How to Start Your Own Recession-Proof, Low Cost, High Profit Snow Cone Business.
Snow cones have been around a long time. When I was a kid my town didn’t have a snow cone stand but when the fair would come each year there was always a concession stand there that sold them. We kids would line up to get one!
Snow cones are an inexpensive treat never goes out of style. Every generation of kids seems to like them. And it’s not only kids in the US that have a taste for snow cones, other kids around the world do too. Being married to a Filipina I’ve been to the Philippines many times and kids like them there just as much as kids here in the US do.
And not just kids that like them, almost everyone does, young and old alike. Your customer market includes just about everybody! Besides selling a product with a high demand and doing it from a low-cost startup, there’s another perk that goes along with selling snow cones, especially for people running a snow cone stand in their retirement years.
What is it? Well, when you operate a snow cone stand, at least in the US, you only operate it 8 months out of the year. During the cooler months of the year the market for snow cones also cools off. Not to worry though, when the weather starts heating up again, so does the market for snow cones. How nice!
How Much Does it Cost to Start a Snow Cone Stand Business?
Start-up costs for a snow cone business is low compared to many other types of businesses.
Still costs can range from several thousand dollars to $20 or $30 thousand depending on the types of equipment you purchase, how elaborate the stand is you choose to start with, and the cost of the location you set up at.
It is quite probable that you can purchase the best snow cone making equipment, build your own stand, rent or lease the location you set up at, buy the other necessary equipment and items you’ll need, and get started for $6 to $8 thousand dollars.
Of course these figures are variable. You can buy used equipment if you can find it and get started for $4 to $6 thousand dollars, or you can buy everything new including a ready-made mobile snow cone stand and spend quite a bit more. It’s up to you.
How Much Money can a Snow Cone Stand Make.
Whether you start a snow cone stand on the inexpensive side (though still attractive and presentable), or you spend more money, if you sell a quality product in a good location it can pay for itself in one selling season, possibly by several times.
It is possible to make that much because the markup on snow cones is so high. A large snow cone that you sell for $3 may only cost you $.30 cents.
Consider for example that you have 100 customers a day buying that large $3 snow cone. Your gross income would be $300 and your costs would $30. That’s a 1000% markup and a $270 gross net profit.
Imagine having 200 customers. You still have to deduct your rent/lease, electricity, water bill, etc., but you can easily see that the income potential is very attractive relative to the investment.
How much you make in a snow cone business really depends on 3 things;
- That your product is reasonably priced, served with generous helpings, and is made with the best quality snow cone ice and syrup.
- That you have a high traffic easily accessed/ exited location to do business.
- And that you serve your customers quickly with a friendly attitude and a smiling face.
Do those 3 things and you’ll likely enjoy a booming enterprise, repeat business, and positive word-of-mouth advertising for many years!
Find out About Business Licenses and Permits You May Need for Your Snow Cone Stand
Visit your county and city government offices and find out what permits you’ll need to get your business started. Pay particular attention to whether they allow portable or mobile structures inside the county or city limits if that’s how to plan to set up.
Also check with your local health department for permits and regulations you may need and be subject to. Usually since you’re not cooking and have little if any perishable food, regulations for a snow cone operation are generally not so expensive to comply with.
After you’ve determined that you can obtain and comply with all the local government requires of you, you can register a business name with the county clerk’s office. This secures your exclusive use of that name in your county and you also may need that registration to open a business banking account.
You’ll also need a sales tax permit to operate your business. Usually for that you’ll have to visit your states local Comptroller’s office. You can use this permit to avoid paying sales tax on the equipment and supplies you purchase and you can wait on getting this permit until you’re ready to do that.
Research Information About the Snow Cone Stand Competition in Your Area
Find out how many other snow cone stands are operating in or near the general area you plan to put your stand. Ideally, you’ll be the only one in at least a ten square mile area.
However, even if there are not any other stands you’ll be directly competing with, you should still look for some stands you can visit to do some research.
Visit those stands during business hours and research the following things:
- How much business are they doing?
- What are their business hours of operation?
- How long have they been in business? If for a long time try to figure out why.
- Do they have a good reputation
- Are they owner operated or do employees operate them.
- How easy or hard is it to access and leave their business?
- What kind of structure are they operating in, is it permanent or portable?
- In your opinion are they in a good location?
- Sample their product. See which ones you like best and why. Take your family with you so everyone can sample their products.
- Is their snow cone ice very fine and fluffy or the more coarse variety? What brand of equipment are they using?
- What flavors do they offer and try to find out where they get their syrup.
All of this information and knowledge will help you when further researching, setting up, buying equipment and supplies, and starting your own stand.
How to Locate a Good Location for Your Snow Cone Stand
My advice is to look for a good permanent location. Portable or mobile stands used with the intent to move around to various events can be quite profitable, but in my opinion they are a poor substitute for a snow cone stand in a good permanent location that becomes a fixture in the local community, but the choice is yours.
Look for a spot where there is a lot of slow-moving traffic in an area where there is a high concentration of kids and young people. Also try to find a spot about which you can answer yes to the following questions:
- Is there plenty of parking and is it easily accessed and exited?
- Is there a place to set up tables?
- Can the location be purchased inexpensively? Short of that, can the spot be inexpensively rented or leased?
- Is water and electricity available?
- Is the area clean and safe?
Another consideration is whether the spot will allow you space to have a drive-through window. A drive through is not absolutely necessary, but where one gives customers a very easily accessed and exited convenience, it will add to your business.
The last important consideration is competition. Ideally you want to be the only snow cone stand for miles around. However, if you can locate your snow cone stand near a school for example, it may not matter much that there are other stands even a mile or two away, especially, if you do a better job in customer service, satisfaction, and convenience.
Locating and Purchasing Snow Cone Making Machines, Equipment, and Supplies
After you’ve decided where you’ll place your snow cone stand and have secured the location, it’s time to start buying the machines and equipment you’ll need.
As you start investigating snow cone making machines you’ll find that they are not all created the same. Some machines make ice that is of a course or grainy texture and they are generally less expensive. Other machines make a finer, fluffy ice and they are generally more expensive.
While different types of ice are good for different things, for snow cones you’ll probably find that people mostly prefer the finer, fluffy ice and I recommend that you purchase that type machine.
Don’t pinch pennies in this area; buy the best snow cone ice shaver available for snow cones. You don’t want to be providing a grainy ice and competing against other stands providing ice that more people prefer.
Even if you’re not competing against stands in your immediate area, you don’t want customers less than happy with you product. That will generate less than purely positive word-of-mouth-advertising in the neighborhood and possibly on Facebook about your stand, and that’s bad.
Research the internet for snow cone making machines and for reviews of the machines you find available. Gather as much information as you can. Here are some links to some snow cone equipment suppliers. Call them and talk about your plans but do your own research first:
When it comes to choosing which syrup flavors to choose, the suppliers listed above can be a big help. They know what people like and what sells the best. Still, one syrup supplied by one company may not be as good tasting as another. The research you did visiting snow cone stands will benefit you very much here.
You may find some additional suppliers.
Some other things you’ll need include:
- A freezer to store your ice,
- A supplier of ice, or equipment to make your own,
- A good blender for smoothies if you want to sell those,
- A refrigerator for perishable add-ons like berries, or things that melt like candy,
- Cups, lids, and napkins,
- Storage Space outside your stand if necessary,
- Weather-proof tables and large umbrellas if you want to provide them,
- An accounting system,
- A cash register,
- And a safe to lock up your money.
How to Get and Keep Customers for your Snow Cone Business
In a good location snow cones sell themselves but there are still things you can do to increase your business. Here are a few suggestions:
Make your snow cone stand attractive, and keep it and yourself clean. Given a choice people will buy from a clean-looking, well maintained establishment. They will also prefer people serving them to have a clean, professional appearance.
Make some T-Shirts with your snow cone stands name printed on them, keep your hair clean and combed, your finger nails trimmed and clean, and do other common sense things to project a good first-impression to every customer.
Always remember to never let your customers see or hear you without a smiling face and a friendly, helpful attitude.
Maximize positive word of mouth advertising. Make it work for you by satisfying every customer. Do that by;
- Giving people a lot of choices, the more flavors you have the better,
- Keeping your prices reasonable,
- And giving generous helpings of your snow cones.
Strive to make your snow cone stand become a part of the local community and you’ll have a profitable business for many years.
Build a website and promote your business on Facebook and Twitter. Facebook is a fantastic help for your business if you utilize it properly. Get as many friends as you can and occasionally use it to announce specials, new products, or new flavors etc.
Lastly, have a “set hours of operation” and keep to it. Don’t break a kids heart by being closed after having got so excited anticipating a fresh cold snow cone!
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