Want to Buy a Food Truck? Here’s What You Need to Know

In recent years, food trucks have become ubiquitous to the American landscape. From LA to D.C., and Minneapolis to Miami, mobile eateries have taken the food industry by storm and introduced an entirely new dining concept. What started with humble beginnings—carts sold hot dogs, taco trucks offered cheap eats, barbecue on a stick was great on the go—has morphed into an array of gourmet, budget-friendly options served up curbside by inspired chefs.

The food truck industry has been performing well ever since its modern inception, in 2008. (The original food truck is credited to a Rhode Island vendor named Walter Scott who, in 1872, cut windows into a covered wagon and parked it in front of a local newspaper’s office; selling sandwiches, pies, and coffees to journalists working after-hours.)

Spurred on by the Recession, renewed interest in the local food scene, and Americans’ on-the-go lifestyle, the food truck industry has come into its own and shows no signs of slowing down. If you’re considering getting into the business or expanding your food truck fleet, there are a few things you should know before you buy a food truck.

What to Know if You Want to Buy a Food Truck

There are plenty of enticing aspects to the food truck industry: flexibility, mobility, low start-up costs, etc., but the industry is anything but a piece of cake. It takes hard work and long hours to properly run a food truck, especially if you start one from the ground—er, tires—up.

Since popularity continues to rise, the cost of acquiring a food truck will also rise. So, if you want to buy a food truck, you may want to do so now rather than later. Here are some things you need to know about buying a food truck.

Industry Growth

In 2008, as the economy started to tank, restaurant owners and other entrepreneurs across the country were hesitant to open brick and mortar establishments. Instead, they followed a new trend from the West Coast and took to the streets where overhead was low, and potential profit margins were high.

The industry emerged just as social media marketing was gaining its footing, which offered an affordable marketing option for owners. To this day many food trucks rely heavily on social media to promote their brand, post menus, announce locations and advertise.

According to the Food & Agriculture Organization of the UN, 2.5 billion people eat street food every day, which, in 2015, lead to an industry worth $1.2 billion. Future growth is predicted, as regulation catches up with demand.

What to Expect

When it comes to purchasing a food truck, there are many elements of the business that you need to consider during the sale. Are you buying new or used? Are you a start-up or are you buying an existing business? What are you serving?

Other aspects to consider:

• Truck commissary; which includes parking, power, fresh water, etc.
• Health permit; costs and rules will vary state by state
• Association or network costs; joining organizations can be extremely beneficial for your business, i.e. finding the best route or attaching customers or teaming up with other food trucks for festivals.
• Commercial kitchen rent; where preparation and storage takes place

When it comes to determining the details of a sale, it is smart to enlist the help of a business expert, such as the brokers of Sunbelt. Experienced business brokers will be able to guide you through the process, negotiate terms, deal with the sale closing and paperwork.

Pros and Cons of Food Truck Ownership

Before buying any type of business, it’s important to weigh the pros and cons of ownership. That way, you’ll have performed your due diligence and will be making an informed decision.

Pros:

• Cheaper than traditional restaurant establishment
• Projected industry growth
• Mobility and flexibility

Cons:

• Food trucks cannot obtain liquor licenses
• Market is saturated (con) but fragmented (pro)
• Regulatory challenges

The food truck industry can be a lucrative market, but you have to put in the work. If you’re looking for food trucks for sale, or have questions about buying or selling this or any other kind of business, contact Sunbelt Business Brokers. With almost 40 years in the industry, Sunbelt prides itself on working to align the interests of both parties, ensuring the sale is met with mutual success and satisfaction. Find your local Sunbelt office today!