Some are investing in food trucks to build brand awareness and increase sales. Other entrepreneurs are investing in food trucks to as a way to enter the restaurant industry without the high-start up costs of leasing, constructing, equipping, furnishing and staffing a new operation.
The National Restaurant Association is helping operators, investors and entrepreneurs learn more about food trucks as a way to increase off-premise sales, promote their brands and attract customers. For the first time, the Association featured a food truck pavilion at its annual Restaurant, Hotel-Motel Show in Chicago.
In addition to the Streetza Pizza and Ludobites trucks shipped on flatbeds to McCormick Place, the pavilion also featured companies that make and equip trucks, design firms that “wrap” the exterior with graphics and logos, point-of-sales providers and other businesses that support the mobile food truck industry.
“Mobile food is stirring things up,” says Ray Villaman, founder of Mobi Munch, a San Francisco consulting company for the food truck industry. Villaman moderated a panel of food truck operators and advocates at the Show, as well as participated in the pavilion with partner Chef Ludo Lefebvre.
Start-up and marketing costs generally are far lower for mobile food trucks than conventional restaurants, says Nancy Kruse, who discussed food trucks at the Association’s recent Marketing Executives Group meeting. Scott Baitinger, owner of Milwaukee’s Streetza Pizza, told the marketing professionals that his truck cost about $35,000. Like many food truck operators he assembles and bakes his pizzas to order on the truck and prepares the sauce and dough in a commercial kitchen or commissary.
The fledging segment relies on inexpensive marketing. Food truck operators announce their locations to loyal fans through Facebook, Twitter and other social sites. Some rely on customer votes to determine the day’s locations.
As customers hang out around the trucks, waiting for their food, they interact in ways unimaginable in conventional restaurants, says restaurant consultant Aaron Noveshen, a partner in Mobi Munch. “It’s about having fun, eating delicious food and connecting with people,” he says. “Social media is a big part of that.”
Although start-up and marketing costs are lower for food trucks than conventional restaurants, operating challenges are similar. “It’s 100 percent harder than I ever anticipated,” says Tiffany Kurtz, owner, Flirty Cupcakes, Chicago. “I learned so many things I never thought I would have my hands on,” including vehicle maintenance.
Like traditional restaurateurs, food truck operators have to develop thorough business plans, obtain business licenses, deal with local regulatory issues, find staff, determine supply costs and set prices. Some operators have failed because they failed to understand some of those issues, says Matt Geller of the Southern California Mobile Food Vendors Association. Plus, they have to worry about getting POS systems that work on the road, as well as security, especially for cash-only trucks that operate late at night.