A gourmet popcorn business sells different flavors of popcorn, including microwaveable, ready-to-eat, and other consumer packages of unpopped popcorn. The Global Popcorn Market was valued at $9,060 million in 2016 and is projected to reach $15,098 million by 2023, registering a CAGR of 7.6 percent from 2017 to 2023. Please note that the United States Popcorn market is witnessing a CAGR of 5. 56 percent during the forecast period (2022-2026).
Steps on How to Start a Gourmet Popcorn Business
Table of Content
Conduct Market Research
If you are considering starting a gourmet popcorn business, you would need reliable market research to be able to maximize profits from the business. The first step in the market research process for your gourmet popcorn business should be to develop market-based research questions in line with your overall business goal and objective.
In this regard, you should source for information that will help you maximize your business, give you reliable data, and of course a hint of what your potential market will be looking out for from a gourmet popcorn business and also help you operate your gourmet popcorn business with less stress.
a. Who is the Target Market for Gourmet Popcorn Business?
- Event Planners
- Schools
- Tourists
- Workers in construction sites
- Campground patrons and staff members
- Everyone who resides in the location where you intend to sell your popcorn.
b. Is Gourmet Popcorn Business a Profitable Business?
Yes, the gourmet popcorn business is quite profitable. A large percentage of the popcorn consumed all around the world is produced in the United States. Americans Eat About 13 billion quarts of popcorn a year.
c. Are There Existing Niches in the Industry?
Yes, there are existing niches when it comes to the gourmet popcorn business, and here are some of them;
- Brick and mortar gourmet popcorn shop (sit-down gourmet popcorn shop)
- Drive through gourmet popcorn shop
- Kiosk gourmet popcorn shop
- Mobile gourmet popcorn shop (gourmet popcorn carts or gourmet popcorn trucks).
d. Who are the Major Competitors?
- SkinnyPop
- Garrett Popcorn Shops®
- Magnolia Popcorn Co.
- Cornucopia Popcorn
- The Popcorn Shop: Chagrin Falls, OH
- Lisa’s Passion for Popcorn: Kaysville, UT
- Great American Popcorn Company: Cedar Rapids, IA
- Cornology: San Francisco, CA
- Shirley’s Gourmet Popcorn
- On & Poppin’
- Original Popcorn House
- Tastebuds Popcorn
- Doc Popcorn
- Ohana Bros
- Planet Popolicious
- Carroll’s Corn Gourmet Popcorn
- Faris Gourmet Popcorn
- 4700BC Popcorn
- The Popcorn Factory
- Gaylen’s Gourmet Popcorn.
e. Are There County or State Regulations or Zoning Laws for Gourmet Popcorn Business?
Yes, there are county and state regulations and zoning laws for gourmet popcorn shops in the United States. Please note that the Food and Drug Administration (FDA) sets the federal Food Code. However, the FDA doesn’t oversee individual gourmet popcorn shops. Instead, the various states use the Food Code as the basis for their food codes. They may adopt its rules, interpret them differently or set their own rules.
Please note that in the United States, you are required to follow your own state’s food service code. Visit the FDA website for a list of food service codes by state. Use this to find the state authority handling restaurants and bars and view the laws that apply in your state.
f. Is There a Franchise for Gourmet Popcorn shop Business?
Yes, there are franchise opportunities for gourmet popcorn shops. Here are some of them;
- Shirley’s Gourmet Popcorn
- On & Poppin’
- Original Popcorn House
- Tastebuds Popcorn
- Doc Popcorn
- Ohana Bros
- Planet Popolicious
- Carroll’s Corn Gourmet Popcorn
- Faris Gourmet Popcorn
- 4700BC Popcorn
- The Popcorn Factory
- Gaylen’s Gourmet Popcorn.
g. What Do You Need to Start a Gourmet Popcorn Shop Business?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Shop facility
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Equipment
- Supplies
- Employees
- Startup Capital
Memorable Gourmet Popcorn Business Names
- Caramel Pot© Gourmet Popcorn Shop, Inc.
- Denzel Kingston® Gourmet Popcorn Shop, LLC
- Glover Sean© Gourmet Popcorn Shop, Inc.
- Yeti Genius® Gourmet Popcorn Shop, Inc.
- Teddy Ben™ Gourmet Popcorn Shop, Inc.
- The Horizon™ Gourmet Popcorn Shop, LLC.
- Brown Corn© Gourmet Popcorn Shop, LLC
- Corn Delight® Gourmet Popcorn Shop, Inc.
- Green Label© Gourmet Popcorn Shop, Inc.
- Tandy Treats© Gourmet Popcorn Shop, Inc.
- Regan Molly® Gourmet Popcorn Shop, LLC
- Ryan Townsend® Gourmet Popcorn Shop, LLC
- Anabel Williams™ Gourmet Popcorn Shop, LLC
- Pop Gang© Gourmet Popcorn Shop, Inc.
- Venus Cape® Gourmet Popcorn Shop, Inc.
- Pamela Signature™ Gourmet Popcorn Shop, Inc.
- Glen Humphery™ Gourmet Popcorn Shop, Inc.
- Dallas County© Gourmet Popcorn Shop, Inc.
- Pop House® Gourmet Popcorn Shop, LLC
- Shavonne Stanley™ Gourmet Popcorn Shop, Inc.
Register Your Business
a. What Type of Business Structure is Best for Gourmet Popcorn Shop?
When it comes to starting a gourmet popcorn business, you have several options when it comes to the business structure, but the one that most players consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits. Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Gourmet Popcorn Shop Business?
- General Business License
- Health and Safety Permit
- Food and Drinks Handlers’ License
- Zonal Permits
- Signage Permit
- Operational State Facility Inspections
- A music license if you want to play live, recorded, or streaming music in your shop
- A dumpster placement permit that specifies where you can put your trash dumpster outside your shop
d. What Type of Certification is Needed to Open a Gourmet Popcorn Shop Business?
You don’t need any certifications to open a gourmet popcorn shop business.
e. What Documents are Needed to Open a Gourmet Popcorn Shop Business?
- DBA
- EIN
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Online Terms of Use
- Online Privacy Policy Document
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering opening your own gourmet popcorn shop business, usually you may not have any need to file for intellectual property protection or trademark. This is so because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Gourmet Popcorn Shop Business?
The cost required to open a gourmet popcorn shop business will vary significantly. A sit-down gourmet popcorn shop costs between $100,000 and $350,000 to set up. A large drive-through shop can cost between $80,000 and $200,000.
A small kiosk gourmet popcorn shop may cost between $5,000 and $50,000. A franchised sit-down gourmet popcorn shop can cost up to $350,000. For example, opening a franchise with Doc Popcorn costs between $39,000 and $355,050. Shirley’s Gourmet Popcorn Company’s franchises cost between $158,500 and $339,000.
b. What are the Cost Involved in Starting a Gourmet Popcorn Shop
- Business Registration Fees – $750.
- Legal expenses for obtaining licenses and permits – $1,300.
- Marketing, Branding and Promotions – $1,000.
- Business Consultant Fee – $2,500.
- Insurance – $1,400.
- Rent/Lease – $75,000.
- Other start-up expenses like stationery ($500), and phone and utility deposits ($1,800).
- Operational Cost (salaries of employees, payments of bills et al) – $30,000
- Start-up Inventory – $15,000
- Store Equipment (cash register, security, ventilation, signage) – $1,750
- Carts – $20,000
- Website: $600
- Opening party: $3,000
- Miscellaneous: $2,000
c. What Factors Determine the Cost of Opening a Gourmet Popcorn Shop Business?
- The size of the gourmet popcorn shop
- The choice of location
- The required licenses and permits
- The type of facility
- The type of related products retailed in the shop
- The cost for branding, promotion, and marketing of the gourmet popcorn shop business
- The cost for furnishing and equipping the facility
- The cost of acquiring insurance
- The cost for registering the business
- Sourcing of your supplies and ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms
- The cost of the grand opening of the gourmet popcorn business
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
It is not compulsory to build a new facility for your gourmet popcorn shop business, but, if you have the required finance, it will pay you to build your facility. The truth is that building or reconstructing a facility will allow you to come up with a facility that will perfectly fit into your overall business goals and vision.
e. What are the Ongoing Expenses of a Gourmet Popcorn Business?
- Supplies (inventory expenses)
- Utility bills (internet subscriptions, phone bills, signage and software renewal fees et al)
- Salaries of employees
f. What is the Average Salary of your Staff?
- Shop Manager (Owner) – $45,000 Per Year
- Accountant – $30,630,000 Per Year
- Gourmet Popcorn Makers and Servers – $27,100 Per Year
- Cleaners – $25,000 Per Year
- Security Guard -$24,000 Per Year
g. How Do You Get Funding to Start a Gourmet Popcorn Business
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Caramel Pot© Gourmet Popcorn Shop, Inc. is a neighborhood gourmet popcorn shop business that will be located in a fast-growing community in Chagrin Falls, OH. We have been able to secure a two-year lease agreement for a vacant shop within the city’s largest shopping mall.
We are fortunate to secure a facility with an option of renewal for 5 years at a rate that is favorable to us. Caramel Pot© Gourmet Popcorn Shop, Inc. is designed to meet both the health and safety standard as recommended by the local authority.
b. Products and Service
- Different flavors of gourmet popcorn
- Beverages and bottled water.
c. Mission Statement
Our mission is to establish a standard gourmet popcorn brand that in our capacity will favorably compete with leaders in the industry. We want to build a business that will be listed amongst the top 20 gourmet popcorn brands in the United States of America.
Vision Statement
Our vision is to build a popcorn business with franchises all across the United States of America and Canada.
d. Goals and Objectives
The goals and objectives of a gourmet popcorn shop business are to produce different flavors of gourmet popcorns for consumers and in some cases retailers.
e. Organizational Structure
- Shop Manager (Owner)
- Accountant
- Gourmet Popcorn Maker and Server
- Cleaners
- Security Guard
Marketing Plan
a. SWOT Analysis
Strength:
- Ideal location for a gourmet popcorn shop business
- Highly experienced employees and management
- Access to finance from business partners
- Access to ingredients and supplies
- A reliable, clean, healthy, and efficient method of preparing gourmet popcorn.
Weakness:
- Financial constraints may restrict the publicity and branding of the business
- Our new business will be competing with well-established gourmet popcorn shops and franchises in the city.
- Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.
Opportunities:
- A rise in the number of popcorn lovers within our market space
- Online market, new services, new technology, and of course the opening of new markets.
Threat:
- The arrival of a new gourmet popcorn shop within our market space
- Steady wage expenses and increasing prices of gas amid the low demand during the pandemic will reduce industry profitability.
- Economic uncertainty
- Liability problems
- The U.S. Food and Drug Administration (FDA) could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
b. How Do Gourmet Popcorn Shops Make Money?
Gourmet popcorn shops make money by selling the following products;
- Different flavors of gourmet popcorn
- Beverages and bottled water
- Franchise
c. Payment Options
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
d. Sales & Advertising Strategies
- Introduce your gourmet popcorn shop business by sending introductory letters alongside your brochure to schools, event, and party planners, households, and other key stakeholders throughout the city where your gourmet popcorn shop business is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
- Create a basic website for your business to give your business an online presence
- Directly market your products.
- Join local gourmet popcorn shop associations for industry trends and tips
- Provide discount days for your customers
- Advertise our business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word-of-mouth marketing (referrals)
Financial Projection
a. How Much Should You Charge for your Product/Service?
On average, regular popcorn can be sold at $2.25/serving and caramel corn can be sold at $3.75/serving.
b. How Much Profit Do Gourmet Popcorn Shop Owners Make a Year?
It depends, but the available report shows that on average, within the industry, a small to medium-sized gourmet popcorn shop can earn anywhere from $80,000 to $150,000 in a year in personal income for the shop owner.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the gourmet popcorn shop
- The types of related products retailed in the shop
- The location of the gourmet popcorn shop is covering
- The management style of the gourmet popcorn shop
- The business approach of the gourmet popcorn shop
- The advertising and marketing strategies adopted by the gourmet popcorn shop.
- The number of years the gourmet popcorn shop is in business
d. What is the Profit Margin of a Gourmet Popcorn Shop?
Gourmet popcorn has a higher profit margin than regular popcorn because of the perceived value. Regular popcorn can be sold at $2.25/serving with a profit of $1.89, while caramel corn can be sold at $3.75/serving with a profit of $3.03. Please note that popcorn shops can boast profit margins of 80 to 90 percent.
e. What is the Sales Forecast?
Below is the sales forecast for a gourmet popcorn shop. It is based on the location of the business and other factors as it relates to such startups in the United States;
- First Fiscal Year: $240,000
- Second Fiscal Year: $400,000
- Third Fiscal Year: $600,000
Set Up your Shop
a. How Do You Choose a Perfect Location for Gourmet Popcorn Shop?
- The demography of the location especially as it relates to people that eat gourmet popcorn regularly
- The demand for gourmet popcorn in the location
- The purchasing power of residents of the location
- Accessibility of the location
- The number of gourmet popcorn shops, and retail outlets that sells gourmet popcorn in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Open a Gourmet Popcorn Shop?
- Chagrin Falls, Ohio
- Kaysville, Utah
- Cedar Rapids, Iowa
- Las Vegas, Nevada
- Los Angeles, California
- San Antonio, Texas
- Miami, Florida
- Houston, Texas
- New York City, New York
- Oklahoma City, Oklahoma
c. What Equipment is Needed to Operate a Gourmet Popcorn Shop?
You will need gourmet popcorn making machines (e.g., a popcorn popper), storage hardware (bins, utensil rack, shelves, food case), counter area equipment, computers and receipt issuing machines, a sound system (for playing music), and Point of Sales Machines (POS Machines).
Hire Employees
When it comes to hiring employees for a standard gourmet popcorn shop, you should make plans to hire a competent shop manager (you can occupy this position), account clerk, gourmet popcorn makers, servers, cleaners, and security guard.
Launch the Business Proper
In recent times, no gourmet popcorn shop opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party. The bottom line is that with a proper launching of the gourmet popcorn shop, you will officially inform people in your city that your gourmet popcorn shop is open for business.
a. What Makes a Gourmet Popcorn Shop Business Successful?
- Choose a good location and shop facility to launch the business
- Make sure your shop is stocked with different flavors of gourmet popcorn (give your customers options)
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your gourmet popcorn shop business
- Leverage on all available online and offline platforms to promote your gourmet popcorn shop business
b. What Happens During a Typical Day at a Gourmet Popcorn Shop?
- The shop is open for the day’s work
- Supplies and ingredients are ordered
- The serving areas, chairs, and tables are properly arranged
- Walk-in customers are attended to
- Deliveries of orders are made
- Stocks are taken and reports are written and submitted
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Gourmet Popcorn Business?
- Excellent customer services skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining skill
- Work experience in a shop environment
- Experience in managing people
- Experience in business administration
- Experience in handling different types of gourmet popcorn-making equipment.