Activity 2.4: Determining Costs

Introduction

Students will explore the important parts of the pitch presentation to the Sharks, and compute the costs and profit potential of their concession stand.

Preparation Needed for the Activity:

• • Pitch Planning sheet - one per student

  • Concession Stand Calculation sheet - one per student

  • Computers ready for use

Part 1 - Pitch Research: 20 min

Introduce the Pitch Planning sheet to the students to help guide them in developing their pitch presentations. They will not have all the information yet, but this sheet will help scaffold their later work. As they determine all the materials they need for their concession stand, they should refer back to the pitch planning sheet to make sure they can answer the questions. The following questions will get them started in the right direction for the work that they need to do for their pitch presentation.

• • What additional items are required to sell your product?

  • What are the different costs associated with running the stand? (labor, equipment, food)

  • What does it mean, and what do you need to do, to make a profit?

  • How much money (or financial investment) do you need to open the concession stand?

Part 2 - Determining Costs per Serving: 50 min

This activity may need to be split between two class periods. Students can do their research one day, and calculate their cost-per-serving the next day.

Using the Concession Stand Calculation sheet, work through the Belgian Waffle example with the students so that they understand how to obtain the information they will need for their pitch. The students will conduct some internet research to find out bulk prices for items they need for their concession stand. If they do not have internet access, be prepared to provide them with bulk prices.

Example:

For your concession stand, you will purchase prepared food items. In the example on the Concession Stand Computation sheet, a concession stand operator bought prepared Belgian Waffles in bulk from a discount food store for $4.99 for a box of six. So the cost per waffle is $.83. Let's walk through the rest of the items in the example...

You now need to make a list of all the items you will need for your concession stand, and find out how much they cost. Remember to find out both the price of the box, and the number of items in the box. This will enable you to figure out how much each item costs. From that, you can figure out how much one serving will cost you.

Part 3 - Determining Yearly Profit: 30 min

Knowing the individual serving cost is the starting point for students in determining the price and profit potential for their concession stand. They will take the information that they calculated and complete the second side of the Concession Calculations sheet. The sheet will guide them in computing the yearly revenue and expenses for their stand, and enable them to determine their profit potential.

Now that you know your cost-per-serving, it is time to calculate your yearly profit. Making these calculations will help you create your pitch and answer the questions the Sharks will ask. Turn to the back of your Concession Stand Profit Calculations sheet and fill in the appropriate items, then compute each of the values on the page.

***The Google files below are copy only files. When you click the link you will see a page asking you to click a "Make a copy" button, click the button and it will create a copy of the file in your personal/school Google drive. Once in your drive, you will be able to edit and send the file to your students and view responses once collected.