The food truck business is quite lucrative. More people than ever before are lining up at food trucks because of the increasing popularity of street foods. What they don’t know is that food trucks have been serving delicacies on American city streets for decades. They’re the most recent iteration of a long-standing culture of American and global society. However, there has never been more recognition or attention in the street food sector. With more work and shorter lunch breaks, which leave employees pressed for time, people are looking for affordable breakfast and lunch options. This has increased the allure of the food truck industry. Here’s what you need to include in your food truck startup checklist before moving further.
1. Business Planning
A business plan is one of the most important parts of a food truck startup checklist. Start by writing an executive summary, which is a brief overview of your business. Try to limit it to no more than one or two pages. Anything more simply isn’t practical. The executive summary is what you’ll share with business partners and potential investors, or present to lenders when applying for investment loans. It should be a synopsis that briefly discusses the idea behind your food truck, your primary operating hours, your locations, an overview of your marketing strategy, and the sum of money needed to get started. Someone should be able to understand your business by just reading your executive summary.
Go over your menu and costs. Think about what foods you’ll sell and how much you’ll sell them for. You also need to factor in production costs, and prep and cooking times. Make sure the foods and snacks you’re planning to serve can be prepared fast, and that your rates are set to compensate for the cost of production. Of course, there are additional costs such as location and maintenance fees to consider as well.
Establish your target market. The target market part of your business plan defines who your core clients will be in terms of their age group, demographics, occupation, and areas of residence. This information will help you estimate the size of your target market, which represents the total number of prospective customers you could have, which is critical information you can use in your branding and marketing efforts.
Think about potential locations as well. Even though you’re going mobile, finding ‘the perfect spot’ will not always be a new adventure. Have a plan in advance to avoid wasting time looking for the ideal spot. Start by thinking about the areas where your target market is likely to be. Choose a location that is suitable for the ‘working lunch’ crowd who want to grab a quick lunch close to their offices.
Customers seek consistency as well. They’ll want to know where and when you’ll be there. If you appear in one spot one day and disappear the next, you risk losing out on repeat business as people will perceive you as inconsistent. Your business plan’s financial plan may be its most crucial section. Here’s where you’ll determine the finances needed to successfully run your company and earn a living. When compared to other businesses, $100,000 in startup costs is very low and way cheaper than opening a restaurant. In fact, most food truck entrepreneurs discover they can finance their startup using savings and loans from family and friends. Since the majority of your startup costs will go towards tangible assets that the bank can seize if things don’t work out, bank loans are also an option.
2. Gearing Up
The most costly and time-consuming step in a food truck startup checklist is acquiring a kitchen-equipped truck. You’ll need to locate a reputable food truck retailer who creates open lines of communication and is capable of facilitating the customization of your food truck to satisfy your specific needs and local regulations or requirements. Choosing whether to buy a food truck from a new or used truck dealership is one of the most important decisions you’ll need to make. While each option has benefits and drawbacks, your choice ultimately comes down to your budget and how much you can pay upfront.
Purchasing a secondhand food truck is an excellent solution if you want to get your own food truck but are apprehensive about spending money on a brand-new car. Purchasing a brand-new food truck is a wise investment if you have the cash. Contrary to other mobile food company models such as food carts, food truck kitchens are spacious enough to hold a range of supplies and equipment. The additional room gives you more creative freedom when setting up your equipment and creating your menu.
3. Asset Protections
You should also include asset protection in your food truck startup checklist. There are more liabilities associated with the food truck business than just traffic accidents. Your general liability insurance will cover the majority of issues. The general liability policy will protect you against the following:
- Physical injury: If a customer is hurt by a staff member or by your food truck
- Food poisoning: If a customer alleges your establishment is to blame for their foodborne illnesses
- Property Damage: If your operations result in damage to surrounding structures or automobiles
- Reputational damage: If someone alleges you’ve broken copyright laws
Because the food truck is a place of business, you’ll also need a commercial auto insurance policy. Like a personal auto insurance policy, this will protect you against physical damage from a traffic collision in addition to comprehensive damages like those brought on by vandalism, theft, or bad weather. Commercial property insurance covers sales equipment, utensils, stoves, food, pans, and pots.
Supplies are important to include in your food truck startup checklist. The food truck’s business plan should include the equipment you’ll need for operations. Consider the costs of purchasing new equipment, maintaining essential equipment, and replacing delicate or single-use supplies. To get started, you’ll need the following equipment:
- Truck ($20,000 – $100,000)
- Commercial cooking equipment such as a grill, charbroiler, and fryer ($500 to $1000)
- Preparation table ($500 to $1000)
- The exhaust hood ($500 to $1,500)
- Refrigerator(s) ($1,000 to $5,000 per unit)
- Condiment dispensers ($12 to $20 each)
- Foam or plastic disposable dishware ($15 to $80)
- Cleaning products ($150 to $200)
- Check books ($50)
- Menu signage ($100)
- Cash registers ($100 to $200)
Consider looking into refrigerated truck rentals. They may be a viable option for you.
Installation is another important part of a food truck startup checklist. Employ certified and licensed professionals to install any equipment required for your operations. If you hire an unqualified person, you may end up in serious trouble and be held responsible for anything that goes wrong. In addition to protecting your truck investment, you’re also responsible for ensuring the safety of your clients, personnel, and businesses in the vicinity. If your food truck is parked beside other food service vehicles, for instance, a fire there can easily spread to the other vehicles. If a disaster occurs as a result of carelessness on your part during appliance installation, you will be held responsible for the resulting damages. You should never try to cut installation costs by working with an unqualified individual.
6. Knowing Who to Call
Repair services are important to include in your food truck startup checklist. A food truck has some benefits over brick-and-mortar competitors but can also present its fair share of disadvantages. Regular preventative maintenance by auto repair services will extend the lifespan of any vehicle, but especially that of your food truck as a breakdown could result in lost working hours or days. Even when new, it can be quite expensive, and as your food truck ages, the more maintenance it will need. Whether it’s a general auto repair service or a commercial refrigeration repair service, you’ll have a variety of options to choose from. However, your choice will depend on the truck model you use as the base of your operation and the distance of the repair facility from your location.
Seasons also affect truck repairs. For instance, the engine needs extra attention during summer as the heat will increase the stress it handles on daily runs. In this case, getting a full service is a wise move so as to prevent disruptions to business operations. Having repair services you can always rely on is recommended when you own a food truck. You never know when the truck may need emergency repairs.
7. Ensuring Quality
Common logic in the service industry holds that serving excellent food and providing exceptional service encourages repeat customers. Only those who have demonstrated these qualities prosper in the industry. One negative review can cause a snowball effect, as many business owners can regrettably attest to. If the review has been established, more are likely to appear over time, creating an avalanche of unfavorable associations that many current and potential new customers will consider when deciding whether to stop by your food truck.
As important as it is to offer each new customer a high-quality product and service, it is also important to maintain that level throughout the course of business. Avoid cutting corners when selecting the ingredients you use to prepare your meals. Offering, say, a homemade sauce rather than a store-bought can be a significant differentiator for your establishment. Don’t undervalue the importance of the small details such as the water filtration system installs; they’ll mean everything to your customers.
8. Building a Brand
As an owner of a food truck business, how you brand your food truck is one of the most crucial decisions you’ll have to make. Everywhere it goes, a well-branded food truck will promote your business all day long. Start by identifying what your brand is. Genuine brands are the best brands. They’re derived from the actual interests, principles, and character traits of the people who run the business. Look within. After figuring out your brand, put together a mission statement. Your mission statement ought to serve as a reminder and a road map for who and what your business is about. Every time you’re making a brand decision, use it as a guide. When your customers read your mission statement, they should be able to relate to it.
Most importantly, your food truck business needs a social media presence. Today’s consumers expect your business to be active on social media. Social media can benefit your mobile food businesses’ branding. First off, customers can always find you on anchored platforms like your social media accounts. Secondly, brand loyalty is easily fostered through social media interactions, which entices customers to visit your truck in person. Lastly, customers can easily be notified of your daily location, menu, and sales changes via social media. Consider hiring professional media planning services to help with your social media efforts. Customers are more inclined to follow active social media accounts that provide useful content. It’s important to include brand building in your food truck startup checklist.
9. Insuring Yourself and Your Employees
In addition to insuring yourself, you should also insure personnel. Your general liability insurance doesn’t cover your employees as they’re considered a part of business operations. If a worker sustains an injury while on the job, workers’ compensation will cover their medical costs as well as any lost wages. Most states require this coverage, which shields your business from claims made by injured workers.
You may not be aware, but small business health insurance offers various benefits that can make your organization run more efficiently, strategically, and effectively. In addition to the benefits for the employees, a group health insurance plan for small businesses can help employers in various ways.
10. Outreach and Community Connections
Food trucks can cater to a variety of events, including corporate events, weddings, birthday parties, and music festivals. Depending on turnout, these gatherings can be lucrative for food truck entrepreneurs. You can increase your revenue by taking on a few side jobs in the catering industry and broaden your clientele by putting yourself in front of those who otherwise wouldn’t visit your food truck. After tasting your incredible cuisine, you can expect new customers at your food truck. Because people constantly want to stay up to date with trends, you’ll likely acquire more event contracts from the one you just catered for.
There’s an increasing number of people lining up at food trucks because of the growing popularity of street foods. They’re popping up at a fast-and-furious rate throughout the United States. If you’re considering venturing into the food truck industry, consider this food truck startup checklist and hit the ground running.