By Sue Stanton
The restaurant business has always been a tough one, but it’s become even more so since the economic downturn in 2007. While some restaurants closed amid the financial crisis, others got creative and came up with other ways to extend their revenues and not just survive, but thrive.
Whether it’s bottling a signature sauce, expanding restaurant space to cater to large private parties, joining a local “foodie tour” or launching a food truck, if you’re considering expanding your revenues, the options are as many as the number of restaurants in Georgia.
Trucking Into Profits
Since the early days of the ice cream truck and hot dog stands, tasty treats from a truck has always held a certain appeal, not to mention a big convenience factor.
Willy’s Mexican Grill is just one Georgia restaurant that has extended its business through a food truck. The Atlanta-based fresh Mex restaurant, which was founded in 1995 and is best known for its award-winning signature burritos, already had 21 restaurants in Atlanta, Athens and Gainesville, Fla., when it launched its food truck.
Willy Bitter, president of Willy’s, says the Willy’s food truck started rolling in the fall of 2010. Before he got going, though, Bitter took a trip to Los Angeles, which he calls the “land of the food trucks,” to check out how the trucks operated.
The truck is used primarily for catering and special events, but it has also been parked at key locations in Atlanta during the lunch hour.
“The response has been great, and people love hosting a food truck at their party or event,” Bitter says. “It’s fun and makes the experience unique.”
The catering side of the business was started in 2000, just five years after the restaurant debuted, and Bitters says it is a very profitable part of his business.“In our case, the Willy’s Food Truck is another part of our catering department, rather than a separate entity,” he says.“We saw the addition of the truck as an opportunity to offer our customers the food truck experience at their home or office.”
If you are considering launching a food truck, however, Bitter recommends you find a way to stand out from the pack without losing your concept identity.
“Don’t get caught up in the hype,” he says.“There are a lot of trucks out there now, and in order to be successful, you need to come up with an original concept. Make sure it works for your menu and offers something better than what is out there.”
How to Get Rolling
Thinking of starting a food truck business, but don’t know where, how to start, or how much capital you’ll need? The Atlanta Street Food Guidebook is a valuable source of information tackling subjects including start-up costs, rules and regulations and daily operations. The e-book is by Greg Smith and Maggie Rentz Smith, founding members of the Atlanta Street Food Coalition, a group of restaurateurs, small business owners and citizens whose mission is to campaign for safe, affordable and legal access to street food in Atlanta and the surrounding metropolitan area.
Among the guidebook’s many helpful topics is the section devoted to start-up costs, which includes everything from the truck or trailer to staffing, to permits. The guidebook states that a conservative target for the average required capital is around $100,000. The list below provides all areas of start-up costs along with cost ranges.
Truck or Trailer ………………………………$10,000 – $125,000
Kitchen ………………………………….. Up to $30,000 or more
Operating Expenses (3 months):
Cost of Goods ……………………………………$6,000-$60,000
Staffing ………………………………………….$5000 – $20,000
Supplies ……………………………………………………$1500
Gasoline……………………………………………………$1000
Insurance ………………………………………………$600-800
Permits …………………………………………………….$1500
The wide range for the truck or trailer depends quite literally on whether a truck or a trailer is used for vending. Per the guidebook, “trailers are extremely affordable; you can spend as little as $10,000 (or less!) on a fully-outfitted trailer.” A drawback in using a trailer, according to the guidebook, is that the trailer will limit the number of locations that can be reached in one day because of the additional set-up and break-down time to park the trailer at the vending location. Ultimately, the additional time and limited vending opportunities per day can lead to increased labor costs.
The guidebook also lists ways to decrease the cost of purchasing a food truck, which in the current market can cost anywhere between $65,000 and $125,000. Alternative cost-saving methods to purchasing a food truck is to lease one, a practice that is not common in the Atlanta market, or to build your own. When building your own food truck, the authors recommend planning at least three months from concept to completion.
Greg and Maggie Smith are both attorneys with The Smith Group, LLC, an Atlanta law firm. Greg is recognized as an authority in food and beverage service and production law and food service licensing and permitting issues. The Smiths are co-owners of the Westside Creamery food truck. Their guidebook is available for purchase for $30 through the Atlanta Street Food Coalition website at www.atlantastreetfood.com.
The Atlanta Street Food Coalition website provides information on current food truck vendors, a monthly calendar highlighting dates and times of food truck vending events and an opportunity to join the coalition.
