I have the opportunity to buy a bread truck business for $110k truck included. After expenses the net each week is $1900. I don’t bake the bread just pick it up in the mornings from the distributor and deliver from 5am-noon. My plan is to run it myself M-T and hire someone for $25hr Friday and Saturday. I can still pocket over a grand each week and only have to work 4 days. Does this sound smart? Im only borrowing $50k with a 10yr loan. I’m a mortgage broker and I’m out of work and need to find something stable while the real estate market recovers. Anyone else ever run a delivery business like this?
There’s a reason there’s so much turnover in bread delivery route sales. At any time in any territory you will find lots of routes for sales. The successful ones are the owner/operators that understand they’re buying a job. They’re committed to servicing their route, getting up at 2am, picking up from the DC at 3am and being at the first Walmart by 5am. Lots of buyers are enamored by the numbers and 3 months in are looking to sell their route because the lifestyle isn’t for them.
The more entrepreneurial ones will find 8-10 new customers per week in the territory that they can squeeze in. The dishonest ones will quickly find the customers with weak receiving policies and put merchandise on their invoice that never makes it in the store. “Direct Store Delivery (DSD)” route owners are notorious for shady practices.
You’re limited by the inventory you can hold in the truck and the receiving times your customers have. Collections also becomes an issue.
If that Citgo gas station is having problems paying its bills, that’s your loss. Can’t take back week old bread.
One of my cousins has been doing this with Flowers Bakery for 15 years. He’s put his 2 kids through college, paid off his mortgage, bought a beach house, and has made a nice living for himself with just a HS degree. He brags about being done by 12p and having the rest of the day to play golf and coach baseball. It’s certainly a viable strategy for a nice life, but don’t look at it as an high upside entrepreneurial opportunity.