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Fast food is big business, and in a fast-moving world, mobile food trucks are a convenient source of sustenance for busy workers grabbing food on the way to the office or snacking at conventions.
According to a survey by IBISWorld, the revenue from 3,624 food truck businesses in America was $870 million, with growth rates of 7.9 percent from 2011 to 2016.
Those figures make purchasing your own food truck a tempting proposition for driving some profits in the food-service business.
With no lease for a restaurant location and minimal staffing costs, a food truck may seem like a low-cost business opportunity. However, there are many hidden costs you need to consider.
Learn all aspects of the business, and ensure you understand your current and projected business costs. Failure to draw up a business plan could lead to serious consequences. So, how much does a food truck cost?
The cost of a food truck
The cost to purchase a food truck varies considerably and depends on a range of factors, including the make, model and age of the truck and the location where you plan to use it.
The cost usually ranges from $50,000 for a new low-end model to $200,000 for a new top-of-the-line vehicle.
It is unlikely you'll need to invest $200,000 in a truck, but you should not consider a really cheap truck, either.
Inexpensive trucks may seem like a good way to get started, but because the truck is the driving force behind your business, it usually pays to spend a bit more to get a reliable model with higher-quality equipment. Spending around $80,000 should be enough for a good truck to begin with.
As an alternative to a food truck, you can purchase a trailer or cart. Trailers are considerably cheaper because they require a separate vehicle to transport them. The cost of a trailer ranges from $30,000 to $50,000, while carts cost $20,000 to $25,000.
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The cost of a business
The cost of a truck is a significant investment but is only the first of many expenses to consider when starting your new business. When you are formulating your business plan, you may need to allocate funds for the following:
- Commissary: While some food truck operators prepare food on-site, others prepare food in commercial kitchens at commissaries that the local health department has deemed acceptable for safely preparing food.
Some commissaries also provide secure parking for food trucks and other services. Depending on the services available, costs range from $500 to $1,500 per month per truck.
- Health permits: To serve food, you need a health permit. The cost per permit can range from $800 to $5,000, depending on your location and your specific requirements.
- Website and advertising: You can use your own skills to create a website and social media buzz, or you can employ the services of professionals. The estimated cost runs from $50 to $50,000. If you pay for advertising, the costs can escalate rapidly.
- Staff: You may not need any staff, but each person you do employ adds $20 to $22 per hour to your running costs.
- Inventory: Your initial stock of food is an unavoidable upfront cost. Price varies depending on what you are serving and where your food products come from. But, it could be as much as $2,000.
- Other running costs: Gas and truck repairs could add $1,500 to your monthly spend.
Even with these costs, starting a food truck business is considerably less expensive than opening a small restaurant.
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Food trucks have grown in popularity as a way for busy commuters and inner-city workers to grab meals.
This popularity leads to increased competition, so there are more food trucks appearing in prime locations, eating into potential profits and forcing up the costs of getting your business started.
In addition to the truck, you need to know what other costs you are likely to incur throughout the course of operating your business. Failure to consider all of the possibilities and to plan accordingly may cause your new venture to stall before it has a chance to grow.
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