A food truck business is a business that operates with a large vehicle with a kitchen to make and serve food. They are popping up across different nations and are becoming increasingly popular.
Many entrepreneurs opt for a food truck because purchasing a restaurant location is very expensive, while food trucks are much more affordable.
This article is a guide on how to start a food truck business. It discusses all you need to know about the food truck business.
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Are Food Trucks Profitable?
Starting a Food truck business may look a bit daunting and scary at first, however, if you are a food enthusiast then this is right up your alley. One essential thing that people need to start a business, whatever kind it may be, is passion!
Embarking on an entrepreneurial journey without passion or zeal will most likely lead to you burning out before you hit your stride.
Being a food truck business owner is hard work. Beyond preparing an amazing menu, you need to think about local zoning laws, health codes, and employee training.
You need to invest in truck maintenance and preparations for when your truck breaks down. And you must be smart about your marketing plans and profit margins.
Many food trucks don’t make it because they ignore or underestimate these business demands. They fall victim to only caring about the meals and menu—the owners’ lack of business savvy and discipline ends up biting them, hard.
When it comes down to it, the most mouth-watering fish taco or pulled pork sandwich will never be able to save a poorly run food truck business.
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How Much Does it Cost to Start a Food Truck Business?
The largest cost of your food truck business is certainly going to be the actual food truck itself. These aren’t just small vehicles outfitted with stoves and refrigerators—they’re heavy-duty pieces of equipment with commercial kitchens inside. And they’re not cheap.
According to a search on the average cost of a Food Truck, it was discovered that the price ranges from $15,000- $20,000.
Now, looking at the total cost of starting and launching the Food Truck, according to statistics it costs between $28,000 and $114,000 to get a food truck business up and running.
The profit margin is quite encouraging with the average food truck earning around $300,000 per year.
Keep in mind that there are key factors that contribute to the success or failure of your food truck business. Have it in mind that this is but a guide to starting a food truck business.
Food Truck Funding Options
The cost of starting might probably be way above your budget, however, do not fret because there is another way to get funding:
- Borrowing from friends and family
- Getting a loan from a bank
- Getting a grant from organizations that help entrepreneurs
- Partnering up with a close associate
- Getting investors
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Advantages of Starting a Food Truck Business
- Business ownership: Numerous tax advantages come with business ownership, and while it is difficult to own and run a business, at least there is a little bit of relief on the tax front.
- Freedom: Choosing menu items, the vendors you want to purchase from, your employees, and the events for which you are willing to avail yourself, are just some of the freedoms you enjoy as a food truck business owner. You also have full control of your social media, marketing, and schedule.
- Mobility: Being able to bring your business to different locations based on demand during different periods of the day, days of the week, etc., is a huge advantage.
Challenges of Starting a Food Truck Business
- Time: Long hours are the norm with a food truck business. With shopping, prep, marketing, event booking, cleaning, truck maintenance, accounting, and tax obligations, etc., running such a business is more than a full-time job.
- Competition and market: Carefully research your market to increase the chance of success – you will most certainly have competition with other food trucks.
- Ordinances and Zoning: Every area is different in terms of where you can park your food truck and how long you can park there. Make sure you know the rules in each location where you plan on operating to prevent tickets and fines.
Before embarking on your Food truck business journey, it is important to ensure that all licenses and permits are intact and up to date. Here’s a list of the permits needed:
Please note that this list is subject to change depending on the location of your business, that is, Country, state, and city
- Food safety: You’ll need to comply with local food safety requirements, just like any other restaurant in the area. Contact the local health department to find out more information, such as if you need to prepare all your food in a professional kitchen or if you can use your facilities.
- Seller’s permit: Some states require food truck owners to apply for a seller’s permit, which allows you to purchase food and equipment at wholesale prices without incurring sales tax.
- Zoning and parking: There may be restrictions on where you can park your truck; make sure you research that before setting up shop. There could be commercial versus noncommercial zoning restrictions, parking time limits, or distance restrictions from other establishments. Your city and local motor vehicle department can help you.
- Vehicle license: Because your business operates from a vehicle, every driver must be properly licensed and trained to operate the vehicle. Depending on your state and the size of your vehicle, you may have to obtain a commercial driver’s license to legally operate the food truck.
- Fire certificates: If you’re using equipment on the truck to cook food, you will likely need to undergo a fire department inspection.
- Business permits and licenses: As with any business, you’ll need certain licenses to operate your food truck, including a license that has your business name registered. Visit the CAC webpage for more info.
The Ultimate Guide to Starting your Food Truck Business
- Write your financial plan– many factors are involved to help us determine start-up costs for a food vending business in Nigeria. There are also one-time costs, as opposed to recurring costs which can be subject to change. This includes: purchasing a food truck, register a point-of-sale (POS) system, truck wrap, office supplies, marketing/advert, public relationship, and other professionals, legal or consulting fees.
- Prepare a menu– it is very imperative to plan a menu based on items that you can serve to your customers quickly, with minimum fuss. Choose items that use a minimal number of ingredients and can be prepared and served in just a few minutes.
- Acquire all legal business requirements– the permits and licensing requirements for food cart businesses vary from country to country, state to state, and even city to city, so making a definitive list with everything you need is close to impossible. At this point, you are going to address issues such as The street food vending regulations in your city; certified Licenses and permission required; The kind of food you will be selling and how they will be handled, stored, thawed, and cooked; Commissary requirements (the requirement to operate from a licensed commercial kitchen); The size, quantity, and quality, material and the equipment of your street food vehicle; The vehicle’s fresh water and wastewater management holding capacity; Safe food handling course requirement; proper Hygiene policies; Pre-approval inspection of the equipment.
- Social media marketing– We are in the technology age, so as a Mobile Food Vendor in Nigeria, you should not be left out. The power of digital marketing is vital to the growth of any business. Marketing and creating awareness for your mobile food business requires a great deal of social media presence.
- Recruitment– you would need to hire at least an extra hand to get the food out in time. Also, in case you need to make deliveries or do quick grocery runs, it is quite necessary to have extra hands on deck.
Now, you’re all ready to set up shop after reading this guide to starting a food truck business, there are still other things to know. Keep in mind that depending on your location, you may need to add more items to your start-up list.
Albert Einstein once said, “ A person who never made a mistake, never tried anything new.” Keep this quote in mind as you embark on your food truck journey and may the forces be with you.