Deal Making on Slices

OK - I’m back for more advice on making deals…

We have a local dragstrip/raceway that has a small concession - they don’t sell pizza and invited us out for opening day. It was a fundraising for Victory Junction (disabled kids summer camp) and we donated 50% of the days sales. It was a horrible day - 32 degrees, windy and miserable. We stayed 12 hours and only about broke even (maybe a little loss) by the time we paid our employees and covered food cost after the donation.

So, we want to make a deal to be there every week. They said OK but wanted to wait about 6 week so they could do some stuff to increase attendance as it’s not at the level they want. They also want 50% of all sales. I countered with an offer to create boxtoppers and post their schedule on our website (we have a "things to do around town general calendar).

So, my question is…if we do what we can to increase their attendance, what would be a fair % of the sales? I just think 50% is too high. We’re doing 16" 8 cut for $2 per slice.

As a side note, we did somthing similar with an airport shuttle service that was getting ready to go under…he passed out our menus and we boxtopped like crazy for him - end result, he’s doing great and really seeing response from “I saw an ad on a pizza box”.

hey dog

we sell pizza for $5 to schools and churches for concession position the pepp for a 6 slice cut they sell them for $1.50 a slice they clear $4 only order what they can sell no one loses

Man. I know I wouldn’t make that deal. I word my @ss off so that he can take a 50% off the top and leave me maybe 5% to 15% return . . . and the better I do, the more he clocks me. I think that you could do much better. In return for marketing his business, and making his business more attractive by having quality food vendor, I’d offer either a fixed rental rate . . . or a base rate plus either 10% gross or 20% net after COGS. Something closer to that. Don’t know the traffic or sales volume, so hard to give a dollar amount or even be very confident of the percentages I suggested. Get an exclusive or restricted number of food vendors contract if you get hosed with a high rate.

Maybe someone out there like Otis can tell us some wisdom on this. I know concession rates are gonna be high, but they gotta offer some assurance of attendance and traffic somehow.

The local Little League is doing a fundraiser with a Texas Hold’em Tournament. They have slots for up to 200 people. I expect about 150 to actually attend the event. I approached them about providing food, and they wanted to know how much of a cut they would get. I offered 35% on all sales over $250.00. I explained that the first $250 would pay my expenses and time to setup the booth, and keep it staffed for 6 hours.

Hey Bud
Why not you become their preffered food vendor and supply pizza that they can sell by their concession employees. Doing this will save you time, labor and money. Sell them Large pizza for say $ 5.00 and tell them to sale it for $ 1.99 a slice. they win and you win…

Also tell them if they go this route than you will help them by doing box toppers see if they can share printing cost with you…on one side of box topper your menu and on other side their event, give them your success story about shuttle business that worked with you on this promotion. Ask them if they can do same thing for you to put your menu on other side of their entry ticket… its like you scratch my back, i will scratch your back senario.

They can also place their up coming events on your front glass as pop in 3 to 4 weeks in advance so people can start knowing by seeing on your store.

Dont spend any money from your pocket, they can help you in your cost. that is the true savings that will help you on bottom line.

Thanks, Take care, good luck
Jayp

That isn’t what they were looking for. They wanted to have someone come in and set things up and run it for them. I appreciate the idea though. We have done that for their regular concession stand business.

Hello,at that price per slice and it is for a charity I think you can do 35-40% and still walk w/ a small profit.Depending on how many employees.

                              Niccademo

Sorry I got busy and couldn’t jump back in on this.

They are offering us our own consession there - our tent, banner and 20’ blow up. We can do 16" 8-cut for $2 per slice = $16 per pizza. If we do a 50%, they get $8/pizza and so do we. But…we’re staffing the concession for 6 hours and taking on the printing cost of the boxtoppers for advertising.

We pay $6.15/ per hour x 2 employees = $12.30 per hour at 6 hours = $73.80. I don’t know what sales to expect - the day that was 32 degrees we sold 125 slices so assuming we have a nice day and we increase 50%, that’s 188 slices. If we get $1 per slice (our 50%), we have $188 less $73.80 payroll, our gross profit is $115. Assuming $2.50 food cost per 1 topping 16" pie, at 188 slices, that’s 16 pies or $32 food cost.

So, our grand total profit would be $83 - just doesn’t seem like much.

If we’re providing the printing, advertising on our website, the tent, the staff, and the food - should they really get 50%? I was thinking more like 25% or a fixed “rental cost” for the ground space we’re taking up.

I do something similiar to a race track in town. The deal I made the owner was I deducted the cost of my 17" pizza, labor and then we split everything 50/50.
So…For each pizza sold, I automatically received my $4. for the pizza, I then deducted the cost of labor and then he received half of the profits not the sale.
Just Food for thought

Tell them no problem but they have to cover 50% of the expenses.