a noraebang that does not sell alcohol, you need to calculate separately whether room charges alone cover rent and labor.
Why the venues that closed did so
In the cases that can be confirmed from reporting, permits, late-night operation and neighbor complaints stand out more clearly than a lack of customers.
- A large noraebang in Koreatown, Los Angeles was found to be a nuisance for reasons including operating past permitted late-night hours and closed in 2018, and reopening for the same use required approval of a zoning exception (What Now LA).
- A 15-room noraebang in Koreatown, Los Angeles applied for a permit to sell alcohol until 4 a.m. and drew opposition signatures from 104 residents, citing noise and the fact that its parking lot was within 100 feet of housing (Korea Daily, 2024).
- An extortion case in which protection money was taken from Koreatown noraebang and from drivers for hostesses (doumi) ended in a guilty verdict in federal court in 2024 (LA Times). Operating with hostesses makes a venue a target not only for enforcement but also for crime.
Forms of competition
- Attached to a Korean restaurant or pocha — In small and mid-sized cities, it is common for a Korean restaurant to have a few rooms inside. This is a direct competitor to a standalone noraebang, and also a way to start small.
- Cloud subscription services — Non-Korean venues mostly use subscription services such as Singa and KaraFun. How many Korean songs they carry is the difference from a Korean noraebang.
- Coin noraebang — We did not find any case of a Korean-style coin noraebang opening in the U.S.
Sources for this section
- Pew Research Center, Koreans in the U.S. Fact Sheet — pewresearch.org
- Statista (citing IBISWorld), number of karaoke businesses in the U.S. — statista.com
- Korea Times, decline in noraebang (2024-10) — koreatimes.co.kr
- Rate examples — The Infatuation, Time Out LA, Courier Texas, Seoul Food Meat Co., Voicebox
- National Restaurant Association, occupancy costs (2024) — restaurant.org
- Industry blog figures — Sculpture Hospitality
- What Now LA (2020-07) — whatnow.com · Korea Daily (2024-02) — koreadaily.com · LA Times (republished by AOL, 2024-03) — aol.com
Limits of this guide
This guide is general information for people preparing to open a business. It is not legal, tax, immigration or real-estate advice. Permits and rules differ by state and city and change often. This text reflects what we found as of October 2026; confirm it with the relevant agency and with your own attorney and accountant before you sign or file anything.
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