OK. Hot dog, bun, drink cup, and soft drink. Straws, napkins, plate or paper wrap, condiments. Labor to serve the customers, and clean up after them. Floor space taken up by the eating area. Cost of storing the raw ingredients, and the kitchen equipment to prepare the food.

I'll grant it's possible they are making a profit, but note he doesn't say they are making a profit, he says they are making a "fair return." They could be losing money. Either way, in the scope of their store operations, it's not consequential on that basis. They do it to make customers happy. It generates good will. That is the "fair return."