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Like most of the street vendors who've set up carts in Salt Lake City, Dennis Tessman knows selling hot dogs involves a lot more than just slapping meat into a bun.

So, in addition to his unusual jalepeno dog, Tessman and co-worker Julie Sanders offer teddy bears. Once a week they give a furry bear to a lucky customer.But then, Tessman and Sanders need a gimmick. They sell near the corner of State Street and 400 South, in front of pawn shops and check-cashing services and far from the bustle of the city's core.

They stay open in the driving rain, even though one storm was so strong it tore the umbrella that covers the cart. They cater to attorneys and other professionals who walk from offices blocks away. They bring in about $150 to $200 each day. But much of the time, business is so slow they pitch pennies onto white lines in the street.

To listen to Tessman tell it, however, he has the best location in the city.

"To me, this has been a very good place," he said. "Downtown is great, but there's a vendor everywhere you go."

Doug Dansie, the city's community planner, said the free market is taking its toll on the vendors, who were allowed to operate for the first time May 1. Of the more than 80 people who applied for permits, only about 50 have paid permit fees. Some of those have yet to start.

"I think we'll have a few more set up, but there is a level where the market won't handle any more," Dansie said, noting he thinks about 75 good sites exist downtown. "Once you start getting over 75 vendors, they will all start hurting."

The city gave each vendor half a street on which to work, meaning eight can operate on each square block. The city held a random drawing in April to determine which vendors got the prime locations. Anyone who didn't pay the permit fee by May 31 was considered to have abandoned the location.

John Gout was one of the lucky ones. His family drew the seventh and 10th positions in the drawing. Gout sells hot dogs in front of First Security Bank near the corner of Main Street and 100 South. Hordes of people walk past his cart, particularly during the lunch hour.

"Ever since the monsoon stopped, business has been good," he said, referring to heavy rains that fell in May and early June. But even Gout needs to find a niche in the market to survive. His specialty is an Italian sausage sandwich. He says he's the only one on the street selling it.

Dansie said he expects more carts to appear as summer continues.

"We're supposed to have a flower vendor with carts on five sites," he said. "I haven't seen hide nor hair of them yet."

The city has fielded complaints from a couple of fast-food restaurants that felt the vendors were stealing business. And some of the vendors seem to be pushing the limits of the city's ordinance by setting up chairs and becoming permanent fixtures. Dansie acknowledges the city may decide to pass new rules.

"My intention was to let things go for a couple of months, then pull everyone together and talk about what's working and what's not," Dansie said.