Food businesses are thriving worldwide. According to recent data, the food truck industry is worth more than $1 billion. Food truck businesses can generate more than USD 100,000 a year. Many newbie entrepreneurs are setting up their food trucks across the country. Food truck businesses are most frequently positioned near nightclubs, pubs, schools, and colleges.
In this article, we discuss things to know before opening a food truck, the pros, and cons of opening a food truck business.
Things to Know Before Opening a Food Truck
Here is a list of things you should be aware of before starting a food business:
Choose the right location:
Location is key to the success of a food truck business. Browse through important locations near offices, schools, and colleges.
Invest in a good truck:
A high-quality food truck can help you save thousands of dollars in repair costs. Always go for timely preventative maintenance to extend the lifespan of your food truck.
Gain experience in this industry:
Work in the foodservice industry to gain experience. You can train yourself to dish out dishes effectively and serve customers in short periods.
Decide what equipment you need for a food truck:
You can purchase high-quality combi-ovens and under-counter cooling solutions for your food truck. With commercial cooking equipment, you can serve your customers efficiently in a short span.
Identify your ideal customer:
Always create a predetermined audience for each month. You can target and position your brand depending on your requirements.
The Pros of Opening a Food Truck Business
Customers prefer quick and economical meals that food trucks offer. Here we list the most salient pros of opening a food truck:
It requires low start-up costs: For restaurant businesses, the major hurdle of starting operations is the high initial investment. With a food truck business, you will need less working capital for maintaining and scaling a food truck business.
You are always working for yourself: When you start your food truck, you are independent and working for yourself. Any improvement and innovation can help your business to scale.
It is less risky than opening a restaurant or cafe: The initial investment for food trucks is significantly lower than brick and mortar restaurants. You can reduce the overall financial risk of opening a food business with a food truck.
You have the choice of making your own menu: You can create a new menu depending on the dishes that you wish to serve. With a food truck, you can display your culinary skills effectively. You have the freedom to create a themed menu, dish out family recipes, and develop your menu.
There is no need to have a lease for a food truck: You can purchase a food truck with limited funds instead of leasing one. Leasing a food truck can be costlier over time.
The Cons of Opening a Food Truck Business
Even though food truck businesses can be highly profitable, there are various cons to opening a food truck business. Here we list down some important downsides to opening a food truck business:
Limited space and resources: Food trucks have limited space for equipment and operations. You need to get used to working in a small space for multiple hours at a stretch.
There is a lot of competition in this industry: Food truck business has become highly competitive because of high demand. Depending on how the night pans out, you can position your brand and offer accordingly.
Get ready for regular repairs and maintenance: The cost for setting up a food truck business can range between $30,000 to $100,000. You will incur additional costs to maintain and repair the food trucks annually. You will also need funds for good quality tires and a better electrical system. The repair cost for food trucks can run into thousands of dollars.
Do thorough research on getting licenses: Food truck business owners need to abide by local laws. You will need to do thorough research before applying for permits and certifications. The process to obtain all necessary permits and licenses can take months. For example, even though food trucks are mobile restaurants, you cannot park them anywhere and start your operations.
Work seasonally: Food truck businesses are seasonal. The demand for food truck businesses decreases during the winter and rainy seasons. Many food truck business owners take the winter off because of low sale volumes.
If you are a first-time solopreneur, you need to develop a solid business plan for your food truck business to succeed. You will also need a deep passion for the food industry and perseverance to turn your business profitable.
Author BIO: Damon Shrauner, Senior Sales Consultant and VP on B2B Sales at ChefBuyer, working in the foodservice equipment sector since 1994. With his expertise in market analysis, product placement, sales, and project management, he will always tell you what to do for the best of your business.