Hi Steve,

I finally got a great spot for my cart, just waiting for the city permitting….should be done this week, I hope!

Anyway, I’ll be located at a Car stereo shop right on the busiest corner in our town with great access and parking for customers. The shop owner didn’t ask for rent he only wants me to sell at a discount to his employees….this is my dilemma!

The original spot I was going to set up at across the street was zoned wrong and the guy wanted $50 per month.

A dog, chips and soda sells for $3.00 with a cost of around $1.15….There are about 8 guys working at the shop and claim to be hot dog fanatics! I don’t want them to eat me out of house and home! I can easily see $50 in discounts within a couple of weeks if they eat frequently….Can you give me an idea of what employee discount I should extend to these guys without my profits being eaten up too!?

Thanks for all your wisdom Steve!

Sandy aka Sandy’s Hot Rod Dogs

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Hi Sandy,

You need a bit more profit margin and NOT just so you can afford the employees discount. Underpricing your product is the fastest way to go out of business. At the very least you will be miserable working your butt off for peanuts.

Even a convenience store hot dog (yuck) with a bag of chips and a soda will cost more than $3.

I sell my dogs for $3 each, $4 as a combo with chips and soda. That includes any condiment including chili or cheese. Make a menu of “signature” hot dogs with unique toppings and names. This is a great way to differentiate yourself from the gas station dogs and justify charging a bit more.

Look at it this way. At your current pricing you will keep $185 for every 100 hot dogs that you sell. If you charge $1 more than you currently do, you will keep  $285 for every 100 hot dogs that you sell, and a $1 employee discount is totally doable.

Would you rather make $185 or $285 for the same amount of work?

Don’t be afraid to charge for a quality product and a unique experience. You are worth it!

-Steve
HotDogProfits.com

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