Friday, August 20, 2010
Making a $1,000 from donuts
If you don’t think there is money in donuts you probably haven’t had your Tim Horton’s fix for the day yet. For those that don’t know what a Tim Horton’s fix is it is coffee and donuts at one of the Tim Horton’s donut shops that cross Canada and are coming into the United States. In Canada there are over 2,800 of these shops with an additional about 600 shops in the US. To be honest we haven’t had our Tim Horton’s fix lately because they haven’t moved into our neck-of-the-woods yet, and we miss our fix!
Some of the best donuts we have ever eaten were served off the coffee cart that used to come to our office in Manhattan every morning. These were donuts made by the coffee break man’s wife. He used to start with one hundred dozen of these donuts every morning and had none left most of the time when he went home. This was over 50 years ago and the price per donut has risen greatly over the years. At that time he charged 25¢ apiece for the donut’s. Not bad, he started with 1,200 donuts at 25¢ apiece meaning he grossed $300 a ay from the donuts alone or $1,500 a week. The cost of the donuts was less then $100 per day meaning a net profit of about $200 per day.
The secret of success in the donut business is not to scrimp on the ingredients. If you do this to increase the profit on your donuts the customers will go elsewhere in a hurry. There is a chain of donut shops that tried this tactic, they are not around anymore!
You can buy all the equipment required to fry donuts and make coffee at a restaurant supply store whether you are going to open a single store, a whole chain of stores or sell your donuts from a coffee cart.