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Starting a Food Truck Business – How Much Does It Cost?

Do you want to know exactly how much it cost to start a food truck business? If YES, here is a detailed cost analysis for starting a food truck business and raising finance.

If you live in the United States of America, Canada, Australia and in the United Kingdom, you would have come by food trucks; trucks that sell stuffs ranging from ice cream to fast food. As a matter of fact, U.S. and Canadian cities including Toronto, Montreal, Hamilton, Vancouver, Washington D.C., New York, Austin, Houston, Los Angeles, San Francisco, Seattle, St. Louis, Calgary, Portland and Tampa are key places where food truck businesses thrive the most.

Simply put, a food truck is a large truck or means of transportation that is equipped to cook and sell food and also to sell ice cream and snacks. It is common to see food trucks engage in the sale of French fries, sandwiches, hamburgers, and fast food. Now having provided you with a:

  1. Food Truck Industry Overview
  2. Market Research and Feasibility
  3. Food Truck Business Plan
  4. Food Truck Marketing Plan
  5. Food Truck Name ideas
  6. Food Truck Licenses and Permits
  7. Cost for Starting a Food Truck
  8. Food Truck Marketing ideas

We will consider how much it cost to start a food truck business from scratch including the operating costs.

  • Industry Overview

The food truck business concept is gaining more grounds in the United States, Canada, United Kingdom and Australia in recent years. Food trucks are sometimes known to sell gourmet cuisine and a variety of specialties and ethnic menus. Little wonder food trucks, and other portable food kiosks and food carts, are on the front line of the street food industry and they serve an estimated 2.5 billion people daily.

Food trucks are no longer limited to the sale of ice creams, hot dogs, snow cones and tacos; they now sell any type of food as long as there is a market for such food. Food trucks now sell foods like sushi rolls that are freshly prepared on the truck. People now find it convenient and time saving to patronize food trucks because they are likely going to get the kind of food and drinks that they want to eat.

Food truck businesses are designed to service areas where it might be difficult to quickly construct a conventional restaurant; areas such as carnival sites, construction sites, sporting event centers, camp grounds, and beaches. Food trucks also take advantage of places like campuses, office complexes, military bases, mechanical village, industrial parks, farmer’s markets, cinemas, and religious centers to sell their foods, snacks and drinks. They know that they are likely going to get enough customers that will patronize their services.

The annual food truck revenue in the United States is about $1,200,000,000 and the Industry revenue increased by 12.4% over the past five years. The total number of food trucks in U.S. is put at 4,130. The average revenue generated per food truck in the United States is about $290,556 and the average spending per order at a food truck is $12.40. The average amount required to own a food truck is about $85,000.

In the United States, Canada, Australia and even Europe, the percentage of sales generated by food trucks based on market segments are as follows; Street locations or street corners account for 55%, construction work sites and industrial sites account for 15%, shopping malls account for 12% and other locations, venues and event centers account for 18%.

As the industry grows, food truck owners are becoming more creative on how they run their business. It is now normal for food trucks to be found at wedding receptions and special events. With the partnership of event managers, food trucks can be hired to service special events, such as wedding parties, crusades, community events, school events, birthday parties, picnics, retirement parties, and any other event as deemed fit by the event manager.

One of the many reasons why aspiring entrepreneurs struggle to start a business of their choice can be attributed to lack of start-up capital or not knowing the estimated amount needed to launch the business either on a small scale, medium scale or large scale. This article will give you an idea of how much it will cost you to start your own food truck business in the United States of America, Canada, United Kingdom and Australia.

How Much Does It Cost to Start a Food Truck Business?

Food truck businesses are subject to the same range of economic and cost concerns as other food related businesses such as restaurants and fast food eateries. For example, despite the fact that food trucks are mobile restaurants, they generally require a fixed address to accept delivery of supplies like normal restaurants. In some cases, or cities, they are required to prepare their food in a commercial kitchen that can be inspected and not on the truck. These factors contribute to an increase in the startup and running cost of the business.

Besides, there are a number of permits that are required to run a food truck business, and of course there is also public health code to observe.  Other costs that should be considered during planning and budgeting are overhead cost, labor cost, supply of raw ingredients and food, packaging/services, wares, fuel and maintenance costs.

It is important to try as much as possible to cut down on overhead cost when making plans to start a food truck business and also to operate in cities where you can be allowed to cook and prepare your food inside your truck. For example, in the United States of America, it is only in Chicago that food trucks are not allowed to cook their food inside their trucks.

Over and above, the cost analysis as it relates to starting a standard food truck business in the United States of America, Canada, United Kingdom, and Australia can be said to be almost the same except for few variations.

One good thing about starting a food truck business is that you have the option of starting it on a small scale with a small truck and perhaps just selling gourmets and soft drinks. You can choose to start on a medium scale and you can as well choose to start on a large scale by acquiring several 40 ft. trucks with standard kitchen facility and cooling system.

The bottom line is that even if you have the financial capacity to start your food truck business on a large scale with several 40 ft. fully equipped trucks, it is still very important to conduct your market survey and feasibility studies. It will help you to make a wise business decisions. Sometimes it is safer to start a business small and then grow it to as big as you want it to be.

Other factors that may be slightly different in terms of costing when it comes to starting a standard food truck business in any of the countries listed above are cost of labor, cost of transportation and logistics, local tax, insurance policies, business incorporation fee and rent/leasing amongst other factors.

When it comes to starting a medium scale food truck company, you should be prepared to either rent or lease a kitchen facility and purchase one or more standard food trucks with cooling facility; this is going to be one of the areas where you are expected to spend the bulk of the start–up capital.

Other areas are the amount required in obtaining the required licenses and permits, the amount required for the purchase of food ingredients and other start–up necessities, the amount required in fueling and maintaining the food truck, the scale/size of the business and also in paying your employees at least for the first three months of starting the business.

How Much Does It Cost to Start a Food Truck Business in the United States?

These are the key expenses you are expected to make when starting a medium scale but standard food truck company business in the United States of America;

  • The total fee for registering the business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits (Health department license and business license) and permits (Fire department permit, Commercial kitchen permit, Commercial Vehicle Operator’s Registration for the truck, Permits for each municipality being operated in (downtown, various suburbs), Food handler certificate, Appropriate driver’s licenses for drivers, Assistant’s licenses for assistants, Health inspection Certificate, Air and water pollution control permit, and Sign permit et al) as well as accounting services (CRM software, Payroll software, P.O.S machines and other software) – $15,300.
  • Marketing promotion expenses for the grand opening of the food truck company in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • The cost for hiring business consultant (including writing business plan) – $2,500.
  • The cost for insurance (general insurance, health insurance, liability insurance, kitchen Insurance, workers’ compensation, overhead expense, disability insurance, business owner’s policy group insurance, and Motor Vehicle Insurance (Comprehensive) coverage at a total premium – $10,400.
  • The cost for the purchase of food trucks – $60,000
  • The cost for leasing a standard kitchen facility with government approval- $50,000
  • The cost for remodeling the facility – $10,000.
  • Other start-up expenses including stationery ($500) and phone and utility (gas, sewer, water and electric) deposits ($6,500).
  • The operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
  • The cost for start-up inventory (Gas Cookers, Cooking gas, Pots, Pans, and other cooking utensils, food ingredient, food serving wares and food packaging materials et al) – $15,000
  • The cost for storage hardware (bins, rack, shelves, food case, food warmer) – $3,720
  • The cost for counter area equipment (counter top, sink, ice machine, etc.) – $9,500
  • The cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • The cost for the purchase of furniture and gadgets (Micro wave oven, Telephone, printing machines, computers, tables and chairs et al): $14,000.
  • The cost for building and hosting a website: $600
  • The cost for opening party: $8,000
  • Uniforms for employees – $500
  • Miscellaneous: $10,000

You will need an estimate of three hundred and fifty thousand dollars ($350,000) to successfully set up a medium scale but standard food truck company in the United States of America. Please note that this amount includes the salaries of all the staff for the first 3 months of operation and a business with more than one food truck operating in different locations within same city.

Starting a small–scale but standard food truck company with just one food truck and minimal overhead in the United States of America will cost about one hundred thousand dollars to two hundred thousand dollars ($100,000 to $200,000).

When it comes to starting a standard and large scale food truck company with several food trucks operating in key cities in the United States of America, a food truck company with the intention of selling franchise, then you should look towards budgeting well over one million,five hundred thousand dollars ($1.5 million).

How Much Does It Cost to Start a Food Truck Business in the UK?

These are the key expenses you are expected to make when starting a medium scale but standard food truck business in the United Kingdom;

  • In the United Kingdom, Online applications are usually registered within 24 hours and cost £12 (paid by debit or credit card or PayPal). Postal applications take 8 to 10 days and cost £40 (paid by check made out to ‘Companies House’). There’s a same day service costing £100.
  • Legal expenses for obtaining licenses and permits (Health department license and business license) and permits (Fire department permit, Commercial kitchen permit, Commercial Vehicle Operator’s Registration for the truck, Permits for each municipality being operated in (downtown, various suburbs), Food handler’s certificate, Appropriate driver’s licenses for drivers, Assistant’s licenses for assistants, Health inspection Certificate, Air and water pollution control permit, and Sign permit et al) as well as accounting services (CRM software, Payroll software, P.O.S machines and other software) – £13,300
  • Marketing promotion expenses for the grand opening of the food truck in the amount of £3,500 and as well as flyer printing (2,000 flyers at £0.04 per copy) for the total amount of £3,580.
  • The cost for hiring business consultant (including writing business plan) – £2,500.
  • The cost for insurance (general insurance, health insurance, liability insurance, kitchen Insurance, workers’ compensation, overhead expense, disability insurance, business owner’s policy group insurance, and Motor Vehicle Insurance (Comprehensive) coverage at a total premium – £8,400.
  • The cost for leasing a standard kitchen facility with government approval – £45,000.
  • The cost for remodeling the facility – £8,000.
  • Other start-up expenses including stationery (£300) and phone and utility (gas, sewer, water and electric) deposits (£1,500).
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – £60,000
  • The cost for start-up inventory (Gas Cookers, Cooking gas, Pots, Pans, and other cooking utensils, food ingredient, food serving wares and food packaging materials et al)- £13,500
  • The cost for storage hardware (bins, rack, shelves, food case, food warmer) – £2,720
  • The cost for counter area equipment (counter top, sink, ice machine, etc.) – £8,500
  • The cost for store equipment (cash register, security, ventilation, signage) – £9,500
  • The cost of purchase and installation of CCTVs: £4,500
  • The cost for the purchase of furniture and gadgets (Microwave oven, Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al): £2,500.
  • The cost for building and hosting a website: £600
  • The cost for opening party – £6,300
  • Miscellaneous: £8,000

You will need an estimate of three hundred and ten thousand Pounds Sterling (£310,000) to successfully set up a medium scale but standard food truck company in the United Kingdom. Please note that this amount includes the salaries of all the staff for the first 3 months of operation and a business with more than one food truck operating in different locations within same city.

Starting a small scale but standard food truck company business with just one food truck and minimal overhead in the United Kingdom will cost about eighty thousand Pounds Sterling to one hundred and eighty thousand Pound Sterling (£80,000 to £180,000).

When it comes to starting a standard and large scale food truck company with several food trucks operating in key cities in the United Kingdom, a food truck company with the intention of selling franchise, then you should look towards budgeting well over one million three hundred thousand Pound Sterling (£1.3 million).

How Much Does It Cost to Start a Food Truck Business in Canada?

These are the key expenses you are expected to make when starting a medium scale but standard food truck company business in Canada;

  • For federal incorporation of business in Canada, the cost to incorporate it is $200 if filed online through Corporations Canada’s online Filing Centre ($250 if filed through other means).
  • Legal expenses for obtaining licenses and permits (Health department license and business license) and permits (Fire department permit, Commercial kitchen permit, Commercial Vehicle Operator’s Registration for the truck, Permits for each municipality being operated in (downtown, various suburbs), Food handler’s certificate, Appropriate driver’s licenses for drivers, Assistant’s licenses for assistants, Health inspection Certificate, Air and water pollution control permit, and Sign permit et al) as well as accounting services (CRM software, Payroll software, P.O.S machines and other software) – $15,300.
  • Marketing promotion expenses for the grand opening of the food truck company in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • The cost for hiring business consultant (including writing business plan) – $2,500.
  • The cost for insurance (general insurance, health insurance, liability insurance, kitchen Insurance, workers’ compensation, overhead expense, disability insurance, business owner’s policy group insurance, and Motor Vehicle Insurance (Comprehensive) coverage at a total premium – $10,400.
  • The cost for the purchase of food trucks – $60,000
  • The cost for leasing a standard kitchen facility with government approval – $50,000
  • The cost for remodeling the facility – $10,000.
  • Other start-up expenses including stationery ($500), phone and utility(gas, sewer, water and electric) deposits ($6,500).
  • The operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
  • The cost for start-up inventory (Gas Cookers, Cooking gas, Pots, Pans, and other cooking utensils, food ingredient, food serving wares and food packaging materials et al) – $15,000
  • The cost for storage hardware (bins, rack, shelves, food case, food warmer) – $3,720
  • The cost for counter area equipment (counter top, sink, ice machine, etc.) – $9,500
  • The cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • The cost for the purchase of furniture and gadgets (Micro wave oven, Telephone, printing machines, computers, tables and chairs et al): $14,000.
  • The cost for building and hosting a website: $600
  • The cost for opening party: $8,000
  • Miscellaneous: $10,000

You will need an estimate of three hundred and fifty thousand dollars ($350,000CAD) to successfully set up a medium scale but standard food truck company in Canada. Please note that this amount includes the salaries of all the staff for the first 3 months of operation and a business with more than one food truck operating in different locations within same city.

Starting a small scale but standard food truck company business with just one food truck and minimal overhead in Canada will cost about one hundred thousand dollars to two hundred thousand dollars ($100,000 to $200,000CAD).

When it comes to starting a standard and large scale food truck company with several food trucks operating in key cities in Canada, a food truck company with the intention of selling franchise, then you should look towards budgeting well over one million, five hundred thousand dollars ($1.5 millionCAD).

How Much Does It Cost to Start a Food Truck Business in Australia?

These are the key expenses you are expected to make when starting a medium scale but standard food truck business in Australia;

  • In Australia, the fees to register your business name with ASIC include: $34 for 1 year. $80 for 3 years
  • Legal expenses for obtaining licenses and permits (Health department license and business license) and permits (Fire department permit, Commercial kitchen permit,Commercial Vehicle Operator’s Registration for the truck, Permits for each municipality being operated in (downtown, various suburbs), Food handler’s certificate, Appropriate driver’s licenses for drivers, Assistant’s licenses for assistants, Health inspection Certificate, Air and water pollution control permit, and Sign permit et al) as well as accounting services (CRM software, Payroll software, P.O.S machines and other software) – $15,300.
  • Marketing promotion expenses for the grand opening of the food truck company in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
  • The cost for hiring business consultant (including writing business plan) – $2,500.
  • The cost for insurance (general insurance, health insurance, liability insurance, kitchen Insurance, workers’ compensation, overhead expense, disability insurance, business owner’s policy group insurance, and Motor Vehicle Insurance (Comprehensive) coverage at a total premium – $10,400.
  • The cost for the purchase of food trucks – $60,000
  • The cost for leasing a standard kitchen facility with government approval – $50,000
  • The cost for remodeling the facility – $10,000.
  • Other start-up expenses including stationery ($500) and phone and utility (gas, sewer, water and electric) deposits ($6,500).
  • The operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
  • The cost for start-up inventory (Gas Cookers, Cooking gas, Pots, Pans, and other cooking utensils, food ingredients, food serving wares and food packaging materials et al) – $15,000
  • The cost for storage hardware (bins, rack, shelves, food case, food warmer) – $3,720
  • The cost for counter area equipment (counter top, sink, ice machine, etc.) – $9,500
  • The cost for store equipment (cash register, security, ventilation, signage) – $13,750
  • The cost for the purchase of furniture and gadgets (Micro wave oven, Telephone, printing machines, computers, tables and chairs et al): $14,000.
  • The cost for building and hosting a website: $600
  • The cost for opening party: $8,000
  • Miscellaneous: $10,000

You will need an estimate of three hundred and fifty thousand dollars (AUD$350,000) to successfully set up a medium scale but standard food truck company in Australia. Please note that this amount includes the salaries of all the staff for the first 3 months of operation and a business with more than one food truck operating in different locations within same city.

Starting a small scale but standard food truck company business with just one food truck and minimal overhead in Australia will cost about one hundred thousand dollars to two hundred thousand dollars (AUD$100,000 to AUD$200,000).

When it comes to starting a standard and large scale food truck company with several food trucks operating in key cities in Australia, a food truck company with the intention of selling franchise, then you should look towards budgeting well over one million, five hundred thousand dollars (AUD$1.5 million).

Estimating Start–Up Cost for Food Truck Company Business was Based on the following factors;

  • Specific Location

Food trucks are known as mobile restaurants or restaurant on wheels; this goes to show that the operator of a food truck will always go to a location where there are loads of people who are likely to patronize them. Little wonder it is easier to find food trucks in places like parks, stadium, camping sites, construction sites, campuses and games village.

Even though you can change the location of your food truck per–time, that does not rule out the fact that the location you chose to operate your food truck company is key to the success of the business. It is important to categorically state that operators of food trucks usually partner with event planners to get updates of events so as to enable them plan their routes and position their food trucks.

  • Staff/Manpower

When it comes to starting a standard food truck company business on a large scale, you would need the services of the following professionals;

  • Manager (Owner)
  • Human Resources and Administrative Manager
  • Kitchen Supervisor
  • Cook
  • Kitchen Assistant
  • Accountant/Cashier
  • Truck Driver
  • Assistant Truck Driver

Can a Food Truck Service Business be Bootstrapped on a Lean Budget Right from Home?

Due to the nature in terms of size and cost of food trucks and equipment involved in starting and operating a food truck company, it is obvious that it cannot be bootstrapped on a lean budget from home. As a matter of fact, the business is meant for the public; you are expected to drive your food truck through routes with enough people to patronize your food and drinks.

On the other hand, if you want to start a similar business such as mobile ice cream/yogurt cart business, then you can successfully bootstrap the business on a lean budget right from your home.

In the United States of America, the Average Cost of Purchasing a Food Truck Franchise is $15,000. Examples of 3 Well – Known Food Truck Franchising Companies in the United States of America are;

  • Chick’n Cone – Franchising Company
  • Don Chow Tacos food truck – Franchising Company
  • Tasti truck delights

In the United Kingdom, the Average Cost of Purchasing Food Truck Franchise is £10,000. Examples of 3 Well – Known Food Truck Franchising Companies in the United Kingdom are;

  • Cafe2U Mobile Coffee Franchise
  • OatopiaFood Truck Franchise
  • Jasper’s Catering Franchise Ltd

In Canada, the Average Cost of Purchasing Food Truck Franchise is $18,000 (Canadian Dollar). Examples of 3 Well – Known Food Truck Franchising Companies in Canada are;

  • Smoke’s Poutinerie
  • Pretty Sweet Mobile Cupcakery
  • Meals on wheels

In Australia, the Average Cost of Purchasing a Food Truck Franchise is AUD$15,000. Examples of 3 Well – Known Food Truck Franchising Companies in Australia are;

  • Home – Tasty Trucks
  • Mobile Boost Vans – Boost Australia
  • Mutter Krause – Mobile Food Truck Franchise

Financing your Food Truck Business

Raising start – up capital is perhaps one of the major concerns for entrepreneurs; it can be challenging raising capital to launch a business idea. Your idea must be workable and promising for you to secure finance from financial institutions or from investors.

The first thing to put in place before sourcing for start – up capital for your business is to draft a detailed business plan. With a good business plan, you can easily convince investors to invest in your business. The truth is that no bank can give you a loan if you don’t have a good and workable business plan. There are several options when it comes to raising money to finance a start – up business. Some of the options are;

  • Raising money from personal savings and sale of personal stocks
  • Raising money from investors and business partners
  • Applying for loan from bank
  • Applying for business grants and seed funding from donor organizations
  • Sourcing for soft loans from family members and friends.
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