How to start food truck business?
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Question by hillddaa33: How to start food truck business?
Where do I begin with starting a food truck business? I haven’t even started on what I might like to offer (depends on what type of truck I decide on-or should it) or the name. Only thing for certain is that I want to know the logistics of how the process goes.
Any help?
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2 Responses to How to start food truck business?
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start a small bussiness and when it is going well buy a truck
theJP
January 14, 2013 at 3:04 pm
This is the summer of the food truck. From San Francisco to New York, restaurateurs seeking an extra boost in sales or entrepreneurs looking to sell food without paying rent are hitting the streets. From their kitchens-on-wheels, they’re serving everything from crème brulee to rotisserie chicken – and customers are gobbling it up. When it comes to the street food scene, “in the last couple of years, there’s been a groundswell of innovation,” says Sean Basinski, director of the Street Vendor Project at the nonprofit Urban Justice Center in New York, who regularly teaches a “Street Food Vending 101” class. “It’s great to have a variety of food,” he says. “Why not have every culture represented in the streets, from hot dogs to caviar?”
Here are the three best ways to start a food-truck business:
1. Buy a used truck for cheap. While a hot-dog cart costs about $ 2,000 to buy, refurbished trucks can run $ 40,000 and upwards, since they have to be built according to health-department regulations. Kim Ima, owner of the Treats Truck of New York, which sells cookies, brownies and other baked goods, found a used vehicle for sale on eBay in fall 2006 and bought it for less than $ 20,000. Laurent Katgely, proprietor of French restaurant Chez Spencer in San Francisco, started a food-truck business called “Spencer on the Go” after picking up a $ 15,000 vehicle from a former burrito seller. Mr. Katgely sells take-away frog legs, sweetbreads, ratatouille and escargot.
2. Find a good location to sell your food. Getting a permit for your truck can be tough since certain cities have a cap. For example, New York limits permits to about 3,000 and the waiting list for them can run as long as 10 to 15 years, says Mr. Basinski. (Renting, borrowing or obtaining a permit on the black market is illegal, he adds.) Plus, some cities don’t allow trucks to be located in certain business districts and streets because they would affect surrounding restaurants or disrupt residential areas. Fortunately for Mr. Katgely, he doesn’t need to apply for a permit. He owns the parking lot where “Spencer on the Go” is located most of the time. It’s seven blocks from the restaurant, and he keeps menus in the truck to give to customers and direct them to Chez Spencer.
3. Use social-networking technology. Many of the new food trucks alert followers about where they’re located or what daily specials they’re serving at a certain time through Twitter, Facebook and blogs. Tweets or status updates can also help groom a loyal customer base. Mr. Katgely tweets from @chezspencergo to tell followers where and when the truck can be found. So far, the mobile business is paying off: Mr. Katgely says he makes a 50% profit on sales from the vending truck vs. 10% from his restaurant
If you are looking to start your own mobile food truck business, here are 10 things to consider:
1. Government Regulation. The food carts’ biggest challenge is the myriad (even outdated) government regulations, licenses, permit requirements and zoning rules. Some states have rules where the trucks can park, how long can they stay in a certain area, and even the size of the truck. Plus, the trucks need to meet the local health department specifications and food preparation rules. Some states regulate where the trucks should be deposited when not on duty, mandating food truck owners to park their trucks only in approved commissary locations.
2. Getting Permit and Licenses. Depending on where you are located, getting the permits you need to operate a food truck business may be tough.
In New York City, for example, there is a cap in the number of permits the local government can issue and the waiting list for new permits can be as long as 10-15 years. Hence, some food truck owners buy their Mobile Food Vendor License in the black market, driving the cost up even further.
In the District of Columbia, mobile food trucks need to pay for a license, inspections, and a one-time $ 1,500 sales tax fee.
3. Startup Capital. Getting adequate funding is important as setting up a mobile truck can be expensive. It is not a business that you can start on a $ 1,000 budget. Old refurbished trucks configured to meet the health department’s requirements can cost $ 20,000 or upwards. Retrofitting a new truck in order to have vending windows, electricity, hot running water, and retail payment system can set you back as much as $ 100,000 depending on your truck’s configurations and features. To start this business on a lower budget, consider buying a used truck instead.
4. Think of Overall Experience. Gone are the old, plain white mobile food trucks of yesterday. Today, the mobile food trucks strive to give their customers a wonderful eating experience – from the overall look of their trucks, uniforms, product presentation, menus and even the website. Branding is heavily used by the new crop of mobile food trucks.
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January 14, 2013 at 3:05 pm