Selecting Profitable Events for Your Concession Stand
When you begin preparations for the prime concession season, which usually runs from Memorial Day to around Labor Day, it is important to focus heavily on the type of events or venues that you decide to pursue as hosts for your concession stand. There are many options to choose from, but generally, the events and events that happen in your area fall into two categories: local events and big-time events.
Local events could be smaller organizations that represent a local organization or a celebration that involves one or two cities. The size of these events may not necessarily dictate smaller revenue. On the contrary, they can be great sources of profit as the close-knit communities will tend to want to put money back into their town and support the concessionaires involved. Smaller events also generally have lower space fees for their lots because the production cost is lower.
While they may have higher space fees, large events like a county fair bring in large crowds.
One potential pitfall of a smaller, more local event is the general state of the community. For example, if one of the larger companies in the city shuts down and has to lay off many employees, this will affect not only the attendance of the event, but also the money you will make during the event.
Big Time Events
Larger events, such as state events or county run events are held over a period of several days (usually a weekend) and can mean big bucks in revenue since you will have a steady stream of new, captive customers every day. The potential for sales upwards of $30,000 in one weekend is not unheard of.
The reason these events are not as desirable is the level of difficulty it can take to get a booth in the venue. Often times, the concession vendors that have been successful in years past are given preferential treatment with regards to first choice of participation and location. New vendors with less experience will have a hard time breaking in to the big state events until they can prove that they will be able to handle the demands of a large event.
Another downside of the large events can be the charges associated with space fees. Larger venues tend to charge fees based on a percentage of gross sales. This is fantastic if your equipment and trailer have nearly all been paid for, but when you are trying to cover the costs of new equipment and still finding your footing, this can be devastating to your bottom line.
Attendance to Booth Ratio
When you are talking with event organizers, there are several important questions you will need to ask in order to determine the probable success of your concession stand. The first is the estimated attendance of the event, or any past records, if the event has more than one year under its belt. This is a fairly standard question. The next set of questions will take a little more finesse. It involves finding out how much and what type of competition you will have.
This booth is located right next to the city capitol building. A prime piece of concession real estate.
Determine the concession booth count. Determining exactly how many food vendors will be at the event will determine how much of a “cut” of the profits you will get when all is said and done.Determining exactly how many food vendors will be at the event will determine how much of a “cut” of the profits you will get when all is said and done.
Discover the types of menus being sold. If you are able to find out what the menus of the competing vendors are going to be, you can determine if your booth will be more or less successful.
For example, say that you are able to find out that there will be ten concession food vendors at a small event. Six of them will be serving lunch and dinner items such as burgers, hot dogs and barbeque. Two of the vendors will be serving one or two specialty items such as kettle corn and fudge puppies. One other vendor will be serving up espresso and other coffee drinks. If your menu consists of primarily meal items, this is not likely to be a profitable event for you; however, if you sell snow cones or soft serve ice cream, you could very likely make a killing since there are no other vendors selling something similar.
Find out booth locations. How the venue organizers assign booth locations could greatly affect your business. If the booths are assigned on a first come, first served basis, and you get one of the first slots, you can choose the spot that will best suit you and your business. If the venue assigns spots based on seniority, and you are a newcomer, it is likely you will not have prime placement in the space provided by the event.
Space fees are the rental fees you pay to the event or event organizers for the space that your concession stand, trailer or cart will occupy for the duration of the event. They range in prices depending on the size and relative popularity of the event. There are two types of fees: flat fees and percentage fees.
A flat fee is exactly what it sounds like. The concession stand owner pays a fee up front to rent the space. The fee does not fluctuate depending on the success of the event. Typically the flat fee is charged based upon the frontage length, the entire length of your stand from end to end. Flat fee events are almost always less expensive than events that have space fees based on percentages.
Larger events and events that are longer in duration and more established typically charge percentage fees. There is a deposit paid at the beginning of the event and at the end, the vendor pays a percentage of his or her profits to the organization, minus the deposit. The fee is usually between ten to 25 percent.
For example: The event deposit for the event is $100 and the percentage is 15 and you make $5000 over the course of the event, then you would owe $650.
(5000 x 0.15)-100=650
While it is the most common form of charging for spaces, it is certainly not the most popular as many vendors say that it does not take into consideration the overhead for running a business, such as food and smallwares.
The one benefit of having a space fee based on percentage of your sales is that, if sales are poor, you will not have as high of a space fee as you would if you were paying a flat rate.
It might seem like common sense that the longer the event, the more money you are likely to make, but it is important to consider other factors about the length of the event or event where you are selling. There are typically three types of events: day-long, weekend and seasonal. Each type of event has its positives and its drawbacks.
Farmer's markets can bee weekend events or daily events.Day-Long
Day-long events are a gamble that can either pay off in a big way or cause an entire day to be wasted. If the event is extremely popular, you will have a steady stream of business all day and end your day with registers full. Also, since you will only be paying space fees for one day, you will get to keep a larger chunk of your profit. However, if the event is poorly attended, you will have wasted time, money and effort.
Weekend events are a popular choice for many concessionaires, because they offer them the ability to spread their business out over the course of a few days. There is less risk associated with an event that is going to last three to four days because if business is poor one day, there is always the chance to make up the difference over the course of the remaining days. However, space fees are usually much larger for weekend events, and they usually charge a percentage of the profits rather than a flat fee.
Seasonal events such as Renaissance Festivals can be very profitable because they are heavily attended over the course of the entire season. The events are typically only open during the weekend, freeing up your weekdays for other concession events. The seasonal events are typically well-established and have concession stands pre-built. For this reason, the cost is higher to rent the space. However, it is guaranteed work every weekend of the concession season. Because of the events’ maturity, it can be very difficult to get a space in a seasonal event.
It is important to remember the hours of operation these events will have as well as how long they last. If an event closes down around five in the evening and your menu revolves around dinner food, it is not going to be as profitable as a nighttime event
It is important to consider where the event is being held. Some events are more friendly to concession vendors than others with regard to accessibility and resources. A event that is located in a grassy park may be ideal for customers of the event, but it can be a logistical nightmare for a concession vendor with a large trailer. Conversely, an event that takes place on the street makes it a piece of cake for a vendor to set up and tear down quickly, and access to electricity and other amenities is much easier.
However, on a hot day, customers are likely to tire of the steamy pavement quickly and look for shelter elsewhere. While parks can be a great place for concessionaires, it is recommended that novices start with events that make setting up a little less of a hassle.
Do not forget that you are not the only business charging your customers money at the event. If the event is large, chances are, your potential customers have already shelled out money for entrance and are planning on spending some of their other money on novelties as well. If you are unable to make adjustments to the pricing of your menu items, you may want to stay away from larger venues that charge customers for entrance.
The length of time and event has been around is a very important factor to consider as it will have an effect on your involvement with the organization.
Choose established events for a sure thing. Events that have been around for a long period of time have an established customer base and provide consistency for concession food vendors. However, because of their reliability, they are able to charge more for space fees and are much more difficult to get a contract with.
Risk new events to reap rewards. New events or events are often eager to get new vendors signed on to their event and will charge much less for participation, but since the event is unproven, there is some risk associated as attendance can be poor.
Avoid poorly organized events. One of the other aspects of the maturity of an event can be the level of organization within the event or event. If the event is new or small, the committee in charge of keeping track of vendor relations can be extremely small and made up of volunteers who have no experience dealing with concession food vendors outside of the event.
There are many factors when it comes to selecting the event and venues that will be the ideal and there will always be some form of trial and error before you find the exact right fit for you. Using the preceding tips as a guideline will help you to narrow down what you believe is the right mix.
More from Selecting Profitable Events for Your Concession Stand...
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- Concession Rules, Regulations and Licenses
- How to Properly Market Your Concession Stand
- Resources for Booking Venues for Your Concession Stand
- The Cost of Running a Concession Business
- Concession Fundraising on a Barely-There Budget
- Planning a Menu Fit for a Concession Stand
- Important Questions to Ask When Researching Food Concession Venues
- Cart or Trailer: Making the Right Decision for Your Mobile Business
- Choosing Equipment for Your Concession Stand
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