Are you interested in starting a business in the food industry? Do you want to learn how to start a food truck business? Do you need a sample food truck business plan template or feasibility study? Do you need an in-depth guide on where to find mobile food trucks for sale and how to buy them? If your answer to any of the questions above is yes, then read on.
Some time ago, I published a feasibility report on how to start an ice cream truck business; so in this article, I will be focusing on a food truck business. Now what is a food truck business? A food truck business can either be called a mobile kitchen, a mobile canteen, a roach coach, or catering truck. This can be defined as a mobile venture that transports and sells food. Some of these food trucks sell mostly frozen or prepackaged foods such as ice creams, chicken, snacks and beverages, etc while others specialize on specific meals, such as breakfast meals, cooked food, etc. Now for those who are still doubtful about the potentials of running a food truck business, I want you to know that the food truck business is a very profitable one based on the following reasons.
7 Reasons Why You Should Start a Food Truck Business
- Food is one of the basic needs of man and probably the most important of them all. What this means in essence is that regardless of the climatic, economic or political conditions, people must feed.
- There’s no specific season for food as it is in demand all year round.
- Starting a food truck business eliminates the need to rent a shop or store, thus saving you money for annual rent renewal and monthly recurring power bill.
- The mobility of the food truck business gives you an advantage over fast food stores, shops or restaurants as you don’t need to wait for customers to come to you. Rather, you take the food to them thus saving your customers time and sparing them the inconveniences. Even if it is raining or snowing, your customers can be sure of getting their supply from you. Is this not a competitive advantage?
- You provide a very peculiar service especially to people who don’t have the time or opportunity to go out and buy food. Examples of such individuals include bankers or bank staff, employees, traders and business men, etc.
- As a mobile food truck owner, you are not tied to a particular location. So if business becomes bad in a particular place, you can take your truck elsewhere.
- As an intending mobile food truck owner, you can further drive down your startup cost by buying a used food truck or building a custom one.
- Starting a food truck business does not require much skill. If you know how to drive and cook, you are good to go.
How to start a food truck business – Sample Business Plan Template
1. Conduct preliminary feasibility study
It is important that you carry out feasibility research before venturing into starting a food truck business. Just like every other business, a food truck business has its own challenges; and you can never know these challenges until you take a critical look into the industry. So part of your feasibility study research must involve industry analysis.
Another important to take is to interact with other mobile food truck business owners in your area, so as to gain further insight into the intricacies of running a food truck business. You will also learn from them the best way to design your truck, van or cart. In the course of doing your research, you need to know who your target market is, and the type of food they prefer at any given time.
- Is your target market school children, adults, men, women, college students, etc?
- Do they prefer frozen foods, cooked foods, snacks, fruit recipes, etc?
- Will you target health enthusiasts?
Why are you starting a food truck business? Is there a need for food vendors? Why will people buy food from you when they can get it down the street? Is there any other successful food vendor within your environment? Who are your expected customers? All these are the questions that need to be answered before committing time and resources to opening your food truck business; and the only way to get an answer is to conduct a feasibility study.
2. Write a business plan for your food truck business
Most people believe that a business plan is needed only when the entrepreneur or business owner intends to raise capital for the proposed venture. But this is not true. Before starting a food truck business, it is important you prepare a business plan because it will give you a bird-eye view into the intricacies of setting up a mobile food truck business. It will also help you forge a vision for your company and stick to it. However, it is of utmost importance that your business plan is prepared in the right format with sections dedicated to executive summary, vision and mission statement, financial estimate and projections, marketing strategy, etc.
Cost of starting up a food truck business
The investment capital needed to start a food truck business is highly dependent on the type of sales truck you intend to buy (ice cream cart or stand or mobile truck), the cost of buying a franchise (that is if you intend to buy one) and the type of food you intend to sell.
3. Get the necessary license and operations permit
Contact your city health department and find out the requirements and the costs associated with getting a permit and a mobile permit for your food truck business. You may also need to visit the advertising regulatory body and obtain a permit as your van will be displaying some information that will be considered as advertorials.
4. Choose a good location for your food truck
How are you going to deliver your food to your customers? Will you drive around your target location and take your delivery services to your customers doorstep or you will place your truck at a strategic stationary location like road intersections, on the waterfront, close to dog parks or parks, plazas, busy shopping centers, schools, churches, major markets, offices and family friendly residential areas. However, to choose a suitable stationary location, you must take into consideration the car and foot traffic, in addition to parking and accessibility for clients and delivery drivers.
5. Purchase the necessary equipment
Now aside the food truck, the type of equipment you buy depends on the type food you intend to sell and the scale or level you want to start. However, you can keep cost low by buying fairly used equipment and tools. Examples of equipment you will need to start your food vending business include:
- Business cards
- Used food truck or cart
- Refrigerator and freezers
- Stove or Gas cooker
- Grill and microwave
- Menu boards
Used Food Trucks for Sale – How to Buy a Food Truck
Where can i buy a food truck? Where is the best place to find food trucks for sale? When it comes to buying food trucks, there are a lot of factors you need to consider, so as to avoid making a mistake. Without wasting your time, below is a guide to buying a food truck.
a. First talk to local food trucks business owners and find out the pros and cons of buying a food truck
b. Decide on the type of truck you want to buy. What are the specifications? What facilities and features do you want to see in your food truck? Will you buy a new food truck or a used food truck? These are some of the questions you need to answer.
c. Do a search for used food trucks for sale on Craigslist and online auto websites.
d. Repeat the search on eBay or Amazon Autos.
e. Contact local food truck vendors and see the type of trucks they have
f. Make sure the trucks you intend buying whether on eBay, Craigslist or the local vendor meets your desired specification.
g. Test drive the food truck. If possible, go with an auto mechanic and have him check the engine and other parts.
h. If you don’t find a food truck that meets your specification, then you should consider buying a used van and converting in into a food truck. A metal fabricator or welder can get the job done. You can also use light wood or PVC to construct the body of the food truck.
7+ Challenges of starting a food truck business
Every business or industry has its own unique problems or challenges that you must face. As an entrepreneur, it is your job to identify these challenges and plan on how best to handle them. Now when it comes to a food truck business, below are some challenges you may likely face.
a. It is capital intensive
Setting up a food truck business can be capital intensive, depending on your location and the availability of a food truck within your reach. Sometimes, most people have to import a food truck or ship it from another state. Note that even after buying a food truck, whether used or new, you will definitely tweak or modify the interior or exterior to meet your desired expectation; and this definitely cost money. Even building your own custom truck doesn’t come cheaper.
b. It requires technical know how
To effectively run a food truck business, you definitely need to know how to cook or prepare food recipes and drive a truck. Also, you will need to know how to balance your books, deal with customers, etc.
c. High cost of maintenance
While running a food truck business, you will have to deal with truck maintenance, supervising staff, fuel and energy consumption, taxes, licenses. Also, the cost in perishables could sometimes be too much for the business. You will also need to find a mechanic that is knowledgeable about food truck repairs, and this can be a pain because these mechanics are few.
d. Weather – Weather is one of the uncontrollable factors affecting food truck business operators. When there is a bad weather, there tends to be a reduction in sales.
e. Getting a good location
The beauty of food truck business is that you can change location easily but when you find yourself in a bad location, you will not make good sells. Therefore, always be on the lookout for a new and good locations. Also try and be on top of events, festivals, and weekend markets so you can sign up early.
f. Getting the right menu
Even with a delicious well-prepared food, good customer service and the right pricing, you may still find it difficult to make sales or breakeven if you have the wrong food on your menu. That is why a feasibility study is important. You have to cook what people need, not what you think they need.
g. Getting your customers’ loyalty
Human beings find it difficult to trust one another, not to talk of trusting someone with your health and stomach. Using myself as an example, i don’t buy food anyhow and i don’t walk into any restaurant to eat. I eat at specific places based on personal experience and recommendations. So getting your potential customers to trust that you can deliver a good meal is quite a challenge and the best way to approach this is problem is to encourage word of mouth marketing from your existing customers.
h. Obtaining License, Zoning challenges and Health requirements
These three factors are probably the worst nightmare all food truck entrepreneurs face. You can’t just kickstart a food truck business. You must first acquire the necessary operating license, then you have to obtain zoning rights which will allow you position your trucks at certain spots and finally; you will have to be cleared by the health department. However, the process for meeting these three requirements are cumbersome. You should also bear in mind that these three requirements are to be obtained at City levels. What this means is that any city you want to take your truck to, you have to be licensed and cleared to operate there. Now you understand why i said this is a pain.
10 Marketing ideas in food truck business
- Don’t just sell your food, get to know your customers or their kids and build a relationship with them.
- Choose a unique business name for your food truck and make sure your truck is well designed and branded.
- Position your food truck in high traffic areas.
- Encourage your customers to talk about your business and refer you to their friends
- Put your business on the web and connect with your community on social media
- Attend community events and sponsor local sport clubs, if there is any.
- Ask your customers for suggestions on how to improve your business and serve them better.
- Maintain a unique route daily and make sure your route and timing is predictable by your customers
- Ask, research and find out events that will take place within your environment and take your truck there
- Deliver quality products and offer quality services