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Tuesday, March 19, 2024

How to Start a Mobile Food Truck Business

The mobile food industry has seen a massive resurgence, especially in big urban areas such as Los Angeles, New York, Washington D.C., Miami, and San Francisco. From their kitchens-on-wheels, they’re serving everything from crème brulee to escargots to gourmet cupcakes to cuisines worldwide. And customers are gobbling it up.

The new breed of mobile businesses sport vibrant colors and branding imagery. They are also tech and social media savvy, often using Twitter and Facebook to announce their locations.

Many are owned and run by highly trained chefs and well-known restaurateurs. Restaurant owners looking for additional sales see the mobile food truck as an opportunity to sell food without paying rent. Others see it as their way to enter the food business, hoping eventually to open their own restaurant.

If you are looking to start your own mobile food truck business, here are ten things to consider:

1. Government Regulations affecting Mobile Food Trucks

The biggest challenge for the food carts is the myriad (even outdated) government regulations, licenses, permit requirements, and zoning rules. Some states have rules about where the trucks can park, how long they can stay in a certain area and even the trucks’ size. The trucks must also meet the local health department specifications and food preparation rules. Some states regulate where the trucks should be deposited when not on duty, mandating that food truck owners park only in approved commissary locations.

2. Getting Permit and Licenses.

Depending on your location, getting the permits you need to operate a food truck business may be tough.

In New York City, for example, there is a cap on 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 must 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 with vending windows, electricity, hot running water, and a retail payment system can set you back at $100,000, depending on your truck’s configurations and features. Consider buying a used truck instead to start this business on a lower budget.

4. Think of Overall Experience.

Gone are the old, plain, white mobile food trucks of yesterday. Today, 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. The new crop of mobile food trucks heavily uses branding.

Fojol mobile Food Truck business
Fojol Brothers\’ food truck in Washington D.C.

One food truck business in Washington D.C., The Fojol Bros. of Merlindia, brands itself as a “traveling culinary carnival.” Serving Indian cuisine, the food cart operators dress up in funky costumes (e.g., fake mustaches, bright gloves with psychedelic turbans) with made-up “Merlindian” names. Even their tweets use what they call “circus language,” eliminating vowels. With their kitschy set-up, they’ve successfully attracted media attention, and their press coverage has significantly helped them grow their customer base.

5. How Food Will Be Prepared.

Depending on your planned menu, how you cook and when you prepare the food are important factors to consider. Some food items can be prepared beforehand, while others need to be prepared on the spot.

Depending on where you will cook it will significantly impact the type and configuration of the truck you will need. This is especially important if you have a limited budget and can only afford to buy a truck that will not have a full mobile kitchen. The truck must be equipped with generators for food that needs to be kept warm or hot.

6. Location is critical.

Where you park the mobile food truck has to be in an area with a lot of foot traffic and convenient to customers. However, mobile food truck owners face the challenge of where to park and how long to park.

In most areas, they cannot just stop anywhere and do business. In fact, some states regulate where food trucks are allowed to park and for how long they can stay in the location. Others mandate food truck owners not to park near competing restaurants. Other locations charge food truck owners fees to be able to park in public spaces, especially for prime tourist-heavy locales. In Seattle, for example, mobile food trucks are only allowed to park in private properties.

7.  Growing Competition between Mobile Food Vendors and Restaurants.

In addition to local regulations, food truck owners must contend with the hostility and threats from restaurant owners in the area. Some local bars and restaurants fear mobile food trucks might drive businesses away or steal customers.

If you’re starting a mobile food cart business, check for any rules on how close you can park to competing brick-and-mortar restaurants and food establishments. In the District of Columbia, the government proposes new rules that mobile food trucks must stay away from 60 to 100 feet of a restaurant serving “like” food.

8. Competition from Other Food Trucks.

As the competition heats up, some food truck vendors complain about the sabotage done by their competitors – e.g., parking their trucks in front of the sales window of another food truck.

9. Use of Social Media.

The advent of social media has allowed food trucks to interact with their customers, seek their immediate feedback, and keep them updated about the business. Many food truck owners use social media to broadcast their daily specials and locations to their customers, making it easy for their followers (repeat and loyal customers) to find their trucks in the city. Twitter and Facebook, the most commonly used social media tools, have allowed truck entrepreneurs to pick and move where customers are located. Other truck owners announce their scheduled location and itinerary ahead of time, with some with their own websites putting a calendar of their locations on their websites for their customers to find them where they are. The most successful food trucks are those that are the savviest in using social media and have the ability to build buzz using this medium.

10. Explore other revenue sources.

Consider catering and events. To increase the revenues of your mobile food truck business, consider getting booked for private events and going into catering. You can have your food truck roam the city during the day to sell the workday crowd, but use the truck for special events at night, such as corporate store openings, sporting events, carnivals, parties, or bar/bat mitzvahs.

Think if you can sell your food items to groceries. A mobile food truck selling empanadas or cupcakes may be able to strike deals with local groceries for distribution. Also, consider opportunities online, such as starting an e-commerce store selling food items. If your mobile food truck has distinct branding, you can sell merchandise such as t-shirts and other novelty products.

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