Early signs of success for Mark's Carts: vegan food vendor achieves profitability
Phillis Engelbert and Joel Panozzo started their vegan food cart, The Lunch Room, in Mark's Carts outdoor food courtyard in downtown Ann Arbor on May 9.
Lizzy Alfs | AnnArbor.com
It’s been nearly two months since the debut of Mark’s Carts, a collection of seven outdoor food carts off East Washington Street in downtown Ann Arbor, and The Lunch Room owners Phillis Engelbert and Joel Panozzo said business is steady and profits are high at the cart.
Their success serves as an early sign that buzz about Mark's Carts may translate into a sustainable business model for local food vendors.
“After five weeks we were able to pay ourselves back for the money we invested,” Engelbert said. “Now we’re taking draws and collecting paychecks.”
With menu items like a barbeque tofu sandwich, tangy Thai slaw and vegan Caesar salad, The Lunch Room pair seems to have struck a chord with Ann Arborites.
After personally investing $7,500 and raising $10,500 with the online funding platform Kickstarter, Engelbert said that business has remained steady each week and profits have already exceeded their own investment.
“Business fluctuates a little with the weather, but it has been very steady,” Engelbert said. “Our daily sales average hovers around the same amount and hasn’t gone up or down more than $10 during a week.”
Although some of the menu items rotate, Engelbert said the cart’s baked goods and barbeque tofu sandwich have been the biggest sellers. She said The Lunch Room has sold more than 1,200 orders of the sandwich, leading to weekly tofu orders coming in at 100 pounds.
Mark Hodesh, owner of Mark’s Carts, said that the success of The Lunch Room seems to be representative of the courtyard as a whole.
“The concept is working,” he said. “I think everyone knows what they are about and they are getting their bills paid. I think the carts are doing some very good business.”
The venture began on May 9, when Hodesh, also the owner of Downtown Home and Garden in Ann Arbor, opened Mark’s Carts on a 2,700-square-foot parcel of land behind his South Ashley Street retail location.
There are currently seven carts in the courtyard, with specialties ranging from PB&J pierogies to chorizo corn dogs. Hodesh said he may eventually rent space to up to 10 independently owned food cart operators.
For next-door-neighbors and vegan foodies Engelbert and Panozzo, the opportunity to offer fresh, quick and inexpensive vegan food in downtown Ann Arbor was too good to pass up when they heard about Mark’s Carts.
The duo had already been hosting private group meals in various retail locations in Ann Arbor and Ypsilanti, which they started offering in October 2010.
Since applying to be food vendors in Mark’s Carts, Engelbert and Panozzo have taken on many roles. From event organizers to gardeners and chefs, the two said they have enjoyed developing a presence in Ann Arbor.
“Part of building our business is the community aspect,” Engelbert said. “I’ve gotten to know so many people in Ann Arbor because of the cart, and now we know a lot of our customers by name.”
And because Panozzo said connecting with people is their “highest priority,” he said they have found social media websites like Facebook and Twitter to be useful tools in helping to drive business.
On The Lunch Room’s Facebook and Twitter pages, Engelbert and Panozzo engage their followers by offering contests with free goodies as prizes.
A recent contest offered, “Say ‘I love The Lunch Room’ in any language besides English and get a free goodie!”
While the two have learned how to fun with their business, Panozzo said the work load as been “intense,” and they have no plans to slow down yet. He said that they may eventually hire more employees to help operate the cart.
“Right now, we’re focusing on trying to run the hours that we have now,” Panozzo said. “We have really long days, but that’s part of opening a small business.”
As for future plans for The Lunch Room, Engelbert said they’ll likely build up some sort of catering business when Mark’s Carts closes in November.
Although they have been asked about opening a second cart location and packaging their baked goods for other Ann Arbor businesses, Engelbert said her only plan is to be open to new ideas.
“Right now, this is kind of a handful,” Engelbert said. “But Joel and I are both big proponents of being open and then the right thing happens. That’s how The Lunch Room came about.”
Lizzy Alfs is a business reporter for AnnArbor.com. Reach her at 734-623-2584 or email her at lizzyalfs@annarbor.com. Follow her on Twitter at http://twitter.com/lizzyalfs.
Comments
sweet_life
Sun, Jul 3, 2011 : 12:07 a.m.
I am continually amazed that even "good news" stories like this one bring out the cynics and naysayers. A couple of young people made an investment and took a chance on a new business They are working hard and so far they are succeeding. I hope they make it. If they do, they will contribute to the local economy, employ others, pay taxes, etc. Why do some of you just want to focus on why they won't? What are you doing to create new businesses and new jobs?
CynicA2
Thu, Jul 7, 2011 : 12:17 a.m.
Good news is no fun!! Bring on the Apocalypse! We all succeed in pushing daisies, sooner or later. A century (give or take) on Terra Firma - an eternity somewhere else. Optimists are so bourgeois. Party-pooper!
CynicA2
Sat, Jul 2, 2011 : 9:21 p.m.
Glad to see they're doing well so far, but I have to agree with Machine. The real test is whether their concept can continue to succeed a couple of years down the road. It does kind of figure that something like tofu would be a best seller here in A2 - bland and squishy-rubbery, unless covered in something tasty like BBQ sauce. Can you deep fry it? Make it crunchy somehow... not squishy?!? Think I'll stick with Texas-style smoked brisket for my 'Q needs.
CynicA2
Thu, Jul 7, 2011 : 12:03 a.m.
Yeah, Some Guy, but it's probably good for you, too. Can't have that!
Some Guy in 734
Tue, Jul 5, 2011 : 5:33 p.m.
Cynic--if tofu's not your thing, then you're still in luck. Most of the menu is still available to you.
CynicA2
Sun, Jul 3, 2011 : 2:30 a.m.
Tofu is not my thing. If you like it - fine! Go for it. I only like things that are bad for you.
Chris VanderKolk
Sun, Jul 3, 2011 : 1:24 a.m.
Please don't make assumptions about the food before trying it. I'm a proud meat-eater and still visit the Lunch Room at least once a week for my BBQ tofu sammie fix.
loves_fall
Sat, Jul 2, 2011 : 8 p.m.
I love that Lunch Room consistently offers gluten free options. I'm not vegan, but I am GF... and their food is always delicious.
rocco
Sat, Jul 2, 2011 : 5:34 p.m.
Joel, Congratulations on your new business venture. It has success written all over it. Best, R&G Gallery Project
PLGreen
Sat, Jul 2, 2011 : 4:52 p.m.
Re: Machine, with limited hours the "overhead" of a Food Cart is much higher than you may think. Additionally, a full serve resturant works on volume, which is not as available to a Food Cart. These people are working very hard, for a very few dollars at the end of the day. This is not "easy money"
WalkingJoe
Sat, Jul 2, 2011 : 4:47 p.m.
I am not vegan but it makes me happy to see a success story like this. And like other posts I am also trying to watch what I eat so, if I'm ever near that area I may take the plunge and help out these enterprising folks by trying some of their fare.
Ken Boyd
Sat, Jul 2, 2011 : 4:45 p.m.
Two months is not a real test for the viability of a business model. Most food service models can do well out of the gate if they offer a unique experience. The real test will be when people have to come back the fourth or fifth time for the same BBQ tofu sandwich. Many food service ideas "flame out" in a season or two if they cannot evolve the menu and dining experience. I do wish them good luck, they seem to be industrious.
Tom Joad
Sat, Jul 2, 2011 : 3:29 p.m.
Reading between the lines 6/7 aren't achieving profitability yet.
aawolve
Tue, Jul 5, 2011 : 1:23 p.m.
Brilliant deduction. What's your point?
A2K
Sat, Jul 2, 2011 : 3:23 p.m.
I'm not vegan, but I LOVE vegetables -- and having a quick, tasty option so close to where I work is awesome...in fact, I've had nothing but great food experiences at all of the carts *especially Lunch Room and Heavenly Hogs...omg!* Lunch Room's cookies are off the hook...how do they get them so ooey/gooey? Mmmm
Some Guy in 734
Tue, Jul 5, 2011 : 5:31 p.m.
For real. Even the most hardcore omnivore should try their molasses gingersnaps or Mexican Hot Chocolate cookies. Ah, who am I kidding? "Or?" "AND!"
braggslaw
Sat, Jul 2, 2011 : 3:14 p.m.
Great news, you should be proud of your accomplishments.
Machine
Sat, Jul 2, 2011 : 3:03 p.m.
Good for them. However, the real surprise would be if they didn't make money. When you charge nearly as much as a full-service restaurant with only a fraction of the overhead, you really should be successful. The real street food experience is about cheap, good, and filling food. This being Ann Arbor, the "cheap" part is being left out of the equation.
sweet_life
Sun, Jul 3, 2011 : 12:13 a.m.
Nothing on their menu is over $5. It fits my definition of cheap and filling. What's yours?
BobbyJohn
Sat, Jul 2, 2011 : 9:29 p.m.
Machine has a good point. Perhaps they learned from Zingy's that in A2, one can package to do very well financially if the concept and product are well liked.
John B.
Sat, Jul 2, 2011 : 4:47 p.m.
There's always the Dollar Menus at Wendy's, etc. for you to consider.
bedrog
Sat, Jul 2, 2011 : 12:50 p.m.
This food cart/court model is quite the coming thing, often featuring superb chefs who concentrate on limited offerings done extremely well. Austin Texas is a model for this , with a tiny barbeque wagon near the interstate rivalling the state's 'bigs' and a small crepe wagon near the river besting Bobby Flay in a televised "throwdown". I'm eager to see /taste the ann arbor version.
MaryKat
Sat, Jul 2, 2011 : 12:48 p.m.
This is fabulous news. Knowing that hard work can still pay off (with an effective business plan) in A2, I feel a glimmer of hope in an otherwise frustrating economic situation. Good luck to all the the vendors. Congrats to Engelbert and Panozzo!!!!!!
Susan Scott Morales, MSW
Sat, Jul 2, 2011 : 12:42 p.m.
Last night my husband and I sat in the courtyard enjoying the music by the talented Community High Jazz Band. The atmosphere is friendly, upbeat, very Ann Arbor. I've tried the food from the Lunch Room and it was delicious. I'm looking forward to sampling from the other carts; they look very inviting.
WhyCan'tWeBeFriends
Sat, Jul 2, 2011 : 11:08 a.m.
You know, even if people are not vegan, a lot of us are trying to cut down on our meat consumption. We need places to offer non-meat lunches and this venue, if close to work, seems perfect, particularly if they keep tweaking the menu to what people want. My family is not vegan but we struggle with out-of-home food choices since so much out there in "fast food" is horrible. Good to have choices. I am glad their early success may signal a prosperous future.