Watching a show on the Food Network called Food Court Wars the winner gets a one year free lease worth $100,000. Most of the competitors are selling food items for around $9.99 each. Usually, the retail price charged represents the cost of the product multiplied by 3. So the gourmet grilled cheese sandwich costs the business roughly $3. That leaves $6 for everything else. The average daily foot traffic is around 100,000 in a big east coast mall. To sell to 1% of these people would be a miracle... But lets pretend that 100 people will buy your grilled cheese sandwich each and everyday. That represents $219,000 per year in gross profit. 4 full time employees will cost $100,000 per year. *This number does not include any health insurance or company withholding. So now we have $119,000 left for everything else. If you survive one year... The free lease becomes an actual lease. $100,000 is taken away. $19,000 is all that is left and the utilities still need to be paid. Sound worth it? Consider now that the State government made 6% (MD) on the sales tax... Thats $22K They made more than you and they never lifted a finger. You still have to maintain a vehicle and fill it with gas. Now imagine if you will, this company gets suckered into creating a Groupon or some other type of discount? This is why selling online is far superior to brick & mortar. Even with the additional costs of shipping. *Think
Posted on: Mon, 31 Mar 2014 08:28:20 +0000
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