26 Wetheral Road Owerri, Imo. Nigeria
26 Wetheral Road Owerri, Imo. Nigeria
The aftershock of the COVID-19 pandemic and social distance requirements caused many restaurants to shut down by force.
But not all food service businesses were affected, like the restaurants and bars: the food truck business had to continue to operate cause of its flexible nature.
At that point, there was no better time to start a food truck business.
For example, the food truck business in North Iowa was lucrative since everyone has to eat, irrespective of the pandemic. The food truck business became the only means to deliver food items to respective homes.
Since the pandemic, food truck businesses have been on the rise. And the number of food truck businesses doubled in 2023
So if you have a great interest in how to start a food truck business in 2023, it’s never late for you.
This article explains the right step to take to start up a food truck business, even if you’re on a low budget.
Yes, the food truck business is lucrative, yet one still wishes to know why they should choose to start the business.
Like the saying “curiosity killed the rat.” So here are the reasons.
Most entrepreneurs opt for a food truck business because purchasing a restaurant is expensive, while food truck businesses are much more affordable.
This is just one reason out of hundreds. Here are other reasons why you should choose to start a food truck business other than its contemporary; restaurant.
I consider a food truck business to be of high profit among other food businesses, mainly because it requires much lower investment at the beginning.
This fact makes it a competitive advantage to the regular restaurant.
The fact remains that the money you will use to start up a restaurant can be used for operations of a food truck business, like marketing and stocks.
And the only main cost you will encounter is buying your truck, which I regard very avoidable as you can maximize the growing food truck rental business.
With this kind of cost at hand, the question is now; which will you choose, food truck or restaurant?
The operational costs of a food truck business are mostly the month-to-month expenditures like food, supplies, gas, and maybe salary. In this business, one doesn’t need to have a full staff and taxes will be much lower.
On the other hand, owning a restaurant requires investing in expensive utilities, hire staff like cooks, cashiers, servers, kitchen managers, cleaners, etc., and paying property tax.
This doesn’t include supplies, food, and gas.
So I leave you to run the math in your head, which cost more.
Almost all food truck businesses are pocket friendly. For instance, a meal at a food truck can cost $2, while it might cost double that at a restaurant.
And since the food cost is low, you can actually please customers.
Also, with better quality food at a marginally lesser price, food trucks have become the latest fad among the consumers as well.
One of the reason restaurants rises and die is the effect of location.
From statistics, it was deduced that 60% of new restaurant fail within the first year and one of the majoprimaryson is the poor location and high expenses.
Luckily, food trucks are highly immune to this problem. They are mobile, flexible, and you can choose the location of your business or move to another location quickly if you so wish.
A food truck allows you better control and more flexibility.
Apparently, this is the best avenue for new entrepreneurs, as they can research and experiment with their model before embarking on setting up a restaurant with high investment and risk.
The dynamics of a food truck are totally different from that of a sit-down restaurant. Analyzing the best location, trying new recipes, changing plans and menus can be much easier in a model food truck than in a restaurant.
Since table restaurants are fixed in nature, it can be difficult and expensive to change your brand name and image if necessary.
Food truck businesses often present unique advantages and disadvantages as well.
And no matter how interesting the business might be, it is important to consider the business’s pros and cons before starting it.
#1. Flexibility: Everyone craves for flexibility in their businesses. Food truck business brings flexibility for adjusting menus and schedules.
Also, you can have the flexibility of bringing fresh food directly to events and festivals renting no equipment.
#2. Mobility: I believe the primary reason people want to start their own business is for mobility. With food truck businesses, you can easily move your business from one place to another.
Ultimately, this helps you expand your customer base beyond one location and increasing your advertising potential.
#3. Business Ownership comes with Tax Deductions: Business ownership enjoys more tax advantages than those who rent. With the food truck business, the owner has greater relief on the tax front, although it is difficult to run the business.
#1. Time: One norm with the food truck business is long hours. It requires you to devote more time to shopping, prep, marketing, event booking, cleaning, truck maintenance, and accounting. Hence, I consider such a business more than a full-time job.
#2. Competition: Being a flexible business, be certain to express competition from other food truck owners. So carefully research your market to increase your chance of success.
Ordinances and Zoning: There are laws abiding where you can park your truck. It can be really difficult for food truck owners to stay up to date with zoning restrictions and local ordinances regarding where they can park their truck and how long they can remain at a single location.
Starting a food truck business can be a pretty difficult, but by following the steps below, be certain to scale through.
Before we state them, let’s see how much it cost to start a food truck business.
Many factors contribute to startup cost of a food truck business.
Basically, there are two major startup costs that arise with food truck businesses; onetime costs and costs that can vary by location.
One-time start-up costs include expenses like buying your food truck, registration or point of sale (POS) system, packing the truck, website design, office supplies, advertising and public relations, as well as all professional services, legal or consultation fee.
Although this list is not exhaustive, it gives prospective food truck owners an idea of some startup costs to expect.
At the same time, there are the recurring costs like payroll, equipment rental, credit card processing, and of course, fuel.
Based on location, each new food truck business must also obtain the proper licenses and permits, which can vary.
Although starting a food truck business varies widely based on your specific situation, costs can range from $28,000 to $130,000 to start the business.
Below is a model of some initial food truck startup costs you may encounter:
This shows the recurring costs of starting a food truck business, and it includes the following:
When starting a food truck business, it’s important to ensure you’re filling a space in the market and meeting demands.
The initial market research on how to start a food truck business is to consider available space and your competition.
Most customers want to know where you are and if they can find you easily. So you must research if there is an available place to attend to your customers.
While you’re doing this research, also consider getting a space where you don’t have competition.
Frankly, you don’t want to pick a location and find out that you’re the sixth person doing it within that location.
Hence, before starting a food truck business, you should make sure that your idea stands out against the existing market.
Start by checking the state for the following:
You won’t be the first person going for the food truck business. So choose a unique concept from your competitors, if any.
Choose a concept that depicts your unique style with the concerns of the community.
For example, you can choose the concept to serve organic and health food together. Acai bowls, cold-pressed juice, and interesting salad combinations are all examples of trendy health foods.
Once you have a concept, the next thing to consider is to get a brand name. Your company name should exhibit the following:
You can also go further to design a unique logo that suits your name. It should be able to evoke quality food and is exciting enough to compete with other food trucks.
Your logo will also be used on menus, business cards, social media, and your advertising efforts.
No matter the kind of business you’re starting, if you want to succeed, you need a business plan.
Your food truck business will need a well-prepared business plan.
Having a business plan for becoming profitable early enough in the process will give you a better understanding of how long it will take for your business to turn into profit.
Your food truck business plan should include the following sections:
Executive Summary: This is the first section of your business plan. It should establish our company’s identity, your goals, and depict the kind of food you want to sell and the concept you’re deploying to achieve it.
Business Description: This section helps you describe the food truck industry in your location and how your business is different from the competition. You can also elaborate on other industries that can directly impact your business.
Market Analysis: Here, you can identify market trends in the food truck industry and your target market and analyze competitors. For example, are there food trucks in your area that are selling the same kinds of food, or traditional restaurants that have the same target customer base?
Organization and Management Plan: Elaborate how you intend running the business, including staffing, responsibilities, standard operating procedures of each key partner and employee.
Service or Product Line Description: You can detail your menu, ingredients, and procedures. You can also state the cost of preparing the food and how much you plan to sell it for.
Marketing and Sales Strategies: Describe how you plan to market your food truck business. Important marketing channels for food trucks include word-of-mouth, influencer marketing, and social media marketing.
Funding Request and Proposal: This section states how much funding you need to start your food truck and exactly how you plan to achieve it. You can specify how much money you need to borrow in case you’re applying for a business loan.
Financial Projections: It can be difficult to detail financial projections since it’s a new business without a financial history. You can calculate how much your business will make over three to five years.
Most people don’t have the kind of capital required to start a food truck business. Hence financing your business will be an important step.
Once you’ve created a business plan, that’s the first step towards seeking for funding for your food truck business.
Considering the cost of opening a food truck business, you will need a loan to start your business almost immediately.
It can only come from some set on liable investors and sponsors who you can pitch your business idea to and if it seems lucrative to them will sponsor your business.
You can go for:
After you have set up where to get your funding, you’ll need to explore what licenses are needed to start a food truck.
Food truck permits and licenses can vary from state to state, and sometimes, city to city. So, it is important to check with the local jurisdiction like the Chamber of Commerce, Health Department, and the Department of Motor Vehicles (DMV) office to find out their requirements.
There are at least two types of licenses and permits that you need. One is the business license, and the other is your foodservice permit.
However, depending on your location, you may need additional permits. For example, California requires the following:
Generally speaking, your truck, kitchen, food, and mode of operation will go under inspection. Make sure that your truck is fitted with an easily washable surface and following health standards that include sinks, water supply, and food storage.
The largest part of your startup budget goes to buying the food truck vehicle, so selecting one that will serve your business well is important.
Food trucks can cost $3,250 for a secondhand trailer and up to $14,000 for a new truck.
Investing in a quality food truck from the beginning minimizes your risk of incurring repair expenses down the road.
Hence, try to look for a local food truck builder, so it’s easy to ensure that all your specifications are being met.
Make sure your truck will fit the following equipment too:
Start by buying this food truck equipment. You will need the following:
Warming and Holding Equipment
Food Prep Equipment
You will need a mobile Point of Sale (POS) system as a food truck business. These systems allow you to take credit card payments directly from your truck but may require internet access.
Many food trucks often forget this route, but customers are less likely to have cash on them, which can limit your customer base.
Hence, as a food truck owners, select POS systems that allow them to accept both cash or credit.
Once you’ve established your truck and its location, the last step in starting your food truck business is to market your truck.
A good food truck marketing strategy involves a combination of traditional and online marketing strategies, including social media marketing, selling at local events, sending out brochures, and building a website.
Indeed, starting a food truck business can be a huge challenge, but by following the steps above, be certain to stand on your feet in no distance time.
So if you’ve been dreaming of how to start a food truck business, you can do that today.
The food truck business is demanding, but it’s rewarding if you take the above steps seriously.