23 March 2024

Starting a Food Truck: Market Research

Food Truck Market Research:

Understanding your market is your top priority when deciding on whether or not to start a food truck. To understand your market you must understand the needs of the customers, the other food trucks and restaurants fulfilling the needs of customers, the local regulations that may limit your ability to do business and the organizers managing locations, catering and festivals. You'll also need to research how the name of your establishment can be represented digitally. Does the name of your business have an available URL? Are the necessary social media accounts taken or can they be confused with other brands? In addition to identifying the aforementioned items, you must also identify your market's geographic parameters.  What cities will you be doing business in?  How many business licenses/health permits will you need? Are regulations the same in all of your markets?  In order to do this research correctly, you must dedicate a significant amount of time to on the ground research. This includes participating in food truck events as a customer, reaching out to local associations, discussing food truck regulations and events with regional health departments and, if you're really ambitious, taking a job on a food truck for a few months.   

Starting a Food Truck: Market Research

Identifying the market for your food truck:

Most food trucks in Manhattan have it easy when it comes to identifying their market. They get permits for Manhattan and do business in Manhattan. Occasionally, they'll do an event in New Jersey or the outer burrows, but for the most party their day to day business is in Manhattan. The food trucks in Los Angeles have a much tougher time identifying their market. The County of Los Angeles has 88 cities and four health departments. Understanding what permits are needed to vend in what areas takes a lot of time and effort. Each city requires a business license so most food trucks have at least five. Three of the cities have their own Health Departments so extra health permits are required as well. In order for a food truck to launch successfully and without too much capital expense on permits, it's important for them to understand where their cuisine/offering is going to be most popular. It doesn't make sense for an Indian food truck to get permits on the East side of Los Angeles County if they think they'll only be doing great business on the West side of the County. Figuring out where you want to do business in a food truck can reduce the amount of time, money and energy applying for permits you're not likely to do great business. 

Most food trucks vend in areas where they're likely to service multiple cities and counties. The quicker you can shrink the list the better. As your food truck becomes more popular and well known, you can add regions and obtain more permits. It's best to start in the areas that have a market for your cuisine and offering. For example, if you're selling traditional hamburgers and  you're considering a region with a lot of tech office space, you may want to reconsider. Tech companies employ both men and women pretty equally and they have a younger demographic who may not want something as heavy as hamburgers. However, if you're also near an area with a lot of factories and blue collar workers (mostly men) hamburgers may do well regardless of the day of the week. Also understanding that your market will want different things at different times of the week is important. People feel guilty about what they ate over the weekend. Crazy football Sunday with burgers, dogs and beers? Customers like lighter faire on Mondays or Tuesdays. Salads, wraps and bowls do great in the beginning of the week around younger customers that are evenly divided between men and women. 

Starting a Food Truck: Market Research

What are you selling from your food truck? 

Every aspiring food truck operator has a menu and brand in mind before they even start their market research. It's important to stay flexible so your research guides your decisions. Don't be so stuck to a cuisine/menu/brand you ignore information that conflicts with your assumptions.  Let your research guide your menu and brand so you're truly creating what your market wants and needs. Don't forget about how important NEED is. If you're thinking about creating a Korean Fusion food truck but there are already 10 Korean Fusion food trucks, then maybe you should go in another direction. Every region has their popular food trucks who are doing great business because customers love them. If you put out a copycat brand, you'll likely always be second fiddle or have one heck a large hill to climb for recognition. Customers tend to look at copycat brands negatively. 

Food trucks have found inspiration from regionally popular cuisines that may not have made their way throughout the region. For example, Banh Mi sandwiches were popular throughout a few parts of Los Angeles and Orange Counties before 2009. It took two entrepreneurial partners to bring those sandwiches to other parts of LA. Now, it's not uncommon to see Banh Mi sandwiches at restaurants everywhere throughout Los Angeles. Some regions have specific things they're known for, but neighboring communities have to travel far to get it. Food trucks have the unique ability to expand a cuisine's reach if they think it will have a similar customer base nearby. Other vendors have combined two popular cuisines to create something entirely new. Kogi, the first popular food truck of the Gourmet Food Truck industry combined Mexican and Korean favorites in Los Angeles. Both cuisines were very popular so people from around the City and County saw something completely new made from something very familiar. The formula worked, and Kogi gave birth to a world wide phenomenon.

When you're creating your cuisine/menu/brand, you also have to make sure you can serve what you're offering in a way that makes you money. If each one of the items on your menu takes 8 minutes to make, and most of you shifts are two hours, then you'll only be selling 15 meals. Your menu has to fit in with food truck operations. Assembling your menu instead of cooking your menu always ensures speed of service and the volume necessary to make money. You want to aim for 40-60 meals per hour. It's ok to have some items that take a little longer, but you must have the line buster items that can be out in 30 seconds to ensure speed. Your menu needs to make you money. 

Starting a Food Truck: Market Research

What to Name your Food Truck Business.

Your brand name is the first thing people will hear about your truck. Kitschy names like "Let's Taco About it” and "Ace of Spuds” are pretty popular in the food trucks space. Other names that incorporate "wheels” or "rolling” are also pretty common. Choosing a name that will allow you to keep your brand if you decide to open a brick and mortar restaurant is a good idea. It's hard to call a restaurant "Tacos on wheels” once the brand has moved to a stationary location. Additionally, you'll want to steer clear of names that are descriptions, as they may be hard to trademark. Something like "The Taco Truck” won't get trademark protection because it's just a description of the food truck. Whatever you choose should be very memorable, easy to spell (so they can find you on social media) and relate in someway to what your business does. 

Starting a Food Truck: Market Research

Food Truck Social Media/URL

When choosing a name, make sure to check to see if there is a URL available, and social media accounts you can reserve so you can use your name easily online. Also, be sure to choose a name that won't get confused with other food trucks or food businesses. Your name should be easy to remember, have obtainable social media accounts and avoid confusion with other similar businesses. Food trucks rely on their digital footprints to communicate with the public. Having a mobile business requires constant interaction with the public to ensure they know where you'll be vending. While twitter was the first social media platform used by the food truck industry, Instagram and TikTok have taken over. This means that having great content is an important factor in your digital strategy. Great pictures of your food are an absolute must. Posting subpar pictures of your food will do more harm than good. 

Starting a Food Truck: Market Research

Checking out your Competition Before Starting a Food Truck: 

An important part of your Market Research should be to check out your competition. The food truck industry is competitive, but it also requires food trucks work together for the benefit of the industry. One food truck may serve an office building, but the real magic happens when multiple food truck operate together. Food trucks can turn any public space into an event, just with their participation. Spend time eating from food trucks. Recognize how fast they get through lines, what point of sale they're using, their digital content and how their food is presented. Check out all of the popular trucks in your region. See what they're doing right and what you can copy from them. Remember, food truck operators have long memories. When you approach or talk to them, be respectful and complimentary. You may soon be in the industry with them. Your first year in the industry will be a lot easier if all of the other food truck operators like you. Be kind and accommodating. A new food truck can get a lot of business from veterans if they're well liked. 

Starting a Food Truck: Market Research

Testing out your Food Truck Menu:

Your menu has to be tested before launch. What better way to test your offerings than with a friends and family party. Set up a "test” to feed your party. Line people up at your kitchen as if they were ordering from a food truck. Have your menu on display and take people one at a time as if they were ordering from the window of a truck. Make sure you have anonymous comment cards to get real thoughts on your menu. Your friends don't want to make you feel bad, but it's important they give you honest feedback. Time how fast you get through the line and how fast you get through each "customer.” The purpose is to make sure your menu can be made quickly and consistently. Don't be offended by honest feedback and meet with the team the next day to see what type of changes you can make. 

Getting a job on a food truck:

Working on a food truck before starting your own is the very best preparation you can do. The food truck owners that have taken this extra step always launch more prepared and have less issues in the beginning than those that don't. Quite a few prospective food truck owners decide that the food truck life isn't for them after a few week's working on a food truck. Every region's industry has a hard time filling positions and getting job, if you're willing to work hard, won't be a problem. Pay close attention to everything during your time working the food truck. Make notes after every shift of what you think worked, and what you'd personally change. Ask questions when something confuses and offer to help with things like social media and promotion. The time you spend working on a food truck will save you time and money when you open your own operation. 

Starting a Food Truck: Market Research

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