Last year I received an email from a woman disputing a claim I made on my website; that a person can start a small concession for $500. The woman said her family had been in the concession business for over 50 years doing some of the largest fairs in the country. She went on to described in detail the tens of thousands of dollars her and her husband were spending to equip their new concession trailer, purchase insurance, support vehicles, pay event fees, travel cost, and so on. I wrote her back explaining my position; that very few people start a concession the way her and her husband were doing; with benefit of a long family history of experience, and with an eye on large sales at high attendance events. Most concessionaires get their start in a much more modest fashion; without previous experience, and, with an inexpensive booth doing small events. Some go on to run high volume booths at major events, but, many do not.
There is a world of difference between concessionaires who routinely attend large events and fairs with attendances of upwards of 100,000 people. These concessionaires often invest $50,000 or more, in their concession trailer, pay 25% of sales, or more, in space fees, hire a large staff on which they pay withholding and workers comp, write checks weekly to suppliers amounting to $10,000 or $20,000, and, make payments on newer model support vehicles, such as; one ton trucks and large motor homes. At a ten day event these concessionaires’ sales might exceed $100,000. Their net profit might exceed $40,000 or $50,000. This is big business dealing with big numbers. They happen because these concessions have the assets and capacity to prepare and serve food to thousands of people. When the event ends the concession company is transported to another event, possibly in another state, where it again serves food to thousands of people.
It is far more common for a concession to be a small business run by a sole proprietor, who may or may not, hire one or two people to help set-up and serve food at three to five day festivals and small fairs with attendances of 3,000 to 10,000. These concessionaires might operate a concession trailer less than 16 feet long, or a 10×10 pop-up tent. The cost of supplies doesn’t usually exceed $2000 per event. Event space fees often don’t exceed $500. These concessionaires are generally happy to average $2,000 a day in sales.
There are a number of reasons small concession operations don’t commonly attend large 10-plus day events. One is because working a fair 15 hours a day for 10 or more days is logistically too difficult. Another reason is because the cost is too high, both in dollars and energy. Another reason is because the operation doesn’t have the sales capacity to make the cost worthwhile. Further, the risk is too high. Sure, many concessionaires can find the money to purchase the equipment and stock, and hire the extra staff to reach for the brass ring of high sales and big dollars at a 10 day state fair. But, sales are never guaranteed at any event. Any of any number of things can go wrong putting the entire investment at risk, such as; bad weather, equipment breakdowns, poor organization, or, an inability to adequately compete for sales.
Nonetheless, even concessionaires who run small or moderate concession businesses quickly become skilled, and often, successful in their particular venue niche.
As for the email I received; I removed from my website the disputed statement about it being possible to start a concession for less than $500. The woman had a point. Though possible, it is difficult to start, even the smallest concession, with so little invested. Everything certainly needs to fall into place, and even then, one’s opportunities are extremely limited. I think it is much more realistic to expect to invest no less than several thousand dollars. This way, one can also expect to earn a good return on one’s investment.