6 Ways to Make More Money With Your Hot Dog Cart

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Do You Have The Courage to Make More Money With Your Hot Dog Cart?

Price isn’t the only way to deliver value in your hot dog cart business. As a matter of fact it’s the very worst way.

It’s normal to be nervous during the start up phase, but it leaves you susceptible to self doubt. The temptation to lower your prices is very strong during this period because it makes you feel more confident.

You think it’s a competitive advantage, something you have control over. In reality this terrible strategy is based purely on your fear of failure.

Man up (you too ladies) and plan to charge a price that will return a decent profit.

Why you should charge more.

Let’s say you have been selling your dogs for $2.50. If you charge an extra fifty cents for your dogs here’s what happens:

If you sell 55 dogs a day, you’ll pocket an extra $5,321.25 per year (based on a 9 month selling season). That’s free money. A 16.5 percent raise which you didn’t have to work any harder to get.

That’s great, but check this out.

If you don’t charge that extra fifty cents, you would need to sell 16.5 percent more hot dogs (about nine) every day to make the same money, right?

Wrong.

You would need to sell 23.6 percent more. Thats TWELVE more hot dogs per day. How can that be?

When you charge that extra fifty cents, your costs have already been covered in your base price so you keep 100 percent of that extra fifty cents.

When you charge the base price, 30 percent of that price is eaten up by your costs. You only keep 70 percent of it. See the leverage you get by charging a premium price? It’s exponential.

Math is cool. Competing on price isn’t. You don’t have enough volume to make up the difference.

Don’t join in the race to bankruptcy just because you’re a little nervous at the moment.

Here are six better ways to deliver value:

1. Serve a kick ass product. Use top quality ingredients, super fresh condiments, ice cold drinks, and name brand chips. Watch those expiration dates – your customers do.

2. Be exclusive. Don’t try to compete with QT, Seven Eleven, and every other one-dollar-nasty-hot-dog-on-a-slimy-roller-grill-thingy operation out there. If all you offer is a green dried out no name dog with ketchup or mustard, you’ll get killed by the gas stations.

Do the regional dogs. Coneys. Mexicans. Slaw dogs. New York red onion sauce. One of your fellow readers Esteban Guzman (Stevie’s Red Hot Weenies) is killing it in Texas with his Chicago Style Dogs.

3. Be creative. The hottest trend in the country right now is “street food”, which usually refers to non traditional or gourmet offerings served from street carts. Jump on this trend by offering gourmet hot dogs. Try unusual toppings like avocado and sour cream, cilantro and tomato, crumbled bacon and chopped dates (try it – it’s good!).

Biker Jim’s Hot Dogs in Denver is becoming famous for his specialty sausages like Alaskan Reindeer Sausage, Elk Jalapeno Cheddar Brats, Southwest Buffalo, and Wild Boar Sausage. He even has a caulking gun loaded with cream cheese.

To see how creativity can get you a ton of attention, just google Biker Jim’s Hot Dogs. He owns the first 40 or so search results!

If your health department won’t allow you do do anything more than basic condiments, at least use a premium bun and “kettle” chips to brand your business as a premium operation. It works.

Better yet, get hooked up with a commissary so you can serve more creative options.

The exception is fairs and festivals where you have thousands of people just looking for a quick meal. There you can get away with a plain Jane product but still don’t sell it cheap.

4. Deliver an experience. Have some music playing (not too loud). Decorate your cart. Have a theme on certain days like “Hawaiian Fridays”. Run a little contest every now and then.

5. Be friendly. Don’t be the grumpy lady who sits in a lawn chair by her cart reading Lavyrle Spencer novels until someone rudely interrupts her to buy a hot dog. Chat up your customers. Most of them spend 50 hours a week in a cube farm under fluorescent lighting with no one to talk to. Be the highlight of their day.

6. Be findable. It’s a new decade. If you don’t know how to use Twitter, make it a priority. It’s free. It’s easy. All the major street food dudes are using it.

For those who don’t know, Twitter is a “micro blogging” service. It’s like texting but you only get 140 characters to say what you want to say, and it goes out to all your “followers” at once.

In the old days you had to be in the same place every day so your regulars knew where to find you.

When you start using Twitter, it sets you free from being tied to one location because you can “tweet” out your location each day. Your “followers”, better known as customers, always know where to find you.

If one location isn’t performing that day, just pack up and move to a different spot and tweet it out. It’s not unusual to have customers waiting when you pull up.

There you go. A half dozen ways to rise above the competition without cutting prices.

Have the courage to be the best. It pays.

What do you think about this concept? Any more ideas? Let’s hear you in the comments!

-Steve

{ 56 comments… read them below or add one }

Jeff

Great read Steve,, Keep it up!

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tod

Steve, you are so right about pricing. I got a late start with my cart. I did my first event during the third weekend last September. I had only been out with my cart two other times that month, and sold 40 dogs each day for 3 bucks a piece. Chicago style dogs..Quality all the way too.
I teamed up with a local bar owner at the event, and set my cart up next to his bear trailer.(Doing this got me in the event right away, and with no event fee). The event was held in an upper class small city. The bar owner was selling beer for two bucks, and said we would make a killing if I sold my Chicago dogs for two bucks, too. I sold 150 dogs the first day. Hundreds of people passed by and turned their noses up at my 2 dollar dog. I actually heard one guy say to his family,”that’s just a 2 dollar hot dog. Can’t be anything special about that.” That hurt, but I learned that a low priced hot dog can make it suspect. I raised my price to 3 bucks at the beginning of the next day, and sold over twice as many dogs with a smaller crowd. I sold 580 dogs in all, and I will never lower my price again. I’m glad I learned this lesson right out of the gate!

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Paul A. Kaiser

Great post Steve!

Now to raise my prices and send out more “Tweets”!

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J. Gagion

During the current recession, that is currently being dragged into the new year by Obamanomics, it is very important that we deliver value to our Customers(clients). Delivering value is not a survival tactic but one that lends growth to your Food Cart business. The good decisions you make in bad times will be great decisions in good times. Do not wait for the bad times to make good decisions.
Steve makes good sense to keep your products at their current price point. If you are using quality meat-let your customers(clients) know-if you are using quality buns-Let your customer(clients) know. Next to your product you are the best advertisement for your product. It is your job pass that information on to your customer(clients) Clients is in parenthesis because I believe the term Customer implies a one time transaction. We all know how important our clients are. These repeat Clientele can help you deliver the concept of value to future clients. Take care of them and they will return the favor.

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david klinger

IM SORRY ILL ONLY CHARGE1.75@HOT DOG 2.25 FOR SMOKED SAUSAGE 3.00 FOR KNOCKWORST 3.50 FOR RED HOTSAND 4.75 FOR GYROS ON PITA AND IM GOING TO MAKE A KILLING

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steve

Hey David,

If you’re already making a killing – congratulations! That’s awesome.

Would you consider raising your prices for one week just as a test? Maybe you’re leaving a lot of money on the table and don’t even know it.

BTW, I totally respect you for posting an opposing opinion.

-Steve

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Don Freeman

Steve, The story goes like this. A customer walked into a propane company and asked how much they charged for a furnace cleaning. Seeing that it was summer and they were slow they replied $20. The customer asked if they could do it now. They replied yes. Cutomer asked if he could ride with the service man to his house. When they arived the customer paid the service man the $20 and said, “Don’t wory about cleaning my furnace.” Service man asked why he did not want his furnace cleaned. Customer replied, ” Cab fare out here is $25.”

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Rick Forness

Steve,
Your article was great.I bought one of those silly hot dog hats last year and it turned out to be a great idea, i soon had to buy two more as my customers especialy at larger events wanted pictures with the hot dog guy wearing one of the hats.This led to a face book page with many pictures and comments. We have even attended meetings not relating to the cart in other towns, where the subject of the hot dog guy with the hat and great 1/4lb hot dogs came up. You can also list events and specials ect to all your fans.

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russ ("Grateful Dawg")

I started this gig in April with a plump polish on a bun for #2.50 and the chili/cheese for $3. I soon made the price for ANY dog $3, as I didn’t want to mess with change (tax is included). Few and far between is the fool who passes me up, complaining about my prices. A few weeks ago this man paused to read the menu, and said well gee, he could get a whole package of dogs at the local store for 50 cents (I doubt this). I cheerfully encouraged him to do just that. “Bon soir, cher! Au revoir!” A minute later, he returned, and got the chili/cheese dog (I have beau coup free fresh condiments, all the best Cajun sauces, peppers, and spices appropriate for a dog). This crotchety sucker has since become a regular.

When people walk by and ask is it a “Lucky Dog” (the carts in the French Quarter), A Coney, a Chicago style, I always say, in the local patois, “Mais, cher, dis is a C******s Dawg”, using a local loving word for “Cajun”…that is not cool to say unless you are one!

The Frito Pie sells briskly at $3. No, I do not need to feel like I hafta compete with the dollar dog at Walmart!!

Am the only dog/BBQ vendor doing the annual Boucherie down in beautiful St. Martinville. February 13th, if y’all down for Mardi Gras (will be along the parade route for that too!!) Not for the squeamish or those intimidated by happy, drunk, dancing Cajuns!!

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famousray

steve the price makes alotta sence now tell me about the up sell 2 dogs soda and chip $?

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steve

Hey Famousray,

As in all things – test, test, test. Try different price points until you meet some resistance, then back it off a notch.

That’s the only true way to determine how high a price your local market will bear.

-Steve

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steve

Don,

That’s FUNNY.

LOL!!! Love it!

-Steve

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Michael

Well, I guess I need to go up because I get $3.00 for a hotdog, chip and 12 oz coke all name brand and $4.00 for a all beef sausage dog, chip and 12 oz coke, expect when I go to a fesival where everything goes up $1.00. I have been real happy with my profits at this point but I guess you need to understand I have no cost to spot my cart, no city fees and just health department and Serve Safe fees to pay. Maybe I will go up in the summer. Duggs Doggs “Good!! Good!!

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Hot Dog City

You also need to take in consideration what part of the country you are selling in. We are in a small city in the south. We cannot sell our products at the same price that you might sell for in NY City or Chicago. You can get cheap hot dogs around our area @ 2 for $1.50 at any of the Quick Stops. So we sell our basic dog at $1.50 each ($2 at special events) but we use top end products. We can buy these top end products locally at very reasonable prices. But if we where selling in a large city, we would have to charge more.

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Esteban Guzman

If you check out my webpage, you will see what I have my items priced at. I feel like I’m on the low end, but for now I can live with that. However, as soon as I start getting supplied with Vienna all beef franks, I’ll have to raise the price of the Chicago dog simply because I’ll be using a premium frank for my staple. As far as the other prices, I will keep them at where they are. No one has complained about my prices yet, in fact, I had someone comment that they would have expected to pay at least $5.oo for a chicago style hot dog, and thats with the franks I get from Sam’s Club! I’m excited about the future and what it holds in store for me and my hot dog business. I’ve already have folks trying to hire me for the 4th of July parties!

Thanks Steve, for mentioning me in the story, that was totally awesome reading it earlier today. Keep up all the good work, and lets all sell lots of hot dogs!

Esteban

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Francisco

Hey Guzman! what kind of franks you get from sam wholesale?

tenacity

Thanks Steve and all for the great article!! I am almost done with The Rte 66 Little Red Wagon!! Will be opening soon!! What do you think about a Southwest dog? (roasted corn, tomatoes, and green chilis?????) Can’t wait for the Big Foot movie to come out, you had better believe I’ll be taking advantage of that!!!

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Jim Lester

After figuring all the costs including meat, The bun,condiments propane, insurance. we sell our dawgs 2.50 sausages 3.00 and work on a 78% markup don’t see any reason to go up we are in a small town and sell between 55 and 100 dawgs a day during the winter and double or more when the tourists show at the diamond mine.
Jim and Kay ” The Great American Dawg wagon’

Jim and Kay “

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Mark

Thanks Steve! Just what I needed!

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RON

i like the storys every body had the prices an there location .hope to get started soon .thank steve i getting ready to build one of your carts .cant waite ron

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tony tysinger

steve i think you are doing it right could toy send me a photo when you are finish with it and how you put it together thanks alot if i need to pay you auy thing please le me know thanks tony

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John

As a semi-comparison look at what the burger, sub, and other fast foods are giving you for $5 or more, some dont even include a drink or side for that. Surely a fresh cooked quality beef dog with the trimmings, name brand drink and chips is worth $5 dont you think?

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Esteban Guzman

John, absolutely, especially if you offer top end hot dogs and fresh toppings, 5 dollars is very reasonable! I’ve changed up my prices a bit because I’m now offering Vienna beef franks for my chicago style hot dogs but its worth it. I still have the Bakers and Chefs franks for my other offerings, but I wanted Vienna for my chicago dogs to be truly authentic. I can tell you what, people down here in Central Texas who have never tried a chicago dog are truly raving about my hot dogs and I’m excited! I’ve also added more items to my menu without actually adding to my overhead. I’ve already had the food, I just decided to be a little more creative on how I serve it. Good luck to everyone, hope its a great year for everyone!

Esteban Guzman
Stevie’s Red Hot Wienies

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Boner Billy’s

Great read, thanks so much. As we continue to develop the best Hot Dog possible at Boner Billy’s Famous Hot Dogs we are always looking for great ideas to market, and provide the best for our customers. Thanks so much.

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Donnie Ward

I started selling dogs .25 cents more than my competition a block away. He was outselling me for the first three months. Eventually the word spread that my dogs were much better, now he complains to me that I am running him out of town. I also heard he complains to customers if they use too much ketchup. Be friendly, sell a good product, and make your money on quantity. I also have more condiments than anyone in town. Chili, Cheese, Sauerkraut, Stewed Onions, Raw onions, Relish, Hot sauce, ketchup, Mustard, Honey Mustard, and Spicy Brown Mustard. Oh yeah, i also have a styrofoam container for customers that want it to go. Costs more, but they keep coming back day after day. Happy Dogging

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Daryl at "The Blacktop Grill", Denver, CO

Maybe my prices could be a bit higher. I may try raising just 50¢. We’ll see. Good to hear what others in the biz are charging around the country. I sell only Vienna Beef brand dogs and toppings. I am considering a non-meat substitute for the vegetarians out there, but I would charge 50¢ more, or maybe even $1 more instead. Kinda hesitant about the veggie dogs, but I do rarely get someone who asks for these.

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mark

Hey Steve great post mate,
Im from the land down under and I charge $4.95 for a hot dog. I dont charge extra for extras and I go heavy on the condiments. I run a mobile food van cart set up so the guys pay for added conveniance when I come straight to their work place and set up.
Have had some managers complain and I’ll tell em straight up that these are the best hot dogs in perth, and if they want cheap hot dogs they can call the competiton, coz they sell they worst hot dogs in perth. I will NEVER lower my price…EVER!
GReat post

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Steve

Can you hear me clapping my hands, Mark? I’m whistling too! Right on mate, profit margins are everything to small businesses such as ours.
“these are the best hot dogs in perth, and if they want cheap hot dogs they can call the competiton, coz they sell they worst hot dogs in perth.” I LOVE that.

Christine

O.K. Hope im not asking a question already explained and I missed it but I asking anyways. I will be starting my HD cart in about two weeks and am UP and DOWN trying to decide if I should go full fledge top quality dog or a good quality dog to start. Im losing my mind!! I want to do a top quality dog but wondering if something like Bakers & Chefs Beef Franks will do til I get on my feet. I am not exactly rich to start off top quality like Nathens and Ill lose money because Im not even sure at the moment if my location will cover the expensive dog. Are Bakers & Chefs Beef Franks good enough to start? I have a killer homemade chili and will be using real shredded cheese. I also have a homemade slaw and other fresh ingredients.

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Steve

Any decent all beef hot dog will work. Stay away from the pork and turkey filled dogs. You will find that your location will support the brand name dogs as long as you give you customers a unique experience to go along with it. This business is more than just the food! Good luck Christine!

Christine

Thank you! I finally got a straight answer from someone ;} I was on road foods for a while in the professional hot dog part and all i got was people screaming how dare I not use a Nathens or some other expensive dog made me feel as if I was going to food poison someone lol! I eventually want to use the expensive brand but Im just starting new. I have never done this before so I don’t want to dig my self a hole til I get grounded. Im thinking of chefs and bakers for now with a good quality bun.

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Steve

That’ll work. We try to run a friendly joint here Christine – welcome aboard!

Christine

I just re read what i said…I don’t want to dig my self a hole til I get grounded” huh???? lol! THANK U

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Steve

No worries. What you encountered is a real problem, especially for newcomers to the industry. We try to create an atmosphere here at Hot Dog Profits where you don’t have to be afraid to ask even the simplest questions.

Christine

O.K….I tried Bakers and Cheifs from Sams Club and they were horrible! I bought the box of 80 and wished i hadn’t now. Maybe they will let me return them lol! Im back to square one again trying to find a good dog thats not going to break me. Maybe I should just buy the Nathens and just charge more. I just dont want to scare off customers with expensive hot dogs. What do you think? Also, I tried the Skyline chili and cant figure out what the fuss is..it tastes like pumpkin. Ill stick with my own chili recipe if the HD lets me do it. Still waiting on them to approve my menu. ;}

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Steve

Don’t sell your dogs too cheap. You’ll be out of business in a year. Sell a high quality product and don’t be afraid to charge for it.

Christine

Oh yes, the only reason I got Bakers and Chefs is because the great reviews. Typically I try a dog first but didn’t this time. Wont to that again, that was dumb lol!

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Christine

Mark from down under kinda helped me with my dilemma…Thanks Mark…I agree

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Christine

I never really had a chance to read through this whole blog and now realize most of what im worried about here the answers are.

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Steve

I’m glad you find it helpful Christine!
-Steve

Rocco L.

Hi Steve- I’m a teacher, and have been thinking about running a hot dog stand here in CT during the summer (mid June – mid Sept.)… I grew up in the restaurant business, so I know about food. Do you think I can make a go of it during the summer?

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Steve

I never promise specific income results because like any business, so much depends on you. But if you follow the training in my book “Carts of Cash” (you can get it in my Hot Dog Biz 101 package) you have an excellent chance. The proof is out there – there are so many folks making great money in the hot dog business. Why can’t one of them be you?

Let me know if I can answer any more questions!

blake

i think 1. 00 A DOG IS GOOD PROFIT WHY BE GREEDY

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Steve

If you’re happy then I’m happy. However think about this…

There are advantages to making more profit and it has nothing to do with greed. Not at all.

More profit means more money to reinvest in your business so you can expand and serve more customers who want your tasty food. This is a lot better than just scraping by, living hand to mouth, not being able to replace worn out equipment, not being able to buy quality food to serve your customers, and worst of all – denying folks access to your services because you don’t have the resources to reach them.

Think of dollars as “certificates of appreciation” that customers gladly give you in exchange for providing something that they enjoy. That’s what money really is.

We are not “taking” money away from people. People buy what you sell only if they feel they are receiving a greater value than the value of the currency they exchange for it. The customer makes that decision, not us. If the food and experience you offer isn’t worth what you are charging you will know it very quickly. The customer will take their “certificates of appreciation” elsewhere and happily give them to someone more worthy.

And most importantly, more profit puts more money in your pocket which allows you to help not only yourself, but others who are in need. There is an old saying, “It’s hard to help the poor when you’re one of them.”

Chris

I have been in the entertainment business for 20 plus years and have concluded that you are only worth as much as you charge. I have worked for clients that chose me because I charged considerably more than other entertainers.

If it cost a buck-fifty to build your dog and you sell it for a dollar… it’s only worth a dollar. On the other hand, if you sell it for 4.50, the customer will perceive a greater value in your quality product. Sales and pricing is ALL about perception. Like Steve has said… be unique!

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Justin

What about Bison Dogs? Anyone doing those? I live in Montana so it is readily available, and not too expensive. I can get a 1/4 lb Bison Brautwurst for $2.25 each and 1/5 lb. dogs for2.19/ea. Do you think these would cost too much if I sold the Brats at $4 and the dogs for about $3.25? I would also use a high quality but reasonably priced bun from our local big bakery (Wheat Montana).

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Steve

Your pricing is fine Justin. Sounds delicious! Send me some pics of those bad boys.

Ryan

I have a question on pricing. I have 4 festivals coming up. I charge $3 on my cart every day and that includes whatever toppings. Is that the price I should charge at a festival or should I raise my price?

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Steve

If you are going to see any of your regular customers there, don’t raise your price. If the festival is far away then raise prices two to three dollars.

James - MOE'S Hot Dogs

Steve,

I have a old school circus looking food truck. I sell Dogs, Chili, Fries, Soup, Chips, and Hot Chocolate at a Farm stand/Fall festival(Pumpkin patch,hay rides..etc) on Long Island. Just added the soup to the menu (New England Clam Chowder) and finding that it is expensive to produce. Not to mention the cost of soup cups, the ingredients (Clams,Scallops,Pancetta) are proving to be pricey, but the soup is very hearty!!. I was thinking about charging $3.50 which would yield about a 50% profit being that it cost roughly $1.50/Cup. Am I wasting my time. Should I increase the price? It is already the most expensive single item on the menu, can you see me getting $4.00 or $4.50 for a cup? This would be more like 65-70% profit which is roughly where I have set all my other prices.

thanks Steve

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Steve

The only way to know what the market will bear is to test it. Start out at $4.50 and see if it sells. You can always lower the price if it doesn’t move.

The really important criteria is whether the soup makes enough profit to be worth the effort. Calculate the cost of ingredients plus your time to prepare it at $25 an hour. This will give you your true cost of goods sold for that product. That is your break even point. Anything else is gravy.

Angela

oh wow, this is all great. I am starting a HD business and so excited. In reading some of the posting i see that we are just talking about the price for the HD. I will be using Nathans and Hebrew Nationals, with assorted buns. My question is that, i do want to add a soda and chips, but not sure as to, what to charge as a bundle. Recently, i was at flea a Market and the gentleman sold 2 hot dogs, a soda and chips for $5.50. Also, what do you think of the customer serving themselves with toppings. Should my specialty sauces sell for more. Thank You for your response….Oh i live in NC.

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Steve

Hi Angela,

Congrats on getting started in the hot dog biz! We shoot for a combined profit margin of 65 to 70 percent on all consumables. That includes dogs, chips, sodas, buns, condiments, etc.

The key to pricing is to not underprice your products. Come up with some unique menu items, serve them with a great presentation, and don’t be afraid to charge for it.

J

Angela, Where in NC are you?

MrBen

ok great blog, im looking to sell at my sons football games and i was wondering if since mainly high school students and parents will be there would a all beef frank be a good way to sell lots of dogs at a 1$ a piece.

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Steve

Not if you want to make any money. Sell an all beef frank with awesome condiments and a unique experience and you can charge $3 or more. Good luck!

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