Earnings Potential of Firework Stands
A strictly seasonal fireworks business should earn from $20,000 to $50,000, after state and federal taxes. A year-round business should clear at least $50,000. Most businesses are augmenting their sale structure to add services by supplying special events.
If you’re curious about the earnings potential of firework stands, you’ve come to the right place. The amount of money a firework stand can make during the holiday season can vary depending on several factors. These factors include the location of the stand, the popularity of fireworks in the area, and the marketing efforts put into promoting the stand. On average, a well-managed firework stand can make anywhere from $5,000 to $20,000 in profit during the holiday season. There are several key factors that can significantly influence the earnings of a firework stand.
Profit Margins and Sales Breakdown
The average markup for fireworks is roughly three times the wholesale price. Buying a case of fireworks for $100 means the business owner will likely rake in revenue of $300. Zagorsky notes, however, that it is difficult to get a true sense of a fireworks stand’s average profit margin or total revenue due to the other variable costs involved in setting up the business.
Selling Season and Fundraising
The selling season is a short 7-10 days depending on state and city laws. Groups can expect to make $1500 – $6000 per season. Selling fireworks as a fundraiser is better than other fundraising methods because it is fast and profitable.
How to Run a Successful Fireworks Stand
Of those 7-10 days, the sales breakdown will typically follow this pattern: 10-25% of sales Opening-July 2 25-40% of sales July 3 35-65% of sales July 4. Now, since I am exclusively involved in fireworks, for the most part, that means that 35-65% of my annual income is reliant on July 4. Raining all day? That’ll cost me about 15%. Drought/heatwave? 50%+ losses.
Setting Up Your Fireworks Business
It is all about the location when you set up your fireworks tent. Besides setting up shop somewhere your customers will see you, you’ll also need to consider taxes, zoning laws and regulations. For your fireworks business to be viable, you’re going to want to look at the different areas in your city. Finding a good location is key to having a successful business. You’ll want to do market research to identify where your future customers are located.
How Fireworks Work
Each year, as the Fourth of July approaches, the sound of explosions starts to become a normal part of the evening. Fireworks have existed in one form or another for around 1000 years, and they show no signs of going away anytime soon. But how do they work? Most of us just know to light the fuse and stand back. Let’s take a closer look:
A firework is a chemical reaction. The explosion produces gases, and their electrons are excited. As they return to their ground state, they emit colored light according to the chemicals used: blues from copper compounds, yellow from sulfur, green from barium, and so on.
Starting a Fireworks Tent
The three things that you will always need to start a fireworks tent are as follows; a tent or movable structure to conduct your business, the fireworks themselves, and money for any staff and security you may have during the season. These can all vary widely but always consider if you don’t sell your inventory by the end of the season, you may be left with a huge money sink.