How Much Does a Food Truck Business Cost?

Food trucks have been extremely popular in numerous locations over the past 10 years, in part because of their low operating costs. Despite being less expensive, starting a food truck business frequently costs more than opening a typical brick-and-mortar restaurant. A new vehicle may cost anything from $50,000 to $175,000 to buy and install. Like when launching any restaurant, you should start with a solid food truck business plan and a realistic budget.

Initial Costs

Different licenses, permits, and other costs may account for state-to-state variances in the cost to establish a food truck. A simple gimmick with a mobile kitchen and limited storage might be built for as cheap as $50,000. That amount would pay for the car and most of the early kitchen appliances. However, remember that you get what you pay for. A food truck is mostly a moving object. Unlike a fixed structure, this restaurant needs reliable transportation. You're out of business if it is in the repair shop for a week.

No matter how basic or luxurious an automobile may be, you should have a reliable technician inspect it.

According to Forbes magazine, a lightly used truck with "decent" remodels and preparing food equipment often costs closer to $70,000 or $80,000. If you're willing to spend $100,000 or more, you can have a brand-new truck or extra bells and whistles. The caveat to this rule is that it's frequently not worth it to spend more money on a new car. Preparation equipment can vary substantially depending on the type of food truck you operate.

Daily Operating Costs

Compared to traditional eateries, food trucks frequently have lower startup expenses and overhead expenditures. Additionally, keep in mind that there are various other costs associated with operating a food truck on a daily basis, such as license and permission fees. In cities like Portland and Los Angeles, getting permits may be difficult if you don't have the required paperwork in a timely manner.

Not all hidden expenses are cunning. To add more room for meal preparation, several food trucks share a commercial kitchen. Consider where you'll park the truck after hours as well. You might need to rent a parking space if you live in a neighborhood that is extremely congested. Your truck will need the same maintenance as your primary car.

You also need to promote your business. How are you going to handle your social media accounts and website? Do you intend to do it yourself or hire someone? Finding you should not be a problem for your clients. You might make flyers or consider other options if you want to promote your food truck.

The majority of your regular daily operating expenses will be made up of food and supply costs, employee salaries and payroll taxes, POS and credit card processing fees, transportation, equipment maintenance, and insurance. These areas should receive the same respect as any other restaurant.

Financing Opportunities

A business plan is necessary to finance a food truck, just like any new restaurant. You have the option of writing the plan yourself or hiring a professional who will carefully review your menu, your target market, and your marketing approach. Once you have a business plan, you can submit an application for funding to banks, the SBA, private lenders, and investors. You might be able to lower your interest payments or investor obligations if you have assets to sell in order to raise some beginning capital.

A nearby restaurant without a food truck could be willing to lend support. Your food truck might be appealing to a local restaurateur who is attempting to establish her brand. You can enter the market with a well-known brand name and a few menu items that are already well-liked in your community by developing a relationship. In the event that you use this experience to someday create your own food truck, the banks will be glad to see that you have industry experience.

Do Your Homework

The food truck sector provides a more cost-effective way to start a restaurant. However, avoid viewing it through rose-colored lenses. Food truck business owners encounter surprising realities when they initially begin their businesses, and many of them shared with FoodTruckr what they wish they had known beforehand. Surprises regarding licensing and approval were frequently noted as grave concerns. The process might sometimes take months. Regulations differ from state to state, and costs are frequently far more than expected.

The next step is to estimate the cost of creating a successful food truck in your neighborhood. It's highly possible that what works for food trucks in Chicago and New York City are very different from one another. Never presume that what functions in one circumstance will function in another. Studying your target market will help you better understand the problems and needs of the local food communities. Learn about the local food truck scene before you sign the first check.