Food trucks have exploded in popularity over the past decade. Once seen as just a novel trend, food trucks are now a serious and viable business venture for many aspiring restaurateurs and chefs. However, despite the apparent opportunities in the food truck industry, the failure rate for new food truck businesses remains high. Most food trucks close up shop within the first few years. So what are the top reasons food trucks fail?
1. Poor Planning and Research
One of the biggest mistakes new food truck owners make is failing to do adequate planning and research before launch. Opening up a food truck requires much more than just purchasing a vehicle and whipping up some tasty recipes. There are complex operational logistics, legal and regulatory requirements, hiring challenges, and location scouting that must be addressed. Owners who skimp on planning often find themselves scrambling once they are up and running. For example, many new owners underestimate food costs and don’t understand licensing requirements, which leads to profitability issues down the road.
Experts recommend taking at least 6-12 months for planning before launching a new food truck. This includes thoroughly researching your local market, analyzing the competition, securing licenses and permits, establishing supply chains, hiring staff, hunting for commissary kitchens if needed, and scoping out optimal locations. Food truck owners should create detailed business plans covering every aspect of operations and worst-case financial scenarios. Meticulous planning helps avoid nasty surprises after opening up.
2. Poor Location Selection
Choosing the right vending locations is critical to the success of any food truck. New owners often pick locations based on intuition or convenience rather than objective analysis. Parking in front of their home or place of business might seem attractive at first. But a steady stream of hungry customers won’t just show up without ample foot traffic, visibility, parking, and surrounding amenities.
Ideally, food trucks should target locations with built-in crowds. Office parks, busy downtown areas, event venues, and college campuses tend to work best. Owners must scout potential locations at various days and times to calculate average foot traffic and use permitting restrictions. Geographic desirability factors like income levels and pedestrian access should be assessed as well. The most successful trucks park in highly visible spots at critical mealtimes when other dining options are limited. Location selection should tie closely with your menu, brand, and target customer demographics.
Tips for Location Selection
- Look for areas with limited restaurant options nearby
- Scout morning, lunch, dinner, and weekend crowds
- Consider visibility, parking, and foot traffic patterns
- Partner with venues that lack on-site food options
- Research income levels and office density
- Comply with permitting and zoning limitations
3. Deficient Social Media and Marketing
Food trucks heavily rely on social media, digital marketing, and word-of-mouth advertising to attract customers. Owners who neglect digital and social promotion quickly find empty lines and quiet lunch hours. Yet many new truck owners emphasize menu development and truck outfitting over their marketing strategy.
Savvy social media promotion should start weeks or months before even launching service. Food truckers should build excitement and curiosity on platforms like Instagram and Facebook leading up to opening day. Hashtags, local food blogger partnerships, and crowdsourced menu development campaigns are great ways to organically grow followers. Once up and running, trucks should post daily promotions, location announcements, and mouthwatering food photos.
Beyond social media, trucks should focus on search engine optimization, online reviews and ratings, email collection pop-ups, cross-promotions with bars/breweries, and clever guerilla marketing ploys. The most successful food truck marketers spend far more time on digital branding and customer outreach than kitchen craft.
Social Media and Marketing Tips
- Build your brand story and identity online first
- Partner with local influencers and bloggers
- Reward customers for social shares and reviews
- Post daily specials and location updates
- Collect emails and phone numbers for regular promos
- Monitor review sites and online feedback
4. Menu Problems
Even the most social media-savvy food truck can struggle if the menu isn’t dialed in properly. Fickle customers will quickly abandon trucks with lackluster fare or poorly executed classics. Constant menu experimentation and overreach in the kitchen leads many trucks to mediocrity.
Menus should be focused, concise, and specialized around a clear theme or cuisine. Trucks usually fare best with a smaller selection of dishes executed extremely well. Trying to be everything for everyone is a common pitfall. Novel fusion dishes and weekly specials are great supplements but shouldn’t distract from core menu anchors.
Ingredients and prep processes need to be chosen strategically for quick execution and mobility. Steaming, grilling, frying, and quality cold dishes make more sense than braises or complex baked dishes. Savory, satisfying finger foods with vibrant flavors tend to sell best from trucks.
Menu Tips
- Build your menu around a speciality cuisine or unique theme
- Offer a focused selection of 5-10 dishes max
- Feature dishes and ingredients that are easily prepped and served
- Include vegetarian, vegan, and gluten-free options
- Avoid overly complex or time-consuming cooking methods
- Experiment with fusion dishes as weekly specials
5. Poor Financial Management
Like any small business, food trucks live or die by their financials. Insufficient capitalization, unrealistic sales forecasts, and sloppy bookkeeping sink many truck concepts. Owners also tend to underestimate operating costs like fuel, insurance, staffing, licensing fees, and truck maintenance.
Food truck owners should have access to at least 6 months of operating capital before launch. This provides a buffer as customers are acquired. Detailed financial projections should use local market research rather than guesswork.Breakeven sales volumes, ideal ticket averages, and worst-case scenarios need to be estimated.
Once up and running, daily sales, margins, and expenses must be meticulously tracked. Careful cashflow planning and lean operations will help offset inevitable slow periods. Owners should run frequent profit and loss statements and tweak pricing or menus as needed.
Financial Tips
- Secure ample operating capital for the first 6-12 months
- Build financial projections from local market research
- Track sales, costs, and cashflow daily
- Analyze statements and cost drivers regularly
- Keep overhead and operating expenses lean
- Plan slow periods into your capitalization
Conclusion
Starting a food truck may seem easy enough at first glance, but the reality is very few trucks achieve long-term success. Creating an exciting brand and menu is important, but smart planning, location analysis, social media marketing, and number-crunching determine sustainability. Food trucks that cut corners on research, capitalization,costs, and financial controls often end up stalled on the side of the road.
