How To Start A Food Truck: Counting The Costs

In our first installment of this series, we gave an overview of things to consider when starting a food truck. If you have already researched the licenses and permits required, then the next step to actualizing your dream of owning and operating a food truck is to set up a financial plan. Some of your expenses will be obvious, but it is important to understand how one expense may affect another. Here are some of the main costs to consider:

The Food Truck

It goes without saying that this will be the most important investment of your entire food truck journey. In some ways, buying your food truck will be like buying a house. Do you want to buy a fixer-upper and make renovations as you go or do you want to invest in a brand new truck and have peace of mind?

Depending on which path you choose, the price of the food truck will range from $50,000 to $200,000, not including the cost of decorating and wrapping the truck. If you buy a used food truck, you are accepting whatever condition it’s in at the time of purchase, for better or worse. One important thing to consider when buying a used food truck is outside financing. Since the truck’s condition is questionable, it is risky for banks and brokers to provide a loan, so you may need to pay out of pocket. It is also essential to know if the truck’s warranties have expired already.

The price of a brand new truck will be on the higher end of the spectrum, but it is easier to finance and you’ll have fewer repairs and hidden costs to worry about down the road. You can also have your truck and kitchen built to the exact specifications that you want and within the law. On that note, we can’t stress this enough: check the local laws and permits before purchasing your food truck. Can you imagine getting a good deal on a food truck only to find out that it’s not in line with your city or county regulations? Not fun.

By doing a simple online search, you can find online marketplaces where you can search for used trucks, but it may be helpful to check with your local food truck association and local food truck owners for perspective and referrals first. Whether new or used, it is ideal to buy your truck local. According to Restaurant MBA, it will also cost an additional $3,000-$5,000 to fully wrap your truck.

Commissary Rental

In most cities, you cannot prepare or store what you will be selling in your home, so many food truck owners turn to private kitchens that rent out space to caterers and other food entrepreneurs. You can either rent out a kitchen for yourself or rent a shared space at an hourly rate. These commissaries may offer a safe parking space for your truck as well. Unless you already own a brick and mortar restaurant where you can prepare food, this is your best option. Commissary fees, including kitchen space, parking, and waste disposal, can run between $250-$1,250 a month.

Business and Truck Insurance

Not only do you need to protect your physical investment while out on the road, but you need to protect your business as well. You will need to seek auto insurance that covers commercial liability and includes accidents, theft, vandalism, and anything else you deem necessary. If you have a barbecue truck or regularly cater large events, you probably need to tow your grill or extra supplies, and they may need coverage as well.

From a business standpoint, you need to protect yourself and your employees. For example, workers’ compensation covers any employee who needs medical treatment due to ailments or injuries sustained while working. Business personal property insurance protects anything that isn’t nailed down to your truck, such as smokers, mixers, and pans. Umbrella liability covers anything you can think of that isn’t already accounted for. Lastly, you need to protect yourself in the event that a customer gets food poisoning.

This list is not all-inclusive, so based on your research, determine what is required and decide which protections are necessary for your business. In general, you can expect to pay $2000 – $4000 annually depending on coverage levels and what percentage of the year you plan to operate the truck.

Other Costs to Consider

By this point, you have your food truck, a kitchen to prepare your food, and the insurance to cover it all. Below are some miscellaneous costs to consider.

  • Employees: Expect to pay anywhere between $8-15 per hour per employee. Employees with food truck or restaurant experience will be easier to train, but you will have to pay them on the higher end of that spectrum.
  • Food: Initial inventory for food and supplies (pots, paper products, uniforms) may cost around $1,000, depending on what supplies you need.
  • Fuel: The cost depends on the size of your truck and how often you drive, but it will still cost $250-500 monthly.
  • Point-of-sale (POS) system: You can purchase a basic cloud-based POS system with reliable service for as little as $200. The more sophisticated systems can cost up to $1,000.
  • Training and certifications: Some states require for your employees to attend food safety training and/or obtain a food handler’s certification. Check with your state to verify the cost and requirements.

Given these expenses and the licenses and permits we covered in our previous blog, you can expect to pay at least $60,000 to start your restaurant on wheels. This does not cover all of the expenses required, but this does give you a reference point for the more costly expenses and how to approach them. If none of these options work for you at the moment, it’s not the end of the world. Consider starting a food cart or concession business. The up-front costs aren’t as expensive, the regulations may not be as strict, and you can still build a following to set up your next venture.

In our final two installments of our “How to Find a Food Truck” series, we will discuss how to find your niche in your local food truck scene and putting yourself out there. In the meantime, download the Goodfynd app to search for food trucks near you!


Author: Goodfynd

Whether you're at work, home, or just out and about in the city, we list the food trucks closest to you and do a little bit more!

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