Things To Know When Starting a Food Truck Business

By Team Zeller

25.06.2021 Business tips

Things To Know When Starting a Food Truck Business

From licensing and location to the mobility of your menu – we've got you covered. 

Whether you’re taking your first step into the food industry or looking to expand your existing restaurant business, a mobile food truck is an exciting venture and business model. 

Over the past decade, the food truck trend has continued to thrive in Australia and the variety of cuisines and healthy options available have grown exponentially. From tasty South-American arepas to fresh Vietnamese dishes and vegan food, the humble pie truck has a lot to contend with. 

With rents on the rise across the nation, a mobile business with fewer start-up costs is a lucrative way for new business owners to get into the industry and grow a loyal following, before launching an in-house dining experience. A food truck offers a place to hone your ideas and creations, and grow confidence in your skills before taking on a bigger risk.

For existing restaurant owners, a food truck can act as a launching pad for testing new menu items, while also generating brand awareness when travelling to new areas and experimenting with different locations. The value a food truck can add to an existing and expanding business should not be overlooked.

Keep reading to find out what you need to know when starting a food truck business, including the legal obligations that come with a mobile food business, how much it costs to get started, where food trucks can be set up, and how to create a delicious and unique menu that will draw in hungry customers.

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Your legal obligations

Legal jargon can be tedious and frustrating, but knowing the regulations that apply to your business is crucial to operating in a safe and legal manner. Many requirements and policies differ between states so ensure you keep up-to-date with all the relevant laws applying to your business and location. 

Restaurateurs shouldn’t assume regulations for an in-restaurant business are the same for a mobile food business. Be sure to check up on this in order to be compliant with all laws and standards. 

Food Safety Regulations

When it comes to a food truck business, it’s not as simple as buying a truck and selling food. Legal requirements to operate a food truck are quite strict, and you will firstly need to complete basic food and safety training to comply with the Food Standards Code. Get a copy of the code and become familiar with the policies relating to your business. 

Licences

In order to legally operate a food truck business, you must register it and apply to your local council for your licences. Licence requirements differ state-to-state.

Talk to your local council to find out what you may need, or simply check on the Australian Business Licence and Information Service website, which covers each state and territory.

Generally, on your licence application you’ll need to include:

  • the type of food you intend to sell, and whether it’s packaged or fresh
  • your food business classification 
  • your target customers

There will be a fee for the licence, and it must be renewed annually. 

Insurance

Depending on the vehicle you use, the food you serve, and the local laws and regulations where you operate, different forms of insurance may be legally required.

The basics to consider are:

  • public liability
  • vehicle protection
  • workers compensation
  • income protection

Where your food truck can go

Where can food trucks go? It’s important to ensure you are serving customers in a place where you are allowed to operate. If you’re not permitted to be at a certain location, you could end up with a large fine or risk losing your licence. 

It’s imperative that you research your local area and make savvy decisions when choosing where to set up your food truck. The perfect spot for your business will bring in more sales and have you selling out of stock rather than wasting your valuable time and produce. 

Understanding your local market is key to your financial strategy. You can look into:

  • markets
  • school fetes 
  • festivals
  • events, such as weddings or industry networking events
  • partnering up with a local brewery, bar or resort
  • permanent food truck sites

What you should serve

You possibly already have an idea of what type of food you want to serve to your customers. You’ll still need to do some research to identify if there’s a gap in the market for what you’re offering, and whether it’s a style of cuisine people within your community will appreciate and gravitate towards. 

What you dish up will need to be delicious, authentic and unique, while also being cost appropriate and efficient to serve. Even if you’ve been in the restaurant business for a while, there will likely be a learning curve; preparing and serving food from the back of a truck isn’t the same as preparing food in a fully-stocked professional kitchen. You’ll also have to move at an even faster pace, because your customers won’t want to wait, and there won’t be time for executing the finer details.

In creating your food truck menu, it will be important to consider:

  • the mobility of the food, as it will typically be eaten on the go
  • whether you can save costs by eliminating the need for cutlery and minimising packaging 
  • how much food prep needs to be done, and the energy required to power tools, such as ovens, vats, etc
  • what your competitors are doing, and your point of difference

How to take payment on the go

It’s important to remember that mobile food trucks need to be able to quickly take payments on-the-go, so customers aren’t waiting long. Your customers will also want a fast, secure and trusted option — no customer wants to get to the front of the queue, only to be directed to the nearest ATM to take out cash. A reliable, mobile EFTPOS machine is a key tool to ensure you’re able to serve a customer quickly, then move onto the next without delay. 

When choosing an EFTPOS terminal provider, it’s especially important for food truck business owners to prioritise connectivity. You never know where business might take you — you might take your food truck to a music festival, or attend a market in a regional area. If your EFTPOS terminal can’t connect to the internet, you can’t sell any food. 

With Zeller Terminal, your customers can tap, dip or swipe their payment method of choice, so you’re able to move on to the next. And Zeller Terminal connects to the internet via Wi-Fi and SIM card, so no matter where you park your food truck, you’re able to accept card payments.

Ready to get started with Zeller?

How much money it costs to start a food truck business

While a food truck is cheaper to run than a brick-and-mortar restaurant, your vehicle will be a significant outlay to purchase and fit-out. If you’re buying a new, custom-built food truck, expect to pay upwards of $100,000 depending on the inclusions. 

Cheaper second-hand options exist on the market, but be aware that the cost of kitchen equipment and remodels of the vehicle can stack up quickly. Having a realistic budget planned in advance is essential preparation for handling initial costs. 

Here are some of the things to take into consideration when budgeting for your new food truck business:

  • licenses, insurances, permits and other fees
  • kitchen equipment
  • auto-service to maintain the vehicle and check it’s in good condition
  • marketing costs for your business to build your community and brand awareness
  • daily operating expenses, such as food and supplies, staff wages and payroll taxes, credit card processing fees, and transportation

Writing your business plan

Are you wondering how to make a business plan for a food truck? Putting together a strategic business plan will be your road map to success. This is especially relevant when financing a food truck with investors or obtaining a loan from the bank.

Food truck work is not limited to the hours of operation of the business. There’s also food prep, commute times, administration and banking, booking events and the maintenance of your vehicle and tools to take into account. Being mentally prepared for everything running a food truck entails, and keeping focused on your goals, is essential. 

Start by conducting some essential market research before putting together your plan. You can visit local food trucks and connect with foodies in the area to find out what cuisines are popular and what other options people might want. Creating a list of expenses, such as vehicle insurance, cost of licences, equipment and anything else you may require, will help give you a realistic picture of your budget. 

Opening and operating a successful food truck can definitely be a challenge, but after considering the points above you are in a strong position to get started on the right foot. For more information on writing a business plan for your new food truck business, read our other articles: How to Write a Business Plan and Your Business Plan Blueprint for Success.