How to Start a Candy Cart Business

A candy cart business is a business that sells candy from carts, and carts are designed to service areas where it might be difficult to quickly construct the convention shop; areas such as children’s outdoor parties, carnival sites, construction sites, sporting events centers, campgrounds, and beach et al.

The U.S. candy market is expected to reach a value of USD 19.6 billion by 2025, according to a new report by Grand View Research, Inc. So also, a report published by Fior Markets shows that the global candy market is expected to grow from $217.8 billion in 2020 to $290.7 billion by 2028, growing at a CAGR of 3.8 percent during the forecast period 2021 to 2028.

Steps on How to Start a Candy Cart Business

1. Conduct Market Research

If you are considering starting a candy cart business, you would need reliable market research to be able to maximize profits from the business. The first step in the market research process for your candy cart business should be to develop market-based research questions in line with your overall business goal and objective.

In this regard, you should source information that will help you maximize your business, help you operate your candy cart business with less stress, and of course, build the business to profitability.

a. Who is the Target Market for Candy Cart Business?

• Schools
• Facility managers
• Event Planners
• Tourists
• Everyone (kids) who resides in the location where you intend to sell your candies.

b. Is Candy Cart Business a Profitable Business?

Yes, the candy cart business is very profitable and the industry is projected to grow to $290.7 billion by 2028.

c. Are There Existing Niches in the Industry?

No, there are no existing niches when it comes to the candy cart business.

d. Who are the Major Competitors?

• McJak Candy Co LLC
• The Cotton Candy Co.
• Rainbow Cotton Candy
• Piedmont Candy Co
• Dandy Cotton Candy Co Inc.
• Cotton Candy Inc.
• Dillon Candy Company
• Hey Sugar Cotton Candy
• Warrell Corporation
• Lollipuff Gourmet Cotton Candy Catering
• Art of Sucre
• Spinning Wylde
• Nuage Cotton Candy
• Cloud Nine Cotton Candy Company
• Pandy Cotton Candy & Sweets
• The Jolly Sheep Cotton Candy
• Uranus Fudge Factory and General Store
• Puff Delights
• Natural Candy Store
• Fun Tyme Foods Inc.

e. Are There County or State Regulations or Zoning Laws for Candy Cart Business?

Yes, there are county or state regulations or zoning laws for the candy cart business. Towns, cities, and counties also have zoning restrictions, designating commercial and noncommercial zones. While you may be mobile, you can’t park just anywhere.

Most areas limit candy carts to specific locations. A list of where you can and can’t park should be available from the county clerk. You may also have to adhere to two-hour parking restrictions and pay for parking meters.

f. Is There a Franchise for Candy Cart Business?

Yes, there are franchise opportunities for the candy cart business, and here are some of them;

• Candy Connections
• Sugar Threads Gourmet Cotton Candy
• Pluffy Cotton Candy
• Fluffys Cotton Candy Creations
• Fuzziwig’s Candy Factory Inc.
• Candy Cloud Factory.

g. What Do You Need to Start a Candy Cart Business?

• A Feasibility Report
• Business and Marketing Plans
• Business Licenses and Permits
• Candy carts
• Insurance
• EIN (Employer Identification Number)/Federal Tax ID Number.
• A Corporate Bank Account
• Employees
• Candies and Packaging Materials

2. Choose a Memorable Business Name

When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.

Some of the catchy business name ideas suitable for a candy cart business are;

Creative Candy Cart Business Name ideas

• Kiddies Delight© Candy Cart, Inc.
• Party Time® Candy Cart, LLC
• Lucky Star© Candy Cart, Inc.
• Future Stars® Candy Cart Company, Inc.
• Sweet King™ Candy Cart Company, Inc.
• Bumble Bees™ Candy Cart Company, LLC.
• Kiddies Crest© Candy Cart Company, LLC
• Jason Andrews® Candy Cart Company, Inc.
• Star Serve© Candy Cart Company, Inc.
• One Child© Candy Cart Company, Inc.
• Leafy Green® Candy Cart Company, LLC
• Classic Brand® Candy Cart Company, LLC
• Seven Twenty™ Candy Cart Company, LLC
• Creamy Taste© Candy Cart Company, Inc.
• Sun Rise® Candy Cart Company, Inc.
• Fun Land™ Candy Cart Company, Inc.
• Lovelyn Mack™ Candy Cart Company, Inc.
• Lauren King© Candy Cart Company, Inc.
• Cat Boy® Candy Cart Company, LLC
• Doris James™ Candy Cart Company, Inc.

3. Register Your Business

a. What Type of Business Structure is Best for Candy Cart Business?

When it comes to the business structure of a candy cart business, the one that most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits. Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC

• Choose a Name for Your LLC.
• File Articles of Organization.
• Choose a registered agent.
• Decide on member vs. manager management.
• Create an LLC operating agreement.
• Comply with other tax and regulatory requirements.
• File annual reports.

c. What Type of License is Needed to Open a Candy Cart Business?

• General Business License
• Zonal Permits
• Signage Permit

d. What Type of Certification is Needed to start a Candy Cart Business?

You don’t need any certifications to start a candy cart business.

e. What Documents are Needed to Open a Candy Cart Business?

• DBA
• EIN
• Business and liability insurance
• Federal Tax Payer’s ID
• Certificate of Incorporation
• Food Handlers’ License
• Business License
• Business Plan
• Employment Agreement (offer letters)
• Operating Agreement for LLCs
• Insurance Policy
• Online Terms of Use
• Online Privacy Policy Document
• Contract Document
• Company Bylaws
• Memorandum of Understanding (MoU)

f. Do You Need a Trademark, Copyright, or Patent?

If you are considering starting a candy cart business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.

4. Cost Analysis and Budgeting

a. How Much Does It Cost to Start a Candy Cart Business?

A candy cart business will cost from $5,000 – $50,000 to start and that can easily go higher depending on your overall business goals and objectives.

b. What are the Costs Involved in Starting a Candy Cart Business?

• The total fee for registering the Business in the United States of America – $750.
• Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $1,300.
• Marketing promotion expenses for the grand opening for $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.
• Insurance (general liability, workers’ compensation, and property casualty) coverage at a total premium – $2,400.
• Operational cost for the first 3 months (salaries of employees, fueling of the candy carts, purchase of gas, payments of bills et al) – $10,000
• The cost for start-up inventory (different types of candies and packaging materials et al) – $5,000
• The cost of storage hardware (bins, rack, shelves, candy case) – $3,720
• The cost for store equipment (cash register, security, ventilation, signage) – $3,750
• The cost of purchase of a well–equipped mobile candy cart – $10,000
• The cost of launching a website – $600
• The cost for the opening party – $3,000
• Miscellaneous – $1,000

c. What Factors Determine the Cost of Opening a Candy Cart Business?

• The size of the candy cart business (number of candy carts you intend to start the business with)
• The required licenses and permits
• The cost for branding, promotion, and marketing of the candy cart business
• The cost of furnishing and equipping the candy cart business
• The cost of the insurance policy covers
• The cost of registering the business
• Cost of recruiting and training your staff
• The cost for the purchase and customizing of uniforms

d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

It is not compulsory to build a new facility for your candy cart business. This is so because the nature of the business makes it possible for you to get everything done on the go.

e. What are the Ongoing Expenses of a Candy Cart Business?

• Inventories (candy supplies)
• Gas
• Utility bills (internet subscriptions, phone bills, signage, and software renewal fees et al)
• Salaries of employees
• Cart maintenance
• Insurance
• Marketing costs

f. What is the Average Salary of your Staff?

• Chief Operating Officer (Owner) – $38,000 Per Year
• Manager – $30,000 Per Year
• Candy Cart Operators – $25,800 Per Year

g. How Do You Get Funding to Start a Candy Cart Business?

• Raising money from personal savings and sale of personal stocks and properties
• Raising money from investors and business partners
• Sell shares to interested investors
• Applying for a loan from your bank/banks
• Pitching your business idea and applying for business grants and seed funding from, the government, donor organizations, and angel investors
• Source for soft loans from your family members and friends.

5. Write a Business Plan

a. Executive Summary

Kiddies Crest™ Candy Cart Company, Inc. is a registered and licensed candy cart company that will be based in Brooklyn Park, Minnesota but operates all across major cities in Minnesota selling a wide range of candies at parks and children’s parties.

Kiddies Crest™ Candy Cart Company, Inc. has been able to secure all relevant licenses and permits to operate throughout the United States and Canada. We will ensure that we abide by the rules and regulations guiding the candy cart industry and we will only hire experienced and qualified cart operators.

b. Products and Service

• Hard candies
• Cotton candies
• Milk chocolates and caramels
• Dark chocolate
• Soft or creamy candies, like candy corn
• Chewing gum and gumballs
• Products from top candy production companies such as Almond Joy, Aplets & Cotlets, Big Hunk, Reese’s Pieces, Mounds, U-No Bar, and Ayds et al.

c. Mission Statement

Our mission is to build a candy cart business that will meet the needs of our customers in the regions/cities where our carts will cover and to sell franchises all across the United States of America and Canada.

Vision Statement

Our vision is to become one of the preferred choices when it comes to candy carts in Brooklyn Park, Minnesota.

d. Goals and Objectives

The goals and objectives of a candy cart business are to service areas where it might be difficult to quickly construct shops; areas such as carnival sites, sporting event centers, campgrounds, beaches et al.

e. Organizational Structure

• Chief Operating Officer (Owner)
• Manager
• Candy Cart Operators.

Marketing Plan

a. SWOT Analysis

Strength:

• Excellent operational history
• Superb menu list
• Experience and trained professionals.
• Well-equipped candy cart.
• Excellent customer testimonials.
• Reliable and efficient candy carts and service.

Weakness:

• The owner is new to large-scale marketing
• We will need a loan to purchase the latest candy carts and commercial candy-making equipment
• The owner is currently running the business solo
• Lack of economies of scale.

Opportunities:

• Growing outdoor activities targeted at children
• Build upon existing clientele
• Online market, new services, new technology, and of course the opening of new markets.
• An increase in the number of families who want to patronize candy carts.

Threat:

• Loans diminish profitability until they are paid off
• The first year will be financially tight while we gain customers and pay off loans
• Competition in the area could increase
• Management of employees requires time, money, and efforts
• The regulatory department could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses.

b. How Do Candy Cart Businesses Make Money?

Candy cart businesses make money by selling candies.

c. Payment Options

• Payment via bank transfer
• Payment with cash
• Payment via credit cards
• Payment via online bank transfer
• Payment via check
• Payment via mobile money transfer

d. Sales & Advertising Strategies

• Introduce your candy cart brand by sending introductory letters to schools, residents, park managers, and other stakeholders in and around the city you intend to cover.
• Engage in roadshows in targeted communities from time to time to sell your candies and promote your candy cart company
• Advertise your candy cart in community-based newspapers, local TV and radio stations
• List your business and products on yellow pages ads (local directories)
• Leverage the internet and mobile apps to promote your candy cart brands
• Engage in direct marketing and sales
• Deliberately brand your candy cart
• Encourage the use of word-of-mouth marketing (referrals)

Financial Projection

a. How Much Should You Charge for your Product/Service?

• Average concession price: $3.00 – $4.00 per bag.

b. How Much Profit Do Candy Cart Business Owners Make a Year?

It depends, but the available report shows that on average, a candy cart business should net more than $50,000 per year assuming they have steady clientele.

c. What Factors Determine the Amount of Profit to Be Made?

• The capacity of the candy cart business (number of candy carts owned)
• The location of the candy cart business is covering
• The management style of the candy cart business
• The business approach of the candy cart business
• The advertising and marketing strategies adopted by the candy cart business.
• The number of years the candy cart business is in business

d. What is the Profit Margin of a Candy Cart Business?

The profit margin of a candy cart business is not fixed. It could range from 25 percent to 55 percent.

e. What is the Sales Forecast?

Below is the sales forecast for a candy cart business. It is based on the location of the business and other factors as it relates to such startups in the United States;

• First Fiscal Year: $220,000
• Second Fiscal Year: $320,000
• Third Fiscal Year: $450,000

6. Set Up your Shop/Office

a. How Do You Choose a Perfect Location for Candy Cart Business?

• The demography of the location as it relates to children
• The demand for candies in the location
• The purchasing power of businesses and residents of the location
• Accessibility of the location
• The number of candy carts, and other candy retailers in the location
• The local laws and regulations in the community/state
• Traffic, parking and security et al

b. What State and City are Best to Open a Candy Cart Business?

• Phoenix, Arizona
• Fort Smith, Arkansas
• Lakewood, Colorado
• Columbus, Ohio
• Delaware City, Delaware
• Chicago, Illinois
• Boston, Massachusetts.
• Los Angeles, California
• Las Vegas, Nevada
• Atlanta, Georgia.

c. What Equipment is Needed to Operate a Candy Cart Business?

You should be prepared to purchase carts, candy cases, and boxes, candy-making machines et al. You will also need computers/laptops, an internet facility, a telephone, fax machine, and office furniture (chairs, tables, and shelves) amongst other and all these can be gotten as fairly used.

7. Hire Employees

When it comes to hiring employees for a standard candy cart business, you should make plans to hire a competent chief executive officer (you can occupy this position), manager, and candy cart operators.

8. Launch the Business Proper

In recent times, no candy cart business opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening party if you are operating on a low budget or you can go for a grand opening party.

The bottom line is that with a proper launching of the candy cart business, you will officially inform people in your city that your candy cart is open for business.

a. What Makes a Candy Cart Business Successful?

• Choose a good location, good menu, and reliable candy carts to launch the business
• Hire only competent, hardworking, and trustworthy staff
• Throw an open house grand party before officially opening the candy cart business
• Be deliberate with your marketing sales approach
• Encourage the use of word of mouth to promote your candy cart business
• Leverage all available online and offline platforms to promote your candy cart business

b. What Happens During a Typical Day at a Candy Cart Business?

• The business is open for the day’s work
• The carts are washed, cleaned, and ready for business
• Candies are arranged in the carts
• Customer requests are taken and they are attended to
• Schedule maintenance of carts is carried out
• Marketing/website upkeep
• Supply ordering
• Administrative duties
• The business is closed for the day.

c. What Skills and Experience Do You Need to Build a Candy Cart Business?

• Customer services skills
• Interpersonal skill
• Business management skills
• Work experience in a candy cart business
• Experience in managing people
• Experience in business administration
• Experience in handling relevant software.