Do you have a sweet tooth or enjoy a sweet treat every once in a while? Even if you don’t, many others do. As an entrepreneur, you can tap into this market by selling bulk candy or gourmet popcorn.
This is possible through an online candy store where you can sell wholesale candy or by having a brick and mortar store. The candy industry is a profitable one, especially if you keep up with the current trends. In fact, some customers will pay a premium for certain products, including exclusive or trendy candy.
However, before you get into the bulk candy business, there are some costs that you have to consider similar to a snack food business including healthy snacks. This blog covers the costs that you will incur when starting your own bulk candy store or wholesale snacks business.
Bulk Candy Store Business
When opening a business, your ideal goal is to have it succeed. To do this, you need to start by doing your research on the industry, the current market, customers, and the products you’re looking to sell.
In this case, it’s bulk candy. However, there are different kinds of bulk candy that you have to choose from. The best way to determine what your ideal candy product is, is to establish the niche market you’re looking to go after.
The candy industry isn’t going anywhere anytime soon. In fact, the Global Candy market has a value of 64,198.9 million USD in 2021. This is expected to increase to 81,296.0 million USD by the year 2027.
Key Takeaway: The average cost to open your own bulk candy store can range from a few thousand dollars to about $50,000. This will depend on the type of candy store you want to run and your business plan.
Create a Business Plan for Your Bulk Candy Store
As with any business, it’s best to start off with a business plan. You can write a business plan on your own or rely on a professional to put one together for you.
Your business plan should outline every aspect of your bulk candy store and your expectations for it. This includes funding information, market research, competition, location, marketing strategies, customer acquisition, and customer acquisition strategies.
Own or Rent
One of the biggest factors to consider for your bulk candy business is whether you want to run a brick-and-mortar store or go the eCommerce route. If you choose eCommerce, you have to decide on the eCommerce marketplace that you want to use. It’s also best to incorporate an eCommerce marketing strategy.
However, if you choose the brick-and-mortar route for your bulk candy store, you have decided whether you should purchase a property or rent one. The most important thing is the location of the business.
You want to pick a commercial location for your bulk candy store that has good visibility, foot traffic, and parking. This is what will help bring in customers.
Once you find the location, you can start negotiating the purchase or rent price. The price will vary based on the location and size of the property.
Before starting a business, you need to secure financing. Many small businesses will have to put down a minimum of 15-25% of the total startup costs while the bank finances the rest.
In most cases, it’s ideal to have a minimum of $10,000 on hand to start your bulk candy business, along with a solid business plan. Your business plan will help you secure financing from investors or when applying for a loan.
6 Bulk Candy Store Costs
The standard costs for opening a bulk candy store can vary. A modest eCommerce candy store may cost only a few thousand dollars. However, a modest-sized brick and mortar candy store make require you to invest about $50,000 just to open it.
As a business owner, you should plan to have a minimum of $150,000 on hand for operating costs. This will hold you over until your business starts earning profit.
Not all businesses have such high startup costs. In fact, you may consider starting a candy stand or candy vending machine business. This may require you to have about $5,000 on hand for startup costs.
1. Startup Costs
The startup costs for your bulk candy business will depend on the size and scale of your business. These costs often refer to equipment, inventory, supplies, and cash reserves. The average startup costs for a small business range from $5,000 to $50,000.
Different businesses focus on different types of candy. When it comes to your bulk candy inventory, you have the ability to be as creative as you want.
This means that you can focus on a single type of candy or have different options for your customers to pick from. The key to it all is to balance the shelf life of your candy products with the stocking levels. This will minimize the chance of having unsold inventory that goes bad and results in a loss of money.
Following a strict inventory management process will help with this. It’s also important to keep in mind that each product should have a specific reorder point and par level for stocking.
To put things into perspective, dark chocolate has an average shelf life of about twelve months. However, milk chocolate has an average shelf life of eight to twelve months. This is important to consider when selling wholesale chocolate and maintaining the candy shipping procedure.
Hard candies also have an average shelf life of twelve months whereas the average shelf life for chewing gum is about eighteen months. Be sure to do your research on each candy type that you sell to understand each shelf life and ensure food safety practices.
3. Candy-Making Equipment
Within your business plan, you should determine whether you will make or buy your bulk candy. It’s possible to also have a combination of both.
However, if you choose to make your own bulk candy, you will need candy-making equipment. It’s important to consider the cost of this equipment in your budget.
The equipment that you need will depend on the type of candy you want to make. Examples include candy thermometers, mixing bowls, whisks, double boilers, and sheet pans. The average initial investment for candy-making equipment is about $6,000.
4. Store Supplies
When selling products, like bulk candy, you will need to have different store supplies. These include packaging supplies, shopping bags, and candy dispensers.
With these supplies, you will be able to conduct your daily business operations. On average, supply costs will range from $500 to $1,500. It’s possible to invest more money into your bulk candy store supplies and add branding or eco-friendly packaging materials.
In order to communicate essential business information to your customers, you need to have the proper signage for your bulk candy business. This includes an open and closed sign for the door, a business name sign for the front, and labels that communicate store hours.
The signage you choose to have will depend on the kind of business you have. On average, the startup costs for signage range between $500 and $1,000. Keep in mind that if you’re running an online business, you won’t need signage.
6. Shelving and Displays
Staying organized is one of the ideal ways to run a wholesale business. This is because wholesale businesses tend to have a lot of inventory, and it requires proper store and warehouse inventory management.
Whether you’re running a brick-and-mortar or eCommerce store, you need to have shelving and displays for your candy products. Since most wholesalers set an MOQ and EOQ for products, you’ll likely end up ordering bulk quantities of products. This will require you to have backstock that needs to stay organized.
Shelving and display cases are a large investment for any business. The cost will vary depending on the size of the bulk candy store, but the average cost is $2,500-10,000.
Frequently Asked Questions About Opening a Bulk Candy Store
Starting a small business, like a bulk candy store, will require a startup investment. This investment will depend on the type of business you plan to run. Is it eCommerce or brick and mortar?
There are many factors to consider when it comes to startup costs. However, proper planning will allow you to account for all costs before you dive into the business. Be sure to also consider the following commonly asked questions.
What Is the Most Popular Bulk Candy?
Three of most popular bulk candies include:
- Jolly Rancher Hard Candy
- Starburst Individually Wrapped Original Fruit Chews
- Airheads Assorted Flavors
How Successful Is a Candy Business?
The success of a candy business will depend on a number of factors; however, the annual net profit can range from $50,000 to more than $700,000. Keep in mind that the revenue will depend on if you make your own candy or not.
Do Online Candy Stores Make Money?
Yes, you can make money by running your own online candy store. It’s possible to make about $25,000 to $30,000 per year; however, this profit will depend on a number of business factors. Utilizing a proper SEO strategy can help you achieve this profit.
What Skills Are Needed To Run a Candy Store?
The skills that you need to run your own candy store include:
- Knowledge. It’s important to have knowledge about different types of candy, including what’s currently popular. Staying up to date with current and upcoming trends is also crucial, along with holidays.
- Customer service. Providing great customer service will improve the customer experience. This also helps with customer retention.
- Design. Creating an appealing storefront or eCommerce website will attract customers to your store. This will keep business coming in and set you apart from the competition.
- Creativity. It’s important to be creative when it comes to making different candies and candy arrangements.