A Tale of Two Tacos, by Amee Loftis

This is the first in a series of “Think Globally, Act Locally” articles, which will explore the steps of taking a business idea with an international flair to the local marketplace. This story is about three NMU students who want to open a taco stand. The second piece will describe the next step of their entrepreneurial adventure—finding investors or funds. Finally, the last piece will describe the first days or weeks of business.

The bustling streets of New York are filled with people on tight schedules, hungry and looking for food. Whether pizza or a hot dog, people are able to grab and go. Although Marquette is no big city and wilderness trails coexist with a few traffic-jammed streets, this unique characteristic of New York is present in Marquette.
There is a hot dog vendor that sells to people coming out of late-night establishments. Every weekend, rain, clear skies or snow, there are hot dogs. Hot dogs are great, but every once in a while, I want variety. With this information I had a breakthrough, a great entrepreneurial idea, the answer to the question of late night craving—I would sell something different, I would be the vendor to provide variety, I would start my own stand.
Equipped with my new business partners, Chris Wellens and Mauricio Posada, we sat down to create a business plan. As an economics student, at Northern Michigan University, I had abstract ideas as to how a business should operate efficiently and book knowledge on how businesses determine profit margins in globally competitive markets. Unfortunately, I had zero experience in the application process of this knowledge.
My new business partners and I wanted to take what we learned inside our classrooms at NMU and use it to provide local consumers with more late-night meal choices, offering them variety — something other than tasty hot dogs. We felt there was an unmet want in the late-night market, and we wanted to fill it while generating a profit. Everyone would benefit.
But how should we proceed with implementing this idea in a way that promised success to us and our potential customers?
First, we relied on what we had been taught in our economics classes. Our customers have choices. They voluntarily choose what to purchase, what to eat and they value those hard-earned late-night meal dollars. Well, maybe not hard earned.
My partners and I could not assume that just because we offered variety the late-night people would buy whatever we sold. The food item of choice had to be something they craved leaving the bars. Something they craved even more than hot dogs…
It had to be cost-effective for us, as entrepreneurial venders, to cook and keep the food of choice warm. We decided we needed something simple—a cart. All of us agreed up to this point. But, what, oh what, could we sell?
I wanted to sell pizza, something that people could easily grab and eat. Chris voted for hamburgers. “They are an obvious fast food option,” he boasted. Mauricio was set on tacos, tacos seasoned with his secret family recipe—a potential market niche.
Tacos are easy to make. Many people love them. The local community just finished reading Tortilla Curtain by T.C. Boyle. But would we bring something of value to our customers?
To find out, we surveyed NMU students. As a downtown merchant, we would be profitable only if we provided a food item in a cost-effective fashion that they would value. The value would be expressed in the money they would choose to spend at our cart. The student vote was split between pizza and tacos sold at various profitable prices.
As a team, we decided to offer tacos. They could be produced at the highest profit margin when compared to our second best alternative—pizza slices. Tacos became a new option for late-night eaters. They were easy to keep warm, tasty and inexpensive to make. We were especially proud of our corn tortilla that was fried, providing a soft shell with a contrasting crunch. Our tacos would consist of ground beef, cheese and lettuce all piled into a hot and crunchy corn tortilla.
Knowing that we had a solid idea, we took the next step. We contacted local development agencies—Michigan Works!, Lake Superior Community Partnership and Marquette Downtown Development Authority. We checked into local ordinances, zoning restrictions and the Marquette County Health Department. The resources are abundant, the support plentiful and, consequently, we were ready to charge ahead.
In order to keep the price of the taco as reasonable as possible, we would have to have the ingredients supplied at the cheapest price. We traveled to Wal-Mart, Gordon Food Services and Econo Foods, looking for the ingredients and comparing prices. The price difference was small, but we were looking for a way to get a large volume of ingredients cheaper. We set up a meeting with Econo Foods, asking if we could set up a deal, hoping for a better price.
Early on Friday morning, we approached the counter asking for Tony, the general manager. “Should we talk here or go upstairs?” Tony asked.
We opted for the conference room, ready to launch into a rather elaborate presentation. Tony entered, and I pitched our business plan, after enthusiastic introductions.
Mauricio added our hope for a relationship with Econo Foods, and Chris worked out the details. We discussed having Econo as our sole supplier; in turn we would be able to get a discount on ingredients.
We were offered a business account that would be paid monthly. In a small way, we were modeling ourselves after Econo Foods, a small business that was a force in the Marquette food industry.
Excited with our progress, we made tacos to celebrate our first official business meeting. The evening was filled with heated debates on cart warmers, outdoor space heaters and of course, the price of the products. With full tummies and the motivation to become millionaires, we bundled up and walked to Downtown Marquette.
The deserted streets and isolating cold pushed us to the Matrixx. At 2:00 a.m., people were starting to trickle out, hoping to catch a bite to eat before they went home. Here we surveyed what people craved.
The answers were varied and somewhat amusing. Tacos and pizza seemed to tie for first, with “but there are only hot dogs” following behind. We struck up a conversation with the man working at the hot dog stand and asked how his night was.
“It’s alright,” he said. “Sometimes my buns freeze and people yell at me.”
We mulled around watching the sales, freezing. We walked back, disappointed. There was a small volume of people, many of whom did not want to eat a hot dog. Would they eat a taco? We were deflated, the experience a bit defeating. Should we invest our money, time and energy into something that was riskier than we thought? Like any other new business, we went back to the drawing board.
After much deliberation, we decided to use this failure to seek other options. We decided to expand our customer base. Perhaps the bar scene would be more profitable in the summer when it was warmer and conditions not as harsh. If we were going to start now, we needed a different plan, something that looked more promising in the short run. The advantage of having the cart was that we were able to change our location and sell to different people on different days.
Perhaps we needed to change our market, perhaps we would sell more…on campus, at a large place of business in Marquette County, and another place? Do our readers have any ideas?
—Amee Loftis, guided by Tawni Ferrarini, associate professor
of economics, NMU

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