Food trucks are the iPads of the restaurant industry. They are small, portable and very, very popular.
We had a client recently who gave up his middle management job with a large communications firm so that he could purchase and run a food truck. He will operate the truck in Florida in the winters and work state and county fairs in the northeast in the summers. He intends to sell a lot of BBQ made from an old family recipe.
I was reminded of this client just recently when The Wall Street Journal ran a story about food trucks on college campuses.
The article also reminded me of another client from about 18 months ago who inherited a house in downtown Portland and intended to raze it so that she could provide space for food trucks to set up for the Portland lunch time crowd. Who knew?
Well, if you want to get in on what appears to be a pretty serious trend, you better get your business plan ready. Food trucks cost between $50,000 – $100,000 (or more) but they are easily financed for qualified borrowers through a number of sources including commercial banks that participate in the SBA 7(a) loan guarantee program.
If I were an investor or a commercial lender reading a business plan about a food truck, these are the questions that I would want to be answered:
- Do you have food industry or restaurant experience? If not, how will you mitigate that?
- Do you have a concept that will work in a “take away” environment?
- Have you checked out local licensing requirements?
- Can you make money and generate cash flow?
- Do you have a target market in mind?
- Have you analyzed the competitive environment in terms of brick and mortar restaurants as well as other food trucks?
- How do you intend to create awareness for your food truck?
Here are some tips to creating your food truck business plan:
- Be sure that it responds to the questions above.
- Make sure that the impression that it makes is as professional as you intend to be.
- Articulate your goals and strategies for a 3-5 year period of time.
- Ensure that the financial forecast complies with the requirements of your proposed source of funding.
If you need help developing your business plan, there are many sources of help available including:
- There are software programs for entrepreneurs who have the ability to write the content and prepare their own financial forecasts.
- There are business plan writers who will take what is in your head and put it on paper. The quality will depend on the depth of your knowledge base.
- There are consultants such as our firm who have the experience to prepare a high-quality, credible roadmap for the business that will enable you, your investor, and your lender to understand where you are going and how you are going to get there.
Personally, I love ethnic concepts such as Chinese and Japanese foods. Some might argue that Mexican concepts are overdone, but how can you argue against great tasting tacos when you are in a hurry to get back to the office or to class? How about nutrition drinks, smoothies, and fresh juice drinks?
Whatever concept you decide on, it should be something that stirs your passions just as your business plan should stir the passions of its readers.