Anyone who has been in business for a long time knows that the most important numbers are not gross profit, but profit margin. You are better off with $ 5,000 in sales and $ 4,000 in net profit than if you have $ 100,000 in sales, but only $ 3,000 in net profit. This difference is the profit margin, and the snow cone business has a great profit margin due to low overheads per product.
What is the math of profit margin?
The snow cone business has huge profit margins, and because of that, many people who buy shaved ice stands find that they can recoup their initial investment in less than a month … and sometimes much sooner! For any given snow cone, the overhead is very low. A paper cup can cost 5 cents each when purchased in bulk, napkins cost less than a penny each, while plastic spoons can cost a penny and a half each.
Even with the added syrup costs, the numbers still look great. Prices vary based on whether you make your syrup from concentrate or buy it pre-mixed, but even then, prices can range from 15 to 30 cents per snow cone maximum. Add all of that up, and even if you only charged a dollar for shaved ice and had no upsell, you’d still make a 65-70% profit. Very few companies can say that.
Imagine doing $ 200 worth of business in a few hours and knowing that three-quarters of it was going into your pocket, and that doesn’t include sales, if you can charge more than $ 1 for a snow cone, or if you find a good deal. on bulk purchases and save even more on costs.
There are also always ways to cut out the numbers. You can find good products to sell, find a good sale, and buy in bulk to further reduce overhead costs, or perhaps your location allows you to have higher prices. There are always ways to figure out how to make your business that much more profitable overall.
So how much can I pocket?
So what is the profit potential of a snow cone business? It depends on the sales figures you are seeing in your area, the foot traffic, and the prices you may charge. But the enormous potential of the business comes from the high profit margin. How much can you charge per snow cone?
Even if you can only charge $ 2 per snow cone, sell 100 an hour at a minor league game or 500 at a flea market, or even 1,000 during the day at a beach event and you’re seeing some really good days. especially when you are pocketing more than 60% of the money as net profit. There aren’t many companies you can count on that you’ll pocket hundreds or several hundred dollars in cash for just a few hours of work just one week after starting.
If you’re in an area where average income and prices allow you to charge even more, then that’s even better! Even if you are installed in an area known for low prices, the large profit margin that comes from selling snow cones means that you will have a really good few days. One of the best parts of the snow cone business is that it is in high demand during hot days, and the large number of sales with a high profit margin means that you will be very happy, especially since each payment is made in cash in cash.
There are many good old stories where a single shaved ice cart owner made more than $ 1,000 in profit. This is not an ordinary day, but ordinary days of $ 300, $ 400 or more are not unheard of for some snow cart owners.
Individual areas will offer different earning potential. If you are in an area that has a relatively low population and constant competition, then the ceiling will be lower than if you live near a city park that always sees a lot of people in the summer but has no competition. If the median income in your area is $ 20,000 a year, you probably won’t be able to charge as much as you could in an area where the median income is $ 60,000 a year.
With that said, there are always spare coins for a snow cone during the summer, and no matter where you live, profit margins make a well-run snow cone business a very profitable venture, and one that can generate a great deal of money. additional income, a high quality. second job, or if you live in a warm enough climate, maybe even a full-time life.