How should one think about the costs and benefits of opening a food truck?

My answer to How should one think about the costs and benefits of opening a food truck?

Answer by Desmond Last:

For 7 years I was the General Manager of Matilda’s Food Trucks in Sydney. We sold the business for several $million to Spotless in Melbourne. We had 40 Trucks and 90 staff.

The Food Truck business can be very profitable or it can sink you – and fast.

It is not a business you can operate at arm’s length. It is all consuming and needs a firm hand at the tiller.

One Truck professionally operated with a good steady customer base will make you a living. You as the operator will be its magnet. Your personalty will drive your sales.

But once you go past that one truck to your second, is when you must be very clear in your mind where and how you want your business to get its sales from.

The Food Industry is easy to enter. Which is why there is so much competition. But it is also the industry that has the most failures. Just because you can cook at home does not make you an instant business expert.

First you will need to mark out an area and canvas the businesses you intend to serve.

You cannot just drive in and expect the customers to buy from you.

Some sites will want you to attend a and Safety Course. Others may not want mobile food truck. There are those who will already have a Food Truck calling.

It is a very competitive business and calls can be worth $000’s to whoever is supplying them.

I had used to have running battles with Quick Snax in Sydney who we competed with.

The cost of the Truck is a big ticket item. We used to build our own. But small operates will not have those facilities.

Maintenance can be very expensive if you operate older trucks. We had our own garage and mechanics – our fleet were all older Chevrolet C20’s. I am a qualified Motor Vehicle Technician. We had good Maintenance Program for our Trucks.

You will be at the mercy of commercial rates costs if you are unable to manage your own fleet.

You will need a fully outfitted Commercial Kitchen and a Cool room.

Council Permits will be required and also insurance.

You will need an ice-maker for ice to keep drinks and food cool or an on-board generator.

Your truck will also need an oven. We used to make our own out of stainless steel. They are not cheap.

Your staff will need good comprehensive training. Our was for one whole week. They should also have to pass your own in-house driving test.

You will need somebody to canvas new calls and quality check existing ones.

For actual numbers you will need to decide if you are going to takeover an existing business or start a new one. It is a mature market with tough operators.

Actual costs can vary so much depending on where you are. But as a guide allow a minimum of $100,000 a truck with body for a mobile operator. This includes training, startup losses , advertising, insurance and painting.

My advice would be to thoroughly research your market and buy an existing operator.

As ground zero startup you will burn a lot of your money just trying to establish a market. Your customers are going to be somebody else’s and more than likely they are not going to sit back and let you walk all over them.

How should one think about the costs and benefits of opening a food truck?

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