Start a Food Truck

Food trucks are one of the hottest trends in the culinary industry with a considerable growth rate.[1] If you like cooking and serving people, you might be considering opening up your own food truck, which can be less expensive than starting a restaurant.[1] But you may be unsure of how best to start your food truck. By getting yourself set up and building your business, you can start a food truck!

Steps

Sample Documents

Doc:Food Truck Menu,Vendor Letter,Food Truck Ad Campaign

Getting Set Up

  1. Talk to food truck owners. Before you take concrete steps to start your food truck, consider talking to other food truck owners. They can answer questions you have and may help offer you practical advice for setting up your business.[2]
    • Ask questions about how she set up her food truck. See if she experienced any setbacks that could have been prevented with preparation or can suggest ways to cut startup and operations costs.[2]
  2. Consider your goals and lifestyle. Think about how owning a food truck can fit into your life. Factors such as your career and financial goals, time, location, and possible can help guide your decision and shape your truck as you get set up. Ask yourself some of the following questions:
    • What are the physical demands? Operating a food truck will probably require that you spend long hours standing on your feet.[3]
    • Are there emotional demands? Running a successful business can put a lot of emotional stress on you between trying to succeed and make money as well as the time it may take away from loved ones.[3]
    • Does the business fit your personality? Owning a food truck means you rely on the public to support your business. Customer service is going to be a big part of your job and if you enjoy working with and interacting with others, this could be a great choice for you.[3]
    • How much will I make? The average salary for food service managers, which includes operating a restaurant, is $48,560 annually.[4] This amount may differ according to your location and products. Be aware that it may take a while to make a profit because of considerable start-up costs.[5]
  3. Come up with a preliminary concept. Design a basic concept to guide you as you get the food truck set up. Thinking about the food you want to serve and your image can help you more easily formulate you business plan.[6]
    • Ask around to find out which food trucks do the most business in order to get an idea of the types of food that potential patrons may find appealing.[5]
    • Speculate on what types of food trucks may do well even though they do not currently exist within your municipality. For instance, if cupcake trucks do well in your area but no one has tried other dessert trucks, you could experiment with a specialty-dessert truck.
    • Consider having a taste test before finalizing your concept. Anonymous surveys and taste tests can help determine whether or not there is any interest in your truck.
  4. Establish your legal business entity. Set up a legal entity to give your food truck business some legitimacy. Establishing a legal entity, which includes your business plans, can persuade potential investors and clients that your food truck is a serious business.[7]
    • Contact the Small Business Administration, which can help smaller companies get started, with any questions.[8]
    • Consult with local authorities.
    • Setting up a legal business entity can reduce your personal liability if problems with your truck ever come up.[9]
    • Register your food truck business with the Internal Revenue Service (IRS) or other tax authorities.
    • Retain a local lawyer and accountant to help you handle the legal and financial sides of your business, from registering with authorities and the IRS to budgeting.
  5. Write business plans. Draft and finalize both a short- and long term business plan that can guide your business. Not only is this is important to help develop your business and accommodate for contingencies like a lawsuit, but it can also help you secure financing to buy permits, insurance, and supplies.[5]
    • Write out the goals and objectives for your truck, what financing you have and need, any marketing strategies, and how you will implement your business plan.[7]
    • Give a brief executive summary that clearly tells your potential investors what you want.[10]
    • Be as detailed in your plan as possible, but remember to allow for some flexibility based on suggestions. List any owner and employee responsibilities, and your route plan. Compose a preliminary menu and prices, which will force you to focus on one concept.[7] Finally, tabulate any costs for permits, supplies and payroll.[7]
  6. Apply for licenses, permits and certificates. Mobile restaurants need different types of permits and licenses for their trucks and cooking facilities than regular restaurants. Ask local authorities about what you need. You can also consult with other food truck owners to ensure you obtain the correct licenses and certificates.[5]
    • Obtain permits for the truck to park, which often requires additional zoning permits.[7] Your route plan can help you get your zoning permits.
    • Contact your local health department with your plan. Apply for a health permit and licenses to operate as a mobile food unit.[7] The health department can generally give you all of the information you need to get started and operate.[11]
    • Requirements for licenses and permits vary from state to state, but in general you will probably need: proof of ownership, license for the vehicle, proof of food manager identification, food purchase record storage and record keeping, that your service support facility meets your food truck’s operation needs and a copy of the facility’s license and recent inspection report.[11]
    • Contact the Small Business Administration with questions in addition to local authorities.[8]
  7. Apply for insurance. Just as a regular vehicle, your food truck—and business- need insurance. This can protect your assets and from any liability if your truck hits someone.[5]
    • Be aware that cost of insurance can vary depending on the company that insures you, but it should not be much higher than regular vehicle insurance.[12]
    • Let the underwriter know about any risks your food truck might present. For instance, if you plan to store propane tanks on the truck, your insurance underwriter can incorporate this into your policy.[12]

Getting Supplies

  1. Buy a truck. A truck is the centerpiece of your business, so buy a vehicle that can carry your supplies and serve your customers, which can cost on average between $30,000-$50,000.[13] A good truck can help attract customers and make your work easier.[13]
    • Check with local authorities about construction requirements for food trucks, as they vary from state to state.[7]
    • Shop around for the best deal. The exact cost will depend on the condition of the truck and how much equipment it already.
    • Consider buying or renting a used food truck to save money.
    • You will need sufficient space for your kitchen, supplies, and serving customers.[13]
  2. Stock your truck with kitchen equipment. If you plan on preparing food in your truck, you will need storage and cooking appliances. Stock the unit with anything you need immediately and add supplies as they become necessary.
    • Get basic storage supplies including a refrigerator, freezer, and cupboards for ingredients and utensils.
    • Buy basic preparation and cooking supplies such as an oven, fryer, countertops, cutting boards, and utensils like plates and silverware.
    • Consider renting commercial kitchen space if you want to prepare the food off-site.[5] If you can find affordable kitchen to rent and a cheap, basic truck, this might be more cost-effective.
  3. Contract food vendors. You’ll need to work with vendors to supply the food or ingredients for your dishes. Making contracts with specific vendors can not only help cut costs but may also get you business by word of mouth.
    • Call multiple vendors and discuss your food truck. Ask the vendor questions about quality and pricing.
    • Check the vendor's references. Find out their current customers and if those restaurants or food trucks are satisfied with the vendor's performance.
    • Make sure that the quality of the product is good, as well as the quality of the service. Verify that any meat, dairy, or perishable food items are shipped in a timely and sanitary manner. Ask to see health inspection reports and permits.
    • Limit your vendors. Keeping track of a large quantity of invoices can bog down your business. Consider sticking with a couple of key vendors for your needs.
    • Negotiate any aspect of the contract you like such as delivery schedule and payment.
  4. Buy in bulk from non-contract sources. If you prefer to buy supplies yourself instead of dealing with food vendors, consider buying in bulk from catalogs and warehouses. Be aware that you will need to provide proof that the vendor meets health inspection standards for its products.
    • Shop at retail warehouses which sell food in large quantities. Be aware that the supply of fresh food is limited through warehouses, however.
    • Consider buying in bulk from a catalog. Bulk food catalogs buy food from vendors and producers before turning around and selling that food the businesses or consumers. However, it may be difficult to get fresh, perishable food through a catalog.
  5. Find a place to park your truck. Food trucks are large and require a space to park when they are not operating.[7] Some cities will require you to rent space at a city-owned truck lot, while others let you to rent your own depot or commissary space as long as it is approved by health inspectors.
    • Check with your local authorities about specific regulations and procedures for parking your truck.
    • Check that your depot or commissary offers power to store the truck overnight, fresh water, and a place to fill up your propane.[7]

Building Your Business

  1. Work with a mentor. Ask an experienced businessperson who understands small businesses or the restaurant industry to serve as a mentor for your business. She can help you grow and offer advice during difficult times or situations.
  2. Finalize your menu. Based on the food concept you tested earlier, finalize your menu. Keep the menu as simple as possible so that you can specialize in one cuisine or product.[11]
    • Offer several different dishes that you cook and sell well.[11]
    • Make sure your food matches the time of day that you’re selling. For example, ribs probably won’t work in the morning.[11]
    • Make sure your foods can be easily carried around.[11]
    • Think about foods that are cost effective.[11]
  3. Price your items fairly. Set up prices structure for your food. Remember that you’ll need to charge enough to cover operational costs and make a profit.[11]
    • Figure out range of prices and then set a final price once you’ve had a chance to research what other trucks charge for similar dishes and calculated your own costs.
    • Gauge your prices are commensurate with similar trucks in your local area.
  4. Set up payment structures. Once you know your prices and costs, establish an invoicing and payment system. Consider the types of payment you accept and how you will write receipts and pay bills.
    • Open separate bank accounts for your business and personal finances.[14]
    • Have separate credit lines for your business and yourself.[14]
    • Keep your pricing and billing transparent for customers and vendors.
  5. Hire staff. Depending on your finances and initial projections, you may want to hire assist you. In the early stages, you may need to be the only person to help with cooking, preparation, or customer service.[11]
    • Interview people and make sure they have some experience with food trucks.
    • Make sure the potential employees have any necessary food preparation licenses, certificates, and permits.
  6. Develop your marketing strategy. Social media and word of mouth are key pieces of marketing your food truck. Hooking your potential customers with social media and ads can help attract a wide array clients.[11]
    • Paint your truck with your name and logo. This can attract potential customers.
    • Use an ad agency or design your own ads and website by researching other food trucks. Keep your brand simple, distinctive, and attractive to your customers.
    • Make sure your ads complement your brand. Use similar color and design schemes that match the painting job on your truck.
    • Attract customers through referrals and maintaining strong business relationships with your clients.
    • Set up an active presence on social media sites like Instagram, Facebook, Snapchat, and Twitter.[11] Use these sites to announce deals and offers that can attract customers.
    • Consider placing an advertisement in the newspaper or in bulletins and other local publications. You can also post advertisements on an online classifieds website.
    • Put flyers up on community bulletin boards, often located in libraries and coffee shops.
    • Partner with other businesses or trucks. Talk to local businesses about displaying your menu in exchange for referring them to your clients or displaying their business cards.
    • Get involved in community activities, which is a type of free marketing. Donate food or make a contribution to a charity to get your truck’s name out in the public.
  7. Listen to customer demands. Pay close attention to your customers' suggestions and requests. This can help you retain—and gain—customers.
    • Be flexible without changing your entire concept. For example, if you sell gourmet cupcakes but you find customers turning away because you do not have traditional flavors, compromise by having a selection of traditional and gourmet flavors.
    • Ask customers what they like and why they like it. Chatting with your customers can bring a lot to your business.
    • Hang up a suggestion box on the side of the truck and check it daily.
  8. Stay on top of industry trends. Because food trucks are increasingly popular, staying on top of industry trends is important to keeping your business fresh and attracting customers. Read trade publications, network with food truck owners, and eat at other food trucks to keep yourself informed.

Sources and Citations

  1. ↑ 1.0 1.1 http://www.entrepreneur.com/article/220060
  2. ↑ 2.0 2.1 http://foodtruckr.com/2013/10/what-i-wish-id-known-before-starting-my-food-truck/
  3. ↑ 3.0 3.1 3.2 http://www.bls.gov/careeroutlook/2014/article/self-employment-what-to-know-to-be-your-own-boss.htm
  4. ↑ http://www.bls.gov/ooh/management/food-service-managers.htm
  5. ↑ 5.0 5.1 5.2 5.3 5.4 5.5 http://www.inc.com/guides/2010/05/opening-a-successful-food-truck.html
  6. ↑ http://www.inc.com/guides/2010/05/opening-a-successful-food-truck.html
  7. ↑ 7.0 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8 http://openforbusiness.opentable.com/tips/how-much-does-a-food-truck-cost/
  8. ↑ 8.0 8.1 https://www.sba.gov
  9. ↑ http://www.entrepreneur.com/article/81180
  10. ↑ http://www.entrepreneur.com/article/247575
  11. ↑ 11.00 11.01 11.02 11.03 11.04 11.05 11.06 11.07 11.08 11.09 11.10 http://www.entrepreneur.com/article/220060
  12. ↑ 12.0 12.1 http://www.inc.com/guides/2010/05/opening-a-successful-food-truck.html
  13. ↑ 13.0 13.1 13.2 http://openforbusiness.opentable.com/tips/how-much-does-a-food-truck-cost/
  14. ↑ 14.0 14.1 http://www.entrepreneur.com/article/204862

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