Plan to open a hot dog cart business in 2024? This post share step-by-step guidance on how to start and make money from the venture. Unlike most information published online this advice comes straight from the experienced hot dog vendor Matt Gladfelter of Bow Ties and Hot Dogs. Gladfelter has been operating his hot dog cart more than five years, but got started as a part-time side hustle while employed as a restaurant manager.
In this post, Matt walks through the 7 steps needed to start a profitable hot dog stand. From startup costs, inventory and equipment needs, marketing, and even how much you can really expect to make running a hot dog cart business is outlined below.
How-To Start a Hot Dog Cart Business (Step by Step)
Step 1: How Much Does a Hot Dog Cart Make?
How Much Can a Hot Dog Cart Make?
– This is the big question. Can a hot dog cart actually generate enough revenue to support your lifestyle? It’s important to understand revenue potential of a business before you get started so you know if this is the right type of business for you. Gladfelter outlines his sales targets, aiming for $300 to $500 in daily revenue on weekdays. For weekends, he shifts focus to higher-value local events, setting his sights on making between $500 and $1,000 each day.
I’ve hear about restaurant businesses doing $50,000 in monthly sales and having massive days where they sell 750 hot dogs in a single day so the skies the limit in this industry.
Advantages and Disadvantages of This Business Model – As with any business model, there are pros and cons to operating this type of business. I want to be 100% transparent with you about so you know what you’re getting yourself into. Being your own boss in the hot dog business can result in long hours, trial and error, and hot or unpredictable weather that many and YouTube videos don’t tell you about.
Making a menu for your hot dog cart ain’t like painting the Sistine Chapel. You gotta remember: keep it simple, focus on what sells, and use quality ingredients. The goal is to create a menu you’re proud of, that’s easy to manage, and keeps customers coming back for more. Here’s how you do it.
- Determine Menu Items: You’re selling hot dogs, not five-course meals. Stick to classic dogs to start with. What usually performs well on hot dog menus? Chili Dogs. People go nuts for ’em. Chicago Dogs. A classic. Coney Island dogs. My personal favorite. These should be your bread and butter. Start with a focused menu of 4 or 5 popular hot dog options, but don’t go overboard.
- Premium Ingredients, But Not Too Many: Use quality ingredients, but don’t get too fancy. You’re looking for that sweet spot where cost meets quality. Premium beef, organic, or locally sourced sausages can set you apart. Better to have a few items that people will crave instead of a whole bunch of average folks can get anywhere. You want folks coming back for that one amazing dog they can’t get outta their head. If you’ve got too many options, you’ll slow down service and jack up your costs.
- Create the List of Suppliers and Products: Start by listing your go-to suppliers. This could be places like Costco for bulk buys – they’re good for getting your basics like hot dogs, buns, and condiments at a decent price. If you’re looking to differentiate yourself, maybe you’ve got a local butcher for top-notch sausages or a bakery for fresh buns. Don’t forget your produce – onions, relish, tomatoes, all that stuff. A local grocery store or a farmers’ market can be your best bet here.
- Use Specials for Experimentation: Wanna try something new? Roll out a special now and then. If it’s a hit, consider adding it to the menu. If it flops, no big deal.
- Feedback Is Gold: Listen to your customers. If they’re all asking for something specific, think about adding it. If something ain’t selling, ditch it. Sometimes sales speak louder than anything else. Keep track of your top selling hot dogs. Keep what works and drop the ideas that flop. Eventually, you’ll come up with a menu that people love.
Remember, the hot dog is a blank canvas so I understand if you want to go wild with unique flavors. But don’t go nuts right outta the gate! Start with some tried-and-true favorites and add more items slowly as you learn the business.
Step 3: Write a Hot Dog Cart Business Plan
You might think, “Why the heck does a hot dog cart need a business plan?” Well, it’s more than just fancy paperwork. In this audio lesson, Gladfelter shares the info he included in his business plan to scope out the competition and build a unique brand.
Here’s why this step is so important:
- Organizing Your Thoughts: When you’re slingin’ dogs, there’s a lot to juggle. A business plan helps you lay it all out. It’s like a roadmap for how you’re gonna run your cart, what you’ll sell, and where you’ll sell it.
- Suppliers, Ingredients, and Recipes: It’s smart to have all your supplier info in one place. Who gives you the best buns, the juiciest dogs, the crispiest onions? Write it down. What are your killer recipes? Get ’em in there. This way, you’re not scrambling to remember where you got what or how you made that special sauce everyone loves.
- Vending Route and Contacts: Your plan should outline where you’re selling. Got a sweet spot near the park on Tuesdays? A busy street corner on Fridays? Maybe rainy days are slow – so you come up with a plan for indoor locations. It’s all about being one step ahead. Include contact info for event organizers or anyone you need to coordinate with inside the document.
- Financial Planning: Let’s talk numbers. A business plan helps you keep track of your dough – what’s coming in, what’s going out. It’s key for figuring out if you’re making a profit or if you need to tweak your prices.
- Long-Term Vision and Goals: Where do you see this cart in five years? Maybe you want to expand, get a second cart, or even open a restaurant. Your business plan is where you dream big and set goals to get there.
- Troubleshooting and Strategy: Things don’t always go smooth. The plan helps you strategize. Maybe rainy days are slow – so you come up with a plan for indoor locations. It’s all about being one step ahead.
In short, a business plan for your hot dog cart ain’t just fluff. It’s the tool that keeps you organized, focused, and ready to tackle whatever comes your way. It’s about knowing your business inside and out and being prepared for growth and challenges. Keep it handy, keep it updated, and it’ll keep you on the path to success.
Step 4: Inventory Vending Supplies and Ingredients
Inventory Checklist Sample.
|Cost per Item
|Daily Bread Co.
|Total Inventory Cost
Hot Dog Stand: Basic Equipment
If you’re looking to set up a hot dog stand, here’s the no-frills equipment you’ll need to get started:
- Hot Dog Stand: Your main setup, where you’ll cook and sell your dogs.
- Grill or Hot Dog Steamer: To cook those franks just right.
- Fridge: Gotta keep the dogs and toppings fresh.
- Topping Stations: For all the fixings like mustard, ketchup, and relish.
- Bun Box and Warmer: Nobody likes a stale bun.
- A 3 Compartment Sink: Many health departments require a 3-compartment sink to meet food safety standards, making it essential for passing health inspections. A 3-compartment sink ensures that washing, rinsing, and sanitizing are done separately, preventing cross-contamination. I would try to get a cart with one of these sinks so you have greater flexibility on where you can vend legally even if it’s not a requirement in your city.
- Serving Tools: Tongs and such, for serving up the goods.
- Cooler for Drinks: If you’re selling sodas or water.
- Paper Goods: Plates, napkins, and forks for serving.
- Trash and Recycling Bins: Keep your spot tidy.
- Cleaning Stuff: Wipes, sanitizer, and more to keep things clean.
- Fire Extinguisher: Safety first, always.
- Cover like an Umbrella or Canopy: For shade and shelter.
- Signs: To show off your menu and prices.
- Point of Sale System and Cash Box: A point of sale system will allow you to accept payments from credit cards and track sales. You might also want to invest in a cash box if you accept a lot of cash payments.
And don’t forget, check with your local health department to make sure you’ve got everything covered and you’re all set to serve up some tasty dogs!
Step 5: Estimate Startup Costs & Equipment
On average, you can expect to spend between $4,500 – $28,600 to open a hot dog cart. Matt was able to start his business for under $5,000 by purchasing a used cart from a restaurant owner.
Click Here to View the Hot Dog Business Startup Cost Spreadsheet – This post breaks down all the startup costs associated with opening a hot dog cart from initial inventory to propane tanks, cooking equipment lists, smallware like tongs and spoons, the cart and even insurance.
How to Cut Startup Expenses in a Smart Way – Do you like spending more on things than you need to? How about flushing money down the toilet? Didn’t think so. In this post, we cover specific ways you can cut costs with a hot dog business and avoid food waste. After all, at the end of the day it’s not how much you make, but how much you get to keep that matters in business.
Step 6: Create a List of Vending Locations
Alright, let’s talk shop about picking the right spots to set up your hot dog cart. Location is everything in this business. You gotta be where the hungry folks are. Here are some prime spots:
- Bars and Nightlife Areas: This one’s a no-brainer. Set up near bars, especially on weekends. You’ve got a crowd of folks who’ve been drinking and are looking for something to soak up that booze. Hungry, a bit tipsy, they’ll gobble up hot dogs like there’s no tomorrow.
- Industrial Areas with Shift Workers: Factories or big warehouses can be goldmines. Lots of workers, often with limited food options nearby. Catch ’em on their lunch breaks or during shift changes.
- Farmer’s Markets: These places are great, especially if you’re using quality, local ingredients. People there appreciate good food. Plus, the regulars get to know and look forward to your stand.
- Private Parties and Catering: This is where you can make some good, steady money. Birthdays, graduations, family reunions – folks love having a hot dog cart for their guests. You can charge a flat fee or per hot dog, and you know exactly what to expect.
- Festivals, Sporting Events and Concerts: If you can get a spot near a stadium or concert venue, you’re in for a busy day. Just check the local regulations and permits you might need.
- Tourist Spots and Beaches: If you’re near a tourist area or a popular beach, especially during summer, you’re set. Tourists are always looking for a quick and easy bite.
- Business Districts: Set up near office buildings for the lunch rush. Office workers looking for a quick, tasty lunch will flock to you.
Remember, each spot has its own rules and regulations, so do your homework. And, don’t be afraid to mix it up. Try different locations on different days to see what works best for you.
Step 7: Get Permits, Licenses, Insurance and More
To run a hot dog cart or food truck, you gotta play by the rules and get your paperwork straight to legally operate this business. Here’s what you need:
- Business Entity: You’ll need to form a business entity to make the hot dog business official. Some vendors start out as a sole proprietor because they are easy and low-cost to get setup in most states. As an example, I could setup a sole proprietorship for only $25 in Idaho. But keep in mind that if a sole proprietor business incurs debt or faces a lawsuit, the owner’s personal assets (like savings, property, etc.) can be used to settle business debts and liabilities. Many owners
- EIN / Resale Number: The EIN (Employer Identification Number) is like a Social Security number for your business. You get it from the IRS, usually online, and it’s free. If you’re gonna collect sales tax (and most places you will), you’ll need a resale number too. This you get from your state’s department of revenue. I got an EIN number when I formed my LLC so this step is often a package deal when creating a business.
- Create Business Bank Account: The next step to setup a business bank account in the name of your newly formed business. This account will separate your personal expenses and income from the business. This bank account can be setup at almost any bank or a credit union. Before you setup a business bank account, make sure to find out what you’ll need to get an account setup. Most banks require you to bring your business documents, personal IDs like a drivers license, and have a minimum amount you need to deposit like $1,000 when the account setup. In my experience an account can be setup at no cost to you just like any other bank account.
- Business License: This is your ticket to legally sell. Each city or county has its own rules, so hit up your local government office or their website. They’ll tell you what you need to do to get licensed. Usually involves filling out some forms and paying a fee.
- Health Permit: Health departments don’t mess around, and you don’t want to either. This permit shows your cart is clean and safe. Again, rules vary by location, so check with your local health department. They’ll likely inspect your cart and you might have to take a food safety course.
- Commissary: Some cities will require you to operate out of a commissary at a hot dog cart. A commissary is a commercial kitchen that is used to prepare foods in advance of vending at a location. If this is a requirement, you will need to provide proof (a legal document) to demonstrate you operate out of a commissary. There are shared commissaries you can rent on a monthly basis, you could also operate out of a restaurant, church, or other facility with a commercial kitchen if you have access.
- Types of Insurance: Don’t skip on insurance. Shop around for quotes or ask other food vendors who they use in your area. InsureMyFood.com is a good resource for insurance in the food industry and can help guide you on everything you need and also tell you how much liability protection you should get. In most cities and states you’ll be required to get between $1 million and $2 million in general and liability protection. Many hot dog vendors pay between $300 – $600 per year in insurance as a ball-park figure.
Here are the basic forms an insurance you should consider and learn more about as a hot dog vendor:
- General Liability Insurance: This is the most basic form of insurance and covers a broad range of potential issues, including customer injuries (like slips and falls) or property damage that your business might cause to others.
- Product Liability Insurance: This type of insurance is particularly important for food businesses. It covers any illness or injury caused by the food you serve. If a customer claims food poisoning or a similar issue, product liability can cover the legal and medical costs.
- Commercial Auto Insurance: If you use a vehicle to tow the hot dog cart or for deliveries and other business-related activities, you’ll need commercial auto insurance. This covers any vehicle-related accidents or damages.
- Workers’ Compensation Insurance: You only need to worry about this if you have employees, most states will require you to carry workers’ compensation insurance, which covers medical costs and lost wages if an employee gets injured on the job.
To find this info, start with a good old Google search. Something like “how to start a hot dog cart in [Your City/State]” should do the trick. Check out your city or county’s official website, and the state’s department of health and department of revenue websites. If you live in a larger city like Los Angeles, all of this information might be clearly outlined for you on their website. And don’t be shy about calling up these offices either. They’re there to help, and sometimes talking to a real person is the quickest way to get the info you need.
Hot Dog Cart Manufacturer List and Reviews – Looking for a hot dog cart? Here we’ve listed all the major manufacturers from across the United States and Canada so you can see what your options are in terms of new carts.