“What is the total food truck cost?”
This is one of the most common questions asked by budding entrepreneurs looking to start a mobile food business. Sounds like a fair question because you may want to know how much you need to put in before expecting profits from one of the fastest growing small businesses in the country. As a matter of fact, an IBISWorld survey suggested that yearly revenues from food trucks grew 8.4% annually between 2007 and 2012. Food trucks are giving a tough competition to small restaurants and other eateries due to the sheer convenience and excitement associated with eating on-the-go. Be it professionals, children, young men/women or senior citizens; just about everyone tends to grab a bite of outdoor food whenever they can. The average American family spends $100-$150 per week on eating outside. This amount goes up significantly when you focus on young adults, who don’t mind eating out every other day. Owing to facts like these and the burgeoning popularity of mobile food, initiating a food (or lunch) truck business is no longer dismissed as just another ‘risky business’.
Factors to consider while evaluating food truck cost
The costs associated with buying a food truck don’t merely involve the truck, licensing, its equipments and food processors. It entails the following (hold your breath, but don’t get overwhelmed):
· Truck Purchase
· Website design
· Truck wrap
· Promotion and marketing
· Global positioning system (must-have)
· Consultancy fees
· Licensing and commissary
· Credit card processing
There are no hard and fast rules for interesting into an outside dining setup. For instance, street kiosks can be commenced by beginners with minimal investment. You can get a food cart for $3,000 while food ingredients and licenses/permits cost an additional $1,500- $2,000.However, if you’re really serious about your businesses you may want to invest in a food truck whose cost may easily go into five figures. In dollar terms, this amount could be in the range of $50,000 to $150,000. Take a higher amount and you’ll be entering the dangerous territory of a high-end eatery establishment. If however, you decide to invest an amount less than the lower end, you run the risks of operating a business whose reliability and food quality remains dubious. You don’t’ want that to happen, especially when you’re starting out.
Look for an optimal amount to invest
Anything between $70,000 and $90,000 is a safe amount to invest in a quality food truck that delivers quality products and can still be modified to suit your requirement. Seek a truck that is a few years old but is in top working condition. Going for anything newer would escalate the investment figure considerably unless you aim to compete with a brick and mortar restaurant. Remember that you will also need to accommodate expenses like maintenance, fuel, website, accessories, license, supplies, insurance, etc.; hence, use your discretion. If you do have a sound business plan and are confident about your strategy, invest a higher sum by all means a physical space can easily cost between $200,000 and $300,000, by conservative estimates.
The boom in mobile food business is naturally taking up the investment cost to new levels, something that you must watch out for. Any investment that runs into six figures should not be looked at with too much enthusiasm because the risks are far too many.
After including overhead costs like gas, transportation, etc., it can be a challenge to sustain good profits. Also, some trucks are only allowed to run for a few hours a day.
Therefore, be creative and look for ways to save money. Some food truck owners spend $3,000 per month by leasing shared kitchen while others partner with private restaurants and pay just $7,000 to $1,000 a month. You can do the same.
Get a techie friend to do a website for you for free, or launch creatively packaged pages for your social media promotion. Spread the word around, little by little and focus on satisfying your consumers through quality items.
Small measures like these would eventually keep the food truck cost in check and put you on track to sustain a profitable mobile food business.