Thursday, September 1, 2016

Minnesota State Fair Concessionaires: An Easy Fortune?

Every year, I, like approximately 1.8 million others, put on my walking shoes and expandable
waistband shorts to attend the “Great Minnesota Get-Together.” And each year as I indulge in savory snacks, sweet treats, and exactly one vegetable, I hear several fairgoers comment on how they too could make a fortune at the fair if they just “put ________ on a stick” or “baked their famous _________ recipe.” And while someone may have a great idea for a new food item, as any successful State Fair concessionaire knows, running a successful booth requires more than a great idea.

Dazzled by the gross revenue of Sweet Martha’s Cookie Jar each year ($2,902,825 in 2014), fairgoers often ignore several other important numbers:

  • 247. As of 2015, there were 247 licensed food vendors who sold more than 500 food items. Turnover among these food vendors is very low, meaning that obtaining a license with the State Fair is very difficult. Several thousand proposals are rejected each year, and putting something on a stick and/or deep frying it does not guarantee that your proposal is accepted!
  • $50,000-$60,000. The median gross revenue for a booth is between $50,000-$60,000, which is far from what Sweet Martha’s pulls in. In fact, in 2014, the second highest grossing booth was almost $2 million behind Sweet Martha’s. According to the State Fair’s license administration manager, “It’s a good part-time job, puts the kids through college or maybe goes to (a vacation) or something. That’s what the money is for. Not very many make a living just doing the fair.”
  • 15%. For food and beverage concessions, concessionaries pay the State Fair 15% of gross revenue after any applicable taxes.
  • 7.125%. Most sales made at the State Fair are subject to a 7.125% sales tax. 
Other, less easily identifiable numbers include:

  • Expenses. Concessionaires also have the expenses of paying for staff, utilities, and food. Though some food stands can make do with a few workers, others, like Sweet Martha’s or the Corn Roast, require much more man power.
  • Ticket Times. Similar to a restaurant, where the amount of time between when a patron places her order and when she receives her order plays a role in the restaurant’s profitability, concessionaires must be able to produce their product quickly enough to fill orders without causing too much of a backup. When Sweet Martha’s first opened, about 200 cookies could be baked every 12 minutes. Now, about 24,000 cookies are produced every 12 minutes.   

Being a successful concessionaire at the State Fair requires more than having a great dish. It requires, among other things, an enticing product that is inexpensive to make, easy to consume, and capable of being produced in high quantities in a small amount of time.


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