So, you want to start your own food truck business? Can’t say I blame you! Providing sustenance through modern, conventional methods is certainly no new concept, but it’s becoming way more of a popular avenue entrepreneurs seem to be taking. Of course, it’s not as simple as it sounds. There’s a lot to take into consideration; Permits, equipment, a proper POS (point-of-sale) system, and naturally…the truck. But fret not! We at REC can totally help you with sorting all that out! So here’s our guide on how to start your very own food truck business!
Brainstorming The Concept
This is where it all begins. Your imagination is the only limit here. Well, perhaps your budget too, but we’ll get to that. If you are a restaurant owner with a somewhat established brand, then this part may be a lot easier. But before you can go out and get your new, shiny truck and start serving up deliciousness, you have to ask yourself a few questions: What style of food will I be serving? What’s trending? What’s my budget? What’s my target demographic? What about geographical preferences? Should I get a new truck or simply rent one? What about cooking equipment? Did I leave the stove on?
…okay, maybe that last one was just me.
Forming Brand Identity
Choosing the right brand identity is not something that will happen overnight. So before you can start scattering your money all willy-nilly, you must figure out a plan. Again, if you are in the foodservice industry to begin with, then this may not be as difficult.
Let’s have fun with this, shall we? I’ll go ahead and create a fake food truck brand identity.
Okay, so let’s see. I really like tacos…but wait, what about Italian food? No, tacos sound a lot easier and more appealing. Or maybe bacon? Bacon is good! YES! I will have a bacon themed food truck!
But what would I call it? Let’s see: Bacon is good. It’s crispy and greasy, and provides happiness. How can I incorporate this into a name? Let’s step back even further! I’m from Brooklyn, NY. I grew up in Bensonhurst. My father used to take me to this hotdog stand, and I always got a footlong with extra onions. Don’t think I ever got bacon though…OOH! But when I was young my mom used to make me eggs and bacon, and she would place the bacon in a smiley face pattern. Maybe I call it “Smiley’s Bacon”? Nah, that makes it sound like I own a bacon store.
(And this could go on and on and on and on)
So I’ve finally settled on a name! I’ll call my food truck business “Squeels On Wheels”!
Now it’s time for a logo. A logo is your first impression. A chance to really “wow” someone. Find a passionate graphic designer to bring your vision to life!
So now that you have your brand identity, it’s time to consider your startup costs. Your biggest expense will definitely be the food truck itself, so you’re going to want to explore various options first. It’s possible to find a used truck for a great price, but after shelling out money for possible repairs, maintenance, and upkeep, it could end up costing more than you would have preferred. Your budget should ultimately be planned to handle alterations, retrofitting, etc. Experts say that you could easily spend around $75-80,000 on a food truck. If you go with a food trailer or cart, it would be significantly less, and if you are franchising, then leasing options are a big benefit.
But the truck is just the beginning. Other considerations include permits and licensing, cooking equipment, food and supply inventory, a POS (point-of-sale) system, and your truck’s appearance.
The Actual Startup Capital
Now that you’ve got your brand and a rough idea of your budget, now it’s time to think about where this money will be coming from. Unless you already have the startup funds, then you can just skip over this section.
Having good credit, both business and personal, along with a great business plan is the strategy here. And most financing options for food trucks will require good credit, along with a down payment and possibly collateral. But like I stated, if you are already in the restaurant business, this will be a lot easier. A small, business loan is a viable option as well.
If you can’t finance initially, there are a few other methods to starting up your food truck business:
- Start out with a used trailer or food cart
- Talk to a current food truck owner, and try to negotiate an affordable rental agreement
- Begin your business venture at a local market or art fair, and build from there
- Find a successful restaurateur, and see if you can run a food truck for their business
- Obtain sponsorships (if your truck idea provides a public service or a community benefit)
- See if you qualify for an advance loan
Finding A Food Truck
Now it’s time to find your food truck! And luckily for you, we live in the age of quick Google searches and references galore! Make sure to take your time when shopping around. Plan out the equipment you’ll need and the amount of space and storage you will require. You will also have to meet any and all health/fire codes to run your operation. Once you are certain of your needs, you have some options:
- Local Classified Ads: Used trucks are cheaper than other newer options, and you will be able to easily inspect it. You may even be able to negotiate a lease option with the owner, provided it’s not being used.
- National Classified Ads: Same concept as with local classifieds, but you will have more options. Traveling to the truck may be the only issue, but for the right price, it could pay off.
- Leasing: It may require decent credit and a down payment, but local trucks or a national truck leasing company is a good option. And you may be eligible for a lease-to-own agreement.
- Franchising: You may be able to contact an established company for a franchise opportunity. Unfortunately, it will not be a cheap investment. And you may need collateral for the deal to go through. You also won’t have control over the marketing or menu, but if you play your cards right, this investment can really pay off in the long run.
- New, Custom Trucks: This option won’t be feasible for most people starting up a business, but if you have the funds for it, then go for it! New food trucks go for around $80,000, and that’s before customization. The advantage of this option though is that you can purchase a truck that’s built and equipped to your specifications. You can finance a new truck, but it will be costly, and most likely require a hefty down payment.
Make sure that you ask plenty of questions pertaining to the truck you’re seeking out, used and new. And test everything. EVERYTHING. Have a mechanic inspect the truck, and make sure all safety requirements are met. You should also contact your insurance company ahead of time.
Setting Up A POS (Point-Of-Sale) System
Now I’m sure you’ve been to a food truck at some point. And chances are, you’ve paid with cash. Most food trucks only accept cash, and hey, it’s a low price option. But between convenience and people not always taking cash out, paying with a card seems to be commonplace. And by limiting yourself to cash-only transactions, you could be losing out on a large percentage of sales.
Starting your food truck business with a basic cash box is a great way to begin. Here are some options for sale processing.
- Cash-only: A very low priced solution. A lock box can be purchased for around $20 or less. However, you cannot track sales or your inventory. These can be purchased anywhere in store or online.
- Cash w/card processor: Still a low price option. You can buy a card reader for cheap, and then you only need to worry about swipe fees. However, you need to have access to reliable Wi-Fi or a speedy data plan to connect your mobile device to the payment service.
- Cash w/POS system & mobile processing: This option will be your most costly one, but you can accept any payment method and track your inventory. You will need to pay a monthly fee however, plus any hardware costs.
Equipping It Properly
A food truck needs the proper equipment to function…well, properly. Now we can sit here and say do your due diligence, find a contractor, and struggle to make it happen, but why deal with that stress? We happen to be in the business! Contact us at RECFoodserviceDesign.com and we can turn your dream into a reality! Consultation, layout, design, and specification. We do it all! If you only need the equipment, visit us at RestaurantEquipmentClub.com and browse all of our deals!
Now once you’ve figured out all of this, you still have some more obstacles to get through, such as permits and regulations, marketing, etc. But once you get the truck rollin’ and do some more research, we’re confident that you will have what it takes to succeed. We hope this guide will be able to point you in the right direction to opening that dream food truck business!