How to Start a Food Truck Business or Side Hustle

Food trucks can gross anywhere from $100,000 to $500,000 per year, or roughly $8,300 to $42,000 per month. Assuming a full-time schedule, that translates to $47 to $250 per hour.

That’s obviously a very wide range, but the key takeaway is that successful food trucks can be very profitable. That said, exactly how much you’ll make will depend on many factors, including:

• Your chosen niche
• Your location and the local market (how much demand there is)
• The quality of your food
• How successful your marketing efforts are

However much you earn, you won’t be taking all of it home as profit. You’ll have to factor in your startup and operating costs as well.

How much does it cost to start a food truck?

On average, it takes between $50,000 and $250,000 to open a food truck. (If that sounds like a lot, don’t worry; we’ll talk about how to fund your business later.)

Many factors contribute to this hefty upfront investment. The greatest expense, of course, will be the food truck itself, which could cost anywhere from $30,000 to $175,000, depending on its age and condition. Luckily, the truck—along with much of your equipment—will usually be a one-time purchase.

You’ll also have ongoing costs to keep your business running. Don’t forget to account for these expenses, both as you get started and at regular intervals afterward:

• Food truck maintenance and repairs
• Gas
• Rental or loan payments
• License and permit renewals
• Food and ingredients
• Marketing materials and ads
• Insurance premiums
• Credit card processing fees

Be prepared for your expenses to eat up to 50% of your earnings, although again, the exact figure depends on how you run your business.

Follow these steps to get your food truck side hustle going:

1. Refine your food truck business idea

Before you invest any money into starting a food truck, you’ll need to do some market research to make sure your idea has what it takes to go the distance.

Scout out your neighborhood, identify its key demographics, and think about what types of food they’re likely to prefer. Next, check out existing food trucks in your area. Pay attention to where and when they operate, and note any food niches that seem to be missing from the scene.

Once you’ve done your research, you can develop a concept that will set your food truck apart from the competition, considering what kinds of food you’re most comfortable cooking.

Don’t forget to come up with a memorable name for your business. You’ll also want an attention-grabbing logo. If you have a talent for graphic design, you can create one yourself, but you can also hire someone to design it for you on websites like Upwork and Fiverr.

2. Create a business plan

You don’t want to jump into opening a food truck business without a solid plan for how to fund, operate, and grow it.

These are the essential elements of a business plan. This is a written document that you’ll present to potential investors or lenders to convince them to finance your operation.

Include the following topics in your plan:

• Overview and goals: Introduce your company, define its goals, and detail what makes it different from other food trucks.
• Target market: Describe the demographics your truck will serve, including an analysis of how you expect your sales to affect the existing market. This is where your market research will come in handy.
• Menu: Outline your intended menu, including any seasonal items that you anticipate rotating in and out.
• Marketing/sales strategy: Outline your plan for marketing your business, especially if you plan to pay for advertising, and your strategy for generating enough sales to stay in business.
• Operational plan: Define your internal business structure and the legal business entity you plan on creating (e.g., a sole proprietorship). Detail the organizational system you plan on using for your daily operations.
• Financial projections: As best you can, calculate how much revenue you expect your business to make in the next five years to show that it will be profitable.
• Funding request: Lay out exactly how much money you need from investors and show how you will spend it to start and grow the business.

Where to secure funding for your food truck

Unless you have an awful lot of spare cash lying around, you probably don’t have the means to foot the bill for your startup costs on your own. Don’t worry—once you create your business plan, there will be plenty of ways to secure funding without having to dip into your personal bank account.

You can start by asking family members or friends to consider supporting you (although this can put strain on your relationships, so be careful about who you approach).

You can also look into these funding sources:

• Business loans: The Small Business Administration offers microloans of up to $50,000 that are specifically designed for small businesses, including food trucks. You can also apply for loans through financial institutions like National Funding.
• Community sponsors: Talk to local organizations (such as your city’s Chamber of Commerce) to find businesses that may want to sponsor your food truck.
• Crowdfunding: Try online crowdfunding platforms. Kickstarter helps you raise money from a broad audience in exchange for tangible rewards. Wefunder lets people invest money in exchange for equity in your business.
• Business credit cards: You can apply for and use a business credit card for some of your initial expenses, but be careful about racking up too much debt this way—credit cards often have high interest rates, and you don’t want to end up in a deep financial hole.

Securing startup funding is often the hardest part of opening a food truck. Make sure your business plan is strong and convincing before you show it to potential investors.

3. Get the necessary licenses and permits

There are legal hoops that you’ll need to jump through when you start your food truck business. It’s important to comply with your local laws and health and safety regulations.

Register your business

You’ll need to register your business as a legal entity. If you’re a sole proprietor, you’ll probably only need a business license, often issued by your city or county, and an employer identification number (EIN), available for free through the IRS.

If your business classification is anything other than a sole proprietorship (e.g., an LLC or partnership), your state may require additional paperwork. Check your local regulations, and consider consulting with an attorney to be sure.

Obtain licenses and permits

Next, you’ll need to get all the proper permits to operate your food truck.

In general, you’ll need the following:

• Mobile food facility permit
• Food service license (also called an employee health permit or food handler’s license)
• Health department permit
• Standard driver’s license or commercial driver’s license (dependent on the weight of your vehicle)

Depending on your business and location, you may also need:

• Food seller’s permit
• Liquor license
• Parking permits
• Fire certificate

Permit and licensing laws vary by location, so it’s critical to research your state, county, and city regulations to ensure that you’re in compliance. Check with your local Chamber of Commerce, health department, and Department of Motor Vehicles (DMV) to learn their requirements.

Get insurance

Just like with any other vehicle, you’ll want insurance for your food truck. However, unlike personal vehicles, food trucks require commercial auto insurance, which covers physical damage to your truck and any attached equipment.

In addition, it’s a good idea to get general liability insurance. This will protect you and your business if there are accidents or injuries to your customers that you’re found liable for (e.g., if someone gets sick after eating your food and you end up on the hook for their medical expenses).

There are several other types of insurance you might also want to consider, including:

• Equipment breakdown insurance
• Food spoilage and contamination insurance
• Workers’ compensation insurance (if you have other employees)

Talk with an insurance professional to get a clearer idea of what your business will need.

4. Purchase or lease a food truck

Now that all the planning and legalities are out of the way, the fun part begins. This is the point where you go out and get your food truck.

You’ll need to decide (based on your finances and business plan) whether it’s better to buy or lease a truck and whether you want a new or used one.

It’s also important to consider any customizations you’ll need and whether you’re willing to make them yourself or would prefer to find a truck that already has everything you need.

• If you’d like to buy: Start by searching local online classified boards, like Craigslist, or national marketplaces, like Roaming Hunger.
• If you’d like to lease: Try truck leasing companies or sites like FoodTruckRental.com. You can also put out feelers in your local community of food truck owners to see if any of them are willing to rent one of their vehicles to you.

Again, once you have your food truck, don’t forget to insure it!

5. Develop your menu

If you didn’t already create a menu when you came up with your food truck concept, now is the time to do so. It should line up with your initial idea and target audience. Ideally, it will also fill a gap in your area’s food truck offerings.

If possible, include alternative menu items or substitutions for those with dietary restrictions or allergies (e.g., gluten-free or vegan options). This will help you appeal to a wider customer base without compromising your niche.

Keep the menu itself short and clear. Include photos to draw people in and add tantalizing food descriptions that will get mouths watering.

When it comes to pricing, be competitive but reasonable. As part of your market research, you should have learned what other food trucks in your area charge for similar items. Don’t stray too far from the market’s accepted rates.

It’s also wise to offer items at a wide range of prices so that there isn’t a barrier discouraging new customers from trying your food. This might mean offering different portion sizes or small add-ons for lower prices.

6. Buy additional supplies and equipment

If your truck didn’t come equipped with everything you need to prepare and serve food, then you’ll have to buy additional supplies.

You’ll likely need these essential types of equipment:

• Cooking: Grills and fryers
• Warming: Food warmers and other related equipment
• Food preparation: Knives, cutting boards, serving spoons, and other cookware
• Serving: Disposable food containers, napkins, cups, straws, etc.
• Refrigeration: Refrigerators, freezers, and ice machines
• Sanitation/janitorial: Sinks, soaps, sanitizers, and trash cans

Don’t forget about equipment to help you get paid. If you prefer, you can choose to only accept cash and buy a lockbox to store it in, but many customers don’t carry cash and are used to being able to pay with a card, so you’ll probably want a point-of-sale (POS) system, like Toast or Square, to process card payments.

This is also the time to figure out where you’ll buy your ingredients. Make sure they’re fresh and high-quality. Consider supporting your community by buying seasonal items from the local farmers market.

Beyond that, look into wholesale food distributors, regional suppliers, and bulk grocery stores. Whoever you choose, you’ll be working with them closely (and hopefully for a long time), so nurture that relationship well.

7. Pick a location

The point of a food truck is that it’s mobile, but you still have to choose where to park your truck and when (i.e., your hours of operation).

Concentrate on high-traffic areas during peak meal times, but be open to receiving the hungry masses in unexpected places and times and be willing to adjust your schedule according to what the market wants.

When you’re starting out, try multiple locations at various times of the day and week to figure out where you get the most business. Once you’ve done that, you can keep shifting between several key locations or stay in the same spot so loyal customers always know where to find you.

8. Run your food truck

Once your food truck is up and running, that’s when the real work will begin.

During your initial testing phase, you should get a good sense of the daily operational and management tasks you’ll need to perform. These include things like taking orders and payments, preparing and cooking food, buying supplies, maintaining your inventory, cleaning and sanitizing, scheduling, and bookkeeping.

It’s important to stay on top of your administrative duties while also serving customers day in and day out. Keep your space neatly organized to avoid confusion or chaos, and make sure to thoroughly train any staff you have. Take inventory on a regular, frequent basis so you understand consumption patterns and can prepare your business accordingly.

As you gain experience and momentum, you’ll be able to refine your systems and employ new ones as you encounter new situations.

Don’t forget to stay up to date on food trends in your area and adapt as your business grows. Solicit feedback from your customers about what they like and what they’d like to see you do differently.

9. Promote your food truck

To attract more customers and expand your reach, you’ll need to market your food truck.

Try some of these marketing strategies:

• Prominently display your logo to attract attention.
• Make your menu visually appealing.
• Participate in community events.
• Sell t-shirts and other merchandise featuring your logo.
• Offer promotions for existing customers via email and SMS.
• Build an online presence with a website and social media accounts and post regularly.
• Collaborate with other local businesses with similar audiences.

10. Expand your business

Once your food truck is established with a loyal customer base and plenty of profit, you can consider expanding.

You could start off small by offering catering services or opening a second food truck. Eventually, your business could turn into a franchise with an entire fleet of food trucks.

Depending on your goals, you might decide to transition to a restaurant with a fixed location instead. If your real ambition is to be a restaurateur, a food truck can be a great stepping stone since it gives you the opportunity to build a brand for a much lower initial capital investment.

Be careful not to expand too quickly, or else your operating expenses could overpower your revenue before your new ventures have a chance to gain momentum. Take it by degrees and, if you can, avoid taking on more debt by using your profits to fund each expansion instead of soliciting loans or outside investment.

Consider hiring and training staff

If you’ve been operating your food truck all by yourself so far, then the first step when you expand might be to hire staff, such as cooks, servers, or drivers. Bringing them on board will help ease your workload and free you up for higher-level tasks.

Since you’ll be working closely with these people in a small space—or leaving them in charge while you attend to other duties—it’s important to choose the right employees. They need to believe in your business values, have a good work ethic, and have a passion for serving the community.

Once you’ve chosen your staff, train them well. Each employee will need to take a food safety training course and get a food handler’s card before they can prepare, store, or serve food to the public. Also, make sure to inform them of any particular expectations you have as they interact with customers.

You’ll want to consider both the pros and cons of starting a food truck before you decide to move forward.

Challenges of opening a food truck

These are some of the most common issues food truck owners face:

• Long working hours
• Stiff competition within the industry
• Adherence to zoning laws and regulations
• Food waste management
• Unpredictable weather

To succeed in this business, it isn’t enough to have great culinary skills—you’ll need a strong work ethic and a certain amount of business savvy. Of course, you won’t know everything in the beginning, but you’ll need to be a quick study to learn on the job.

You may also need some outside help (which you’ll have to pay for). You might want to talk with a marketing expert about how to get ahead of your competitors, and as mentioned, you may need to consult with a lawyer to make sure you’re abiding by your local laws.

The other challenges are manageable with the right strategies. For instance, to limit your food waste, you can donate excess perishables to local charities and food banks.

Advantages of starting a food truck business or side hustle

Despite the challenges, there are many benefits to starting a food truck. The initial financial investment is lower than many food-related business startup costs, so there’s potential for more profit.

As a business owner, you’ll also get to take certain tax deductions, such as fuel expenses and depreciation on your large equipment purchases.

Running a food truck also provides flexibility in your work schedule and gives you control over your life. You’re the boss, so you get to make all the decisions. What could be better than that?

If reading this has motivated you to give this side hustle a try, there’s an empty parking lot out there waiting for your new food truck. You have everything you need to get started—good luck!