DON’T BE FOOLED! DON’T BUY THE HYPE!
Many of the websites that sell courses and plans for getting started, including some manufacturers of hot dog carts tout huge incomes. Although some hot dog vendors make huge incomes, it’s not all of us. Some of this information is just there to entice you into purchasing their goods. This can attract many people to the business that have unrealistic expectations.
It would be similar to a website claiming that the average medical doctor makes over $300,000.00 annually, gets weeks off each year to vacation, drives the best cars and lives in the best homes. But if they fail to inform and educate the buyer of all the challenges, the insurance, the 12 years in school, the enormous education debt and their risks; then these sites are doing a disservice and are hurting others – only to sell their information.
I have done stories about hot dog vendors making well over $100,000.00 annually, even with a single cart. I have also talked to hot dog vendors that make $30,000 a year. Without talking to 100’s of vendors and getting an accurate income from each of them, it would be impossible to get an accurate average.
I have spoken to several hundred vendors and some have been forthcoming with their incomes, BUT; vendors are notorious for “poor mouthing”. Remember, this is an almost all cash business. Most vendors will share what income they report on their taxes, but not all will share how much they made in total.
Being self employed offers a hot dog vendor the opportunity to take advantage of tax incentives and tax breaks, it allows us to claim expenses that can help us reduce the amount of “income” shown on our tax returns; thereby lowering the perceived income.
Let’s do some math, but before I do, let me share with you the variables. Some websites proclaim that vendors can make $200 a day but then they multiply this by 30 days a month and total it up to show over $6,000 in monthly income. I don’t know a vendor working 3o days a month. Weather, sickness and many other unforeseen obstacles can prevent a vendor from working that much.
Figures based on personal experience and figures provided by hundreds of other hot dog vendors.
50 hot dogs a day (approx. 25 people)
50 x $2.00 = $100 hot dogs
50 x $1.00 = $50 soda or water
20 x $1.00 = $20 chips or snacks
Total $170 Not a bad day, huh? We could easily through these numbers up on a website, multiply the total by 365 (days in a year) and proclaim an annual income of $62,050. But I don’t know anyone getting their supplies for free. We still have costs of goods sold (COGS) and we have all the incidental costs; napkins, foil, sanitizer, ice, propane, etc. etc. etc.
For an accurate estimate, I use 34% cost ratio from gross sales. So now, let’s re-do the above annual income based on working a reasonable schedule and taking into account all expenses and COGS.
$170 daily x 20 days a month = $3400./mo
$3,400 monthly x 12 months = $40,800./annually
But we still have our total costs to remove.
$40,800. minus 34% = $26,928 annual income
Not bad huh, you get 10 days off a month, you are only going to work 3 to 4 hours daily and still have a take home of over $2,000/monthly, free and clear money. Even though it’s not great money, it allows for tons of free time and allows you to make more monthly than millions of other Americans.
Consider this: What if all we changed was to add $1.00 to the cost of our premium all beef hot dog? That would be an additional $1,000/monthly and there would be no additional costs to consider.
Now that’s the low end of the spectrum. I’m not satisfied with that and although I don’t vend 20 days a month, I still make more than that from vending. So let’s look at some figures from the go getter vendors, those hot dog vendors that use all the marketing ideas, the menu ideas, the up-sells and who market their business as something above average.
100 Meals a day x $5.00 (2 dogs, chips and a drink) = $500
Now lets assume you can only work 15 days a month. That’s $7,500/monthly
Minus the 34% costs and you net $4,950/monthly or $59,400/annually
Wow! You are only working a half a year but are making more than 200% more than a vendor we exampled above. You are now working only 15 days a month!
A $1.00 increase in your meal price would net you about $18,000 more annually and we haven’t even discussed tips and those crazy tip jars.
You can work these numbers several ways, you could work more and sell less and still come out in the top 20% of incomes Nationwide. Are there any hot dog vendors making less? YES! But here’s the facts. A vendor can control their income, they can increase their incomes with some key changes;
- find a location that supports 25 to 50 customers daily
- market your business (see my marketing articles)
- team up with your community and become a community asset
- menu selection
- menu pricing
Be sure to listen in to the radio show as we will discuss more about how much you can make as a hot dog vendor and what you can expect. Hot dog vendor income, event income and making more and more each day.