The Everett Food Truck Festival hosted dozens of vendors serving everything from fancy grilled cheese sandwiches to decadent desserts. Food trucks have become pop culture icons and the focus of reality TV shows, but can also be a way for budding entrepreneurs to enter the restaurant business.
According to studies by Ohio State University, up to 60 percent of restaurants fail during their first year. This high failure rate makes starting your own dream dining experience a very high-risk venture. Before investing in a traditional brick and mortar restaurant, starting up as a food truck allows you several key advantages.
Lower start-up costs: Food trucks require lower capital investments than a traditional restaurant. Depending on the food truck, start-up costs range from $30,000 to $120,000. This can be as much as the lease for restaurant space alone in a traditional restaurant. Keeping your capital investment down lowers your personal risk in the venture. However, it is still important to be well capitalized and to have sufficient working capital to get your business up and running.
Building a brand: Food truck mobility allows you to build a brand by taking your menu to festivals, concerts, events and workplaces. Over time you can build a following of loyal customers that will start to come to you. Many customers follow their food trucks’ Facebook and Instagram accounts to find out where they are located each day. When you get a permanent location, you can convert your mobile customers into dining room customers.
Finding the best location: New restaurants make a calculated guess where to open and hope that customers are nearby. With a food truck, you can field-test your theories, and get detailed data on where and when your business is best. Additionally, as you identify the types of customers that like your food, you can use demographic data to better hone your search for the perfect fixed location.
Entrepreneurial experience: Running a business is hard, and running a restaurant is even harder. Even the hardest-working and best-trained professionals will make mistakes. As a new business owner, a food truck gives you a more forgiving environment to learn the ins and outs of running a business. With fewer staff and a more limited menu, you can sharpen your culinary and service skills to be better prepared to manage a larger operation.
Menu testing: You may think you make the world’s best mac and cheese, but feedback from customers will help you take your creation to the next level. Getting honest feedback from customers and making menu adjustments is far less costly experimentation with a mobile kitchen. Additionally, if you try a menu item that is a flop in one location, you can quickly adapt in different venues.
Food trucks do have their own challenges from complicated permitting across different jurisdictions to finding places where you can legally park and serve for the day. The work in a food truck can be cramped and uncomfortable, and when lines of people are waiting the stress can be high. However, if you think you have the recipe for the world’s best fried chicken sandwich, consider starting out as a food truck before investing everything in the restaurant of your dreams.
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