10 Things to consider when creating your food truck’s business plan
It takes more than having a novel food concept to succeed. Most businesses have trouble because they lack a solid plan. If you are a regular Joe, looking to earn a living and hoping to make it big through your small business, then this is for you.
If you know nothing about business but have a great passion for cooking and creating sumptuous dishes, food trucks may be the right path for you to take. The stakes are higher for you, though, since the food business is often the most wasteful and most overlooked industry to date.
Carefully studying these 10 considerations will help you make sound decisions about your business. It will broaden your perspective regarding the industry that you will be dipping your toes in. If you want to be successful, take the time to study and research these 10 considerations. If you do, then you will be on your way to the success that you’ve wanted to achieve!
Parking costs and Locations
It seems odd narrowing this down early on but just hear us out! Identifying possible parking locations for your trucks should be top of your list, primarily because of two things: first, it will help you scope out your competition. Studying different locations will allow you to make sure that your truck will stand out from the competition. Second, Creating a shortlist of popular sites would enable you to identify extra expenses associated with it, such as parking expenses and other miscellaneous fees.
Reviewing different locations will help you develop an integral part of your market research which you will need later on as you go along this process.
Don’t sell yourself short and limit yourself to one or a few locations. Take advantage of the mobility of your wheels! By exploring a wider reach, you are opening yourself to a growth mindset. The possibilities are endless! You can set a few months in one location. You can also change locations every week. Whatever it may be, putting a pin on various possible locations will allow you to narrow down the best places to operate your truck!
Learning about local ordinances where you will possibly operate will help you make sound decisions and business strategies for your proposed food truck business. Information such as Zoning regulations, Health Codes, Fire Codes, National Sanitation Foundation (NSF) Guidelines, and Food Truck laws will give you an insight regarding what you can and cannot do.
Learning all about the rules will make you realize the strengths and limitations that come with each location! Studying these locations and the ordinances that come along with them will guide you in creating an effective strategy.
License and Permits
License and Permit usually vary depending on the location. Having a shortlist of possible places to park your truck will enable you to study each area in depth and list the necessary permits required for each site.
This will enable you to closely assess various locations side by side. Evaluating the required licenses and permits needed per area will allow you to put your business plan under a microscope! By doing this, you may now compare costs needed per location. This will help you make sound business decisions since you are well aware of the situation you will be engaging yourselves in.
Assuming that you already have a working menu in place, you may now start listing down the detailed steps to prepare your different menu items.
Creating a step-by-step guide will help you immerse yourselves in the operational process of your business. Creating a detailed list of the tools you will need to parallel your workflow will surely give you the best solution, as defined by the next bullet point in this list! From this, you will determine the tools and equipment you need to consider purchasing.
By this time, you have already listed various non-negotiable variables essential in running your food truck business. Now comes the most crucial decision: deciding the type of vehicle, trailer, or truck to house your business!
The first four points and considerations have prepared you to make the best possible decision that will make or break your business! Having a closer look at all potential locations aid your decision in choosing between a truck, a trailer, or a container.
Your knowledge of the Local Ordinances will help you decide the level of mobility you’d like to be. Of course, trucks would be your best bet if you wanna go around constantly. Containers would be an ideal choice if you simply wanna do a pop-up and focus on a specific area during a more extended period. Trailers, however, could be either mobile or stationary. Taking it around is pretty much easier compared to containers; all you have to do is have it towed to your vehicle.
Taking a closer look at the various license and permit fees in different areas has probably helped you decide which locations you can consider and which ones to drop.
Operations are the most crucial aspect that will determine your truck’s dimensional requirements! Taking items 1-4 seriously will aid your decision-making process in choosing the perfect vehicle.
Knowledge of local codes will also help you decide the specific custom fit-outs you will need for your food truck to be at par with local standards.
POS and Payments
Deciding whether you want to incorporate a POS (Point of sales) system is a significant decision you need to make. In food trucks, you usually operate on a simple menu that makes programming or purchasing a system a bit cheaper than usual. In this case, the hardware cost would take up the bulk of your budget.
You could also consider cashless payment options. Payments via Venmo, Online Banking, and Debit or Credit Cards are a few options you may incorporate into your business. We all know the hype food trucks usually make; During the first few months of operations, expect long lines, huge crowds, and patrons that may overwhelm your team.
Enabling cashless payments also poses a considerable growth opportunity for your sales. Most people prefer cashless payments, and being unable to accept other modes of payment immediately cuts down your potential market in half.
Before you apply for insurance on your food truck, you should first consider the possible risks your business could face in the future. There are several various types of insurance that you could consider getting.
General Liability Insurance
Public Liability Insurance
Product Liability Insurance
Business and General Property Insurance
Commercial Auto Insurance
Product Inventory comprises all the raw materials needed for your business. In this case, it will be the ingredients you will be using for your menu.
This is something you need to plan as well. It is best to find at least five suppliers and compare prices. This is to ensure that you will be getting the best deal out there! Identifying the cheapest suppliers out there will increase your profit margin.
Define your marketing goals and create a solid marketing plan. Real hype is all about making waves in social media! You can achieve this by creating gimmicks and creating social media buzz before your grand opening.
Great material and content are essential to blow up your socials. Remember, social media has been a great driver for the success of various small food and beverage businesses. It’s time to make use of that potential!
Now that you have identified various costs concerning your dream business, you most likely have a spreadsheet in check. It’s not time to explore funding opportunities.
The good news is, the food truck or trailer itself would account for 50-90% of your business. You get a loan, or you may also pay for it in full. Even if you can afford to pay for the truck in cash, we would still recommend that you explore financing options. With extra money laying around, you will have flexibility in re-investing what you already have, perhaps in another truck or towards other expenses you may need.
Planning your cash flow will help you stay on top of your finances. Being a starting business, you wanna save as much as you can save, so if all else fails, you can still afford to keep your business afloat. Ideally, it is recommended that you allocate at least one year’s worth of operational expenses for your peace of mind during the critical first year of operations.
The Bottom line
Conceptualizing and planning your food truck business goes way beyond the concept you’re willing to offer. Of course, creativity is an important facet that you need to consider in your food truck business, but putting these 10 considerations under a microscope will help you get your finances in check. It will increase your confidence in the decisions you will be making as a business owner.
Remember this: as we conceptualize your food truck or trailer requirements, we will somehow be discussing most of the bullet points written in this guide. Preparing yourself with the needed data will help us help you build the perfect food truck for you! Please, do not hesitate to inquire! We have agents waiting on standby 24/7.
hesitate to inquire! We have agents waiting on standby 24/7.