How to Open a Concession Stand in 7 Steps
1. Create Your Concept
To nail down your concession stand idea, ask yourself these questions:
- What kind of food will you sell? This determines the amount of space and type of equipment you need. Selling pre-packaged snacks involves less room than baking your own scones, for example.
- Who are your target customers? Consider amusement park attendees, sports fans, students on campus, etc.
- Where will you set up your stand? Your target customers will determine where you sell. If your primary customer is a student, you could sell on college campuses or at collegiate sporting events.
- What sets you apart from competitors? Knowing your competition is critical to setting yourself apart from them, either by price, quality, selection, or some other special factor.
2. Make Your Concession Stand Business Plan
45% of businesses fail in their first five years, often because of poor planning. Developing a proper business plan is a lot of work, but setting tangible goals and keeping your business on track is worth it.
Plus, it’s an absolute necessity if you need to secure a loan or funding from investors.
A solid business plan should include these sections:
- Executive summary: A brief, exciting description of your business that grabs the attention of potential investors. Include what you sell, how you sell it, and your mission statement.
- Company description: This is a robust version of your executive summary. Include information about your branding, your sample menu and pricing, and the legal structure of your business (sole proprietorship, limited liability company, etc.).
- Market analysis: Identify your target market and your competitors and explain why you are choosing to operate your stand in a particular area (even if it’s mobile).
- Marketing strategy: This section covers everything from your online presence to traditional marketing efforts, including how you plan to promote your concession stand to attract new customers.
- Loans and financing: Include a breakdown of your funding sources — what you have already acquired, how much you still need, how you plan to spend what you receive (if presenting this plan to a bank or investors), etc.
- Operation costs and financial projections: Inventory, ingredients, equipment, licenses, and other expenses make up your standard operating costs. Be sure to include your financial projections in this section (where you see your revenue in one year, two years, etc.).
- Certificate of Insurance (COI): Always include a copy of your COI in your business plan to show investors, loan officers, or potential business partners that you operate an insured concession stand.
3. Secure Funding
Many concession stand owners rely on several funding sources, including their own savings, to get their operations up and running.
Some ways you can fund your stand include:
- Loans: The U.S. Small Business Administration (SBA) issues microloans up to $50,000 — enough for most concession stands. Use the money from this loan to cover inventory, equipment, supplies, and other costs.
- Crowdfunding: Sites like Kickstarter and GoFundMe are popular for entrepreneurs to source funding. Incentivize your friends, loved ones, and community to donate by offering perks like discounts or free merch.
- Investors: Once you’ve written your business plan, use it to pitch your concession stand idea to potential investors who can provide funding in exchange for a portion of your profits.
- Grants: While competitive and harder to acquire than loans, grants are fantastic because you never have to pay them back. Search and apply for some on Grants.gov and Hello Alice.
4. Buy Your Stand
To choose the right concession stand, determine how mobile you need to be and how much space you need to store, prepare food and beverages, and/or cook.
There are three main types of concession stands:
- Stationary concession stand: Small stands permanently fixed to one location; best if selling one item or prepackaged items ($3,000–$10,000)
- Mobile concession stand: Small, mobile stands that often have holding units for food prepared at a separate location ($3,000–$8,000)
- Concession trailer: Larger, mobile stands with space for a small kitchen and cooking equipment; often powered by generators or gas ($13,000—$68,000)
5. Get Your Gear
While the exact type of equipment you use depends on what kind of food you sell, here are a few items every concession stand needs:
- Point of sale (POS) system (a means of processing transactions and tracking inventory, such as Square)
- Serving supplies like napkins, straws, paper trays, etc.
- Menu board to display your current offerings and specials
- Personal protective equipment (PPE), such as disposable gloves, hair nets, etc.
- Trash and recycling bins in close proximity to keep your area clean and safe
- A power source, such as generators, gas, etc.
- Shelving racks and/or storage bins, depending on the amount of space in your stand
If you plan to make food or hold prepared food inside your stand, there are other types of equipment you may need to invest in:
- Food holding and warming equipment
- Microwave
- Grill/griddle
- Ventless fryer
- Burner/stovetop
- Oven
- Refrigerator
- Freezer
6. Acquire Necessary Permits, Licenses, and Insurance
Food or beverage businesses must meet licensing requirements to legally operate, and concession stands are no exception.
While every city has its own set of regulations, expect to need the following:
- Business license: Many cities, counties, and states require this license allowing you to operate within that area.
- Employer identification number (EIN): This is issued by the IRS and used for tax purposes.
- Mobile food vendor permit: Cities and counties often require mobile food units to carry a specific permit that allows them to operate in more than one location. If you plan on opening a mobile concession stand, check with your local government to see if you need this.
- Sales tax permit: This allows you to collect and remit sales tax on your goods.
- Health department permit: Issued by the health department after your concession stand passes a health inspection.
- Fire department permit: Following an inspection from your local Fire Marshal, you may receive a fire department permit confirming your business adheres to fire safety protocol.
- Food handler’s permit: Most states require anyone who prepares, cooks, sells, or handles food to have a food handler’s permit. Check with your local health department to learn which food handler programs are recognized in your state.
- General liability insurance: Many venues and events will not allow you to vend if you are uninsured. This type of coverage is designed to cover the cost of common claims, such as food poisoning and third-party property damage that can cost you thousands of dollars out of pocket without insurance.
Pro Tip: You can get concessions insurance for just $25.92 from Food Liability Insurance Program (FLIP)! Protect your business and get the financial safeguard you need to run your stand with confidence.
7. Find Events and Venues to Set Up Shop
Before you set up shop and start prepping for hungry customers, scope out events and venues for your grand opening:
- Search event directories like FestivalNet or FLIP’s top U.S. food festivals directory
- Check your local Chamber of Commerce’s website for details on upcoming events
- Join Facebook groups for professionals in your industry, like the National Association of Concessionaires and check pages for events in your area
- Reach out to youth sports leagues or high school/college athletic departments to see if they are accepting applications
- Visit county and state fair websites to apply for a concession stand spot
- Partner with local businesses, such as breweries, wineries, and retail stores that want a concession stand operating on-premises during a promotional event
Concession Stand Ideas for Success
Set Your Prices the Smart Way
It’s tempting to look at how much competitors charge for what you’re selling and match their prices or undercut them, but don’t fall into this trap! You need a strong pricing strategy to ensure a profitable stand.
While understanding what your competitors charge is essential, it’s not the only factor to consider. The cost of your ingredients, your operating costs, and your desired profit margins are equally crucial. Remember, your competitors have different expenses and margins than you, which affects how they price their goods.
Offer Stellar Customer Service
Customer service is critical to your concession stand’s success. In fact, 89% of people are more likely to make another purchase after experiencing exceptional customer service.
Make a lasting positive impression on customers with these strategies:
- Be efficient and keep your line moving quickly to reduce wait times
- Greet customers with a smile and make small talk when time allows
- Keep your stand and the area around it neat and tidy
- Include allergen information on your menus and signage
- Issue refunds or offer replacements when necessary
Promote Your Concession Stand on Social Media
Social media is an effective way to promote your concession stand business, and the best part is you can do it for free!
After making a business profile on Facebook and Instagram (note: you can link the two accounts since both platforms are owned by Meta), spread the word about your stand:
- Share daily updates about your stand via Stories, such as behind-the-scenes setup or food prep content and news about which events you’re attending
- Create polls in your Stories and in the comments of your posts to gauge customer interest in new flavors, menu offerings, etc.
- Encourage customers to take pictures of their food and tag you so you can repost them
Want more secrets to success? Check out our guide to running a successful food business and get tried-and-true tips to grow your concession stand!
FAQs About Running a Successful Concession Stand
What Is the Average Profit Margin for a Concession Stand?
Concession stands have an average profit margin range of 5–20%, but this varies widely depending on the type of food you sell.
For example, hot dogs have an average profit margin of 73%, making them one of the most profitable concession stand menu items. Other items with higher margins include popcorn, cotton candy, and bottled water.
What Are Common Challenges in Running a Concession Stand?
- Complying with local health and safety regulations
- Limited space for equipment, appliances, and food storage
- Handling high-volume periods with a small team
- Navigating fluctuating supply and ingredient costs
- Limiting food waste/spoiled food by properly balancing supply with demand
- Competing with other concession stands and food vendors at the same event/venue
- Serving food quickly and efficiently without sacrificing quality
Alex Hastings
Seattle-based copywriter and (WA) licensed insurance agent Alex Hastings leverages her experience as a lover of fast-casual food, baked goods, and iced oat milk lattes. She holds a B.A. in Creative Writing from Western Washington University. Before working at Veracity, she was a retail copywriter at Zulily and an English language teacher in South Korea. Alex is fully trained on FLIP insurance coverages and writes content that connects food and beverage business owners with the policies they need.
Seattle-based copywriter and (WA) licensed insurance agent Alex Hastings leverages her experience as a lover of fast-casual food, baked goods, and iced oat milk lattes. She holds a B.A. in Creative Writing from Western Washington University. Before working at Veracity, she was a retail copywriter at Zulily and an English language teacher in South Korea. Alex is fully trained on FLIP insurance coverages and writes content that connects food and beverage business owners with the policies they need.
