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Catering, Vending and Cooking For The Masses. this forum is OnTopic. A resource to help with catering, vending and just cooking for large parties. Topics to include Getting Started, Ethics, Marketing, Catering resources, Formulas and recipes for cooking for large groups.


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Unread 10-19-2009, 01:49 PM   #1
Marsha
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Default 40% vending fee - would you do it?

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?
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Unread 10-19-2009, 03:59 PM   #2
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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?
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Unread 10-19-2009, 04:09 PM   #3
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Quote:
Originally Posted by Marsha View Post
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.
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Unread 10-19-2009, 04:48 PM   #4
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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.

What kind of event demands 40% of your cash sales?
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Unread 10-19-2009, 04:58 PM   #5
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How are they gonna know what your cash sales are for the day?
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Unread 10-19-2009, 05:07 PM   #6
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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.
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Unread 10-19-2009, 05:15 PM   #7
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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.
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Unread 10-19-2009, 05:16 PM   #8
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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.
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Unread 10-19-2009, 05:19 PM   #9
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Quote:
Originally Posted by lazybonesmoke1 View Post
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.
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Unread 10-19-2009, 05:23 PM   #10
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+1 on Bull's comments. This sounds like mobster stuff!
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Unread 10-19-2009, 05:26 PM   #11
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Quote:
Originally Posted by lazybonesmoke1 View Post
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.
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Unread 10-19-2009, 05:39 PM   #12
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Quote:
Originally Posted by Plowboy View Post
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.

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Originally Posted by C Rocke View Post
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.

Quote:
Originally Posted by Bbq Bubba View Post
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.

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...
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Last edited by Marsha; 10-19-2009 at 05:40 PM.. Reason: Can't type for beans
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Unread 10-20-2009, 12:47 AM   #13
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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.
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Unread 10-20-2009, 04:26 AM   #14
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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.
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Unread 10-20-2009, 07:15 AM   #15
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Quote:
Originally Posted by Chuckwagonbbqco View Post
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!!
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