Have you been dreaming of starting your own restaurant, but don't want to deal with the overhead costs of a brick-and-mortar establishment?
Opening a food truck might be the perfect solution for you.
With millions of foodies flocking to food truck festivals and events, there has never been a better time to dive into the $2 billion mobile food business industry.1
In this ultimate guide, we'll cover everything from food truck regulations to tips for getting started–so you can get the wheels turning in your dream of finally owning a food truck.
Here's what we'll go through:
Pros and Cons of Opening a Food Truck
What Are the Laws About Opening a Food Truck?
Getting Started With Opening a Food Truck
Pros and Cons of Opening a Food Truck
If you love cooking and have a passion for food, you may have considered opening a food truck. After all, operating a food truck is a popular and trendy business venture today. It's a great way to serve mouthwatering meals to customers in different locations and reach a wider audience.
However, before you jump into the food truck business, you've got to weigh the pros and cons.
Pro #1: Mobility and Flexibility
With a food truck business, you can operate in different places at different times. You can move your food truck around town, set up at various events, and reach out to new customers. Not only does this provide flexibility, but it also allows you the opportunity to test different markets and see where you can get the most traction.
Pro #2: Lower Start-Up Costs
Compared to a traditional brick-and-mortar restaurant, opening a food truck is far less expensive. You don't have to pay rent for a dining space, and you can save money on the furnishings and decorations for the interior. Also, the food truck business requires fewer team members than a full-sized restaurant, reducing labor costs.
Con #1: Limited Space
You won't have much space to work with when you own a food truck! You have a small kitchen area, and you need to be able to make the most of it to offer a broad (or at least high-quality) menu.
You also have to factor in the storage of food and supplies, which can be constrained on a food truck. These challenges can result in a restrictive menu, limiting your creativity in cooking and customers' choices.
Con #2: Seasonal Business
Operating a food truck business can be a significant risk in the winter months, as the demand for outside dining is usually low, particularly in cold-climate areas. You may struggle to profit if you don't have a steady stream of customers.
Also, unpredictable weather conditions can lead to canceled events or decreased sales, which can strain your business.
Con #3: Confusing Regulations
As the government struggles to keep up with the rising popularity of owning food trucks, the laws and regulations can vary greatly from state to state and city to city. This can be confusing and make it difficult to navigate. We'll tackle many of these issues in this post but know that it's important to ask questions and know exactly what's required where you live.
What Are the Laws About Opening a Food Truck?
Selling food from home may seem like a simple and convenient way to start a food business, but it is important to follow the laws and regulations set in place by each state.
In many states, selling food from home requires a Food Handler Card and either registering with the Food Cottage Program or following specific rules. This is called Cottage Law, and each state has its own laws and regulations to comply with.2
In a nutshell, Cottage Law, or "Cottage Food Law," refers to laws that allow business owners to produce certain food products in the home (the "cottage") with minimal regulatory oversight. This includes foods like jams, baked goods, and dry mixes–all foods that aren't known for being particularly hazardous.
In some states, these Cottage Laws also apply to food trucks (sometimes with additional hoops to jump through, though not always).
For example, in Arizona, the Cottage Food Program allows individuals to make homemade products that are neither potentially hazardous nor Time or Temperature Control for Safety (TCS) foods and then offer them for commercial sale.3 But to sell from home (including people with food trucks), you must obtain a specific certification and complete the Arizona online cottage foods registration form.
In New York, the Cottage Law allows individuals to make certain foods such as baked goods, jellies, or snack mixes, and they may qualify for a Home Processor exemption.4 This allows them to prepare food in their home kitchen for wholesale or retail sale at agricultural farm venues. Again, to sell from home in New York, you must obtain a Food Handlers Permit before registering with the Department of Agriculture.
Potential Food Safety Risks When Operating a Food Truck Business
Again, the most important thing to be aware of when running a food truck business is that food safety risks exist just as they do in a regular kitchen–and in some cases, they can be even more dangerous.
While that's not said to discourage you from this endeavor, it's important to remember that vigilance (and doing your due diligence on what's legally required where you live) can go a long way.
Here are some of the most significant food safety risks to be mindful of as you're starting your business:
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Cross-Contamination: Cross-contamination can occur when serving utensils come into contact with different foods or when raw food materials are placed in close proximity to cooked food items. Ensure your workspace and utensils are clean and sanitized in your food truck. You should also store your raw products away from your cooked products, and invest in separate cutting boards and utensils to avoid mixing ingredients.
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Food Temperature Control: Food temperature can significantly impact the growth of bacteria in food, which can lead to health hazards. Purchase a thermometer for your truck to monitor and record food temperatures, ensuring compliance with food safety regulations and guidelines. Make sure that hot food is served hot, and cold food items are kept cold, even when transporting the ready meals from the truck to the customer.
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Clean Water Supply: You need to have access to enough clean water to wash your utensils, food, and hands. Without a clean and adequate water supply, it may be difficult for you to maintain the cleanliness and hygiene of your truck. It may also be more challenging to manage your food temperature and protect it from harmful contaminants. Ensure that your water tank is regularly disinfected, and that the water supply is tested by authorities regularly.
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Personal Hygiene: Poor hygiene practices can lead to the spread of germs and diseases. Implement handwashing guidelines and adequate hygiene training for all your staff. This way, you will remain in compliance with sanitation codes even when you're on the road.
Additional Regulations to Be Aware Of
Moreover, food trucks must comply with food safety regulations established by the FDA, such as proper food handling, storage, and cooking temperatures. The food truck must also have proper equipment, such as refrigeration units and handwashing stations, to ensure safe food handling practices.
Remember that laws and regulations around food trucks vary greatly from state to state. In addition to the Cottage Law, a food truck owner may need to obtain permits and licenses from their local government or health department. These permits and licenses may include food service establishment permits, vending permits, and mobile food vendor permits.
These permits and regulations aren't subject just to the oversight of the USDA, FDA, and the Department of Agriculture and Markets (and other food authorities, per state law) but also to those regulating motor vehicles. You'll also need to conform to various business laws and regulations along with those from your Department of Motor Vehicles.
Ultimately, figuring out what you need to do to start a food truck business legally can be challenging. Still, it's best to consult with the SBA (Small Business Administration) and your local authorities. Some great places to start include representatives from your local:
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Chamber of Commerce
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Health Department
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Department of Motor Vehicles
Getting Started With Opening a Food Truck
Outside of the regulations described above, as a food truck owner, there are a few other things you'll need to do to ensure your ducks are in a row before starting your business. Let's take a quick look!
1. Come Up With a Business Plan
Before buying equipment or scouting for locations, you need to create a solid business plan.
Your business plan should include details about your menu, target audience, marketing strategy, budget, and financial projections. It’s important to have a clear idea of what you want your business to achieve and how you plan to make it happen.
2. Figure Out Costs and Equipment
The costs of starting a food truck business can vary greatly, depending on factors such as your truck's size, the equipment you need, and the permits required in your city.
You’ll need to budget for everything from the truck itself to your initial inventory and insurance costs.
Here are some of the most common (average) expenses you can expect to encounter:
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Truck Purchase or Lease: $15,000 to $100,000
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Equipment: $10,000 to $20,000
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Kitchen Supplies and Food Inventory: $1,000 to $2,500
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Permits and Licenses: $100 to $7,500
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Insurance: $1,000 to $4,000 per year
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Payment Processing: $200 to $1,000
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Commissary Fees: $200 to $1,200
Once you’ve figured out your expenses, you’ll need to consider financing your business. Some options for funding include personal savings, loans, or investors.
3. Get the Necessary Training, Approvals, Licenses, and Permits
Starting a food truck requires several licenses and permits to meet health and safety standards.
These can vary depending on your location, so checking with your local board of health is, again, important. You may also need a food handling certificate, fire safety certification, and insurance coverage for your food truck.
Obtaining the necessary permits and licenses can be the most time-consuming step of setting up your food truck business. You need to ensure you have everything to avoid any delays or hiccups down the line.
If you can, visit the U.S. Small Business Administration (SBA) for a list of registrations or licenses you may need for your food truck business, or check with the other local authorities that we listed above.5
4. Figure Out the Basics
Next up–the nitty gritty. It's time to fine-tune the details and determine what will make your food truck business functional (and unique).
First, you need to figure out whether you'll be working with a point-of-sale system, permits to park, cooking in bulk or individual orders, and the like. These are the basics that can make or break the success of your business.
Start with the menu. Do you want to cater to a particular food niche, or will it be an all-around menu? Determine the ingredients and supplies you'll need for your menu and how to source them.
Next, consider your cooking and prep time. To keep up with the volume of orders, you need to strike a balance between efficiency and speed. For instance, will you cook to order or have pre-cooked ingredients ready?
You'll also need to research and identify possible parking places for your food truck. To do this, check the local municipality's parking requirements, regulations, and schedules.
Finally, consider your costs and pricing to create an effective strategy. Create a menu plan without sacrificing quality and price competitively. Take note of the costs of each menu item, including supplies and overhead, and the profit margin you want to attain.
5. Hire Staff
While some food truck owners go it on their own, hiring staff members for your food truck business can help with workload and efficiency. Take the time to hire talented chefs and passionate staff with a customer-focused mindset.
Make sure everyone on your team is aware of your brand values and the mission of your food truck. Provide proper training about food safety and other operational elements that will be key to your business' success.
6. Start Promoting
Last but not least, be sure to promote your business. Create social media accounts for your food truck and encourage your followers to post pictures of your food, post announcements about your location and hours, and engage with customers.
Another useful promotional strategy is to become involved in local events. This will give you the opportunity to share your food and showcase your brand. You can also offer incentives, such as discounts or free samples, to attract more people to your truck.
Ultimately, it doesn't matter as much what kind of promotions you do to spread awareness for your food truck business–just make sure you do something. Word of mouth is often enough to advertise a business once it's up and running, but you must do some heavy lifting until you have a solid customer base!
Your Next Steps
Opening a food truck can be rewarding, but it takes careful planning and preparation to ensure success.
By researching legal requirements, planning your menu and branding, identifying target locations, implementing a marketing plan, and obtaining licenses and insurance, you'll be well on your way to becoming a successful food truck owner.
If you're still confused about what's required in your state or town to operate a food truck legally, check with your local SBA office or Chamber of Commerce. In the meantime, consider one of Trust20's training products.
Trust20 has a variety of options to help prepare you and your staff for your restaurant business on the road. Even if a food handler training or certificate isn't required by law where you live or doesn't quite meet all the standards necessary for your state, it's a great place to start.
It will get you off on the right foot (or wheel?) by giving you the knowledge you need to be a successful food truck business owner.
So what are you waiting for? With some effort and creativity, your food truck can be a hit and take the world by storm!
Sources
1: Food Truck Nation: Food Truck Nation
2: The National Agricultural Law Center: “Cottage Food” Laws
3: Arizona Department of Health Services: ADHS-Cottage Food Program
4: Forrager: New York
5: Small Business Administration: Register Your Business
