More than seven years have gone by and the food truck industry is still riding high. The industry has been in continuous growth and in the past five years alone, it has grown by 12.4%. Food trucks are a convenient and quick way for people to get a bite to eat without having to wait a long time. It is especially suitable for all those individuals who have a job and social life to maintain at the same time. Just pay, grab something and walk away. This concept has led to the significant growth in the food industry. The busier our lives get, the higher will be the revenues for the food truck industry.
Food trucks can provide a variety of cuisines including Italian, Chinese, Asian, and of course fast food. Though food trucks are definitely not limited to just these. They can even provide you with more than one cuisine. Meaning, you get an all in one dining experience without having to rush to multiple places.
Statistics of the Food Truck Industry
The current $650 million revenue estimate by food trucks, will be hitting about $2.7 billion in 2017! That is almost a four times increase. This hike has made it one of the best revenue generating segments in the overall food industry, currently producing $1.2 billion per year from 4,130 food trucks all over the United States. That’s $290,556 on average per food truck. The average meal ordered at food trucks costs about $12.40, which is much less than a restaurant dine-in.
Because of the food court areas located in almost all the shopping malls, the least revenue is generated by food trucks in nearby areas which consist of 12% of the total revenue. Coming after this, is the industrial and construction work sites where about 15% of the total sales take place. Other locations like event venues produce 18% of the total industry revenue. And the highest percentage of revenue is generated from random roadside locations and street corners which make up 55% of the total revenue. Random placements are the most profitable way of achieving more sales. These areas usually include residential or office-majority locations where there aren’t many restaurants nearby, which make food trucks an attraction for that place.
Statistics In Comparison to Restaurants
1.2 billion dollars may seem like nothing as compared to the revenue generated by restaurants annually which measure more than 709 billion dollars. But when you compare the food truck industry size to the number of restaurants, you will realize how great the food truck statistics actually are. The food truck industry is not as great as the restaurant industry competing at 4,130 to 616,008, respectively. Furthermore, the food truck industry is rapidly increasing and it is predicted that its numbers will come close to that of restaurants, quite soon.
Food Trucks as a Business
Probably the biggest advantage of food trucks is that they are quite an inexpensive start-up as compared to the usual brick-and-mortar restaurants. Moreover, food trucks are very flexible when it comes to, well, almost anything. From testing new menus and recipes to adopting different strategies and catering to specific customer preferences to changing locations for a better customer reach. Food trucks do not have to spend much in order to change their system.
It is much easier for food trucks to cater to customer requirements more effectively because of their close contact with them every day whether it’s talking in-person or through social media websites. These consistent interactions provide immediate feedback and response to the seller. Which in turn, helps in altering their business model and contents of the menu and food over and over again without much cost.
Initial costs of starting up a food truck business is roughly $90,300 from which $85,000 is just the truck and equipment cost. The other $5,300 includes the initial product inventory, permits and licenses, website, point of sales terminal, uniforms, paper products, pots & pans, fire extinguisher and other miscellaneous expenses.
Overall, a hundred thousand dollars will not seem much if you ponder over how flourishing this business is and how well it has been performing in the last few years. You will have earned your initial investment sooner than you think.
The food truck industry has managed to get into powerful consumer trends where people can get fresh and quality food which is served fast and super conveniently. Using the help of social media they can easily broadcast any new concept or ideas they have regarding menus, location, or even their business model and get quick responses so that they can alter their methods accordingly.
Despite the strong performance of the food trucks industry some operators have been discouraged by the law, low-profit margins and even increased competition. Laws regarding food trucks vary from city to city, mostly controlling at what hours the food trucks can operate and the distance a food truck can be from any nearby brick-and-mortar restaurant. The food truck industry competes directly with the rest of the food industry and quite a few of the brick and mortar restaurants have petitioned against food trucks which is causing difficulty in the spread of the industry. Another problem the industry is facing is that in most locations, food trucks have reached a saturation point and profits have become stagnant or have a very insignificant increase. This has stunted the growth of the industry tremendously.
The food truck industry is predicted to face many different types of challenges in the upcoming years which may also include parking regulations, due to which growth can be slowed down quite prominently. On the other hand, with the increase in demand for quick, healthy and fresh food, conveniently available at locations far away from the traditional eat-outs, the food truck industry is sure to persist and may even overcome all the challenges it faces.
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