Chapter 4
Location, location, location…or NOT!
In real estate, the three most important things are location, location, and location. This is pretty much true in the cart business as well. If you have a convenient location with a lot of foot traffic during meal hours, you will always do well. Stop right now and think about all of the places in your town that might make good vending sites. I bet you thought of at least ten right off the top of your head.
Cultivate the habit of always being in “site scouting mode”. Whenever you are out and about, keep an eye out for places that meet the following criteria:
1. High foot traffic
2. Easy access. You want to be able to get in and out easily. You also don’t want to block the roadway or sidewalk when you have 15 or 20 people lined up for your famous hot dogs.
3. Good visibility. You want people to be able to see you (or at least your colorful umbrella) from a long way off.
4. Enough room for you, your cart, and a couple of coolers on the ground.
Here are some ideas to get you thinking creatively about site location possibilities.
Find out where people work, and where they drive for lunch. Now find a side street between the two with decent parking. Set up your cart on that corner and you’ll have a steady stream of hungry people heading right for you.
Find a place where a lot of people work, but where parking is scarce. These people are afraid of losing their parking spaces, so they usually “brown bag it” and don’t go out for lunch…until they see your cart within walking distance. You’ll have a captive audience!
Set up close to other restaurants – but be careful. They will see you as competition and sometimes they’ll hassle you by calling the health department and/or the police to check you out. If you pass the “hassle inspections” (which you will because you run a properly equipped, clean, licensed cart) you’ll be right where everyone goes to eat!
Use your imagination. Some of the most profitable sites may look terrible at first glance, but can be top producers. You have a huge advantage over traditional restaurants because you are mobile. Unlike a traditional restaurant, you have the flexibility to set up at a location and test it out. If it doesn’t produce after a few days, just move on to the next spot.
Compare that to a traditional restaurant which must “bet the farm” on a location before they open. Because of the huge investment involved, they must do a lot of expensive research before they decide to proceed. If they blow it, the consequences are huge, and often fatal. If you pick a bad location, you just move along – no problem! That’s why I titled this chapter “Location, Location, Location…or Not!”. Yes, location is the most important factor for success, but it is not a make or break factor because of your mobility. You don’t have to get it right on your first try. You get an almost unlimited number of opportunities to get it right.
Public vs. Private Vending
In this section we will be discussing sites where you will be vending daily, as opposed to special events such as fairs and festivals. Locations can be broken down into two main categories, public and private. Public locations are those that are owned, operated, or controlled by a public agency such as the city, county, state, or federal government.
Examples include the local courthouse lawn, city streets and sidewalks, park district sports fields, school district property, etc. Private locations include property that is owned by an individual, a company, or a private agency. These are commonly the parking lots or driveways of stores, golf courses, bars, churches, factories, car lots, flea markets, and strip malls.
One of the advantages of public vending is that once you get your permit, the site is usually free. In addition, you are free to vend anywhere within the jurisdiction of the permit issuer. This gives you great flexibility as far as site testing is concerned. Let’s say you get a permit from your city. You can now set up your cart on any city property that allows vending without any additional paperwork. Set up, test, move, set up, test, move. You can find really profitable sites in a hurry this way.
One of the downsides of public vending is that it is public. This means that you are not guaranteed exclusive use of any particular vending site. The best sites may have several carts all competing for the same customers. I actually heard about a very busy street at a university where there were three separate hot dog vendors each working a corner of the same intersection. The funny thing was that there was enough business for all three! So just because you see someone vending at your dream location, it doesn’t mean that you shouldn’t try it out. Hang around and spy for a few days at lunch and see if the line is really long. If it is, and especially if people are dropping out of line before being served, there may be enough business for both of you.
Private vending has many advantages also, the first of which is exclusivity. As part of your agreement with a property owner, you can be certain that you will be the only one allowed to vend there. This can be particularly lucrative if you can find a busy strip mall with a lot of traffic and no restaurants. One downside of private vending is that the property owner will probably ask you to pay some rent in exchange for setting up your cart on his property. This may seem like a reasonable request at first glance, but consider this…
If there are no restaurants, then you will actually draw traffic to the site, which will benefit all of the store owners at this strip mall. You may be able to work out one of two scenarios that will allow you to vend there rent -free. Keep in mind that the store owner and the owner of the strip mall are usually not the same person. Also, when delivering your pitch, you should speak, dress, and act like a business owner. Bring a binder with a large color picture of your cart, a copy of your health department license, and copies of any permits that you may have. The point is to look official and inspire confidence.
Scenario one: After scouting the location, determine which store offers the best vending site. Approach the store owner and say something like, “Hi, my name is Steve Smith and I own a mobile catering business. I was driving by and noticed that this would make a great location for one of my hot dog carts”. At this point you show him a picture of your clean, professional cart. “I think we have a win-win opportunity here. You see, when we set up a cart at a retail location such as this, the store owner usually sees a healthy increase in sales as a result of the extra traffic that we bring in. How about letting us set up a cart here say, next Tuesday, and see how it goes?”
At this point, Jane the gift shop owner may bring up the subject of rent. You reply, “Most store owners don’t charge me rent, because they see the value in me putting 150 people a day in front of their store that they would never see otherwise. I will also put an 8 by 10 color advertisement which says ‘Be sure to stop by Jane’s Gift Shop before you go’ next to the menu on my cart.”
Many store owners will let you set up at this point, especially if you show them they’ve got nothing to lose. Sometimes, however, they will say that they want you, but that the final call is up to the owner of the strip mall. Now you will be dealing with a real estate professional and it may be harder to convince him to let you set up rent free. In this instance, negotiate a monthly rent, but don’t sign anything yet. Divide the rent by the number of store in the mall. Now visit each store owner and see if they will pitch in their portion of your rent in exchange for the additional sales traffic you will generate. Keep in mind that most stores operate on very thin margins and they may be quite desperate for sources of additional foot traffic.
Now you have two ways to negotiate a cart location rent-free. If all else fails and you have to pay rent, try to get it on a month to month basis, which shouldn’t be difficult because the landlord won’t have any overhead in the deal. It is pure profit for him, no downside. Keep that fact in mind when negotiating your rent. It gives you more bargaining power.
Keep in mind that whether you do public vending or private, this type of vending relies on repeat business. You need to keep regular hours and serve a high quality hot dog. Make sure your customers know what your hours are. If one of your regulars drives 15 minutes on his lunch break to get one of your famous dogs, and you’re not there, he probably won’t be back.
Here’s one more idea, and it is powerful! Find 5 large factories or office complexes that are at least a couple of miles apart. You will serve lunch at a different one each day. Since you will only be there one day a week, you will be guaranteed to be busy. A good way to get permission is to talk to the human resources person and pitch it as a convenience for their employees. Many companies are always looking for ways to make their employees feel valued. Pitch the company on the idea of a “Hot Dog Day” where the company buys the employees lunch once a week…
Here’s how to get permission to set up on private property…
If you approach a local business and just ask to set up there, what’s in it for them? Not much. Even if you offer to pay them rent, the tiny additional income doesn’t make it worth it.
The whole key is to remember everyone’s favorite radio station, wii fm (what’s in it for me?)
What does every business want? MORE CUSTOMERS!!!
What do they have to do to get more customers?
They have to advertise and that’s expensive!
You just have to think about it a little differently – from their perspective. What’s in it for them?
Don’t even talk about rent, talk about how many people you will bring to their place every day. People who would never have come there otherwise. A portion of those people will buy what they are selling.
Talk about how you happen to have advertising space available on your cart and promotional materials…
On the fliers you distribute, on the rear window of your tow vehicle, and on the menus that your customers will post on bulletin boards in their break rooms at work – all over town!
Tell them that thousands of people each month will see it and ask them how much that kind of exposure would cost them in traditional advertising? Thousands.
And you’ll do all this for them FOR FREE in exchange for letting you set up there.
That’s the winning pitch. Oh, and this strategy works for getting a commissary agreement also.
Steve, I would love to hear what you and others think of the factory Idea,
We are thinking of Order $25.00 or more and we give them discounted prices and free delivery.
Since there are two of us we can do this and not abandon the cart.
We also will pitc that if they like and will let us we can set up in they’re parking lot and serve although this might take longer and a lot of factories around here only give a 1/2 hour lunch. On third shift this leaves little choice for them to get food. But we can deliver to the factory have one person collect the money have a signup sheet for the employees and we go drop off the dogs get paid and leave.
anyone have other ideas on this?
Thanks Bernie
It all sounds good except for the discount. Does McDonalds give a discount for orders over $25? No. Why should you?
When my slingers talk about discounts it is usually code for, “I’m scared to charge what I think is fair.”
Serve an awesome product with a unique experience and people will pay for it.
Thank You for the advice!
What about Veteran and active military discounts? Is there a way to do it without it being a pain in the backside? Just curious. I have a great respect for our military. Love those guys! Thing is if your busy,busy it seems like it could be a real hassel.
I’ve done discounts like that at my own cart from time to time and it didn’t slow me down much. What I did notice was that the folks in line behind the veteran appreciated that we were honoring that person with a reduced price on their meal. No one minded at all. In fact, I believe it gave everyone a feeling of patriotism. It was good for the vet, good for the folks behind him, and good for me.
We’re thinking about selling at a regular location during the day, then selling at refineries at night between, say, 11pm and 1 or 2am during shift changes. We’re going to start talking to Goodyear, Dupont, Shell, ExxonMobile and others soon. (We’re in Beaumont, Texas)
Sounds like a really great opportunity! Good luck!
Thanks! 😎
Are there any roadblocks we might run into at a refinery that we might not run into at a factory?
I can’t think of any Larry.
yes, you cannot run propane burners in a refinery………
I doubt he is going to be serving inside the refinery itself. Probably a parking lot nearby.
Would a public high school be a “public location”?
Would it be better to ask the high school if you can set up around lunch time, or can we just set up? I live in a pretty small town, so the (one) high school isn’t that big, maybe about 1,000 total students.
The students are allowed to leave for lunch.
There is an area at the back of the parking lot that is easily accessable to the students.
If we would be allowed to set up, I’m sure it would still be like a small event during lunch time! Could be the jackpot, or a disaster, I would definitely need some helpers!
I was thinking if I can vend at the high school, I would leave flyers on the windshields of the kids’ cars the day before I first plan to vend there. It would have the menu, let them know where the cart will be and the hours, and possibly a coupon for a free drink or chips with purchase of a hot dog on “opening day” if they bring that flyer. Still debating about the freebie, what do you think?
Definitely ask if you will be on school property! No matter where you set up you will need the property owner’s permission. Flyering windshields has been banned in many communities also, be sure to check first. The freebie idea is good for a promo, but don’t do it all the time. There is a lot of profit in chips and drinks.
I scouted out a very busy high rise office complex during the lunch hour and there were SO MANY walking back into the complex with restaurant bags. If I were to set up on a corner with scarce parking, is it considered in poor taste or possibly against the law if I set up on the sidewalk or is in the street at curbside considered the norm.
You will have to check with the city. You will definitely need a permit of some sort. Your permit will spell out what is allowable. Good luck Ross, sounds like a great location!
Steve, I live in Michigan north of Detroit, right of I-75. My plan is industrial areas and office complexes (different each day) and rotate from location to location. Another thought is setting up daily at a state rest area off of I-75 about 40 miles north of detroit. Maybe Thursday & Friday do the northbound rest area, good for families heading to northern Michigan for weekends and Monday and Tuesday & Wednesday work the southern I-75 rest area. Should have good traffic, a lot of truckers, etc. I have spoken to the health department for my county and the rest area would be in the county and also public property. Have you heard of anyone doing this? What are your thoughts?
Thanks
Rob Noble
It all sounds good Robert. The industrial/office park plan is a proven winner. The profitability of the rest area gig will depend on how much the state wants you to pay for rent. Keep me posted!
Hi Steve or anybody,
Does the strategy of selling hotdogs to industrial areas and office complexes (different each day) and rotate from location to location still work?
Thanks
Rich
Sure. It will always work.
Hello everyone,
Hi Steve,
First of all I would like to thank you for all the great info,videos, plans and definitely all the Q&A. Definitely worth the money.
I live in the country in Upstate NY with quite a bit of traffic going by and was wondering if it’s possible to open your cart on your own property until I get comfortable with slinging dogs and other items, and then scout out some sites in town. I have a commercial ice machine and regular freezer in my garage which would be come in handy.
I guess my main question is, can you open up shop let’s say in front of your garage or is that okay to do?
Thanks
Joe
At the bare minimum you will need a health permit. As for business license and vending permits, yes you probably need them too. However I have heard of slingers setting up on their own property without them. If it’s not allowed you will find out when someone from the city stops by. Don’t worry, they won’t throw you in jail. They’ll just tell you to stop until you get the right paperwork.
Thanks for the reply. I do intend to get into all of that one day but just wanted to get the minimal before I got comfortable and smooth with the operations first.
Still planning on building your cart but also just received your email with the pop-up camper converted into a food cart. Way to cool. Looking for a camper now.
Thanks again.
My pleasure!
Steve, This book is so helpful so far. So to operate you need a health permit, license etc… I have always wanted to own my own hot dog cart and don’t want to mess up the permits needed. Locations , I’ve thought of many so if I’m understanding correctly a public location is like at a park say soccer/baseball field and one permit is good for those locations and you can move from place to place without being inspected each time and or permission to set up? Setting up in front of say Walmart,Target, a gym or a car wash then you need to get permission directly from the owners? With Walmart,Micheals,or a barnes and Noble who would you go through? Now festivals and fairs are they considered public as well as private vending functions? Sorry Steve just wanted to be certain, Doing the debate onbuilding a cart ,buying used, or new. My husbands anxious for me to get a move on before the warm weather hits.
Hi Julie, yes that’s the basic idea. You will have to check with your city officials to find out how they permit the public vending in your town. Everywhere is different.
Fairs and Festivals are considered private vending. You will have to deal with the event promoter.
Glad you like the book, Good luck!
Thanks Steve. Appreciate your help! This is a great community where everyone has many useful tips and fun ideas for dogs. Makes dogs with just mustard and ketchup seem naked. Also the carts that I have seen through your videos are awesome.I loved the carport ,what a original idea . I’m also digging the camper idea as well. It’s like you need weeks to go through it all.
I’m glad you like it Julie. Yes there is a lot of information here. I try to over-deliver.
Hi there! a question for anyone who has multiple locations and thus multiple employees: how do you manage the fleet day to day?
– who transports the carts from
Commissary to the location each day? A hauling company?
– how do you make sure cash is accounted for at the end of day across multiple locations?
– does this above model work well? If not what are your thoughts on the best way to make the greatest profit?
Thanks all!
The best way to make the greatest profit is to just get out there and start selling hot dogs. Overthinking is one of the biggest roadblocks to success. Once you have been out there for a week or two, so many of your own questions will have been answered by your experience.
Having said that, your employees can pick up and transport their own carts. If you can store each cart safely at it’s location, that’s even better. Then the employee can just pick up their inventory to stock the cart each morning.
Loss control can be difficult. Every day keep track of starting and ending inventory on each cart. When the cart comes back at the end of the day, cash should equal the sales value of the inventory decrease.
I hope this helps.
Hi Steve,
Spoke to you earlier today when I purchased your training program. First I must say that I am thrilled with what I have been reading so far, and have become a human sponge with the information that you provide. Second, did someone mention in the comments here about pop up camper to food cart plans?? Would love to get them as I have a very unique retro-tee pee style pop up I would love to try and do this with to follow the music festival circuit across the US.
Thanks!
Here is an article that I wrote about converting a pop up into a food cart:
http://hotdogprofits.com/blog/converting-a-pop-up-camper-into-a-hot-dog-cart/
i went down and talked to my city and they told me, I can get a business license with a private property leased spot for that location only and that I cant move around??? the whole block in front of the post office is parking spaces but I cant vend in a city parking space?? there is a bank across the street that’s busy with walking traffic and a large medical clinic with a parking lot that backs up to the parking spaces. I am a patient there should I try to get a spot there that is in the corner about 40 feet from the parking and front door of the post office?. I have noticed it is the busiest place in town on Mondays and Fridays? there is a guy at the state building here in front of the DMV,. he parks on the grass in front of their building but I cant because they have him he is a retired vet and I think his wife works inside i don’t really want to be there anyway thanks Rob
Hi Rob,
Yes, try it out. That is the only way to know for sure if it will produce.
-Steve
Steve- I’m a veteran and some people have suggested I have a “veteran owned and operated” decal on my cart. How do you feel about that?
I say do it. Thanks for your service Lee.
Love it. Thanks Steve!
My pleasure Lee.
I live in a town in California of just over 20,000 and there’s no real foot traffic anywhere. Do you think this will be an issue? I believe that it has room for a hot dog cart nonetheless since people still do, obviously, go out to eat. The only places in town that serve hot dogs are fast food places and the quality of my dogs will surely surpass them (plus I plan on serving up some creative options). I figure as long as I advertise and/or find a spot that is visible to the main street, I shouldn’t have too big of an issue selling. What do you think?
You are correct Joseph. You can do really well with an active Facebook page and a location with good visibility and easy access/parking for car traffic. Go get em!