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Lining the streets and sidewalks on every corner with cheap, tasty food, food trucks, once thought to be just a fad, have proven that they are here to stay. Over the past few years, the multi-billion dollar food truck industry has grown in popularity as sidewalk chefs reinvent street food, starting the gourmet food truck craze. According to Los Angeles-based industry research firm IBISWorld, the industry is expected to grow at a rate of 7.5% between 2016 and 2021 — and it doesn’t look like it’s slowing down anytime soon.
How To Start Food Concession Business
However, starting a food truck business is not as simple as buying a truck and preparing food. Any new entrepreneurial endeavor, and food businesses in particular, requires a lot of planning and preparation before getting into the details of actual operations.
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In this guide, we’ll walk you through step-by-step how to start a food truck. We’ll also feature tips from Debbie and Derek Kaye, who run the thriving tri-state food truck business Eddies Pizza Truck & Cart.
Before we break down the steps involved in starting a specific food truck business, let’s talk briefly about some of the steps you need to take first—if you’re starting a food truck or any other business:
At this point, you will be in good shape to launch your business. Let’s see how to start a food truck:
How much does it cost to start a food truck? It’s hard to give an exact estimate of startup costs because there are so many options for startups. First, you need to find the right truck for your business and probably have it custom built to your needs, which can cost between $20,000 and $40,000. costs such as:
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Your actual truck will be the biggest and most pressing expense you will have to pay. Before you settle on a truck, it’s a good idea to have some layout options in mind, keeping in mind what specifically you’ll need for your food truck business.
You can consult with different food truck dealers or other business owners to see what different layouts look like and which one is best for you. It’s also important to keep in mind that things are much more likely to break in a truck, warned Debbie Kaye, so you should factor that into your planning process and have enough cash in case the inevitable happens.
With that in mind, you may want to consider various food truck financing options—such as various loans and business credit cards—to cover your startup costs.
Then you need to rearrange the rules and regulations that you need to follow. As a food-based business, there are certainly several aspects to consider in this regard.
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Therefore, you will probably first need to determine which Health Board regulations you need to follow. It probably comes as no surprise to learn that just as health department inspectors inspect food in restaurants, the same applies to food trucks. Most checks are carried out to check at least the following:
After determining the health requirements, the next step to starting a food truck is obtaining the necessary permits and business licenses. Again, since starting a food truck business involves handling food and serving it to customers, there will likely be a variety of regulations and licensing requirements to deal with. Also, the licenses and permits you need are highly dependent on your state and city.
In fact, some cities, including New York, limit the number of truck licenses issued at one time. You may want to check your city’s website to find out exactly what you need to do to get the proper documentation. Keep in mind that this process can take time and will likely include fees, as well as verification of a Department of Health license, tax clearance, and liability insurance.
Once you’ve figured out the behind-the-scenes details and decided on your truck, it’s time to think about your product.
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After all, a key part of learning how to start a food truck business is deciding what kind of food you’re going to make and sell, how that process will work, what you’ll need, and what your menu will look like. When thinking about these things and making decisions, you have to remember that unlike a traditional restaurant, a food truck has limited space – so it can be difficult to prepare food inside.
That’s why you need to decide whether it’s best for your business to prepare the food in advance before you leave for work for the day, or if you can prepare everything on the spot. Also, when perfecting recipes, you need to make sure that the dishes on the menu are repeatable in large quantities, taste consistently good, are easy to serve, easy to eat, and travel well.
With your food plan in mind, the next thing to do when starting a food truck is to think about hiring staff. In a small environment like a food truck, you obviously can’t have too many employees, but depending on the food, process, and possible demand, you may want to consider having help.
When you’re first starting out, you may be able to work with friends, family, or a partner, but if your food truck grows quickly, a few part-time or full-time employees will probably come in handy. Plus, when it comes to food truck employees, you have to go beyond the typical process of hiring and onboarding team members.
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To explain, aside from all the licenses and permits you need to obtain as a business owner, all of your employees must have a mobile food vendor badge in order to legally operate and serve food in your truck. And unfortunately it takes about four months to get that badge.
“It’s really frustrating to hire someone and tell them they can’t start work for four months,” says Kaye. “It’s a rather backward system, which the food truck association has tried to improve, but so far without success. If you are [caught] without the badge, it will result in a $1,000 fine.”
If you think you’ll need staff for your food truck, you’ll need to eliminate this process and hire your first employee from the very beginning. “It’s even more frustrating,” says Kaye, “because if your business loses an employee, you have to wait four months for a new employee to get their badge, which means you may not have enough employees to serve lunch and dinner.” “
One of the advantages (and challenges) of starting a food truck business is the mobile element. While you have the ability (to some extent) to go where your customers are, you also need to figure out where the best places are to attract customers, and perhaps just as importantly, where you can and cannot park your truck.
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As with licenses and permits, food truck parking restrictions are specific to your city; so you should check with your local regulations to determine what your options are.
It’s very likely that if you’re in a larger location, such as New York, this process will be even more difficult.
“Technically, there’s a book that lists where you can and can’t park,” says Kaye. “However, there is a loophole in the system and the trucks can be moved by the police anytime, from anywhere. It’s quite frustrating.”
These strict rules and regulations on the streets of New York forced the Kays to pay fines of up to $1,000 a month at a time. Kaye says finding parking has only gotten more complicated as more gourmet food trucks pop up around town.
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With this in mind, it is worth paying special attention to defining the rules (and possible loopholes) in the given location.
First, you need to plan and implement some marketing tactics to inform the local community about the existence of the food truck.
You can plan a “grand opening” or see if you can participate in a local event to generate awareness and customers. You may want to consider creating a website and having a social media presence, as well as advertising around town.
Additionally, as a mobile business whose location can change daily, it is important that your customers know where you will be. Whether it’s creating a set schedule on a weekly basis or simply keeping your customers up to date on your website or social media
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