The New York Times reports, “a lot of visitors (are) in need of sustenance. So while vendors are adamant about not divulging details about what they make, most pushcart sites presumably turn a profit or they would not attract such high bids.”
The downside to all of this is that non-seasoned individuals, who walk into the business with the proverbial dollar signs in their eyes, can quickly overpay for these permits. This overbidding comes well before they factor in barriers like mandated flat pricing structures for product, or the cost of overhead in the form of insurance, taxes, suppliers, etc. Costs add up quickly and those dollars become fewer and fewer, sometimes forcing these “winning bidders” out of business.
We find the same phenomenon at our industrial auctions. When the really desirable assets hit the auction blocks, buyers are often sucked into the frenzy and will overpay. Hot Dog!