The food industry is a challenging one, but with low startup costs and a strong potential for high ROI, more people than ever are starting food truck businesses. No longer do food trucks limit themselves to construction sites and local carnivals—these mobile restaurants are everywhere you can imagine in cities large and small: parks, weddings, downtown streets, college campuses, and more.
But despite their rising popularity, owning and operating a food truck is no walk in the park. It’s not enough to buy a truck, get a fresh paint job, and whip up your family’s favorite recipes. To boost your food truck business and guarantee its survival, you’re going to need food truck smarts, a solid financial strategy, and a cohesive team.
To support your ambitious endeavors, we’ve compiled everything you need to know to take your food truck to the next level.
Master the Art of Food Truck Smarts
Operating a food truck isn’t a cooking competition. It’s much more than that. Yes, food is important, but ask any experienced food truck owner and they’ll tell you success depends more on factors like location, timing, and partnerships.
In general, food trucks offer similar menu options for roughly the same price, so how do they differentiate themselves from competitors? Location, location, location. The ability to consistently find prime locations is arguably the most valuable food truck smarts an owner can possess.
Think about it. The best food in a poor location will struggle to get customers, no matter how good the dishes taste. But the worst food in a prime location can attract hungry, curious first-time buyers.
But it’s not as simple as locating local hotspots—the timing is just as crucial! Park your truck on Main Street during heavy foot traffic on a beautiful Saturday afternoon and you’ll be scrambling to fill all the orders. Park your truck in the same location on a Tuesday morning and you may struggle to find any buyers.
Unfortunately, finding the right spot at the right time doesn’t necessarily guarantee success. Remember, you’ve got a big ol’ truck to park, and you’re going to need valuable street space or a parking lot to open up shop. That’s where partnerships come in. Partnerships with local businesses can play a key part in helping you secure prime real estate for your food truck. These businesses often own private parking lots or can help you secure nearby street parking. Find a partnership that makes mutual sense (maybe with a bar that only sells drinks) and you’ve got yourself a perfect location with little competition.
Secure the Capital You Need to Compete
People expect quality food and a quality experience when they visit a food truck—competition demands it! To compete, you’re going to need a number of pricey assets: the truck (of course), staff, ovens, grills, deep fryers, freezers, food processors, or whatever equipment you need depending on your food truck’s one-of-a-kind cuisine. Yeah, it’s a lot, but don’t panic. Just like there isn’t a “best” grub to serve from a food truck, there isn’t just one way to finance a mobile food business, either:
- Equipment Financing — Whether you need a deluxe Belgian waffle maker or a 6-speed blender, you can finance just about any kind of business equipment with an equipment financing loan. Seriously. And the best part is you don’t need a down payment or collateral—your equipment is the collateral. This means you can secure a loan without draining your bank account or risking your personal assets. Since the collateral is literally part of the loan, getting approved is simpler than you’d think.
It’s never too late to get equipment financing. Sure, you can use a loan upfront to start the business, but you can also use one down the road (get it?) to expand your operations: buy a second truck, upgrade equipment, or install solar panels.
- Business Line of Credit — You can use a business line of credit for just about anything. Want to increase your inventory? Covered. Need to replace your tires? No problem. Hiring new staff? Go for it. A business line of credit is there if you need it, but you’re under no obligation to use it. You only pay interest on the funds you use, not the full amount.
Basically, this line of credit gives you the safety net you need with the flexibility you want. It’s a food truck—you never know what could happen. Gloomy weather may keep folks inside for weeks, while a drive across town may lead to a flat tire. It doesn’t hurt to have financing on hand to cover whatever surprises may come your way.
Although starting on limited seed money (as The Great Food Truck Race likes to do) may be the romanticized entrepreneur grind, you can skip the growing pains with financing and purchase what you need to succeed from the get-go.
Hire a Tenacious Dream Team
Recruiting and staffing a strong food truck crew takes more talent than selecting a winning Fantasy Football team. To be successful, you’re going to need to strategically organize your staff. Keep in mind, it’s a tight space (usually 14-18 feet). You only need so many cooks and so many cashiers. Ability is one aspect, character is another. Mix a few incompatible personalities together on a hot day in a 14-foot truck, and they’re going to be stepping on each other’s toes in more ways than one.
If you’re just getting started, have the confidence to believe you’ll be successful—don’t settle for good enough. Go ahead and hire some tenacious talent. Hire a team who’s going to represent the business well, not just get food out the door.
Your food truck business can be more profitable than it is today – much more. Boost your business with just a few minor tweaks to your strategy, financing plan, and hiring team and become the top food truck in town. Now go forth and create your American dream on wheels.