{"id":7693,"date":"2018-05-11T08:47:27","date_gmt":"2018-05-11T08:47:27","guid":{"rendered":"https:\/\/posbistro.com\/blog\/?p=7693"},"modified":"2018-05-11T08:50:24","modified_gmt":"2018-05-11T08:50:24","slug":"how-to-start-food-truck-cost-breakdown","status":"publish","type":"post","link":"https:\/\/posbistro.com\/blog\/how-to-start-food-truck-cost-breakdown\/","title":{"rendered":"How To Start A Food Truck Business: A Cost Breakdown"},"content":{"rendered":"

Dream of starting a food truck and want to turn the idea into reality? Let\u2019s take a look at some numbers on food truck costs so you can build a realistic expectation of what your dream is going to cost to get off the ground.<\/span><\/p>\n

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The Cost Of The Actual Food Truck<\/h5>\n

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The largest cost of your food truck business is certainly going to be the actual food truck itself. These aren\u2019t just small vehicles outfitted with stoves and refrigerators\u2014they\u2019re heavy duty pieces of equipment with commercial kitchens inside. And they\u2019re not cheap.<\/span><\/p>\n

According to food truck business experts like <\/span>Roaming Hunger<\/span><\/a> and <\/span>Food Truck Empire<\/span><\/a>, you can reasonably expect to spend $50,000 to $150,000 on your truck. Let\u2019s break that down.<\/span><\/p>\n

\u2192 Used food trucks: $50,000 on the low end. Used trucks, like with any used vehicle, have questionable internals. You really can\u2019t anticipate repair costs, but you can be certain they\u2019re coming eventually. Banks often raise loan interest rates for used trucks since they\u2019re more risky. So, while a used truck will save you on startup fees, they\u2019re a bit of a gamble.<\/span><\/b><\/b><\/p>\n

\u2192 New food trucks: $75,000 to $150,000. A brand new truck will certainly cost quite a bit more up front, but you\u2019ll also have a valid warranty, lower bank interest rates, and far lower repair costs for a few years. The final price will depend on the size of the truck, the kitchen elements, and any customizations (like wrapping) you require.<\/span><\/b><\/b><\/p>\n

\u2192 A food trailer<\/i>: $15,000 to $50,000. If you\u2019re after a trailer, rather than a fully operational vehicle, you\u2019ll probably be able to save some serious cash in the beginning. While this doesn\u2019t eliminate auto repair costs since you still need a vehicle to haul the trailer, it does mean you don\u2019t lose revenue from downtime because of auto repairs since you can just attach another vehicle.<\/span><\/b><\/b><\/p>\n

\u2192 Renting a food truck: $2,000 to $3,000 per month. Renting can be a great way to get started when you\u2019re really strapped for capital. You don\u2019t have to worry about maintenance and repair costs, many of them come with a commissary kitchen included (likely $1,000 in savings), and you can test your idea before jumping in with a massive investment.<\/span><\/b><\/p>\n

No matter which direction you go, starting a food truck business is not going to be cheap. Generally, experts suggest you budget <\/span>$70,000 to $85,000<\/span><\/a> for the cost of the food truck if you\u2019re looking for a used truck with a couple years of reasonable wear that needs only minor customizations.<\/span><\/p>\n

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Don\u2019t Skip The Business Plan<\/h5>\n

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A business plan is one of the often-forgotten essentials of any successful venture. It empowers you to create a well-rounded business vision, forces you to take a deep look at the numbers, and sets some expectations that you can use to assess progress later on.<\/span><\/p>\n

Do your homework and <\/span><\/i>write a solid business plan<\/span><\/i><\/a>! There are so many trucks that rolled out that didn\u2019t do the proper R&D, financial projections, break-even and capital requirements. Without this essential piece, you are setting yourself up to fail.<\/span><\/i><\/p><\/blockquote>\n

\u2014 Juan, <\/span>MIHO Gastrotruck<\/span><\/a><\/p>\n

Creating your own business plan will take several hours of research, learning how the plans are structured, and actual writing. Hiring a professional plan writer will cost $200 to $500.<\/span><\/p>\n

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Permits, Licenses, Parking, And Insurance<\/h5>\n

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Now that you have your actual truck, it\u2019s time to make it legal\u2014and there are many things to consider. Insurance, food service permits, inspection costs, parking. Keep in mind that these are usually annual costs, so you\u2019ll want to make sure you budget them in for every single year.<\/span><\/p>\n

On the regulatory level, you\u2019re going to need to register your business, register the vehicle, pay for health permits, and go through a handful of other regulatory hoops. <\/span><\/p>\n

\u2192 Business Registration: $75 to $150<\/strong><\/p>\n

\u2192 Vehicle Registration: $75 to $100<\/strong><\/p>\n

\u2192 Health Permit: $250 to $1,000<\/strong><\/p>\n

\u2192 Fire Permit: $100 to $150<\/strong><\/p>\n

\u2192 Food Truck Application + License: $100 to $500<\/strong><\/p>\n

Insurance for your food truck<\/span><\/a> is another doozy, but one that must be dealt with. Not only do you have to cover your business for general liability in case someone gets sick from your food, but you probably also want to insure against employee injury, property damage, and auto damage. These costs can add up and are highly dependent on your <\/span>truck value<\/span><\/a>. Estimate between $2,000 and $4,000 per year for basic liability.<\/strong><\/span><\/p>\n

But wait\u2014you can\u2019t forget about other operational costs like parking your truck and finding a commissary kitchen to prep your food for service.<\/span><\/p>\n

\u2192 Food Truck Parking: $250 to $1,000 per month<\/strong><\/p>\n

\u2192 Commissary Kitchen: $500 to $1,200 per month<\/strong><\/p>\n

\u2192 Event Fees: $500 to $1,000 per event<\/strong><\/p>\n

Please note: all of these costs will depend on your specific city or state and you may end up having to pay extra fees that other food truck operators don\u2019t on the other side of the country. It all depends on the regulations and requirements of your local area.<\/span><\/i><\/p>\n

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The Tech That Makes Your Business Work<\/h5>\n

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You have your truck, the kitchen, parking, and all the regulatory documents required to serve food, but you\u2019re still not quite ready. To actually start serving, you still need a handful of systems and equipment in place.<\/span><\/p>\n

\u2192 Mobile Phone + Internet: $50 to $150 per month. This is highly dependent on your locational and local ISPs, and it\u2019s not optional. People need to be able to call you by phone and you\u2019ll certainly want to be able to accept debit and credit payments.<\/span><\/b><\/b><\/p>\n

\u2192 A Flexible POS System: $50 per month. Your point-of-sale software can <\/span>make or break a customer interaction<\/span><\/a>. A strong POS makes the process smooth, fast, and simple. A bad POS feels clunky, inflexible, and can create poor memories with customers. Look for POS systems with sales and trend reports, integrations with printers, and offline use at the very least.<\/span><\/b><\/b><\/p>\n

\u2192 Customer Loyalty Programs: Free. If you\u2019re not building long-term loyalty with every purchase, you\u2019re missing out on low-cost customer retention. Great POS systems have <\/span>flexible customer loyalty programs<\/span><\/a> already built-in\u2014you just need to start using them.<\/span><\/b><\/b><\/p>\n

\u2192 Online Ordering: Free. Allowing customers to order food online, whether they\u2019re ten minutes away or at a nearby table, has a <\/span>variety of benefits<\/span><\/a>. Once again, great POS systems already incorporate this, but lower-level systems will require you to outsource this functionality to other 3rd party apps.<\/span><\/b><\/b><\/p>\n

\u2192 Social Media Marketing: Free. Accounts don\u2019t cost you a dime, nor does posting pictures and updating your followers on routes, new menu items, and fun specials.<\/span><\/b><\/b><\/p>\n

\u2192 Website And Other Marketing Assets: $0 + $1,000. If you can design your own logo and go without a website, it\u2019s possible to not spend a dime on this category. However, chances are you\u2019ll want a professional to help you set up at least a few items of digital marketing collateral.<\/span><\/b><\/p>\n

Some food trucks piece together a variety of apps and software, but you should really try to find a <\/span>single, powerful POS platform<\/span><\/a> that you can rely on to simplify everything.<\/span><\/p>\n

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The Food, Cooking Tools, And Serveware<\/h5>\n

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The Food – Inventory<\/span><\/p>\n

While we can\u2019t really estimate your specific food costs, we can demonstrate how you can calculate these costs based on your own suppliers and order volume.<\/span><\/p>\n

Let\u2019s say you serve an average of 200 dishes per day for 30 days of service (6,000 total orders) and have a very limited menu: burgers, fries, and soda. Here\u2019s how those costs could play out.<\/span><\/p>\n