Running a family business is a dream for thousands of people, but choosing the right business platform can be tricky and should only be made from the foundation of careful research. In 2019 the average food truck grossed more than 300K, and this dining option only continues to evolve in popularity as an upward trend showing no signs of slowing. Today’s food trucks offer culinary works of art, unique spins on classic dishes, and allow for family recipes making the food truck business competitive with brick and mortar restaurants, with significantly less overhead. When you are ready to start buying a food truck, you will first need to have a firm understanding as to why this option is ideal for family businesses, and how to choose the best food truck that will set you up for success, based on YOUR growth goals and business model as opposed to some cookie-cutter model.
Buying a Food Truck is Highly Profitable
According to Quora, the average food truck grossed $300,000 in 2019 with a revenue increase of 12% over the last five years. In fact, many food trucks turn a bigger profit than physical restaurant locations, as they serve the same quality food, at around the same price, with significantly less overhead. If your family is looking for an opportunity to go into business together, buying a food truck can be the best solution with ample opportunities.
What about Food Truck Cost and the Initial Investment?
Here’s the good news: when buying a food truck, the vehicle itself will be your biggest investment for the entire business. Furthermore, when multiple family members pitch in towards the food truck cost, the investment is easy and very affordable. In fact, there are other ways families can lower that initial food truck cost before investing directly from their pockets. Here are some of the most popular ways:
- Private loan
- Bank loan
- Business loan
- Second mortgage
- Social media/crowdfunding
With this being a quickly evolving digital age, it is easy for families to turn to crowdfund on social media, especially if one’s culture is directly injected into their business model and they intend to revitalize the local community. For example, consider a Mexican family that is trying to raise the funds to buy a food truck that will prepare various types of mole rooted in their families’ tradition. Their community is heavily Latino, and they intend to hire local people, train them, and expand with the goal to get another food truck in two years. Not only will the food truck serve home-cooked traditional fare to their community members, but it will offer jobs and continue to do so as the business evolves. When a family business has a model such as this one, more people are likely to donate.
Taking out a second mortgage can sound risky, but considering the revenue, food trucks saw last year, coupled with the popularity, the numbers all indicate that families will make it back in no time. Private loans are also a popular option–you may have to give a small percentage of your earnings to the investor, but this is not always a requirement, and if the lender does request this, the figure is always low and easy, otherwise, the loan would make no sense.
Finally, meet with your bank and look into a bank loan or a business loan. Most banks see buying a food truck as a safe investment and so long as your credit isn’t on its last breath, you should be able to get a low rate with great options.