Challenges to Expect When Starting a Food Truck Company

Corporate America can wear down its workers and inspire them with entrepreneurial ideas such as starting a food truck company. If you have a passion for food and for running your own company on your terms, this is an appealing idea. However, there are challenges to be aware of when beginning your own food truck company.

 

(1) Permits and Documentation

When deciding where to park your business, you should evaluate the rules associated with that town or municipality. In addition to a seller's permit, often additional paperwork is required including food safety training and health department certifications. There may also be mobile vending laws unique to food trucks that you should review. Determine the cost associated with obtaining each as you do your homework.

 

(2) Capital

Like a typical restaurant, capital is necessary to begin operations. Capital is often underestimated given the "convenience" of a mobile business. Without a realistic outlook on the initial outlay of expenses, it is difficult for the food truck to become profitable. As a result, many close within a year.

 

(3) Bathrooms

Part of the beauty of operating a restaurant on wheels is that you don't have all the constraints of a brick-and-mortar restaurant. That may not always be the case because some cities or municipalities require that food trucks be near a bathroom. In Los Angeles, for example, a food truck parked in one place for more than an hour must be within 500 feet of a bathroom.  

 

(4) Weather

Orlando or Miami are the two best cities for food trucks according to Business Insider, due to favorable weather and tourist population. Unless you live in one of these cities, weather could factor into your success. You should consider how to manage and withstand potential erratic revenue trends due to weather.

 

(5) Insurance

You really need to do your homework when figuring out what insurance is needed. Ask friends or family members for the name of a trusted insurance advisor who can help you find the most affordable car insurance or commercial auto insurance plan that meets your needs. Business personal property and workers' compensation may also be necessary depending on your situation.

 

(6) Hard Work

Many people underestimate the amount of work that is necessary to make a food truck business viable. It is not enough to be a good cook. The business side of the food industry is often overlooked such as sourcing ingredients at fair prices, storage of ingredients and finished product, and the timing and logistics of preparing the food and hauling your business where it needs to be profitable. Often, the food truck is managed by one person so it can evolve into a 24/7 job with limited downtime.

 

(7) Marketing

It is a common misconception that location and good food are all you need to be successful. To get the food truck business off the ground, there needs to be aggressive marketing and social media outreach to create awareness of your product. People are generally unwilling to try something new unless they've heard buzz or good reviews about it. Therefore, you can't expect them to immediately line up at your truck the minute you secure your permits and open for business. Part of your marketing effort is to make sure your product is priced correctly and fills a niche.  

 

(8) Inferior Product

In big cities, new food trucks seem to be appearing daily. As the owner of the food truck, you need to make sure your product is not just good, but great. Test the product (as you would actually prepare it for normal operations) on friends and family members. Is it soggy, hot, cold, or just not as tasty as you believe it is? Remove your bias about your "baby" and accept constructive criticism to make sure you have a competitive product offering.



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Comment by Andrew Grant on March 28, 2017 at 1:48am

Thank you so much for these valuable tips! I'm seriously considering satrting my own food truck company. I have already developed a detailed business plan and addressed the marketing gurus from  http://thecmoclub.com/ to help me with marketing issues.

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