Start a popsicle business by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your popsicle business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a popsicle business?
Opening a popsicle business costs very little. King of Pops was started with just a couple thousand dollars and a used pushcart. Stephen DiMare opened The Hyppo with savings from working a single ski season.
The largest startup expense is the procurement of a location to sell popsicles from. Business owners who want to keep their costs low may rent a booth at a market. Or, they can get a mobile cart to take to different locations. Those who have a little more startup capital might look for a storefront they can lease.
Business owners must also buy equipment for making popsicles and ingredients. Equipment may range from cheap molds to pricey automated equipment. Ingredients often include fruits, vegetables, water, sugar, milk and flavorings.
What are the ongoing expenses for a popsicle business?
The ongoing expenses for a popsicle business are minimal. They include rent for a retail space, utilities, and the cost of ingredients and supplies.
Who is the target market?
A popsicle business’ ideal customer is someone who enjoys cold treats and has discretionary income. Such a customer will may want a popsicle, and they’ll have enough money to pay for a gourmet one.
How does a popsicle business make money?
A popsicle business makes money by selling popsicles. Most are sold at retail prices to customers. Some businesses also have wholesale customers, such as local grocery stores. For example, The Hyppo has over 40 stores that sell its popsicles.
How much can you charge customers?
The Hyppo charges $3.75 for its popsicles. Maintaining prices below $5.00 ensures popsicles are an affordable treat.
How much profit can a popsicle business make?
A successful popsicle business can make tens or hundreds of thousands of dollars a year. Some bring in even more. For instance, The Hyppo produces between 20,000 and 30,000 popsicles per week. At $3.75 each, this equates to a weekly revenue between $75,000 and $112,500. The company’s annual revenue is in the millions.
How can you make your business more profitable?
A popsicle business can sell to customers outside of its area through a website. When sold online, popsicles are typically sold by the cooler full. King of Pops, for example, offers coolers of 50 and 100 popsicles.
A business may also increase profits by catering events. King of Pops also does this. The company provides catering for groups of 25 to 2,500.
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your popsicle business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a popsicle business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Certificate of Occupancy
A popsicle business is generally run out of a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a popsicle business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your popsicle business will be in compliance and able to obtain a CO.
When selling food, you will need licensing from a local health department; all establishments serving food are required to pass a health inspection. Tips for faring well on a health inspections.
There are federal regulations regarding what can and cannot be added to, sold as, and processed with food. Attached is a resource from the Food and Drug Administration detailing the process of starting a food business: How to Start a Food Business.
Businesses involved in the sale of alcoholic beverages are required to obtain a liquor license from the appropriate state or local agency. A comprehensive list of laws by state (including necessary licenses, zoning laws, etc), curated by the Alcohol and Tobacco Tax and Trade Bureau, is included here.
STEP 7: Get Business Insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a popsicle business
The vast majority of a popsicle business’ customers will be people who are walking by. Thus, advertising efforts should focus on getting the attention of nearby people. Signs and free samples are two of the best ways to get people to consider purchasing a popsicle.
How to keep customers coming back
Popsicle businesses attract customers with creative, delicious and unique flavors. King of Pops has made almost 500 flavors, and The Hyppo has over 450 flavors. Business owners should always be developing new flavors. New popsicles keep menu offerings interesting and fresh.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Popsicle Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
Anyone who likes popsicles and is creative in the kitchen might enjoy running a popsicle business. Making popsicles isn’t hard, but coming up with flavors requires some ingenuity.
This is a business that can be started part-time while working another job. Business owners can sell popsicles on the weekends or at events in the evenings. Beau Shell even began a business selling popsicles while still going to school.
What happens during a typical day at a popsicle business?
A popsicle business owner spends a lot of their time making and selling popsicles. When not making or selling popsicles, business owners take care of other tasks. They clean their facility, order more supplies, pay bills, and market their business.
Finally, business owners also must research new popsicle flavors. Researching new flavors involves experimentation. Often, the process is trial-and-error.
What are some skills and experiences that will help you build a successful popsicle business?
To run a popsicle business, business owners must know how to make popsicles.
Business owners can learn to make popsicles by taking a class. Ice Pop University offers hands-on courses that last one day and a two-hour video course. Finamac has online courses that cover both ice cream and popsicle making.
People’s Pops is a book that has 55 recipes for popsicles and shaved ice. After taking a course, these recipes may provide inspiration for other flavor ideas.
What is the growth potential for a popsicle business?
Successful popsicle businesses frequently start small. They may then grow into regional or national businesses. The Hyppo began with a single location in St. Augustine. Along with its retail partners, the company now has seven of its own locations. King of Pops began with a used ice cream push cart. Now, the company has locations throughout the Southeast and East Coast.
Finally, Popbar is an example of a national popsicle business. Popbar has locations in cities throughout the United States.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a popsicle business?
It’s important to select a location for a popsicle business that receives a lot of foot traffic. The size of a storefront is much less important than the foot traffic that a location has. This is why many business owners begin by selling from carts. Carts are small, so renting space in a high-traffic area is more affordable.
How and when to build a team
Most popsicle businesses start as one- or two-person operations. Business owners usually hire people once their business has enough money to do so.