LET’S HEAD INTO DAY 14, and explore 5 Reasons to Choose Food Trucks over Brick and Mortar Restaurants
The age old question.... the difference in start-up costs between food trucks and brick and mortar restaurants. Let's start with some industry insights into the food truck industry, then we'll explore 5 Reasons to Choose Food Trucks over Brick and Mortar Restaurants. According to www.fliprogram.com, the US restaurant industry is expected to reach nearly $783 billion in sales in 2016. As appetizing is that sounds, it's important to understand the reality of start up costs in a brick and mortar restaurant. Before you invest your life savings into legalities, expensive real estate, staffing, equipment, interior design, construction, and recurring monthly expenses, you should know that restaurant sales are growing at a moderate rate. In fact, fast food restaurant sales are declining. On the flip side, the food truck industry is growing. Mobile food businesses report a 9.3% increase in revenue since 2010. In 2015, the mobile food industry was valued at $856.7 million and that number is expected to increase another 130 million by 2019 according to Ibis World.
5 Reasons to Choose Food Trucks over Brick and Mortar Restaurants
Starting a business, whether mobile food truck or restaurant, requires an investment of time, resources and planning. We' will explore the 5 Reasons to Choose Food Trucks over Brick and Mortar Restaurants when analyzing the brick and mortar vs. food truck options.
Reason #1: Food Trucks have a higher success rate
The rate of success within a restaurants' first year is around 35-40%. The investment of a brick and mortar is a high-risk venture that fails due to several factors, including food industry inexperience, lack of investment capital, location/real estate, poor staffing, mismanagement, and pricing structure. Food trucks have a greater success rate, as the initial investment is much lower than a brick and mortar, and starting small can allow you to control your brand and image, while gaining and retaining customers. APEX Specialty Vehicles reports an average success rate of our custom food trucks to be around 96-98% success in the first year. Check out some past project pictures here.
Reason #2: Money, money, money
The average cost of a brick and mortar restaurant start-up is around $500,000. Many banks and financial institutes are hesitant to offer financing for an industry with a below-average rate of success. Consequently, the initial investment of a food truck ranges from $40,000 (lower-end- eBay, Craigslist - used food trucks) to $180,000 (custom, high quality with superior craftsmanship and an unmatched 5-yr warranty). Bottom line is easy to comprehend - you get what you pay for. Investing in a food truck offers the flexibility of reaching your customers, and engaging in events, but reduces the day-to-day worries of paying your staff, suppliers, vendors, rent, etc. APEX offers in-house financing with options for a 60-month term that allows you to maintain an affordable monthly payment, while continuing your business successfully.
Reason #3: Quality Control
Within the 20-ft food truck, you have control of the way your business plan operates; how the food is prepared, stored, daily specials, when to open and when to close for the day, and so on. The constant complaint of so many brick and mortar diners is the lack of food consistency. One day you may eat at a restaurant and love your entree, then two weeks later you return, order the same dish, and it is dry, overly salty, and cold. Many factors contribute to the inconsistency of food at a restaurant, including the available staff, time of the day, management control, and cooking equipment. With a food truck, you have fewer people interacting with the customers and orders, so you are able to reinforce stronger quality control. You can manage the presentation of how the food leaves the truck, and can ensure each dish is prepared to your food truck business standard.
Reason #4: Versatility
One day you can hit up a festival, the next you can be catering a wedding party of 200 people. With a food truck, you've got wheels and the versatility to travel to different locations, events, and hubs to stake out the most profitable avenues. With a brick and mortar, you are constantly driving people TO your restaurant, however with the food trucks, you are literally DRIVING to the people. All about perspective and profit!
Reason #5: Expanding your customer base
With a food truck business, you are able to expand your customer reach by traveling at a wider proximity and having great exposure than a brick and mortar restaurant can provide. You are able to tweak your menu easily and quickly to adjust to your surrounding customers and cultural preferences. You are able to test menu options and gauge the success with smaller sample sizes, and adjust accordingly as your business evolves.