# How can ice cream trucks be profitable when gas costs \$4 per gallon?

The title says is all.  I frequently hear ice cream trucks driving through my neighborhood and at roughly the same frequency as last year.  When I go for walks, I have not seen them make any sales.  How can they make a profit? Are they even making a profit? What am I missing?

#### 18 responses to “How can ice cream trucks be profitable when gas costs \$4 per gallon?”

• Paul Rubin

Little known fact: there is a (substantial) line in the Dept. of Homeland Security budget that subsidizes ice cream trucks to cruise neighborhoods looking for possible terrorists.

• iamreddave

I have always wondered about how generic ice cream trucks are. Yu have several kinds of bars: sports, music, alco, after work, docking worker… But I have only seen one kind of ice cream truck. I have an ambition to set up a black goth ice cream truck that sells ice creams with candy skulls on them and such. We will travel around the european music festivals bringing dairy based joy to gloomy goths.

• Bo Jensen

Seriously I would never buy a ice cream from a truck in US, so many movies where the bad guy is a ice cream psycho..But I would buy ice cream from Dave’s Goth truck any day, should you happen to expand the concept into Denmark, I will bring my goth dress and two mice on the shoulder…such a business can be nothing but a success…

• James Herndon

Often, they’re front operations for drug sales. If you know the secret menu, you get something that’s smokeable, not frozen.

• iamreddave

The main expense in ice cream selling is the sprinkles.

They cost hundreds and thousands…

• Kyle Balkissoon

What distance on average does a gallon of gas get them? Let’s call it d
Using a simple (unrealistic model) where gas is the only cost.

The expected icecream profit over distance d needs to exceed 4\$.

Now lets complicate it a bit, define expected icecram profit as a function of distance (EIP(d)), assume that the trucks are being rented at cost K and driver gets all the profits.

Profitability conditions holds that (EIP(d) – d) – k > minwage*hours

In your case the truck might sell to a horde of say 20 children each paying 5\$ then not again for a short time.

• Paul Rubin

We might be missing something fundamental here. Frozen or not, their product is perishable. It also contains a significant amount of chemical energy. (If you’re not convinced, grab the nearest small child, feed him/her a couple of ice cream treats, and watch a neat demonstration of Brownian motion.) So maybe they’ve figured out a way to convert the unsold product into biofuel?

@James: Some people deal drugs from ice cream trucks. The police have figured this out, and now use ice cream trucks for surveillance. Which is why you want to duck behind cover if you ever see two ice cream trucks on the same block.

• Laura McLay

Paul, do the police and DHS really use ice cream trucks for surveillance? They seem to cruise through the most affluent neighborhoods, which probably don’t need much surveillance. But it would make sense if it’s a cheap way to keep an eye on low-risk areas.

• Laura McLay

I acknowledge that I find the concept of ice cream trucks pretty creepy. I would imagine that buying drugs from an ice cream truck would be pretty conspicuous if you don’t have a small child with you (that would be another problem altogether!). But I don’t have any ice cream truck experience–I’ve never bought ice cream from an ice cream truck or drugs from an ice cream truck (or otherwise for that matter). I do suspect drug sales whenever I see a business that doesn’t seem profitable–like a shoe repair shop–particularly if it is open at strange times of the day.

• Paul Rubin

@Laura: “Paul, do the police and DHS really use ice cream trucks for surveillance?” They do on TV (at least the police do). ;-) In practice, I don’t really know. Almost surely not for general cruising around (too much cost for too little value, plus the municipality would be competing with taxpayers, which is a no-no). They might for stake-outs, in which case the truck would be stationary, which I think is a not-uncommon sight at parks.

Regarding your lack of experience with them, I bought ice cream treats from roving trucks when I was a kid. They had more variety than whatever my folks had in the freezer, and when you’re a little kid there’s the excitement of doing something “grown up” (ordering and paying for yourself). I suspect adults are less likely to patronize a truck in a residential neighborhood, but away from home is another story. FWIW, I bought hot dogs from street vendors when I worked in NYC, too (darned good dogs, in fact).

• David Smith

Here in the UK, many ice cream truck (van in the UK) drivers have ceased the practice of cruising and locate themselves at the carparks for tourist attractions. Instead of looking for customers, they solve a location problem of where to park their vans. Here in Devon you can find ice cream sales at car parks by cliff walks, and on Dartmoor (Hound of the Baskervilles country for you literary types.) Discerning parents choose carparks where no ice cream sales vans are parked.

However there are still some ice cream vans which do cruise on sunny weekends around the city. So the salesmen are solving some kind of scoring model for the decision about whether to cruise or locate.

Do parents in other countries try telling the following story to their children? “When the ice cream man rings his bell, it means that he has sold out of ice cream” (for man, read person to be PC)

Finally, how many OR educators have used the location of two ice cream vans as a problem in game theory in their lectures? Van A locates at point A on the unit interval, and van B locates at point B with B>A. Customers are uniformly distributed along the interval and buy their ice cream from the nearer van. What are the best values of A and B? (and if you say A=0.25 and B=0.75, consider what happens when either moves by epsilon)

• Dan Ream

Love your blog, Laura, and usually just lurk without commenting. but I had to respond when I saw this comment you made above..

“But I don’t have any ice cream truck experience–I’ve never bought ice cream from an ice cream truck or drugs from an ice cream truck”

As a child who treasured visits by the Good Humor man to my suburban neighborhood outside Philadelphia and my grandparents’ neighborhood in southern Maryland, I am profoundly saddened to think that you missed out on this pleasure. But it’s not too late–a Mr Softee truck has been parking near Cabell Library lately (either near the Nate’s and Olio carts on Linden) or by the Shafer Dining Hall in front of Cabell around mid-day and after. Please go get an ice cream and broaden your horizons!

I won’t trouble you with stories about “bootleg” Mr Softee trucks that steal the trademark or the urban legend that you are never more than 100 yards from a Mr Softee truck anywhere in Manhattan, but please don’t let another day pass you by without ice cream truck experience!

I’m fascinated also to read the diabolical comment above about the ringing truck bell meaning “out of ice cream now”. What a cruel, cruel thing to say to children.

As to your initial question, I agree with the commenter above that strategic parking is the key to ice cream truck survival in a time of high gas prices.

Last but not least, VCU alumnus and One Ring Zero band member Michael Hearst has out a fantastic album called “Songs for Ice Cream Trucks” that is excellent if you are inclined to such music

–Dan Ream, VCU Libraries
(aspiring to Ice Cream Truck driverhood in my retirement)

• Laura McLay

David: thanks for your comments. I’d be interested in any game theory lecture materials that you may have, it sounds like an interesting application that I could use in the classroom.

• Laura McLay

Every child should experience excellent encounters with ice cream. My kids get to experience the joys of ice cream trucks–one stops at their day care in the summer. It is their favorite day of the week.

Don’t be too sad for me. My guilty ice cream pleasure as a child was going to Rainbow Cone with my grandpa, where I could get five scoops (seven flavors!!) of ice cream on a single cone.

• Dan Ream

Cool–Rainbow Cone looks great at http://www.rainbowcone.com/Rainbow1/Home.html
Running after a musical ice cream truck with a handful of change is an experience
not to be missed. Can’t testify to the glories of buying drugs from such a truck,
but perhaps those pleasures are significant too–probably more pricey though.
Please go listen to Michael Hearst’s Ice Cream Truck song samples on Amazon, at least
until the next truck comes.

• Dan Ream

For your convenience, from ABC News. Featuring VCU alumnus Michael Hearst.

• Ozzy

I have been selling ice cream from my ice cream truck since 2010 and it was the best job I have ever done. Yes, you dont see that there are not any people who buy ice cream from the truck but it is. Especially, from April to June it is amazing! Most of you guys dont even see the money I make in 4 months. I have paid off my 10K college loan (that means I have saved). Im driving dry packed ice cream and not selling drugs at all. If I could get soft ice cream truck I could make more than 35K in 6 months CASH! Yes, the business is not that great because of the economy but most of the business are slow in these years.
However, some of the soft ice cream truck like Mr. Softee makes more than 60K in 8 months. Great Job!

• Tracie Bush

I too own an ice cream truck biz and LOVE IT! VERY profitable, very innocent, NO DRUGS SOLD WHATSOEVER and wouldn’t even THINK of tearing the innocence away from the biz be mixing that kind of thought process! It irks me to even see people think or say that stuff! The money is amazing and it’s the best biz you could get in to! I love the children and the relationships I have built with the parents and I am proud to call most of them my friends now!