Starting food truck business is a great idea and easy solution for many motivated chefs and dreamers who want to turn their cooking passion into a full-time income. During recession, the idea was a great hit since dining out wasn’t affordable but foodies looked-for some healthy and tasty alternatives at pocket friendly price. Thanks to the young entrepreneurs who came with a solution of starting mobile food carts. These gave rise to the food truck business. At present, the industry is highly competitive though growing consistently. According to Mobile-Cuisine, the annual revenue share of food truck was estimated at 1.2 billion US dollar in the year 2015.
It is quite natural that the mobile food truck is a lucrative business that comes with many benefits including the opportunity to sell food in different locations, meet different people as customers and get instant feedback for the foods. Are you thinking of starting a food truck business and say goodbye to your office? The business is mobile and there is no need to set up a traditional storefront. A food truck serves the purpose of a storefront. Obviously, you will enjoy its mobility but you need to work for a long period, most likely 60 hrs per week. The other most important thing you should realize that you need to invest a good amount on purchasing a food truck. I think this would be a big issue for the aspiring entrepreneurs.
If you are determined to start a food truck business, then you should follow this guide that I have prepared for people like you. There are also a wide variety of options to consider and decisions to make in order to start a successful portable business.
Phase #1: Planning
The first part of starting a food truck business is to go through a planning phase. Since this business requires an initial investment, it also means that there are more risks involved. Keeping this in mind, a thorough planning will help you ensure everything goes smoothly and will avoid a chaos from rising. When this is not done in the right way, it could mean an unsuccessful business, which means you will lose money instead of making profit.
1. The Business Plan
A business plan is the core of any start-up business. It contains all the important information about the business. The name, location, financial forecast, cost of equipment and ingredients, audience overview, future plans, marketing plans and more. This should be the first part of your planning phase. Do a feasibility study of the niche market and then write a comprehensive food truck business plan.
The next part of the project is funding. You need a big initial investment to start this type of business, which means you need some source of funding. This could be an investment you have, assistance from a family member or even a loan from your local bank. Be sure to include all of your requirements in the initial business plan in order to provide a clear overview of the amount of funds you require for the start of your business. If you are already running a restaurant successfully, then it would be easier for you to get bank loan at a decent rate.
3. License & Permit
Food services require special license and you have to park your truck somewhere, most probably at a crowded place, you need to comply with the local zoning and parking requirements. Since you are about to deal with foods, food safety is a prime issue. You’ll need to get special certificates from the local health departments and abide by the local food safety rules and regulations. The specific licenses you will require for operating your food truck business will depend on your area. Each state has their own requirements, so be sure to contact your local authorities to find out about the licenses you require.
The next step is to acquire the other business licenses that are essential for operating any kind of businesses. These are business registration, tax ID number, state sales tax permits. You can get these licenses easily against small fees. Most importantly, you should register your food truck with the department of motor vehicle and get the insurance on the vehicle.
You need equipment when you want to own and operate a food truck. It all starts with the actual truck (or cart). This is the first essential part of the business. Some companies provide carts that have already been fitted with a cooker and other essential kitchen equipment that you will need to cook food. These will most likely be your best option. If you do not have the necessary funding to purchase food truck, don’t be afraid. There are other options available for food trucks. You can enquire about renting or leasing options from appropriate authorities. You may think to start with a used truck which costs much lesser than the new customized truck. The best option to start a mobile food business is the used cart or trailer. You need to spend only a few thousands to buy this type of cart.
The good starting location is very essential for successful running of the mobile food business. This is the vital part of the planning phase. If you choose the right location, people will flock to your food cart. If you choose the wrong location, however, you will most likely not be able to make a lot of money. Where you place your business is very important. You should start by analyzing your target audience and finding out where they hang out most. Don’t open up your food cart in the middle of nowhere. Aim for a position where a lot of people walk past (on foot). You should also esquire about leasing fees and you will most likely need to pay a monthly fee for “parking” your truck at a specific location.
You won’t be able to cook any food without an inventory. Your inventory should include all the ingredients needed to cook food – all of the required ingredients for your specific dishes. Try to find a supplier that can provide you with ingredients in bulk. This will also usually mean at a discounted rate, which will help you save money and make more profit.
Phase #2: Taking Action
The next phase of this business opportunity is to actually take action. By now you should have a business plan, as well as many other essential of the business. Everything should be ready, so all that’s left is to start and promote your business.
1. Brand Your Business
Before officially launching, you should spend some time on branding your business. If you are taking on a franchising opportunity, then all branding will be provided by the mother company. If you are starting your own venture, then you need to hire a graphic designer to create an identity for your brand. This doesn’t have to cost much – you simply need a logo and business cards to get started. Once you have become more established, you can open up to additional branding channels.
2. Launch Your Business
Finally, the time to launch your food truck business has come. You’ve taken care of all the essentials by now, so all that is left is to say you are open. Be sure your food truck is parked at the right location, make sure everything is working fine and ensure you have an adequate amount of inventory. One more thing- you should give your food cart an attractive design. A nice-looking storefront would attract many customers. That’s all, put on the open sign and wait for customers to start placing orders.
Phase #3: Promotion
If you choose a great location, then customers should start flocking to your food cart from day one. Promotion can help you attract more customers, which means more profit. There are many ways to promote your food truck/cart business. If you start to promote your business a week or two before the official launch, it will also help building up some interest. This might help you to catch the attention of more customers during the first few days. You will also need to continue promoting in order to keep gaining customers. Returning customers also give a great business in this industry, so ensure you to provide great quality food so that customers will come back and even tell their friends about your food truck.
You can launch with a promotion. Print out some flyers and offer a discount for anyone buying food with the flyer. This can be a great way to pull the customers towards your business and it will reward them, so they will most likely bring their friends with them. You can also put up posters on notice boards and visit your local post office to get flyers included in their daily mail distribution process.
Starting a food truck business gives you the opportunity to cook all day long, while also making a stable income at the same time. When you do this the right way, it means you will have a lucrative business with frequent orders. It is important to take some time to conduct a thorough planning phase. It is also important to take action as soon as you are ready, instead of postponing. The sooner you start, the sooner you will have an opportunity to make money by doing something you really love doing.