How to Start a Popcorn Shop
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Popcorn can be your path to profitability when you open a popcorn shop. Popcorn appeals to men and women of all ages and socioeconomic backgrounds. Just go to your local movie theater and you'll see a large percentage of patrons munching on this puffed-up treat. Fifteen million quarts of popped corn are consumed annually in the United States according to Popcorn.org, a non-profit organization comprised of U.S. popcorn processors.
Scout out a location. Strip malls, stand-alone stores, shopping malls, and antique and craft malls are all potential places to open a popcorn shop. Shopping malls tend to have higher lease rates than strip malls, but the customer traffic can be greater.
Acquire a business license. Schedule the health department to inspect your shop if you make the popcorn onsite. Obtain a sales tax license from the state. Cities often require their own sales license as well. Check with the Internal Revenue Service to see if you need an Employer Identification Number. Acquire any zoning permits.
Create a menu. Produce flavors such as herbed, cheesy, spicy, and sweet. Mix your popcorn with other ingredients, such as nuts, dried fruits and candy-coated chocolates pieces. Price the popcorn so you make a profit. Restaurants usually mark up the ingredients of a dish by two to three times. For example, if the dish costs $2.50 to make, the retail price is between $5 to $7.50. Observe what your competitors sell their popcorn for and price your products accordingly.
List required equipment and supplies. Include commercial-strength popcorn poppers, ingredients and packaging. Outfit the popcorn shop with lighting, shelves and displays. Raw popcorn works well in the self-serve bins similar to what gourmet coffee beans are in. Candy is often kept in those types of bins, as well. The customer places a bag under the opening of the bin and pushes back a lever. That releases the popcorn into the bag.
Develop a budget that includes all the equipment, ingredients, furniture and fixtures. Include lease payments and deposits. Hire employees to staff the shop when you're not there.
Set up accounts with vendors. Keep in mind the quality and minimum purchase requirements as well as the cost. Remember that popcorn goes stale and that raw popcorn can absorb moisture from the air and not pop reliably. Don't work with a vendor who requires minimum purchases of 100-pound bags because the popcorn could go bad before you use it.
Secure a payment method. Apply for a merchant account, which allows you to accept credit and debit cards directly from customers. Fees are charged on a monthly basis and per transaction. Third-party processors include Paypal and SquareUp, both of which can be used with a smart phone to process credit cards. Third-party processor fees can be equivalent to merchant account fees or higher.
Create a marketing plan. Announce the shop opening with large banners on your storefront. Set up a website and social media accounts. Schedule events that bring in children and their parents, such as making crafts using popcorn. Sponsor a charity event to increase the visibility of your shop. Give away a small bag of popcorn to customers for their donations.
Brightly colored packaging gives your popcorn pizzazz.
Popcorn is quite aromatic, so check with your city for any ordinances or restrictions on smells that reach outside the store.
- Brightly colored packaging gives your popcorn pizzazz.
- Popcorn produces odors when popping. The city may have ordinances or restrictions on odors that reach outside the store.
Brian Hill is the author of four popular business and finance books: "The Making of a Bestseller," "Inside Secrets to Venture Capital," "Attracting Capital from Angels" and his latest book, published in 2013, "The Pocket Small Business Owner's Guide to Business Plans."