The Real Cost of Purchasing a Food Truck Edition 2022-2023
If you’re considering starting a food truck company, you’re definitely curious about the cost of a food truck. A food truck may cost between $50,000 and $175,000. In this post, we’ll discuss your three options for purchasing a food truck and the accompanying expenses and hazards.
We know from our decade of experience in the food truck market that the decisions you make when purchasing a food truck will have an impact on your business for the duration of its existence.
As a result, we decided to compile all we’ve learnt into one simple-to-follow guide. We discuss current food truck rates, the true and hidden expenses and hazards, as well as the advantages and disadvantages of each type of food truck.
Prices for Food Trucks (A Quick Overview)
If you’re considering starting a food truck business or just tossing the concept around, your first thought is undoubtedly about cost. It’s a question we receive daily from the numerous entrepreneurs looking to turn their culinary and business ambitions into reality.
Here’s a short breakdown of the costs associated with purchasing a food truck:
A secondhand food truck costs between $51,000 and $110,000. For lower-quality vehicles in the $50,000 range, the danger of hidden expenditures for engine and kitchen repairs is significant.
Approximately $80,000 to $110,000 for a new kitchen mounted on a secondhand truck chassis. While renovating your kitchen may save you money in the long run, a secondhand truck may have mechanical issues that keep you off the road.
Between $110,000 and $185,000 for a fresh new truck equipped with a brand new kitchen. When you get a new kitchen for your new truck, you will incur far less hidden expenditures down the road.
*NOTE: In 2021, we saw interruptions in food equipment supply chains, which resulted in a scarcity of materials required to create food trucks and an increase in pricing. This also applies to pre-owned equipment.
Following that, we’ll discuss what these prices truly represent in terms of the risk you’re taking and some of the potential hidden expenses.
Purchasing a Pre-Owned, As-Is Food Truck (Cheap But Risky)
The first option is to purchase a used, as-is food truck, which means that you will receive the vehicle and equipment in their current state. It’s comparable to purchasing a fixer-upper home.
An older truck may cost roughly $48,000, and you may occasionally locate one on Craigslist for less.
A more recent custom-built secondhand vehicle can cost up to $105,000 or more, depending on the specifications.
The important thing to remember when purchasing a secondhand food truck is to exercise extreme caution regarding the truck’s condition, as there are no refunds. What you see, and occasionally what you do not see, is precisely what you receive.
Consider the following advantages and disadvantages of this choice:
Advantages 1. Affordability
The price of a pre-owned food truck is attractive. A used, as-is food truck is much less expensive than a new food truck. If you’re self-financing a vehicle and don’t want to take out a loan, pricing will be a key consideration.
If the food truck was recently on the road, it may have already been granted permission to operate in the region. That is a significant time saver. For further permit advice, see our page on Tips And Tricks To Making It In The Industry.
Cons 1. Warranties are almost certainly no longer valid.
If the automobile or kitchen equipment came with a warranty, it is probable that it has expired. This implies that if something goes wrong, you’re on your own.
2. Unforeseen malfunctions and difficulties
When you purchase a secondhand vehicle or piece of equipment, you have no way of knowing what works and what does not. When an owner is prepared to sell, determining the general condition of the truck and kitchen may be difficult. The owner may have neglected maintenance in order to conserve money, which means that you inherit additional issues.
You run the danger of being slapped with potentially hefty repair bills. For example, a water heater breakdown may cost up to $3,000, a deep fryer breakdown can cost up to $5,000, a refrigeration and freezer unit breakdown can cost up to $6,000, and engine, gearbox, and drivetrain breakdowns can cost up to $12,000.
One precaution you should take is to run a complimentary car history report; this will alert you to odometer manipulation, past damage, and other potentially costly red flags. Additionally, it may be prudent to acquire food truck insurance in order to account for and plan for these unforeseen issues.
Outside financing is quite competitive.
Financing a used food truck in its current state is practically impossible. Banks and financing brokers are hesitant to provide money due to the vehicle’s and equipment’s questionable condition.
Entrepreneurs who do not own their own firm are unable to obtain a loan to purchase a used automobile, and hence must pay in full.
4. The layout is completely customizable.
Used trucks are equipped with a pre-determined kitchen layout and equipment that may or may not be compatible with your culinary concept (for example, you cannot make pizza in a burger truck kitchen). Adjustments are difficult to make due to pre-existing plumbing, electrical, and gas lines.
If you make major alterations, you should anticipate resubmitting new designs for permit approval and re-inspection by your local government agency.
Problèmes liés au processus de délivrance et d’inspection
It does not indicate that the food truck is prepared to go just because it has travelled previously. Before your food truck can begin serving clients, it must be inspected and approved.
Additionally, there are aesthetic considerations.
Even if a used food truck is in excellent condition and has passed all inspections, it may have a worn-out appearance. It may require considerable cleaning or cosmetic repairs to the structure’s inside and outside.
To elevate your kitchen to chef-worthy status, you must be prepared to put in some serious work. Expect to pay up to $500 for a deep clean and $800 for a necessary hood cleaning if you employ a professional.
Cost of Installing a New Kitchen on a Truck Chassis
In certain circumstances, you may purchase a new kitchen and have it installed in an existing car. Consider this as an addition to an older home.
As with a used car, you should budget between $75,000 and $100,000 for a new one. This alternative offers a number of pros and disadvantages:
A new kitchen in a trailer
Your new kitchen will be custom-designed to match your own culinary vision.
Due to the tiny nature of food truck kitchens, every square inch must be maximized. Each gadget and work surface in a contemporary kitchen has the potential to enrich your food concept and boost sales.
If you arrange your kitchen precisely, it might be the difference between a profitable business and one doomed to failure.
All American Food Truck’s food truck building experts recently ran a survey and discovered that the most popular food truck kitchen configuration is an 18′ kitchen mounted on a 22′ truck chassis. For further kitchen layout recommendations, see our page on food truck commissaries.
It is possible to obtain a loan to cover educational costs or other obligations.
To maximize your financing options, you should purchase a kitchen on a pre-owned automobile. This is because both you and the bank understand the critical nature of the two components that comprise the total.
If you present invoices from the builder, the bank will be able to determine the total cost and value of the kitchen. Banks are confident in this situation due to these receipts and the everyday purchase, sale, and financing of used commercial trucks. Other funding options include Kiva, a business that loans money to food truck entrepreneurs.
3. New kitchen equipment instills an air of confidence in the kitchen…
Appliances for a brand-new kitchen frequently come with a one-year manufacturer’s warranty. In comparison to older technology, modern appliances require less maintenance and are less likely to require repairs.
When determining whether to acquire a new or used kitchen, you should factor in these lower long-term maintenance costs.
4. It’s rather easy to locate a used truck chassis.
Pre-owned automobiles may be available at a local or regional auction or for sale. Naturally, this has a number of disadvantages, including a lack of records and mechanical checks.
If you want to minimise the danger of something going wrong, the engine may need to be completely refurbished.
Additionally, your builder may aid you in locating a truck chassis and require your signature on the agreement prior to commencing work on your vehicle.
The reliability of a vehicle is an important consideration.
It is likely that a used truck is not as dependable as you would want. Large shipping companies like UPS and FedEx are a significant source of used truck chassis for the food truck industry.
It’s tough to find a contemporary truck chassis with less than 100,000 kilometers because these firms often store them for seven years before selling them. Consider their reliability, since they may be reaching the end of their useful life.
A broken-down vehicle is an expense to your business
If your truck refuses to start or has maintenance difficulties, you risk losing a catering contract or the opportunity to serve lunch to the downtown lunch crowd.
Repairs may not be as straightforward as they look. Each day, you’re losing money and clients if your food truck is out of commission for a week or unexpectedly closes.
Used automobiles on the market now are not intended to satisfy future requirements.
Ford F-59 step vans, Chevrolet P-30 step vans, and Freightliner MT55s have been the most popular food truck vehicle models in recent years.
When it comes to laws and permits, it’s always advisable to get a car that meets the highest requirements possible to avoid future fines.
Numerous food trucks operating in Los Angeles’ food truck hotspot are now need to install $10,000+ converter kits or replace their engines to meet with new emissions requirements for diesel vehicles with a gross vehicle weight rating (GVWR) more than 14,000 pounds (most weigh between 12,000 and 16,000 pounds). After six years of execution, the last section of this law will take effect in 2023.
The cost of purchasing a car that does not meet the most strict specifications may become prohibitively expensive in the future if regulations change. Rather using a diesel engine, consider a hybrid truck chassis such as the Toyota Hino, which is both fuel efficient and emission-free.
Long-term vehicle maintenance may be pricey.
While it is feasible to save money by putting a new kitchen in an older truck, you will still be responsible for vehicle maintenance. The first three to five years of owning a used truck will be difficult. Consider these costs while determining whether to purchase a new or used truck.
The Cost of a New Truck with a New Kitchen
If you lack the funds to purchase a food truck and require financing, the best alternative is to build one yourself. Even if you have the option of acquiring a pre-owned car, building a truck is more cost-effective.
How much you pay for a new food truck is determined by your concept, the size of the kitchen, and the contractor you work with.
There is a cost, but it is comparable to building a new house from start. You design and construct it, and you may be assured that no complications will develop. In a firm where dependability is critical, a new kitchen on a new truck is the most risk-free option. This alternative offers a number of pros and disadvantages:
1. The truck is covered by a warranty.
New vehicle sales often include a 5-year/100,000-mile warranty, depending on the type of truck you’re considering.
Even if you purchase a well-maintained used truck, this warranty might save you hundreds of dollars in maintenance costs. While used vehicles are less expensive than new ones, warranties on brand-new chassis may more than compensate for the difference.
2. Lower interest rates can result in cost savings.
Financing a new kitchen and vehicle may result in interest savings. Loans for a new car and kitchen are available in a variety of forms.
According to numerous food truck-friendly institutions, funding for new kitchen construction is available at rates as low as 4.5 percent and finance for new trucks is accessible at rates as low as 3 percent. You may save a significant amount of money on your monthly payments by simply paying the 1.5 percent difference in interest.
3. Confidence in your reliability
Reputation and dependability are critical components of success in the food truck market. Both of these are provided by a new automobile.
If you install your kitchen on a new truck, it is less likely to breakdown, cancel meetings, or upset consumers.
When weighing the pros and cons of purchasing a food truck, dependability is critical and should not be neglected.
4. Invest in a high-quality vehicle.
A variety of alternatives are available to assist you in developing a vehicle that meets with the most strict current and future standards, not only in your local region, but across the United States.
As a result, you’ll be allowed to conduct business almost anyplace in the United States for the foreseeable future.
5. The property’s resale value is increased.
As a result, you’ll earn a higher profit when selling a modern food truck than an older one.
Some of the most desired automobiles are ones that were originally designed to resemble a new kitchen and are still selling for between $99,000 and $110,000. Consider how this compares to the $50,000–$85,000 range for used food trucks converted into new kitchens atop existing truck chassis.
When it comes time to sell your car, you’ll have a bigger pool of possible purchasers because you constructed it to comply with stricter standards, allowing it to operate everywhere.
There are a few disadvantages, including the following:
Individuals looking to save money upfront may be put off by the higher upfront costs associated with installing a new kitchen on a new truck compared to the other options.
Because you’re paying for a brand-new kitchen that is customized to your exact specifications, the initial costs are higher.
Additionally, lease-to-own food trucks are available.
Leasing a food truck may be a more cost-effective option than owning one.
There may be commissaries in your neighborhood that may lease you a food truck. Prices in certain cities start at $4,500 per month, however, we do not have an exact number for rents in other places.
Entrepreneurs and established businesses may take advantage of a lease-to-own model we’ve designed for food trucks.
Monthly payments for a new, fully-built truck that includes the All American Food Truck benefits package should be approximate $4000-$4500. Additional information is available on our Food Truck Lease Page.
While renting a food truck for a short period of time is typically prohibitively expensive, it is possible. How much does it cost to rent a food truck? The monthly cost of leasing a commercial vehicle is between $2,000 and $3,000, depending on the type and length of the lease. Previously, we helped a few clients locate and hire food trucks for a few weeks at a time. To begin, go to our Food Truck Lease Page and complete the form.
We are aware of no low-cost options for long-term leases. With one specific organization, long-term leases in Los Angeles may be secured for as little as $9,000 per month. While this may be excessive for a fledgling entrepreneur, it may be necessary for an established business.
…at the End of the Day
How much does owning a food truck cost? Hopefully, you now have an idea of how to proceed.
Clearly, purchasing a truck and a kitchen is a huge decision.
Each decision entails a unique set of costs and risks, some of which are evident while others are not. Continue studying and developing your business plan if you are unsure of what is ideal for your scenario.
It’s up to you
You should, however, rely on your own judgment. Maintain an open mind until you can perform further research on the truck you’re contemplating before making a final decision.
As a last reminder, we are available 24 hours a day, 7 days a week. To ensure the success of food truck enterprises, the All American Food Truck Marketplace provides a critical and complementary resource.
The All American Food Truck vendor network will link you with reputable food truck builders, and we will assist you in getting your business started by connecting you with our vendor network.
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