concession trailer

Unlike conventional small food service business operators, whose expenses and operating costs remain fairly consistent, concessionaires are faced with variable business expenses and operating costs – costs that are typically higher than non-concession small food businesses. Additionally, because the concession business is part-time and seasonal, enough revenue also must be generated to cover the concession operation during its down time.  Therefore, it is important to price your menu high enough to cover variable costs and expenses that are hard to foresee and pre-determine.

Whether you are in the planning stage of finding the right menu with which to start your concession, or, are already serving your menu at events, here are some tips to price your menu correctly. Get out your paper and pencil.

• Break down each dish on your menu into individual ingredients, and cooking and serving products. For example: A concessionaire who serves corn dogs should also account for the cost of frying oil, ketchup, mustard, napkins, and a serving tissue.

• At your supplier list the wholesale price of each item as purchased in quantity. For example: A case of corn dogs might cost $24 dollars, a five gallon jug of cooking oil costs $28, a #10 can of ketchup costs $3.60, a one gallon jug of mustard costs $5.60, a pack of napkins costs $7.19, and a pack of serving tissues costs $15.67.

• Measure or weight a serving size of each ingredient in the dish.

• Now do the math to find the price of each ingredient and product in each dish. When broken down the cost per serving looks like this:

Corn Dogs:  $24 per case of 72 = 0.33 each.

Frying oil: $28 per 5 gallons = 0.17 (I arrived at this hard to determine figure by dividing by 1000 servings, which is the minimum number of corn dogs I would expect to cook with this oil)

Ketchup: $3.60 per #10 can = .01 (again divided by 1000 servings per can)

Mustard: $5.60 per 1 gallon = .03 (customers usually use more mustard than ketchup on a corn dog so I divided by 200)

Napkins: $7.19 per pack of 500 = .01 each.

Tissues: $15.67 per pack of 1000 = .02 each.

• Now add together each item in a serving. In the example the total cost of serving a corn dog is: $0.57.  By dividing the total cost of a serving into your selling price you learn your profit margin. For example: if you sell a corn dog with a total cost of .57 cents for $3 your cost ratio would be 19%  of the selling price (.57 divided by 3.), therefore your profit margin is 81% and within the range of profitability.

If, like most concessionaires, you offer more than one item on your menu, some dishes may be more profitable than others. Then, the average profit margin of your entire menu is the rule. For example: Some dishes might have a margin of 77% while others might be as high as 83%. Here, providing, on average, all dishes sell equally well, then your profit margin remains at 80%.

This is important. When a food concession business sells food at 80% profit and keeps additional operating costs and general business expenses, such as, space fees, wages, licenses, insurance, fuel, and maintenance under 30%, half of sales earned over the season will be profit.

a busy food concession trailer

Many food concessionaires feel that hiring and managing good help is one of the most difficult and frustrating aspects of managing a food concession business. It is also one of the most important. Working in a food concession is not rocket science. Yet, as a manager, hiring the right people with the right qualities to help your business run smoothly and profitably is often harder than you’d expect.  Fortunately, with the right policies you can improve your staff for a more profitable food concession business.

1. Hire the Right People. Successfully staffing your concession business starts with finding and hiring the right people for the job. Honesty and reliability are the first qualities we look for in a concession worker. A worker who also learns quickly and can multi-task is much better. If they are also friendly, outgoing, and energetic they are ideal. Perhaps, equally important; because the success of a food concession business depends on maximizing sales during peak sales times a worker must be able to work quickly and competently, while confidently managing hordes of impatient, hungry customers.
2. Guard Against Theft. In most cases a concession worker will spend much of his or her time being the cashier. This creates frequent opportunities to pocket money on the sly. The best defense you have against theft is to, first, know your business. Although you may never catch the thief in the act, you should always have a pretty good idea how much revenue the booth has produced and a good instinct for inconsistencies. Requiring the cashier to verbalize each order, the price, and amount in change made to the customer, lets you know what has transpired at the cash register even when your back is turned. This policy also protects the cashier from the customer who makes false accusations that an error was made.
3. Be Honest with Your Staff. Be honest and straight-forward with your staff. Articulate your specific expectations and possible reasons for termination. By initiating an honest, fair-minded, and team-oriented policy from the outset, the incentive for dishonesty may be eliminated.
4. Articulate Your Standards. Address the intangible aspects of your business. By articulating your high standards for cleanliness, product quality, service quality, and appropriate interaction with the public, your workers will be clear where you stand on their role in representing your business.
5. Reward Your Staff. Beyond the reward of earning a decent pay, sometimes it’s the little things that inspire good employees. Let them know how much you appreciate their help. Have fun in the booth. Further, by placing a tip jar on the front counter for your workers they receive instant gratification and motivation for providing your customers with good service. And, the ritualistic counting of the tip jar at the end of a busy day has its own rewards.

Although all of these policies will surely help you build your staff management skills, there are many more worth mentioning, and I’d be curious to know what other policies you’d add to this list. As always, your thoughts, comments, and shares are very much appreciated.

food concession trailer on a slow day

Hands down, the best part of this concessionaire’s day is after my booth is closed when I trot off to my camper, crack open my favorite snack, and get down to counting the money. That is, unless my sales were poor. Then, I can’t wait to finish up so I can slink away to scrub the big capital “L” off my forehead in private. There are hundreds of factors and variations of factors that influence the success of a food booth at any given event. Many are controlled by the coordinator, such as booth location, booth/attendance ratio, duplication of menus, and overall organization and promotion of the event. There are many more that are controlled by the vendor, such as your menu, how well you promote your menu, booth appearance, quality of service and product, efficiency, pricing, and consistently returning to the same event. There are still other factors that are out of everyone’s hands, such as the weather and local economy. In my opinion, in this business, the four most important things that influence a concessionaire’s sales are: your location within the event, your menu, the effectiveness of your signs, and, your operational efficiency. Of those four, three are entirely with your control.

a concession booth with a large and diverse menu

A concession business usually includes a commissary – a place to store and service equipment and stock between events. The commissary of a concessionaire who serves a simple menu may be something as easy as a little floor space in the corner of the garage, where, he or she has installed some shelving to store extra cases of product. However, concessionaires who operate complex operations, with large and diverse menus, need a space that functions as an equipment warehouse, stock warehouse, repair shop, and vehicle yard.   Concessionaires often use what they have at home to serve this function, such as, their garage, shop or shed, and parking area, where their large collection of food service equipment and support vehicles is kept and serviced.  This collection almost always includes standard equipment like grills, deep fryers, steam tables, and propane burners. With these four basic pieces a concessionaire can sell almost anything; from hamburgers, hot dogs, curly fries, elephant ears, stir fry, and sausage to breakfast, and more. In fact, most dishes sold on the midway are prepared with one of these four pieces of food service equipment. The warehoused collection of equipment will also include ice chests,  freezers, beverage and condiment dispensers, utensils, sneeze guards, tent poles and canvases, signs, propane tanks, water hoses, electric cords, floor mats, pop canisters, garbage cans, dish washing tubs, and much, much more.

Also in storage will be food stock. A collection of freezers might hold cases of stir fry noodles, diced chicken, hamburger patties and corn dogs. On shelves will be non-perishable items like cases of nacho chips, cans of nacho cheese, hamburger buns, cans of ketchup, and beverage mix.

In the yard is an assortment of trucks, vans, motor homes and trailers used to transport the equipment and stock to events. Along with the vehicles will also be tools needed to maintain and service both the vehicles and food service equipment. Garden hoses, used to clean equipment and fill water tanks, will lie amongst spare parts and power cords.

You may find equipment in various degrees of condition, some ready to go to an event, others needing cleaning or repairs, and, still others being kept for spare parts.

Both the food booth and commissary of a concessionaire who operates under a mobile food service license is inspected and licensed annually, and complies with strict regulations that enable food to be handled and prepared within the commissary.  However, concessionaires who travel from event to event are frequently licensed as temporary restaurants. The commissaries of these concessionaires are not inspected and licensed. Temporary restaurant license holders are not permitted to handle or prepare food at their commissary. Instead, food is prepared in the booth on site at the event. Food safety issues are addressed at, and within the booth prior to opening for business, at each and every event.

food booths at a small town festival

It wasn’t long ago when concessionaires used the telephone – with cord – to search for, query, and request applications for event food booth space.  The job was time consuming and frequently non-productive.

Thankfully, the internet has changed that.  State tourism departments now make available online their public event listing; once available only on hardcopy. There are also dozens of searchable event listing websites.  One of my favorites is: www.festivalnet.com. In addition to their vast database of events, this comprehensive website is a trove of information for vendors.  The problem I have with online listing is; not all events are listed. It’s no fault of the website, but rather, because it is up to event organizers to list their event.  Small, local events that don’t want a flood of queries from artists, musicians, craftspeople, bands, booking agents, and food vendors, simply don’t bother.  However, these small events are sometimes quite lucrative for small to moderate food concessionaires because they are less expensive and have fewer competitors. It takes a little sleuthing to learn about these gems. Most are promoted locally, such as; with the chamber of commerce, on the city or county website, or in the local newspaper.  Other worthwhile events may be listed on special interest websites, such as; car shows, horse shows, sporting events, etc.  Another favorite, tried and true event listing resource is Drake Fair Guides. Drake Publications, www.drakefairguides.com, has been putting out event guidebooks for each of the western states for over twenty years. The information is unbiased, detailed and accurate. And, because Drake has been in the business a long time, is a regionally based company, and doesn’t wait around to be contacted by event coordinators, many small, local events are listed in their guide.

Once you learn about an event it takes more research to learn if it is appropriate for your concession, and to estimate its profit potential. In the days of pre-internet this was done by directly questioning the coordinator. Now, many events have websites that provide answers to questions vendors typically ask, like: the event’s date, attendance, location, and schedule of activities. Information about the vendor space fee, vendor policy, and a downloadable booth space application is usually also available. All this information makes it possible to pre-screen your entire event schedule without using your business voice.

small concession tents at small festival

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.

booths at a small community event

Welcome 2012! With the party hats, confetti and well-earned hangovers behind us it’s time to start planning for the 2012 concession season. Every year I am surprised how fast winter slides into spring, bringing with it a flurry of the usual pre-season activities.  One of the first things to think about is event applications. If this is your first year out there is no time to lose.

Obtaining contracts for food booth space at quality events can be a difficult undertaking because there are a limited number of booth spaces available at a limited number of events. Event coordinators may receive twenty, forty, or more, applications for food booth space each year. Therefore, it is critically important new vendors present themselves and their new concession business in the best light possible. Some things you can do to get the coordinators’ attention and increase your chance of being offered a space at the events you apply for are:

1. Serve a unique menu. A concessionaire who serves typical fair food, such as corn dogs and snow cones, will likely be passed over by event coordinators. Serve a menu that is unique, but not so crazy unique customers will be afraid to spend their money on it. Though a unique menu initially may not sell as well as standard fair food, your event bookings will be of higher quality, and, if your food is good, your niche will develop quickly producing higher sales in the future.
2. Have a clean, attractive, and professional looking booth, display and signs.
3. Better still, have a gimmick. Design a particularly fun display or booth/menu name. Something as simple as painting clown faces on your trash can lids (mouths open to receive trash) might be enough to make your booth memorable to the decision makers.
4. Design a brochure, pamphlet, or flyer and include it with your booth space application. This brag sheet introducing your booth and menu to event coordinators is the most effective way to make an early and positive impression. A color photograph or drawing of your business, along with a blurb describing your delicious food and your professionalism, is an effective way to set yourself apart. You want to show the coordinators what an asset your concession will be to their event. Further, you want them to be excited to have you there.

This coming event season every concessionaire will be challenged to earn every sale. As a new vendor you may find that the business is more challenging than you expected. However, you might also be surprised to earn more money and have more fun than you thought possible.

food booths at Longbeach Kite Festival

I think every food concessionaire remembers his or her first event. Mine was with a stick joint made of scrap barn boards, screwed together on sight by my dad and me. It took all day and lots of hand tools to have it standing straight enough to throw a tarp over it and call it a food booth. Inside I had a folding table, folding chair, stack of napkins, cash box, and, a tall stack of coolers full of my one and only menu item –sliced loaves of banana bread.  I knew it wasn’t the perfect menu for a five-day Fourth of July event, but, since I was already baking loaves to sell to restaurants, it was easy to bake extra. Besides, what’s not to like about banana bread?

In anticipation of sales, for a week prior to the event, I stayed up late each night baking bread in my home kitchen. By fair time I was ready with two freezers full of bread.  I mistakenly believed I would sell every one of them. It’s amazing now to recall how, back then, the health department was much more lenient in their food service licensing than it is today. By just answering a few questions, such as: “Is your dog an indoor or outdoor dog?” I was able to get a license to cook commercially at home.

I wanted a classy looking booth so an artist friend hand lettered wooden signs for me. On the front counter I plunked down a nice bouquet of flowers. I was set to make my mark in the concession business.

Looking back, it is obvious to me (and, most likely, everyone else) my first mistake was my choice of menu. Luckily, a more experienced vendor saw my dilemma, and helped me out by showing me how, in addition to bread; I could sell a quick and easy nachos dish. He spent a lot of time at my booth talking about the concession business. Experienced concessionaires are not usually inclined to help naïve new vendors; something I didn’t appreciate at the time. I expect he simply found me attractive, but, I was extremely lucky to benefit from his thirty years of experience…thanks Tom.

I probably don’t need to tell you, the event didn’t turn out the way I had hoped. But, it was the start of my concession business education that continues today. Lesson number one: selling food is not as easy as it appears. Lesson number two: your menu matters.  Lesson number three: it helps to have a good mentor.

Please share your “first event” story. It might get featured as a blog post.

fair food

In the food concession business, when it comes to menus, it can be a challenge to identify and pin down your market. Because your market is, literally, a moving target.

In one day your customers might be attendees of a farmers market in the morning, and Harley Davidson riders, enjoying a swap meet, in the afternoon. The following weekend you might have your concession at an art and wine show. Then, two days later, you find yourself setting up at a five day county fair.

I don’t know any menu that can maximize sales at every event. Cotton candy is for kids, and fajitas are preferred by adults. Event goers admiring art while tasting wine are not likely to buy a corn dog. But, they might buy chocolate dipped strawberries or oysters. The reverse is true for people attending a motocross race.

Most concessionaires serve a menu based on their ambition. Generally, concessionaires who earn well over fifty thousand dollars a season operate highly productive concession booths and serve a menu that has broad appeal. The food they serve can be prepared and served to hundreds or thousands of people within a short window of time. They dominate large events, such as state fairs and large sporting events. These high attendance mega events attract a wide demographic of attendees and the earning potential is huge. There, too, booth space and other operating costs are equally huge. For these food concessionaires the critical mass bar is high, but, when reached, so is the pay-off.

However, large events are not for everyone. In my world most concessionaires prefer to work smaller special interest events and festivals, such as horse shows, farmers markets, car shows and small fairs. They cost less to participate, and the attendees are usually more receptive to a variety of menus.

In either case, no matter what your business model, menu, and type of events you work, achieving critical mass is key. The bar is high for concessionaires who operate high production booths, selling food at mega events. The bar is much lower for others who sell economically at moderate events. There, a less productive menu that appeals to fewer people might work just right.

There is more to reaching critical mass in sales than the popularity of your menu. More on that in a future post. Your comments are encouraged. Maybe you have a different perspective.

curly fries, corn dog and lemonades

Not long ago food trucks were called “roach coaches” and served quick snacks to industrial site workers. Now, food trucks and food carts seem to be on every street corner and discussed on every form of media. In fact, just today I was listening to Here and Now on NPR, while the host, Robin Young was discussing mobile food trucks with Richard Myrick, editor of Mobile-Cuisine Magazine.

Myrick pointed out that many carts and trucks are opened by chefs and culinary entrepreneurs because they are less expensive to start and run than a traditional restaurant. It seems, as a result, many mobile food businesses are becoming known for the unique quality of the dishes they serve. This makes me wonder about the difference between street food, served from food carts and trucks, and so called, fair food, served from food concessions.

Whereas, many street food vendors are making a name for their selves based on the quality of their menus, concessionaires at festivals and fairs are known more for serving outrageous junk food. In fact, last summer, food booths selling deep fried sticks of butter and deep fried Twinkies were winning awards for the best food at many state fairs. Can you imagine street food carts having the same success with such a menu? At first glance, it sounds like only street food vendors serve good food because that is where all the good cooks are. But, that’s not it.

Food sold on the street is different from food sold at fairs because the market is different. Like restaurants, street food businesses are generally open full-time, and depend on a steady clientele of repeat customers for their success. Food concession businesses, on the other hand, are open part-time in a variety of markets, and therefore, must serve hundreds or thousands of customers within a very short window of time. Food sold from a concession business must also have a higher profit margin to offset high operating costs.

Perhaps, more importantly, people who attend fairs and festivals eat differently. They allow themselves to splurge on food that is not particularly good for them while enjoying an infrequent “special event”.

I occasionally meet professional chefs, who, as new concessionaires, show up at fairs with newly minted manufactured trailers, fully equipped and prepared to serve gourmet food. I never see them return the following season. It’s likely because; they had the wrong business model for the market.

That’s not to say; there aren’t successful concessionaires serving gourmet food at special events. But they are the exception. Until the market evolves, it is hard to earn a consistently high return in the food concession business unless you serve traditional fair food that is fast, cheap, and, often loaded with calories. I think the market will evolve. Just as people in urban areas now like grabbing a quick meal of quality food from street vendors as an alternative to the menus available at fast food franchises. They could soon look for similar quality in their food as an alternative to typical fair when they attend special events.

But, if you think it is a simple case of achieving critical mass in whatever food sales market you serve, it’s not that simple for concessionaires. The special events food sales market is hard to nail down because all special events are different. County fair goers eat differently than art show goers.  More on that in a future post. I welcome your opinion.