PDA

View Full Version : 40% vending fee - would you do it?


Marsha
10-19-2009, 01:49 PM
Have any of you BBQ folks out there who do vending worked a venue where they ask for 40% of your take at the cash register as your vending fee? We are considering a new venue, but really need to crunch some numbers to see how profitable it might be.

We have vended at an event that took 30% and I thought that was pretty steep, but we did make money. The new venue is one that will have some very big crowds.

Lots to consider. Any ideas or suggestions?

Plowboy
10-19-2009, 03:59 PM
That is steep. Any other costs involved like permits? Consider competition. Ask them for numbers for comparable vendors for the last three years. Consider what % you need to make for it to be worthwhile. If you didn't cook this event, would you be working at all during that time?

C Rocke
10-19-2009, 04:09 PM
Have any of you BBQ folks out there who do vending worked a venue where they ask for 40% of your take at the cash register as your vending fee? We are considering a new venue, but really need to crunch some numbers to see how profitable it might be.

We have vended at an event that took 30% and I thought that was pretty steep, but we did make money. The new venue is one that will have some very big crowds.

Lots to consider. Any ideas or suggestions?

LB Grand Prix gets 32% less sales tax on top of your vendor fee - If this helps. Hard to make it back until the 3rd day's sales.

Bbq Bubba
10-19-2009, 04:48 PM
As said earlier Marsha, absolutely not. 40 % before expenses would be suicide IMO.
Given an overhead of 25% (low), out of $1000 sales you have $250 in overhead, they get $400 and that leaves you a profit of $350.
Not good business in my book.
Good luck on your decision and let us know what you decide. :biggrin:

What kind of event demands 40% of your cash sales?

lazybonesmoke1
10-19-2009, 04:58 PM
How are they gonna know what your cash sales are for the day?

landarc
10-19-2009, 05:07 PM
Back when I was shooting video for horse events, this started coming in vogue, and a few were asking for that much money. It doesn't make sense for a business to do this. I know they claim that they are giving you a market, but, it is still very difficult unless the market has no other choices. I would not do it, even if I had an exclusive, unless there was some safeguards in the agreements.

Marsha
10-19-2009, 05:15 PM
Thanks for the great replies. The venue is Infineon Raceway, north of San Francisco. They hold a NASCAR race once a year, motorcycle, NHRA, and Indy car races, etc. We were pleased that they approached us to vend there. But, now that I think about it, why does the venue need to go out looking for more food vendors? The best venues we work often have a waiting list of people wanting to vend there because they have a good reputation as being a well organized, profitable event. I have a list of questions for them when I talk to them after we read the information packet they are sending, and that list is getting longer all the time.

bbqbull
10-19-2009, 05:16 PM
When I did catering on a very small scale for a couple years I wound never consider those type fees.
I did private partys, graduations ect., no vending.
That almost sounds like the mobsters demaning a very high price for your protection or even allow you to vend.
I hope im not out of line here with my comments but thats borderline insanity.

Marsha
10-19-2009, 05:19 PM
How are they gonna know what your cash sales are for the day?

Some places send a person out each day to watch you Z out your cash register and everyone initials the paper roll at that point then you turn it all in at the end of the day.

big brother smoke
10-19-2009, 05:23 PM
+1 on Bull's comments. This sounds like mobster stuff!

C Rocke
10-19-2009, 05:26 PM
How are they gonna know what your cash sales are for the day?

Larger vending venues require you have a cash register, and note the serial number(s) on your application. You then provide a tape or reading as backup for the sales number.

Marsha
10-19-2009, 05:39 PM
That is steep. Any other costs involved like permits? Consider competition. Ask them for numbers for comparable vendors for the last three years. Consider what % you need to make for it to be worthwhile. If you didn't cook this event, would you be working at all during that time?
We would have to get a permit from the county HD up there. I will ask about previous vendors. Good idea.

LB Grand Prix gets 32% less sales tax on top of your vendor fee - If this helps. Hard to make it back until the 3rd day's sales.
We have crunched numbers that show us many events are usually not profitable until the second day. We now rarely do 1-day events.

As said earlier Marsha, absolutely not. 40 % before expenses would be suicide IMO.
Given an overhead of 25% (low), out of $1000 sales you have $250 in overhead, they get $400 and that leaves you a profit of $350.
Not good business in my book.
Good luck on your decision and let us know what you decide. :biggrin:

What kind of event demands 40% of your cash sales?

Wow, those numbers do put things into persepctive. $350 profit on $1000, and that is looking generous... Hmmnnn...

Chuckwagonbbqco
10-20-2009, 12:47 AM
Also remember that you will pay California State Board of Equalization 8.25 % of sales. This means that if you raise your prices to cover the 40% being charged to you----you will also be paying the state 8.25 % .

Events like this collect cash register tapes every hour and question any No Sale ring ups. They also put a sign on your vending booth to tell customers where to report you if they do not get a receipt from you.

You will have a captive audience that can afford an eleven dollar tri tip sandwich.

Dr_KY
10-20-2009, 04:26 AM
Marsha would be very interested in seeing a list of questions that you are asking them. There have been a few events that have asked us for 20% and I would love to have some back -up via important questions to ask.

BTW at 40% I would walk away if vending over there. Here things haven't gotten advanced enough to need a cash register or receipts.

Spydermike72
10-20-2009, 07:15 AM
Also remember that you will pay California State Board of Equalization 8.25 % of sales. This means that if you raise your prices to cover the 40% being charged to you----you will also be paying the state 8.25 % .

Events like this collect cash register tapes every hour and question any No Sale ring ups. They also put a sign on your vending booth to tell customers where to report you if they do not get a receipt from you.

You will have a captive audience that can afford an eleven dollar tri tip sandwich.

Business Friendly environment over there in Cali!! :cool:

Marsha
10-20-2009, 06:44 PM
Also remember that you will pay California State Board of Equalization 8.25 % of sales. This means that if you raise your prices to cover the 40% being charged to you----you will also be paying the state 8.25 % .

Events like this collect cash register tapes every hour and question any No Sale ring ups. They also put a sign on your vending booth to tell customers where to report you if they do not get a receipt from you.

You will have a captive audience that can afford an eleven dollar tri tip sandwich.

$11 tri-tip sandwich. Wow! We charge $9 at the Laguna Seca races, but that includes potato salad. And that seems like a pretty high price, but the venue does support it.


Marsha would be very interested in seeing a list of questions that you are asking them. There have been a few events that have asked us for 20% and I would love to have some back -up via important questions to ask.

BTW at 40% I would walk away if vending over there. Here things haven't gotten advanced enough to need a cash register or receipts.

I will PM you the list later. I am still adding to it, too. :)

Business Friendly environment over there in Cali!! :cool:
You'd think they would want to make it easy for small business to do business. We end up buying permits and licenses for everything imaginable out here.

chad
10-20-2009, 06:56 PM
That's high and you'll probably have a vendor's fee, too. Also, all it takes is one day of really crappy weather and all bets are off.

The "Ribfest" is like that here:
1. You gotta blow somebody to get on the "list"
2. You gotta pony up $1000 vendor's fee
3. Pay local licensing
4. Split the profits
5. Hope the weather stays good - what I usually would want is the DRINK concession!

On the other hand, you can potentially "make" about $10K on a Ribfest weekend but since it's ribs the food cost is significant.

Infinion would be a very cool venue (yeah, I admit it, I watch a LOT of NASCAR racing, bikes too!)

Bbq Bubba
10-20-2009, 07:50 PM
$11 tri-tip sandwich. Wow! We charge $9 at the Laguna Seca races, but that includes potato salad. And that seems like a pretty high price, but the venue does support it.



Michigan International has a BBQ vendor inside the gates that serves a 4" PP sammie for $7 all day long and its crock pot pork.

Is this for the whole season or just Nascar?

Nascar is usually sold out so guaranteed money. Where on the track would you be? High profile area or one of them off distance turns? That could be a VERY lucrative contract, even with the high percentage!

Marsha
10-20-2009, 08:13 PM
The fellow we talked to said the whole season. BUT, as we have learned from the Laguna Seca racetrack, not every race draws a huge crowd. We lost money the first time we vended the 'Festival of Speed' because we over-estimated how many customers we would serve. Dumb move on our part not to research it more. So, at Laguna Seca we always vend at the biggest race of the season, the Red Bull US Grand Prix. The others, not unless we have nothing else going on.

Location is one of the big questions on my list!

jbrink01
10-20-2009, 08:29 PM
I doubt you can charge enough or work fast enough to make it worthwhile.....never know though.

Marsha
10-20-2009, 08:39 PM
I doubt you can charge enough or work fast enough to make it worthwhile.....never know though.

Too true. Sigh.

Jacked UP BBQ
10-20-2009, 08:58 PM
My over head at a vending event it around 50% if I do the numbers expected. So unless there are two digits before the comma with the first one being at least a 2 or 3 in your gross sales, heck no. That is a huge waste of time IMO.

jbrink01
10-20-2009, 09:00 PM
Do you REALLY want it? If you do, give it a shot. You can always bail after 1 event.

jbrink01
10-20-2009, 09:03 PM
We do a 2.5 day that has gross sales in the 5000 - 6000 range and i hate paying the $500 fee!

HoDeDo
10-20-2009, 09:09 PM
usually those tracks have LOTs of food vendors... I would expect exclusivity on the items on your menu, and for 40% do they offer any type of guarantee? Esp if they charge a vending fee.

the vendors at our track that I know, always b!tch about how they are getting screwed, but they always seem to go back for more. So the money is good enough they put up with the crap. I wouldnt give up 40%. that's just me.

FatBoyz
10-22-2009, 04:43 AM
it your going to pay 40% i would like to know are thay going to have all the power you will need or will you need a gen? will you have accsess to water? and what is the attendence # ? i work off the 10% # if there is 10000 there i will feed about 1000. something about this does not seem right.i have to go with bubba on this one i would pass,,, and are thay doing tickets or are thay checking your Z at the end of the day... now there is a paper trail... bad but this is just my opinion

Marsha
10-22-2009, 06:30 PM
Just received the information packet in the mail from the food concession manager at this racetrack. Just glancing through all their rules and regulations my first repsonse is NO WAY!!! The area supervisor for our part of the track will come in and inventory all of our product first thing in the morning and we have to note spoilage and staff meals throughout the day. Spoilage must be verified by the area supervisor. We cannot bring in more product during the day unless our area supervisor adds it to our inventory sheet. The area supervisor will come into our booth during the day and do a check on everything. The staff must wear khaki pants, white shirts and black hats. (White shirts and BBQ!? We have black polo or t-shirts for our staff with our business name on them) If the staff are not dressed properly they will bring them the shirt or hat and charge us for them. All tables inside and outside the booth must have table covers that cover top and legs of the table. We cannot close the booth at the end of the day until the area supervisor says we can and then they will inventory our product at the end of the day, etc, etc. And then there are issues like the management of the change/bank funds, etc.

I have no problem at all following the rules and regulations of venues where we do work, like Laguna Seca racetrack, or the California International Airshow. But this place is very restrictive AND they charge an arm and a leg.

Thanks for all your great input folks. This event/venue is definitely a PASS for us!

Caseyjoenz
10-23-2009, 12:01 AM
40%...no way. None how.

leanza
10-23-2009, 05:12 PM
40%, to me, is in the blood sucking range. Your hard work, sweat and tears and then giving them 40%!