What I like about the donut business? Donuts are cheap to make. They’re the second
most profitable food item in the nation, behind only to the potato and the average cost to make and finish a donut
is approximately 12 cents.
Donut shops have the potential to be very profitable. Unlike restaurants, where it’s
difficult to sell in bulk, wholesale, or to diversify product, most all donut shops sell coffee, espresso, and
other baked goods for bigger profits. Products that go together, grow together—donut shop owners can implement a
deli line, soups, sweet rolls, croissants, muffins and acquire donut wholesale accounts relatively easy for donuts
sell themselves, (Who doesn’t like a hot, fresh donut?).
A donut business doesn’t have to be complex – it can be as simple as selling
specialty donuts at local events. (I personally enjoy selling donuts at gold prospector events – those folks love
their donuts!) You may have other, better ideas that are best for you, such as operating a concessions van on the
weekends, selling only mini-donuts utilizing a donut making machine. However you decide to approach the donut
business, it’s a great way to supplement your income or create a new business from scratch.
Once a donut shop is up and running, shop owners can economically open a satellite
location, commonly known as a “cold spot,” where you or a driver delivers the finished donuts, sweet rolls, etc. A
cold spot can be operating within a few weeks, carry all the products of your primary shop, and be operated by one
Should your primary location lack a drive-through for customer convenience, a cold
spot is a great option for improved "immediate" profits with increase resale value as well! The lone employee just
has to sell the finished product, similar to the increasingly popular drive-through coffee kiosks.
But with donuts, you have the competitive edge. Donuts sell themselves, and coffee is
always associated with donuts.
However, a professionally trained coffee “barista” should be sought to help define
your donut and coffee shop as the authentic, local donut authority. Consider selling proof and bake “yeast” donuts
to restaurant supply companies for additional profits. Also selling donut holes in different varieties and packages
can generate easy revenues as kids love them.
The possibilities for growth are truly endless. For instance, with today’s
affordable technology, the possibility of turning your donut shop into an Internet café is very appealing to repeat
customers, especially business people and the self-employed who can work for a little while each day from a table
in your shop.
Filling this niche is yet another example of how products (and services) that go
together, grow together. Only implement new products or services that are based on what is best for you and meets
the particular needs of your community.
One very attractive element of starting your own donut business: compared to other
opportunities, the start-up cost is very minimal.
The average cost for a complete set of donut equipment needed to run a donut shop
(which can be widely purchased used) costs under $5,000. (Other costs, such as retail rental space, vary by
location.) Another cost-cutting bonus: industrial-grade coffee makers and espresso machines can be obtained for
FREE from major coffee suppliers if you agree to use them as your sole coffee supplier.
Considering that a specialty donut like a bear claw can sell for $1.25 on average,
donuts sold in volume (as well as related products) will make you money. In addition you control product
consistency and quality and you do not have to worry about the counter person selling the donut, (Donuts sell
themselves). Therefore you do not have to hire numerous employees to operate a donut shop.
Think about the donut shop owner, work ethic as you consider this: as I was driving
to the shop one morning with the radio on, I heard various announcements from local companies and government
agencies that were closed for the day due to a very large storm. It must be nice to have a paid day off because of
some rain, I thought. However, as I was driving, I noticed that a few businesses were starting to open. One of them
was a donut shop.
I knew it would be open—this business and others like it didn’t have stockholders and
taxpayers eating the cost of being closed for the day. I also knew that this place was about to be packed with
people. I find it ironic that the same people who had such a hard time going to work in that extreme weather had no
trouble going out for donuts. But the reason these people were at this donut shop was because they knew the store
would be open, clean, and with a wide selection of freshly prepared donuts.
Donut making gives a person a sense of accomplishment and fulfillment after every
baking session. (But I still always look at the case and wonder if I could have done it any better or sweeter!) I’m
rewarded by my customers, who spend their hard-earned money and compliment me daily, motivating me to do a better
bake. The next time one of your friends starts complaining about their job, do what I do: look them in the eye and
tell them "take control, be a donut maker."