A cotton candy business plan sets out where you'll spin and sell, what a cone costs and sells for, the machines and the booth, and the year month by month, which follows the fair and festival calendar. Cotton candy is famously cheap to make, about 10 cents of floss sugar in a cone, so the costs that matter are the ones around it: the fair's share of sales, the person spinning, and the booth. Pre-spun tubs for shops, party bookings and flavored tubs online spread the work beyond fair weekends. In the example below, a cotton candy maker in Tulsa sells cones at fairs, tubs to shops, party bookings and gourmet tubs online, makes money every month, and ends the year about $29,700 ahead on $59,900 of sales, after paying for every hour at the machine. Below is a description example, each part of the plan, the season, the rules, the startup budget, and a free template.
The short version
- Describe the business in a paragraph: the events, the shops, the parties, the goals.
- Cost a cone with the fair's share and the staff in it, not just the sugar.
- Sell tubs to shops and book parties to keep the machines busy between fairs.
- Fairs often take a share of sales or a flat booth fee; count it before signing up.
- Plan the year around the summer fair season, with a small bump for holiday events.
- Two machines and a booth are the startup; it's one of the cheapest food businesses to start.
- TaroStack keeps floss sugar, cones and tubs counted at the booth and the storeroom. More below.
Part 1: the business description
Route 66 Cotton Candy Co., a made-up cotton candy maker in Tulsa, Oklahoma, I use in these examples, writes:
Route 66 Cotton Candy Co. spins cotton candy at fairs, festivals and ballgames, sells pre-spun tubs to candy shops and convenience stores, brings a machine to birthday parties and school events, and ships gourmet flavored tubs online. In our first year we plan to work 25 fairs and festivals.
Part 2: what a cone costs
| Per unit | Cone at fairs | Tub to shops, 2 oz | Party booking, 2 hours | Gourmet tub, online |
|---|---|---|---|---|
| Floss sugar and flavor | $0.10 | $0.20 | $0.35 | |
| Cone and bag, or tub and label | $0.13 | $0.35 | $0.50 | |
| Staff at the booth, $16 an hour | $0.80 | |||
| Spinning and packing, at $20 an hour | $0.33 | $0.50 | ||
| The fair's share of sales, 20% | $1.00 | |||
| Party: 150 cones' supplies, two staff for 2.5 hours, travel | $129.50 | |||
| Card fees or case share | $0.15 | $0.02 | $9.00 | $0.24 |
| Variable cost | $2.18 | $0.90 | $138.50 | $1.59 |
A cone's sugar and paper cost 23 cents; the fair's 20% share costs a dollar, and the person spinning 80 cents. Fairs and festivals charge in different ways, a share of sales, a flat booth fee or both, so the plan works out what each one really costs a cone before applying. How to read a food cost against the price is in what is a good food cost percentage.
Part 3: customers and prices
| Product | Price | Variable cost | Contribution | Margin | In June |
|---|---|---|---|---|---|
| Cotton candy cone at fairs and events | $5.00 | $2.18 | $2.82 | 56.4% | 1,200 |
| Cotton candy tubs to shops, 2 oz | $3.50 | $0.90 | $2.60 | 74.3% | 400 |
| Party and event booking, 2 hours | $300.00 | $138.50 | $161.50 | 53.8% | 5 |
| Gourmet flavored tubs, online | $8.00 | $1.59 | $6.41 | 80.1% | 150 |
A shop tub leaves almost as much as a fair cone, with no fair's cut and no weekend at the booth, so shops are the line to grow. A party is $300 for two hours, booked and paid ahead. Tubs are sealed against humidity, which is what melts cotton candy; how to set a wholesale price that holds up is in how to price baked goods for wholesale, where the same arithmetic applies.
Part 4: the season, month by month
Fixed costs are $585 a month, averaged over the year: storage ($100), insurance ($70), permits ($40), the vehicle ($150), event deposits and booth fees ($150), the website and online shop ($40), and software and card fees ($35). Month 1 is April; June and July are full speed, with a December bump for holiday events:
| Month | Fair cones | Shop tubs | Parties | Online tubs | Sales | Profit | Cash, year to date |
|---|---|---|---|---|---|---|---|
| Apr | 480 | 160 | 2 | 60 | $4,040 | $1,892 | $1,892 |
| May | 840 | 280 | 4 | 105 | $7,220 | $3,831 | $5,723 |
| Jun | 1,200 | 400 | 5 | 150 | $10,100 | $5,608 | $11,331 |
| Jul | 1,200 | 400 | 5 | 150 | $10,100 | $5,608 | $16,939 |
| Aug | 1,080 | 360 | 5 | 135 | $9,240 | $5,069 | $22,008 |
| Sep | 720 | 240 | 3 | 90 | $6,060 | $3,131 | $25,139 |
| Oct | 480 | 160 | 2 | 60 | $4,040 | $1,892 | $27,032 |
| Nov | 180 | 60 | 1 | 23 | $1,594 | $388 | $27,419 |
| Dec | 360 | 120 | 2 | 45 | $3,180 | $1,354 | $28,773 |
| Jan | 120 | 40 | 1 | 15 | $1,160 | $115 | $28,888 |
| Feb | 120 | 40 | 1 | 15 | $1,160 | $115 | $29,003 |
| Mar | 240 | 80 | 1 | 30 | $2,020 | $654 | $29,656 |
The year's sales are $59,914 and the profit $29,656, after paying for every hour at the booth and the machine. Even January and February cover their fixed costs, thanks to shop tubs and parties. How to plan stock for a season like this is in seasonal inventory.
Part 5: the rules and the startup budget
A cotton candy booth is a food vendor: it generally needs a temporary or mobile food permit for each county it works in, a handwashing setup, and a sneeze guard over the machine, and the pre-spun tubs sold to shops need a licensed kitchen and a label. Fairs ask for proof of insurance. Check with each county before the season. This is general information, not legal advice.
| Item | Example |
|---|---|
| Two commercial cotton candy machines | $2,000 |
| Concession tent, tables and sneeze guard | $3,000 |
| Floss sugar and cones, first order | $300 |
| Tubs and labels, first order | $400 |
| Signs and menu board | $300 |
| Permits | $300 |
| Working cash | $2,000 |
| Total to start | $8,300 |
Get the template
Download the cotton candy business plan workbook. Four sheets: your products with price, variable cost and volume at full speed; the year, month by month, with sales, profit and cash, and month 1 set to April; your fixed costs; and your startup budget with working cash. Change each month's share to match your event calendar. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
Ten flavors of floss sugar, cones and tubs by the case, two machines at two events on the same weekend, shop orders every week, and an online shop. A sheet can't say how much blue raspberry sugar went to the fair, how many tubs are packed for the shops, or which events earned their weekend.
How TaroStack does it
TaroStack keeps floss sugar, cones and tubs counted at the booth and the storeroom.
The booth and the storeroom. The storeroom and the booth are sites, with transfers for what goes out to an event and what comes back, counted on a phone with no signal at the fairground. Units convert: floss sugar bought by the case, used by the ounce.
Tubs as a recipe. Each tub is a recipe of its sugar, tub and label, so spinning a run of tubs takes them off stock at what you paid. Shop orders and party bookings are sales orders that show whether the tubs are packed while you're still typing.
And what each event earns. The reorder list works in days of cover so cones don't run out before a big fair, and margins are reported by product and by customer.
| The job | Notebook | In TaroStack |
|---|---|---|
| Sugar and cones out to the fair | A list on the cooler | Transfers between sites |
| Tubs packed for this week's shops | Count the shelf | Sales orders, checked against stock |
| Cones before the county fair | Found short | The reorder list, in days |
| Fairs, shops or parties, which pays? | A feeling | Margins by product and customer |
Recipes, counting and margins by product and customer are on every plan, from $49 a month; up to three sites, the storeroom and the booth included, are on Standard at $99. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.