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 from all over the world. And customers are gobbling it up.
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 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 The food carts’ biggest challenge is the myriad (even outdated) government regulations, licenses, permit requirements and zoning rules.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.
One food truck business in Washington D.C. called 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 been successful in attracting 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 will do the cooking and when you will 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 do the cooking will impact significantly 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. For food that needs to be kept warm or hot, the truck needs to be equipped with generators.
6. Location is critical. Where you park the mobile food truck has to be an area where there’s a lot of foot traffic and convenient to customers. However, mobile food truck owners are faced with 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 locale. 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 have to contend with the hostility and threats from restaurant owners in the area. Some local bars and restaurants fear that mobile food trucks might drive business away or steal their customers.
If you’re going to start a mobile food cart business, check if there are any rules on how close you can park from competing brick and mortar restaurants and food establishments. In District of Columbia, the government is proposing new rules that mobile food trucks need to stay away anywhere 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. T witter 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, with some with their own websites putting a calendar of their locations on their websites in order for their customers to find them where they are. The most successful food trucks are those who are savviest in using social media, and their ability to build buzz using this medium.
10. Explore other revenue sources. Consider catering and events. To increase 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, among others.
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 ecommerce store selling the food items. If your mobile food truck has distinct branding, you can sell merchandise such as t-shirts and other novelty products.