Starting a food truck is turning into a trendy alternative for entrepreneurs who wish to get in the food sector — this isn’t any better epitomized by the fact that the food truck business is a $2 billion-plus sector and has grown by 300% since 2014 in towns all over America. (Food Truck Nation)
The most cited reasons why folks elect to open a food up truck as opposed to getting a fixed premised because of their restaurant are: freedom of location and an ability to operate in occasions, greater ability to promote oneself whilst traveling around and lower initial set up costs and overhead.
This last reason, namely that a food truck is less expensive to set up and operate compared to starting a new restaurant company, is definitely the most often cited reason why folks enter the food truck sport. This includes a drawback, however, since lots of individuals underestimate the money necessary to establish a food truck and make a success out of it.
Cutting corners because of an inadequate budget is a surefire way to lose out to the contest. With this in mind here are the costs which will need to be accounted for when starting a food truck.
The clearest cost in starting a food truck, and one which applies no matter what you’re serving is the truck itself.
Now, it is always tempting to choose the least expensive truck available when your company is in its infancy. While the notion of having a”minimally viable item,” specifically getting yourself out there and analyzing the market with as little cost as possible, works in certain industries, you finally save money by spending a bit more on a fantastic excellent truck.
This is for 2 reasons. Primarily, with all of the cooking going on in the vehicle, wear and tear will happen quicker than if you were just to use the vehicle for transportation. A cheaper truck will require a whole lot of upkeep, which over time, will cancel the first savings and more.
Second, if your truck breaks down and needs to go to the garage, you don’t have any business until it’s up and running again. A better quality truck means less downtime and, thus, more earning potential.
Though it is going to depend on where you are and which sort of food you intend to serve, an excellent food truck will often cost you around $70,000. If you purchase new, expect to pay over $100,000, so it’s well worth shopping around for a high quality secondhand truck in good shape.
Besides the truck itself, you’ll also need to be certain that you get a dedicated account to your business so that you can manage budgeting and taxes after you start trading. A fantastic money saver when you’re starting is to go for an account with a reward program so that you can get money back once you make your primary business purchases.
As soon as you’ve brought your automobile, kitting out it will be the next significant expense to account for before you can begin to make money. The required spend depends on what food you’re going to be serving.
Listed below are a few examples of the equipment you will require, and how much it is likely to cost, for various meals truck companies:
- Food Truck Selling Burgers — Gear: Flat top grill, broiler, commercial refrigerator, salad crispers
(Estimated cost: $8,000)
- Food Truck Selling Pizza — Equipment: Pizza oven, serving stations, dough mixer, commercial refrigerator
(Estimated cost: $20,000)
- Food Truck Selling Grilled Sandwiches — Many sandwich presses, grill, separate storage spaces for vegetables and meat, commercial refrigerator (Estimated cost: $11,000)
Regardless of what food you serve, you’ll need a point of sale system (POS), which means that you can take card payments. This will enable more people to make purchases for you and will prevent you from having to hold tens of thousands of dollars in money on your truck at the end of every day.
You could also benefit from investing in extra restaurant equipment like coffee machines and drinks fridges for additional up-sells. This can choose the installation cost of your food truck company to well over $100,000 in the event that you combine both the truck and gear .
Licenses and Insurance
To legally sell food at a public area, you’ll require the licenses and insurances required to sell food, and permission to trade in whatever area you decide to establish your truck.
Insurance to sell food at a public place will begin at about $300 a year, but you can expect this to grow if you start hiring employees or operating in a number of locations.
The permits required to market food (or anything else for that matter) can differ from state to state and even city to city. It is worth speaking to the regional government official, or a lawyer specializing in this sort of business to ascertain what you require. Score has a wonderful guide on the permits and permits required to function.
Generally speaking, it’s more costly to trade in areas which are more densely populated. This can, of course, mean more business in the long term, so it may be a smart investment to make.
When attempting to save money on your own food truck business, it is very important that you save money in areas that don’t undermine the quality of the food itself. With so much competition, your product has to be exceptionally great for you to stand any chance of succeeding.
That having been said, you can save cash by purchasing second-hand equipment. Some restaurants purchase equipment to check out new things on the menu. If these items aren’t a hit, then the equipment can sit there, be nearly like new, and supply no value to their original owners. This is where you can take it off their hands in a very low cost.
You may wish to find an affordable POS system with the restaurant management system features you have to run a food truck. Having a dependable point of sale system will help keep your inventory, sales, and taxation in order.
As your truck is the most important initial expense, you can save money through keeping it properly and therefore making certain you squeeze every ounce of value from it as possible. Get your automobile serviced regularly (at least once every year) and be sure seemingly minor issues are regarded when they’re noticed. If you do so, then your truck could last you decades, making the initial outlay seem a great deal more reasonable.