Thinking about starting your own coffee truck? In this blog post we guide you through the steps required start a profitable coffee truck or cart business from someone that’s already done it. My goal is to give you step-by-step instructions on the startup process from market research to business planning, equipment and startup costs. Find out if you really want to open a coffee cart business below. 

Learn how to start a coffee trailer like this one.

 

Background

Listen to the full podcast interview where you’ll learn how Drew created a one-of-a-kind brand for the Mo’ Joe A Go-Go coffee business. From sourcing of product to the equipment used on the truck everything is 100% unique. Matt Drew’s story began not unlike other mobile food entrepreneurs I’ve interviewed in the past. Drew was employed as a marketer in a corporate setting and found himself less and less passionate about the work.

Drew also had a daughter on the way and started to question the point of putting in 12 – 16 hours per day for someone else, and ultimately wondered what his legacy would be if he continued down this path. So Drew made the decision to change the trajectory of his life in a big way by starting a coffee truck.

Step 1: Market Research & Business Planning 

The first step you need to take in starting a coffee truck business, before you even start thinking about the equipment, the size of cart to buy or the licenses you’ll need to operate is to take some serious time to consider the brand you want to grow. This means evaluating your competitors in the local market to see where your business can fit in and developing an in-depth business plan. 

Outside an Italian style coffee truck.

Here’s how Drew differentiated his coffee truck from others in Texas: 

• Organic Products: Drew emphasized that everything sold on the mobile unit would be organic and sustainably grown whenever possible. This requirement applies to every detail of the business from the food to drinks to the dairy served. The tagline of the business even reflects this: The Freshest Coffee Sustainably Grown and Artfully Crafted.  
• Responsibly Sourced and Fair Trade Beans: One regrettable aspect of the coffee industry as a whole is farmer’s are often located less developed countries have often made the least amount of money from their product. Drew has worked to ensure that the beans purchase with his business are through farms are Fair Trade, meaning they have responsible growing practices and are fairly compensated.
• A Unique Product: By As you can see from the examples above that by following these brand guidelines, it results in a product you can’t get anywhere else locally as a consumer. If you want a cup of coffee with an impactful story behind it there’s only one place to find it.

Based on your competitor and market research, come up with a concept that stands out. This could mean specializing in artisanal coffees, offering a broad selection of beverages (like teas, smoothies, etc.), or even focusing on a particular theme or experience (eco-friendly practices, local sourcing, etc.).

You want to be able to say, “We’re doing something that nobody else is doing. We’ve got something that nobody else has and this is the only place you’re going to be able to find it.” Because if you can’t say that there’s really nothing compelling to be able to talk about with your brand. – Matt Drew on the importance of branding for mobile food owners. 

Create a detailed business plan that outlines your vision, target market, competitive analysis, financial projections, and marketing strategies. This plan will be essential for guiding your business and securing any needed financing.

To have any type of successful food business, you need to be able to differentiate the core product in a meaningful way. By establishing the things that are most important to your business this will make the process easier.

Step 2: Make a Sample Menu 

For a new coffee truck, it’s wise to start with a streamlined menu of around 8 to 12 items. This approach allows you to focus on quality, manage inventory efficiently, and streamline the training process for your team. And Caleb Goodrum of Refuge Coffee Co. points out, “You’ve got limited space in a coffee truck—every inch counts so you need to maintain a focused menu. ” Here’s what a small coffee truck menu might look like: 

• 3 to 4 Coffee Classics: Include essential coffee offerings like Espresso, Americano, Latte, and Cappuccino. These cater to the traditional coffee drinker and form the backbone of your menu.

• 2 to 3 Specialty Drinks: Introduce a few unique or seasonal beverages that can differentiate your truck, such as a signature Mocha, a seasonal Pumpkin Spice Latte, or a unique Iced Coffee blend.

• 1 to 2 Non-Coffee Options: Not everyone drinks coffee, so having alternatives like Chai Latte, Hot Chocolate, or a selection of teas can broaden your customer base.

• 2 to 3 Food Items: Depending on your capability to handle food, offering a small selection of grab-and-go items like croissants, muffins, or breakfast sandwiches can complement the drinks and provide a complete breakfast.

Over time, you can gradually expand your menu based on feedback and sales data, introducing new or seasonal items that your customer base might enjoy.

Step 3: Coffee Truck Equipment Checklist 

This is a checklist of basic equipment installed on a coffee truck. Pro Tip: Drew recommends investing in quality equipment versus the lowest priced because it’s the heartbeat of your business. You don’t want to be dealing with repairs, replacements, and a lower quality product. 

• Espresso Machine: An espresso machine will be the most expensive single piece of equipment you install on a truck. Expect to pay between $2,000 – $10,000 depending on the model and if you anticipate buying new or used. The UNIC Stella Di Cafe  is the exact model of espresso machine used by Drew. This is a high-end Espresso machine from Italy. 
• Drip Coffee Maker: A significant percentage of your clientele will want a regular drip coffee. A commercial drip coffee maker will run you around $1,500 – $2,000. But you could invest even more if you want top of the line equipment.
• Grinder: This is required for grinding coffee beans on a daily basis for the freshest tasting coffee. The ballpark cost for a commercial grade grinder is $500 – $1,000. 
• Blenders: For making blended coffee drinks and smoothies. A good commercial blender for a coffee truck needs to be durable, powerful, and able to handle high volumes of use throughout the day and will cost $1,000 – $2,000. 
• Commercial Refrigerator: You need this to keep milk, cream, and other products cool. Expect to shell out $2,000 – $5,000 for something reliable. 
• 3-Compartment Sink: This is a standard requirement anywhere you operate in the United States. This is needed to washing dishes, spoons, and other cutlery. 
• Plumbing and Water Tanks: You need these to store clean and grey water. This is roughly $2,000 – $3,000 for equipment and installation by a processional. Unless you’re extremely handy, this is not a project you want to take on yourself. 
• Cash Register or Point of Sale (POS) System: Crucial for processing customer transactions efficiently and managing sales data.
• Generator: If you plan to operate a coffee truck, don’t cut corners on this piece of equipment. As a coffee truck, you’ll have higher electrical requirements than most food trucks. Espresso machines, drip coffee makers, and blenders all require a lot of energy. You don’t want to lose power when you have a big rush and all your equipment is running. Around $3,000 – $7,000 should be invested on a quiet running generator that won’t scare off customers. 
• Initial Inventory: Don’t forget about a the little things you need to start a coffee truck. Paper cups, stir straws, lids, napkins, sugar packets, coffee beans, cleaning supplies, a plastic garbage can and other necessities add up quickly. It’s essential that you take the time to itemize every little thing you end need to purchase for the truck. As a rough estimate, expect to pay $2,000 for inventory. 

These are the basic components of a coffee truck, but keep in mind that your vision may require additional equipment. Do you plan to serve breakfast sandwiches? Consider a commercial panini maker. Take the time to figure out what you plan to serve on the truck and then work backward to determine equipment needs. 

Determine your startup costs, which include the coffee truck, equipment, initial inventory, permits, and marketing expenses. Then, secure financing if needed, which could be through savings, loans, or investors.

Step 4: Build a Daily Operations Plan 

Wondering what it’s like to operate a coffee truck truck on a daily basis? “My mornings typically start at about 3 a.m…. and that sucks.” says the founder of Mo’ Joe a Go Go Matt Drew. 

Drew’s days usually start at 3 a.m. This has been a challenge at first because Drew used to be a night owl. But in order to get the serving window up between 6:00 a.m. and 6:30 a.m., it requires waking up a few hours early to prep for the day, drive to the vending location, and prepare for service.

Here’s what a typical day in the life of a coffee truck owner looks like: 

Prep Work

• It takes roughly an hour each day to complete prep work. This includes cleaning for the day, grinding coffee beans, getting drip coffee ready, placing breakfast items like muffins out. Much of this work is completed at a commissary before heading out on the road.

Travel to Vending Location

• One of disadvantages of operating any type of food or beverage truck is that you need to commute to a different destination each day. Take the distance between your commissary and vending location into consideration before committing to it.

• Commuting to and from your home base is a non-revenue generating activity. The farther you drive the more gasoline you use too. Try to keep one-way drive times under 30 minutes whenever possible as a best practice for saving time and money. 

Running the Coffee Truck

• As you might expect, morning is the busiest time for a coffee truck business. Coffee is a beverage most people enjoy after they wake up. As a result, you can expect more traffic before lunch as a general rule of thumb. Of course, you could always get into serving iced coffees to capture the afternoon crowd. 

• Drew insists that you should not limit yourself to operating in the AM as a coffee truck. A rush of customers can happen at just about anytime depending on the location. As you get more familiar with your regular vending spots, you’ll get a sense of regular cadence between busy and slow times. 

Opening a coffee trailer?

You can start to estimate your break even numbers for the business as a whole by determining the cost of your coffee, how many sales you anticipate, and the profit margin of each customer. I advise putting together a formal business plan to come up with a basic sales forecast. 

As a general rule of thumb, you’ll want to shoot for over $100,000 in sales per year as a full-time owner operator. This will ensure you’re able to pay for licenses, the truck, insurance, inventory and other expenses for the business. 

Refuge Coffee Co. Food Truck.

When you do get the opportunity for downtime, make sure to take advantage of it. Use these breaks as an opportunity to clean the truck, promote the business on social media, or follow up on catering opportunities. 

As Drew stresses in the interview, every day operating a food truck is a little bit different. Be prepared for anything in the early days and recognize that you will be looking for ways to improve processes and operations overtime. 

Step 5: License Requirements and Permits

The permits and license requirements of a coffee truck are different across each city and state in the United States. The bottom line is you will need to figure out the legal requirements to operate the coffee business in your specific area.

That being said these are the standard licenses and permits in most areas:  

• Health Permit: This permit allows you to sell food or beverages to the public. Contact the county health department website you plan to operate for more information on what you’ll need to acquire this essential license. 
• Fire Department: The local fire department will check your HVAC system and fire extinguishers to ensure you meet their requirements. 
• Business license: Establishing a formal business entity whether that’s a sole proprietorship, LLC, partnership or corporation is required in the United States. This will also get you an EIN number. 
• Vehicle license: Whether you own a trailer or truck, you’ll need a license within the state you plan to operate just like any other vehicle on the road. 
• Food Handlers permit: Many cities and counties require that you take a class and pass a test for handling food. This permit is often required for a coffee truck even if you don’t plan to cook any food on the unit. 
• Special event or temporary permit: If you plan to vend at special events like concerts, you will need to work with the event planner to identify what’s needed and the costs. 

Related Reading: Why Do Coffee Shops Fail? 232 Owners Share Top Reasons

• Zoning and Parking Permits: Depending on the city or county, there might be specific regulations about where you can park your coffee truck and for how long. Zoning permits ensure you’re operating in compliance with local laws regarding mobile food vending locations.
• Liability Insurance: To protect your business from potential lawsuits or claims related to accidents, injuries, or other liabilities, having comprehensive liability insurance is crucial. This insurance can cover everything from customer injuries to employee accidents on the job.
• Workers’ Compensation Insurance: If you’re planning to hire employees, most states require you to carry workers’ compensation insurance. This insurance provides wage replacement and medical benefits to employees injured in the course of employment.
• Commissary Agreement (if applicable): Some local health departments require mobile food units to operate out of a licensed commercial kitchen or commissary. This agreement proves your access to such a facility for food prep, storage, and sanitation purposes.

Step 6: Launch

Plan a launch strategy for your coffee truck. This could include a soft opening, special promotions, and events to generate interest and attract customers.

Soft Opening

First up, you’ve got your soft opening. This is your trial run before the grand opening. Invite friends, family, and maybe a few local influencers or bloggers. The goal here isn’t just to celebrate; it’s to test your operations under real conditions. You’ll figure out the kinks in your workflow, how quickly you can serve up orders, and get some honest feedback on your coffee and menu items. Plus, it’s a great way to start spreading the word through personal networks and social media buzz.

Community Engagement 

Don’t forget the power of the local community. Attend farmers markets, local festivals, or charity events where you can serve your coffee and get to know your customers. Engage with people, share your story, and get feedback. Being active in the community can build a loyal customer base that supports you not just for your coffee, but for your involvement and contribution to the area.

Collaborations can be gold. Partner up with local businesses or events that complement your coffee truck. Think bookstores, art galleries, or even fitness studios (everyone loves a good coffee after yoga or a workout). This not only broadens your exposure but also aligns your brand with other local favorites.

Collaborations & Events 

Hosting events can also draw in crowds. Consider a launch event that’s themed—maybe a ‘Coffee and Live Music’ morning, or ‘Coffee Art’ where you showcase some latte art skills. Make it unique, make it memorable, and most importantly, make it Instagrammable. Social media love is free advertising.

Remember, even after you start your coffee truck continue to gather feedback from customers and adjust your menu, operations, and marketing strategies as necessary. Stay adaptable and look for opportunities to grow your business, such as catering events or expanding your menu. The launch of your business is only the beginning of the adaptations and adjustments you’ll need to build a profitable coffee business. 

How Much Does It Cost to Start a Coffee Truck?

Expect to invest $50,000 minimum for a coffee truck that will pass your local health inspections with quality equipment installed and is reliable. You could easily spend as much as $100,000 or more on the truck you select and if the truck is brand new.

Here’s the estimated cost of a few different mobile coffee businesses:

• Coffee Push Cart or Bike: $10,000 – $25,000
• Coffee Trailer: $30,000 – $60,000
• Coffee Truck: $50,000 – $100,000 (Coffee trucks cost more because they have an engine.)

You might read something on blogs or forums of folks that have been able to open a coffee trailer for $20,000. It is possible by investing in a coffee cart that’s lower in price by buying used or non-commercial grade coffee equipment. But keep in mind that you’ll still need a vehicle haul a coffee trailer that isn’t included in these costs. If you already own a truck investing in a coffee trailer could be a good option. If you plan to serve in a stationery location, a trailer can also be a smart way to keep startup costs low.  

Related Reading: How to Start a Coffee Shop on Your Own Terms

The other thing you want to keep in mind is that the truck is literally the face of your brand. If the truck doesn’t look good on the outside, people will associate the appearance with the quality of your coffee too. You’ll want a vehicle that looks good to give yourself the best chance of success. 

Keep in mind that the figures mentioned above are broad estimates. Determining the the average cost of a coffee truck is always difficult to answer because it’s a variable cost that will depend on the size, year, equipment installed (this is a big one), business licenses in your area, if you’ll be operating a truck or trailer, and who is building it.

It’s a lot like asking someone the average price of a car. The price of a car will depend on the model, age, mileage, upgrades and other factors. 

How Profitable is a Coffee Truck?

Based on our survey of 223 full-time food truck owners, over 50% report generating at least $150,000 in revenue per year after 2 years or more in business. Coffee truck owners can expect to see similar revenues if you operate the business full-time and establish name recognition locally. Profit margins for coffee trucks and cafes often range from 15% to 25%, but these figures can be higher or lower based on the specifics of the operation. 

For example, if a coffee truck generates $15,000 in sales per month and has costs of goods sold at 35% ($5,250), labor and additional expenses totaling 50% ($7,500), the profit before taxes would be $2,250, which is a 15% profit margin. Most new coffee truck founders do all the work themselves and eliminate the labor expenses and retain those profits for themselves. 

Overall, coffee is a high-profit margin business. A cup of coffee that costs you less than 50 cents to produce can be sold at retail for $3.00 – $4.00 a cup on average. 

Opening a coffee trailer?

You can start to estimate your break even numbers for the business as a whole by determining the cost of your coffee, how many sales you anticipate, and the profit margin of each customer. I advise putting together a formal business plan to come up with a basic sales forecast. 

As a general rule of thumb, you’ll want to shoot for over $100,000 in sales per year as a full-time owner operator. This will ensure you’re able to pay for licenses, the truck, insurance, inventory and other expenses for the business. 

The post How to Start a Sustainable Coffee Truck in 6 Steps appeared first on Food Truck Empire.

How much income can you expect to make on a hot dog cart? In today’s podcast episode we get to the bottom of the “how much can a hot dog cart make?” question with Matt Gladfelter of Bow Ties and Hot Dogs in Knoxville, Tenn. Matt has been operating his business for more than 5 years. Matt understands the different between hype and reality with income numbers and how much work actually goes into hitting certain sales thresholds.

We begin our conversation with low-ball sales estimates. According to Gladfelter if you aren’t able to go out and generate at least $100 in sales within 2 – 3 hours you’ve got the worst location in the world or something is wrong with your presentation or image and you’re turning people away. You need to either move on to a better location or reevaluate your presentation if y0u find yourself in this situation.

On the high-end, you can generate a few thousand dollars in sales in a few hours by working at large events or offering catering. Just a couple big events per month like this can really help explode your overall profitability. Some events that Gladfelter has found to be extremely profitable include charity events, tourist attractions, and park events sponsored by the city.

But on average on a hot dog cart? Gladfelter explains that he usually shoots for $300 – $500 in sales per day on weekdays. On the weekends you’re looking for the higher value local events with the goal of doing $500 – $1,000 in daily sales. A good goal when starting out is finding locations where you can get 100 sales per day consistently.

Here’s how the math work on some different hypotheticals: 

• 50 customers per day * $8 per dog = $400 per day
• 100 customers per day * $8 per dog = $800 per day
• 150 customers per day * $8 per dog = $1,200 per day

Here’s another example if you’re selling a meal with hot dog, chips, soda or other premium beverage as a combo deal: 

• 50 customers per day * $10 per meal = $500 per day
• 100 customers per day * $10 per meal = $1,000 per day
• 150 customers per day * $10 per meal = $1,500 per day

Gladfelter explains that before getting into the hot dog business, you need to determine how much you need to make on a monthly basis to make the business worthwhile to operate. If you are looking for a side-hustle that brings in an extra $1,000 – $2,000 per month, you won’t need to work as hard as someone who needs $10,000 per month to cover their expenses.

Now that you understand the average income you can expect on a hot dog cart. Let’s dive into specific ways you can increase profits with a hot dog cart below:

• Create High Value Offerings
• Frequency of Serving
• Add a Tip Jar

Create Higher Value Offerings 

You’ll need to sell 100 hot dogs at $4 a piece to reach $400 per day in sales. But, if you’re able to move the average sale price to $6 – $10 you’ll need a lot less customers over the course of a shift to be profitable. One way to increase your average customer value is to offer value meals or boxes where you bundle menu items and drinks together.

For example, if you sell at hot dog at $4 a piece you could offer a drink and a side of coleslaw for a total of $6. Fast food restaurant chains are famous for doing the same thing in their industry and has help these businesses attain longterm profitability. There’s a reason McDonald’s asks if you would like fries and a drink with that for only $2 more. They are increasing the average income per customer by doing so.

There are a variety of menu items that Gladfelter has used to offer additional products beyond that hot dog. These items include giant pickles, baked beans, corn on the cob, and an assortment of different drinks like fresh squeezed lemonade.

You can also test serving higher value condiments like bacon wrapped hot dogs, small batch ketchup, organic sauerkraut or premium mustards from small producers. You can often charge an extra $1.00 – $2.00 by adding premium items like this to a hot dog. This bumps up your average ticket price and helps you make more money with each transaction on average.

Frequency of Serving

In the hot dog game, it’s all about hitting the streets regularly. More days out there, more dough in your pocket. Here’s why frequency and consistency are your best pals in this business:

You can’t plan your life on maybes. Being out there more means you can count on a certain amount coming in. This is key for paying bills and keeping the lights on.

Now, let’s talk numbers. Suppose you’re making between $400 to $1000 each day you’re out using the 100 customer per day rule:

• 5 Days a Month: You’re probably lookin’ at about $1,000 to $3,000 a month. It’s not bad money for a side-hustle, but it doesn’t bring in enough income after expenses to pay most people’s bills either if you want to go full-time. Some months might be lean if the weather’s bad or if there’s some other reason folks ain’t buying.
  • Annual Income (Estimate): $12,000 – $36,000
• 20 Days a Month: Now you’re cookin’. You’re looking at $5,000 to $13,000 a month at this level. That’s a serious step up. More regular, more predictable. You’re a known face, and people count on you for their lunch.
  • Annual Income (Estimate): $60,000 – $156,000
• 25 Days a Month: This is the big leagues. You’re potentially pulling in $8,000 to $20,000. That’s some serious cheddar. But remember, this is hard work and long hours. You gotta be sure you can handle the grind.
  • Annual Income (Estimate): $96,000 – $240,000

Bottom line: The more you’re out there, the more you make. If you go on vacation, your income goes to zero for that day. It’s a grind, but that’s the game. More days on the street means more chances to sell, and that’s what fills your pockets at the end of the day. Overtime, you’ll be able to keep track of the locations that are your top producers. Keep going to locations that make money and drop locations that don’t pay well over time.

Gross Income Versus Net Income 

Gross versus net income is a key concept to remember when operating a hot dog business when hearing about income potential. When someone sales, I made $500 operating a hot dog cart today, they are usually referring to their gross sales numbers. This is the amount of income the business generated BEFORE product costs and taxes.

You can think of this like a when you get a regular paycheck from your employer. You might get paid $20 an hour (this is your gross income), but after state and federal taxes you may only see about $15 an hour in your wallet (this is net income).

Taco dog with Mexican cheese, lettuce, and tomato.

When operating a hot dog business, here are the costs you can expect:

• Cost of Goods Sold (COGS) –  This should be at around 1/3 of your gross income. This includes hot dog buns, propane to fill your tank, napkins, and other products you sell. Don’t forget about the price for condiments like relish, grilled onions, sauerkraut, ketchup, mustard, chips, foil, paper plates, soda, lemonade and anything else you decide to offer on the cart.
• Operation Costs – If you’re just starting out, I’ll assume you do not have any employee expenses and plan to operate the cart yourself in the early days. If you plan to hire an employee to run the hot dog cart, you’ll have more overhead in the form of labor. Also keep in mind the cost of gas to travel to different locations, insurance, fees from payment processors or credit card, or replacing cooking equipment will be standard costs of operating the business. Learn more about the startup and operational costs of a hot dog business here. 
• Taxes –  Just like any other business you are responsible for paying taxes.
• Net Income – This is what you get to keep after the all your expenses, including taxes, are paid.

Add a Tip Jar

Alright, so here’s the deal with a tip jar on a hot dog cart. It’s like this secret weapon for boosting your cash flow, without much extra work. As any waiter or bar tender will tell you as well, you can make pretty decent extra money just from a few tips per day.

Gladfelter says you can generate an extra $20 – $50 per shift pretty easily by placing a tip jar on the cart. Now, for the tricks of the trade to bump up those tips:

1. Crack a Joke or Two: Everyone loves a laugh. If you’ve got a few good jokes up your sleeve, share ’em. Make ’em laugh, and they’ll remember you. Happy customers are more likely to throw a tip your way.Example: “Why don’t hot dogs star in movies? Because they always get roasted!”
2. Signs That Encourage Tips: Sometimes folks just need a little nudge. A clever or funny sign can do wonders. Something like, “Help support my hot dog habit,” or “Fear change? Leave it here!” It’s a light-hearted way to remind people that tips are welcome.
3. Be Grateful: Always say thanks when someone tips. A bit of gratitude goes a long way. It shows you don’t take their generosity for granted.
4. Create a Tip Goal: Sometimes I put up a sign with a goal, like “Help me buy a new umbrella for the cart!” People like to know their tips are going for something specific and helpful.
5. Keep It Clean and Tidy: A clean and well-organized cart can make a good impression. People might be more inclined to tip if they see you take pride in your setup.

Remember, the tip jar ain’t a miracle worker, but it sure can help boost your take-home pay. Be friendly, be yourself, and let the customers see the hard-working person behind the cart. That’s how you get them tips rolling in.

Regional Income Factors 

Where you live and operate can increase the potential earnings on a hot dog cart significantly. Live in a warm climate like California or Arizona? In the southern United States you may be able to operate as frequently as you want year round. The more times you’re able to go out and operate over the course of a year, the more money you can make.

If you happen to live in Minnesota where the winters are too cold to get outside and vend you will have fewer opportunities to go out and make money. One the other hand if you plan to operate outside the Central Park Zoo in New York City, you’ll need to invest a reported $289,500 to legally vend. Fortunately, this is the exception and not the rule for slinging hot dogs.

Live in a higher cost city? You can increases your overall profits simply by raising prices. Gladfelter operates his hot dog carts in Tennessee and typically charges $4 for a Nathan’s Quarter Pound All-Beef Hot Dog. If you happened to live in a coastal or tourist type community, you may be able to charge $6 – $10 for the same product. By understanding these regional factors, you can more accurately estimate the profitability of your cart and charge what you’re worth.

Quotes From The Show

You’re going to get a lot of varied answers from different vendors. And I hate to say this but motivation has a lot to do with those answers. – Matt Gladfelter on estimating a food carts income. 

Your goal is 50 – 100 people (customers) per day. So your location is obviously going to dictate that completely. – Matt Gladfelter on the importance of identifying profitable vending locations. 

Not a lot of cars are going to stop for a hot dog cart, unless they know who you are. – Matt Gladfelter on the importance of building a brand. 

To me I’ve found that events are where it’s at because literally in 5 hours you can make thousands of dollars. And that’s not smoke and mirrors. – Matt Gladfelter on the types of locations that drive the most revenue. 

It’s a process. Gradually you want to move out and replace your slowest locations. – Gladfelter on the process of identifying better and more profitable vending locations over time. 

Mentioned in the Show

O’Doggy’s – This is a hot dog cart that has grown into a restaurant located in Rolla, Missouri. Gladfelter cites O’Doggy’s as an inspiration as to how many creative types of hot dogs can be developed.

Hot Dog Business Market Research – Like this interview? You’re going to love our previous conversation with Gladfelter about how to conduct market research and write a business plan for a hot dog cart.

The post How Much Income Can a Hot Dog Cart Make? (My Experience.) appeared first on Food Truck Empire.

It’s a fact: The hot dog stand business model is one of the lowest cost and simplest businesses you could start. If you’ve been researching the topic online, you’ve probably seen claims that you could get started for less than $1,000 and be operating a profitable business right away. But are those claims of fast profit legit?

For this post, I spoke with a 5+ year hot dog veteran Matt Gladfelter from Bow Ties and Hot Dogs about how much it really costs to start and operate this business. On the low-end, you could start a hot dog cart for as low as $4,500 if you can get a used cart, all the way up to $28,900 if you want to go all out. Take a look at the spreadsheet below for all the fixed and variable costs of opening a hot dog cart.

Hot Dog Cart Startup Costs Spreadsheet

Equipment Estimated Cost Notes Hot Dog Cart + Cooking Equipment $3,000 – $20,000 A hot dog cart will typically cost a few thousand dollars. A larger hot dog trailer that a couple employees can cook in will cost more. Initial Product Inventory $300 – $1,000 This will include Hot Dogs, Buns, and any Condiments. Permits and Licenses $100 – $500 Varies a lot depending on where you operate. Website Free – $2,000 You may not even need one of these. A Facebook page can serve as a simple alternative. Facebook / Twitter Free Cash Register / POS $200 – $1,000 Can also use an iPad and an app for credit transactions. Uniforms / T-Shirts $0 – $1,000 Paper Products (Plates / Napkins, etc.) $200 – $300 Misc. Expenses $500 – $2,000 Plan for some unexpected expenses here and put it into the budget. Smallwares: Tongs, Spatulas, Spoons, etc. $100 – $500 Fire Extinguisher $100 – $300 For safety! Kitchen or Storage Space Rental Varies If you don’t have space at home, you might need to rent a kitchen or storage space for prepping and storing supplies. Marketing and Advertising Costs Varies Initial costs for marketing materials like flyers, business cards, or online ads. Signage and Branding Varies Costs for professional signage on your cart and branding materials. Total Low End $4,500 Total High End $28,600

Hot Dog Cart Monthly Costs 

A tip to consider.

Item Monthly Estimated Cost Notes Commissary $0 This is a highly variable cost. Phone / Internet $50 – $200 Fuel $0 – $300 This will vary greatly depending on gas prices and how far you plan to travel to vend. Labor ??? $10 – $15 per hour is average rate. Or if you plan to operate the cart yourself there is no cost here. Repairs / Upgrades $100 Bad things happen sometimes. Best to be prepared for the unexpected. Food / Beverage Restock $500 – $2,000 Depends on food cost and frequency of operation. Higher restocking isn’t a bad thing. Might just mean you’re selling lots of hot dogs each month. Paper Product Restock $200 – $500 Depends on food cost and frequency of operation. Higher restocking isn’t a bad thing. Might just mean you’re selling lots of hot dogs each month. Insurance $25 – $100 Can remove insurance in winter if you don’t plan to operate. Propane $20 – $40 At the time of writing, propane is cheap and you can refill a standard size tank for around $20. Utilities for Storage or Prep Space Varies If you rent a space for storage or food prep, there might be utility costs involved. Total Low End $885 Total High-End End $3,210

Note: If you would like to copy and paste this into a spreadsheet to enter your own information, you can find the template here: Cost Spreadsheet.

Some additional thoughts about recurring monthly expenses… I wouldn’t consider a higher monthly expense to be a bad thing with this business model. If you have to buy more hot dog buns, sausages, and other supplies, it means you’re probably selling more hot dogs too! Ditto for the gas and propane costs. If this is higher, it probably means you’re traveling to a lot of events and making a profit.

One other thing you’ll need to remember when it comes to monthly expenses is that you’ll have to pay taxes on all revenue generated through the food cart. Like all businesses, you need to pay the IRS.

Another variable item not factored into the spreadsheet above is the cost of vending at certain locations. Although Matt Gladfelter who is featured in the interview rarely needs to pay to vend at locations. However, paying for a location is an option, especially if you would like to be in a consistent location. If you’re interested in paying for a more consistent location Street Eats by Best Vendors is a great place to start the search no matter where you live in the United States.

One other big advantage to this specific type of business versus other mobile food models is that you don’t have much in terms of food waste. According to the USDA.gov website, you can preserve hot dogs in the freezer safely for 1 – 2 years. Of course, once you thaw those out  you’ll need to use them in the next week or two to ensure the best taste and quality possible for customers.

One point that Gladfelter makes during the discussion is extremely insightful. When starting out there are three costs:

• Paper Cost – This is what you expect to pay to start and operate a hot dog business. The paper cost is outlined in the spreadsheet below.
• Ideal Cost – This is the amount you would expect to invest in a perfect world. The ideal cost is something that you will need to tweak and work toward within your business. For example, one way to cut costs would be to reduce food waste. As a business owner, you should be able to reduce cost overtime as you begin to understand how much food you’ll need to purchase for each event.
• Realistic Cost – Life happens. Things break. Hot dogs are accidentally dropped to the curb. Expenses come up that you didn’t realize would be important. It’s important to build in a bit of a buffer with your expected monthly costs of operation.

Variable Factors that Determine Startup Cost

When evaluating the hot dog business, there are multiple costs you need to keep in mind that are dependent on the rules and health codes where you live.

Investing in the Right Cart – Before you invest in a hot dog cart, you need to understand the local health requirements to vend legally in your city. The last thing you want to do is spend a couple thousand dollars on a cart that you won’t ever be able to use because it doesn’t meet health requirements, like no available hot / cold water source.

Typically, you will be able to find this information by contacting the city hall and asking about their requirements for food vendors.  As you can see, the cheap cart you’re able to find for sale on Craigslist might not be the great deal it is advertised as if you can’t use it.

Keep your hot dog cart clean.

As a hot dog vendor, your health requirements will often be lower than someone that wanted to start a burger stand, where they would need to actually cook meat. Still, you want to make sure that you’re passing any health inspection with flying colors. Not just for government regulations, but it will make your cart more appealing to prospective customers too.

Easily for under $7,000 you should be able to get started. – Matt Gladfelter on the average cost of getting started in this business. 

Local Permits – While you’re at city hall, be sure to ask about any permits you’ll need to acquire to vend within city limits. As a general rule of thumb if you live in a big city like New York, you’ll pay a lot to get started. If you live in a smaller city, there are generally lower permits. Often these permits need to be renewed on a yearly basis so you’ll need to build these into your expenses. According to a real-life example from John Caruthers over at SeriousEats.com, at the time of writing in the city of Chicago it will cost $700 for a two-year license. In addition, you’ll also need to budget $100 for a fire safety permit.

Fortunately, once you’ve done the research within your particular city the costs to operate this type of business is pretty straight forward and consistent no matter where you’re located. A hot dog bun, Vienna sausage, and a mustard packet are about the same no matter where you’re located.

Ways to Save Money Starting a Hot Dog Cart 

Naturally, everyone wants to save money on their hot dog startup. But sometimes, trying too hard to save money can cost you as Gladfelter explained in our discussion. One of the biggest mistakes you can make in terms of starting a hot dog cart is buying a cheap hot dog cart that won’t pass health inspections in your area. As Gladfelter shares in the podcast, “Don’t impulse buy because you see a cart for $1,000 on Craigslist. If it doesn’t pass health codes it’s useless.”

Maximize profits, minimize waste.

Buy a Used Hot Dog Cart: Instead of buying new, look for a used hot dog cart in good condition. This can significantly reduce your initial investment. Check online marketplaces on Facebook or Craigslist, restaurant closing sales, or local classified ads. Matt bought his first hot dog cart from a restaurant owner for only $2,500 so this is a legit option as long as it meets or exceeds local health requirements.

Limit Your Menu Initially: Start with a basic menu. Offering a limited range of items reduces inventory costs and waste. As your business grows, you can gradually expand your menu. “When I started out, I had a lot of things on my menu that I don’t now.” says Gladfelter. “That’s one thing that I would recommend… Going with the basics at first.”

Related Reading: How Much Income Can a Hot Dog Cart Make? My Experience. 

Bulk Purchases for Inventory: Buy your supplies in bulk where possible. Items like hot dogs, buns, and condiments can be cheaper when purchased in larger quantities.

Reduce Food Waste – If you find yourself throwing away buns, sausages, or anything else, you throw away is lost money. Fortunately, the food waste for a hot dog cart is lower than typical than restaurants because the food you make has a long shelf life of weeks or month.

Condiments like ketchup and mustard, you don’t need to worry about spoilage as long as they are stored at room temperature. The main items you’ll need to be concerned about is your hot dog buns won’t taste as fresh after a few days. There are also certain premium items like grilled onions or bacon that you can only serve one day.

Still, low food waste is a huge advantage over other food business models. Every food business will have a certain level of waste. But, due to the long life of the product, you will be able to maximize your profits.

Quotes from the Show

What I used the part-time for was proving the business plan and really taking that as the opportunity to make sure my costs were correct and my cooking procedures were what I wanted. – Matt Gladfelter on why he started his business on the side, before transitioning for full-time business owner. 

We started out with like $2,500. That was the first egg to put this business together. – Matt Gladfelter on his initial investment. 

One event on a weekend and you’ll have that investment back to be honest. – Matt Gladfelter on how long it took to recoup his initial investment in a used cart. 

Want to start your own hot dog business venture?

Download the FREE Hot Dog Business Startup Kit. 

The post Total Cost to Open a Hot Dog Cart Business (+Spreadsheet) appeared first on Food Truck Empire.

In today’s podcast episode Matt Gladfelter of Bow Ties and HotDogs shares his list of the pros and cons of operating a hot dog business. As with any business models there are plenty of good things and bad things you should be aware of before getting started.

You may already be aware of many advantages of this business so let’s start out with some of the downsides of operating a hot dog cart first. Let’s get into it.

• Disadvantages
• Advantages
• Licenses & Health Permits

Disadvantages

It’s more than selling sausages.

Harder Work Than You Might Think. Anytime you want to generate an income, you’ll physically go outside, prepare your cart for service and vend to make money. This includes a setup process that will usually take 30 minutes of prep to get signage up, your umbrella out, and the grill turned on and ready to sling hot dogs. (This of course assumes you haven’t hired an employee to do the work for you.)

After your long day of vending is complete, you’ll need to clean up your area. You’ll also need to pack everything back up and into your vehicle again to haul home or to the commissary. You’ll also need to do some basic bookkeeping to record sales and check inventory levels. If inventory is low, you’ll need to go shopping to make sure you’ve got enough sausages, chips, sodas, buns, utensils, napkins and condiments for the next shift.

Not a Get Rich Quick Business – If you think you’re going to take your cart out and immediately begin making $100,000 in net revenue per year you will more than likely be disappointed in the results. Sure, there are plenty of hot dog business owners that attain that level of success, but it almost always happens after working the business for a few years. It takes time to find the most profitable vending locations in your city and you may need to scale beyond a single cart to accomplish this. Click here to learn more about the real profit potential of this type of business.

Withstanding the Elements – Unless you operate a hot dog truck (which can still be hot in the summer!), you will need to be prepared to withstand anything that mother-nature throws your way. A perfectly blue sky can quickly transform into rain clouds depending on where you live.

As mentioned in the interview, this most recent summer in Tennessee where temperatures regularly went up to 95 degrees and that doesn’t factor in the humidity. On the flip-side hot dog vendors in places like Chicago and New York operate year round and experience hot summers and brutally cold winters. There’s a certain level of toughness you must have to be successful.

Dealing with Public – Anytime you operate a customer service based business, including a hot dog stand you will encounter challenging people. Eventually, someone is going to complain about the quality, taste or temperature of their hot dog… Even if nothing is wrong with the product.

If you end up serving at a beer garden or bar, you’ll inevitably need to deal with folks that have had too much to drink. These situations can be challenging and it’s your job to maintain a level of professionalism and coolness factor even when someone else is not being nice. You can influence the types of people you meet depending on when and where you vend, but dealing directly with all sorts of different people can be tough.

“It’s a rollercoaster, really.” says Matt Gladfelter. “One minute you’re getting praised for the ‘best hot dog in town’, and the next, you’ve got someone grumbling that their mustard-to-ketchup ratio isn’t up to their standards. It’s like being a chef, a customer service rep, and a therapist all at once.”

Rent or Lease a Vending Location – You can’t just pull your hot dog cart up to any busy street or side walk and start vending. And vending often isn’t a free activity. Most organizers charge a fee of hundreds of dollars or a percentage of the sales to vend at festivals or festivals. If you want to setup your stand in front of a gas station or outside of a bar, you might need to pay the owner of the property monthly rent to vend there. Keep this bit of overhead in mind before getting started so you can better estimate profitability of the business.

Unpaid Work: Operating a hot dog cart involves several tasks beyond the immediate vending activities, many of which are often unseen and unpaid but are crucial for the success of the business. This work can include publishing promotion content on social media websites, working with catering clients, menu planning, inventory management, and planning a new vending route, or other administrative tasks.

Advantages

Mobility is an advantage.

Control Your Time – This is a big one for Gladfelter as he explains in today’s podcast episode. Gladfelter got to spend the whole summer with his kids since he had such a flexible schedule. If you need to take off due to a kids baseball game, go ahead and shut down the cart for the afternoon and attend.

This type of business unlike just about any other in the food industry is unique that you can operate around your schedule. With a restaurant, you’ve got a set amount of hours you need to be open for each day. That’s not that case with a cart.

Low Cost to Get Started – We’ve discussed this before, but Gladfelter was able to start his hot dog cart business for less than a $5,000 initial investment. He has purchased an upgraded cart with all the bells and whistles since that time, but he was able to prove the model to himself and the business plan by doing this.

There are not many real business you can get into for under $10,000. From there success or failure is largely determined by how much hustle you put into the operation. “Compared to running a restaurant, my overheads are a joke. No rent for a big space, no huge utility bills. It’s just me and my cart.” says Gladfelter.

Ability to Scale – If you have aspirations of making really large sums of money beyond the $100,000 per year revenue mark, your business needs to be able to scale. With a hot dog business this is a real possibility because adding new carts isn’t going to break the bank once you start generating an income. If you want earn more, just add another cart and hire someone to operate it. There are some business owners that over the period of a few years have added over 100 carts. Just imagine how much income you could generate with even a small amount of net profit being generated from these vehicles on a daily basis.

Related Reading: Total Cost Breakdown for Hot Dog Business Startups

Your job will become significantly different if growing your business is the goal. Instead of focusing your time on operating a single cart, your focus will be on managing people and making sure you’ve got systems in place to train new vendors you bring into the system. Still, it’s reassuring to have a business that you know can grow if you want it to.

Mobility and Location Choice: Gladfelter says, “If one spot isn’t working out, I just roll to another. This business is all about fishing where the fish are.” If you put in the work to find quality locations that pay well week in and week out, you can build a nice business for yourself that will cover expenses for years to come.

Supplemental Income: Tips can significantly supplement your income. They are a direct reflection of customer satisfaction and can add up, especially during busy periods or special events. These can really enhance the profitability of a hot dog cart. Make sure to leave out a tip jar and you could easily generate an extra 10% – 20% in profit from every event.

Building Relationships: As a vendor, you’re more than just a business; you become a familiar face in the neighborhood. You get to know people’s names, their usual orders, and bits about their lives. This builds a sense of community and loyalty. It’s like being a part of a big neighborhood family.

Licenses and Health Permits 

It gives entrepreneurs the freedom.

It’s important to remember that you can’t just buy a hot dog cart and start slinging dogs at any roadside location you find. You’ve got to make sure you’ve got the appropriate licenses and health permits to be able to sell safely in your area.

1. Business License: Think of this as your entry ticket to the world of commerce. It’s like when you buy a ticket to a baseball game; it’s your permission to enter the stadium and enjoy the game. Similarly, a business license allows you to legally operate your business in your city or town. Most vendors start as a sole proprietor or form an LLC.
2. Food Vendor’s License: This is akin to getting a driver’s license. Just as you need a license to drive a car on public roads, you need a food vendor’s license to sell food to the public. It’s proof that you’ve met certain standards and are qualified to operate your food cart. Head to Google and search for food vendor license + your city or state to get more information about this requirement. Here’s the application process to get a food vendor’s license in Boise as an example.
3. Health Department Permit: Now, this is crucial. It’s like getting a seal of approval from a doctor for being fit. A health department permit ensures your hot dog cart meets health and safety standards. It’s like ensuring the baseball game you attend is safe and enjoyable, without any health risks.
4. Fire Department Certificate: If you’re using propane or any other flammable material, this is a must. It’s like having a fire extinguisher in your home; a precautionary measure to ensure safety against fire hazards. Not all cities will require this type of certificate or inspection, but many do.
5. Commissary Letter of Agreement: This is quite unique to food carts. Think of a commissary as your home base, where you store and prep your food. It’s like having a garage where you park and maintain your car. A letter of agreement with a commissary is often required to ensure you have a clean, sanitary place for food preparation and storage. Again, not all cities will require you to operate out of a commissary since hotdogs are a lower risk food to serve.
6. Sales Tax Permit: If your state charges sales tax, this permit is like keeping a scorecard in baseball. It’s how you keep track of the sales tax you collect from customers, to be remitted to the government.
7. Food Handler’s Permit: This is for you and any employees. Just like players need to know the rules of the game, anyone handling food in your business needs to understand food safety. This permit is proof of that knowledge. More often than not you can get your food handler’s permit online in a few hours. The cost is generally low for this permit too.

While this doesn’t fall under licenses, you’ll also need to provide proof of insurance on a hot dog cart to acquire a vendors license. The amount of insurance a hot dog cart vendor needs can vary depending on several factors, such as location, the size of the operation, and the specific risks involved. However, here are some general guidelines:

1. General Liability Insurance: This is the most basic and essential type of insurance. It protects against claims of bodily injury or property damage that your hot dog cart might cause to others at a festival or other event. The typical coverage amount can range from $1 million to $2 million. Think of it as a safety net, similar to wearing a seatbelt while driving.
2. Product Liability Insurance: This covers you in case someone gets sick from eating your hot dogs. Given the nature of food service, this insurance is particularly important. Coverage amounts are often similar to general liability insurance.
3. Property Insurance: If you own a more expensive cart or have a lot of equipment, property insurance can protect against loss or damage to your hot dog cart. It’s like having homeowner’s insurance for your cart.

Quotes from the Show

Your scale of growth is limited to your imagination, to think outside the box a little, and to create a great brand and experience for your guests. – Matt Gladfelter the growth potential for this business model. 

It is an exciting way to live, but it’s not for everyone. – Matt Gladfelter on operating a hot dog business. 

There’s a reason there’s a lot of used hot dog carts on Craigslist. I think that’s because a lot of people do ignore the fact that this is hard work. – Matt Gladfelter getting real about how much work it is to operate a vending business. 

Related Resources

Hot Dog Business Plan – Ready to start your own hot dog cart? Learn how to create a business plan and conduct market research in your area.

How much income can you make on a hot dog cart? – Find out if you can actually make a decent living in this type of business.

The post Pros vs Cons: Are Hot Dog Carts Really a Good Business? appeared first on Food Truck Empire.

Velma’s Wicked Delicious Kettle Corn has been popping at farmers’s markets and craft shows across throughout New England since 2006. Today, we speak with Eric Bickernicks, the owner of this kettle corn business to discuss how to start this type of business, what it’s like to be an operator, how much it will cost to start this type of business, and the equipment you’ll need to get up and running.

Eric first got the idea to start a kettle corn business while visiting a fair near his home. He couldn’t believe the length of the line that was being formed next to a little kettle corn stand. After doing some mental math in his head about how much revenue this tiny business was generating at $5.00 in revenue per bag, Eric was hooked and decided to start a old fashioned kettle corn business of his own with a buddy. The rest as they say is history and Eric has continued to operate this business for the past decade!

Pro Tip: If this is a business model you’re interested in diving deeper into, check out Eric’s website WickedDelicious.com. Eric has been documenting his journey operating a kettle corn business here for the past 10-years and provides summaries of many of the events that he’s vended at. It’s a great resource if you want to learn more about this topic!

Watch the video above to see Eric Bickernicks in action at the Framingham Farmer’s Market to get a sense of what the typical day is like for a kettle corn vendor. This is a time lapsed video from a 5-hour vending time frame and condensed into a video that lasts under 2 minutes.

The Early Days

After deciding to start the business, Eric and his partner decided they would take a chance and start vending at a local farmer’s market near their homes. The event charged a fee of roughly $50 to vend at so the risk was very low that they would lose money. At the end of the farmer’s market Velma’s Wicked Delicious Kettle Corn had generated about $200 in sales. Not an incredible amount of cash and not much more than “beer money” as Eric described it. But the concept had worked to generate revenue!

From that initial day, sales continued to grow organically for the business. By the second season of operating, it was routine for the business to generate around $400.00 regularly per day in sales. At $5.00 per bag, you only need to sell 80 bags of kettle corn in a day to reach that number.

Slowly, the business continued to grow overtime though word-of-mouth and repeat customers at farmer’s markets. For some customers, it became a routine to pick up a bag of Velma’s Wicked Delicious each week just like they would eggs or milk. This repeat business led to higher overall sales numbers over time. Eventually, the business would more frequently make $800 all the way up to $1,000 in a single day.

Getting Customers to Buy Your Kettle Corn

When Eric opened Velma’s Wicked Delicious for the first time, no one knew about him or the quality of his kettle corn. So how did Eric convince folks to give his unique style of corn a try? The same way that thousands of new food businesses have used to raise awareness of their product. Free samples!

In the early days, Eric used free samples to give craft show goers a taste of their product. Enough people that tried the product, liked it and became a customer. This can be a great way to encourage people to try your product for the first time. The next time they see you, they might just skip the free sample and buy a bag to bring home.

Margins of Kettle Corn 

How’s how much margin is built into a bag of kettle corn:

• $5.00 per bag gross profit.
• $1.50 – $1.60 cost of goods (cooked kettle corn + branded bag)
• This equals about $3.50 in net profit per bag sold after expenses.

There are some other variable costs that you will also need to consider, however. Some craft shows or fairs charge a small fee to be able to vend. It can cost anywhere between $25 – $300 depending on the type of event you plan to vend at. Make sure to build this into your expenses prior to attending an event. You should also factor in gas money for the travel required to attend each event.

Equipment List

Here is the basic equipment you’ll need to start a kettle corn business:

• Kettle Corn Popper – The kettle corn machine is what you need to operate your business. Make sure you invest in something that is durable and allows you to produce a consistently high-quality product every time you vend.
• Sifting Bin – The bin is where your kettle corn will be stored temporarily before it is packaged.
  
• Stirrer – This is used to stir the kernels and make sure the product gets popped.  It’s also good for entertainment purposes because customers can see watch you making their kettle corn.
  
• Counter – A counter is helpful for serving customers. It also provides a nice way to hide product.
  
• 3-Compartment Sink – This is needed in most areas to adhere to health regulations. Additionally it will allow you to wash your hands.
• Propane Tanks – This is to provide power the popper.
• Tent and Signage – The tent serves two purposes. One is to protect you as the vendor and product from the elements of wind, rain, and sunshine. The tent and banners that make up your pop-up also help to sell and draw attention to your stand. 
  

As an aside, one of the suppliers that Eric mentioned during our interview is North Bend Kettle Corn Equipment. This is the brand of equipment of Eric uses for his business. Another business recommended by Eric is Mann Made Poppin’ Machines.

Ingredient List 

Here’s a simple list of ingredients you’ll need to make a batch of classic kettle corn:

1. Popcorn Kernels: 1/2 cup; these are the stars of the show.
2. Granulated Sugar: 1/4 cup; for that sweet touch.
3. Vegetable Oil: 1/4 cup; canola or another high-smoke-point oil works too.
4. Salt: 1 teaspoon (or to taste); it’s not kettle corn without the sweet-salty balance!

And there you have it! With just these four ingredients, you’re on your way to making profitable part-time or full-time food business. Best of all, you can sources these ingredients from retailers like Costco or Sam’s Club.

Of course you may want to take a little extra time to source a unique popcorn kernel for your business. For big, fluffy kettle corn, most kettle corn vendors go with “mushroom” popcorn kernels. Here’s why.

These kernels pop into large, round shapes that resemble a mushroom’s cap. The shape is sturdy and provides more surface area, which is excellent for kettle corn. The sugar coating adheres better to the round, robust shape, ensuring you get that sweet crunch in every bite. Plus, their substantial size offers a satisfying mouthfeel, and they’re less likely to break into small pieces when being stirred in the kettle with the hot sugar.

While “butterfly” kernels are more common for regular popcorn due to their irregular shape and light texture. This is what you’ll typically find at the grocery store. The mushroom kernels are the go-to for most sweet popcorn recipes, including kettle corn, caramel corn, and other candied popcorn, primarily because of their structure and resilience to coatings

Estimated Startup Cost to Get Started

According to Eric, your biggest expense is going to be purchasing a kettle corn popper machine and a tent / pop-up. The costs of this equipment is variable, but a professional grade kettle will run you between $3,000 – $5,000 on average.

Eric advises not going too cheap on this investment since you’ll want a machine that will operate efficiently for many years into the future and cook a consistent product for your customers. Bottom line, if you find a popper on Amazon.com for $199 that’s probably not what you want to build your business around.

How to Find Kettle Corn Vending Locations

Craft fairs / Antique Festivals / Car Shows / Farmer’s Markets / Fire Works Shows – If you’re just starting out these are great opportunities to begin. Typically the event fees are low here and you’ll be able to vend for $50 or less.

Eric recommends starting small at events like these for a few reasons. For one, small events are low risk to you as a business owner. With a low entry fee it won’t take long for you to cover the cost of vending. Your overhead can be even lower since you’ll likely be able to operate the stand on your own so no need to compensate an employee.

Larger Fairs / Festivals – County fairs and large music festivals are the types of events that can generate a big pay day. Unfortunately, vending at big events like these come at a price. Many of the biggest event charge hefty fees for the opportunity to vend. The price tag varies but could easily be $200 – $1000 for a multi-day event. This literally eats into your profits.

The other thing is that you’ll need extra help if you plan to vend here. You may need to employ 1 – 2 employees to take advantage of the demand at these events. If you need to pay two employees at even $10 per hour each that’s more out of your net profits. Depending on the event, hiring some part-time employees could totally be worth it. But it’s a factor to consider before moving forward.

Related Reading: 201+ Best Performing Popcorn Marketing Slogans and Taglines 

Charity events – The different between serving at charitable events versus a car show is that you will usually need to share a certain percentage of your sales with the charity. These events can be personally fulfilling as well as economically for a kettle corn business. 

There is one type of charitable event that Eric warns against, however. Churches will often do small fundraisers that attract 100 people or less. While it can be wonderful to help support every charity, you may not be able to afford to attend every event like this that you’ve been asked to participate in if you want to generate a decent income.

Corporate events – These are the holy grail of the kettle corn business. Unlike other vending opportunities, you’re usually paid in advance with corporate events. This doesn’t just include vending at parties for businesses either. One of Eric’s favorite places to vend is at colleges and universities.

Typically universities will buy a certain number of bags from you in advance. All you need to do from there is to show up and distribute your bags of kettle corn to the hungry crowd of kids. If the event isn’t well attended or there’s rain, it’s none of your concern. You have fulfilled your end of the bargain by attending the event and providing your product / service.

What Permits Do You Need? 

Starting a kettle corn business is an exciting venture, but it requires several permits and licenses to ensure you’re operating legally. These requirements can vary widely depending on your location (country, state, city), the scale of your business, and whether you’re operating from a fixed location, a food trailer, or setting up at different events. Here’s a general list of permits and licenses you might need:

• Business License: This is the standard requirement for any new business. It registers your business with the local, state, or national government.
• Food Vendor’s License: Since you’re dealing with food, you’ll need a license indicating you meet all health standards for preparing and selling food to the public.
• Health Department Permit: You may need to have your kettle corn stand or food truck inspected by the health department to ensure you’re complying with local health and safety regulations.
• Fire Department Permit: If you’re cooking on-site, especially since you’re dealing with high temperatures and open flames, you’ll likely need a permit from your local fire department.
• Temporary Food Facility Permit: If you plan to set up your kettle corn business at fairs, farmers markets, or special events, you might need a temporary food facility permit for each event.
• Mobile Food Facility Permit: If you’re operating out of a food truck or cart, this permit is necessary in many areas.
• Sales Tax Permit: If your state or country has a sales tax, you’ll likely need this permit to collect tax on your sales.
• Food Handler’s Permit: Depending on your location, anyone who handles food may need to be certified, meaning they understand the safety requirements for preparing and serving food.

Before you start popping, make sure to check with your local city hall, county clerk, health department, or small business development center to get a precise idea of what you’ll need.

Quotes from the Show

The cops used to call us “kettle crack.” – Eric Bickernicks on the addictiveness of their product.

It gets so hot because you literally have to stand over it [the kettle] and in August I’ve gotten very close to getting heat stroke. – Eric Bickernicks on working conditions you should expect on some of those hot summer days. 

I would have quit kettle corn years ago if I didn’t get one with the kettle motor and the stirrer on it. – Eric Bickernicks on recommended equipment for a kettle corn business. 

Typically you would do a craft festival. That is sort of the bread and butter of the kettle corn biz. – Eric Bickernicks on where you should start to look for vending opportunities. 

I get approached a lot of times when I’m sitting at the farmer’s market. People come to me and they’re like, “Will you do my event?” – Eric Bickernicks on the importance of being selective on where you choose to vend after your business is off the ground. 

It’s almost impossible to gauge how much you’ll be making unless you try it. – Eric Bickernicks on how the average income of a kettle corn business is highly variable depending on where you vend, how often you vend, and your overall work ethic.

How is Kettle Corn Different than Regular Popcorn? 

From a cooking standpoint, the difference between regular popcorn and kettle corn lies in the ingredients and the cooking process.

Regular Popcorn:

Ingredients: All you need is popcorn kernels and some oil. Seasonings (like salt or butter) are optional and added after the popcorn is popped.

Cooking Process: You heat oil in a pot, add the popcorn kernels, and cover it. The kernels pop pretty straightforwardly due to the heat, and you can hear that satisfying “pop” sound as they burst open. Once the popping slows down, you remove it from the heat and add your seasonings.

Kettle Corn:

Ingredients: In addition to popcorn kernels and oil, you need sugar and salt. The sugar is crucial because it’s what gives kettle corn its signature sweet flavor.

Cooking Process: The cooking process is a bit more nuanced. You still heat the oil and pop the kernels, but the sugar and salt are added to the oil before the kernels pop. As the kernels pop, the sugar melts and coats them, giving them a sweet crust that’s also a bit salty.

This process requires constant stirring (especially when the sugar is added) to prevent the sugar from burning and to ensure an even coating on the popcorn. It’s a delicate balance because you need the heat high enough to pop the kernels but not so hot that you end up with a burnt sugary mess.

So, while regular popcorn is like a blank canvas waiting for your choice of flavor, kettle corn brings its own sweet-and-salty personality right out of the pot! Kettle corn is more time consuming and require more effort to make to make, but it’s totally worth it.

The post How to Start a Profitable Part-Time Kettle Corn Business appeared first on Food Truck Empire.

Interested in starting a food truck? You’re about to discover what it’s really like to build a mobile food business from scratch. 

If you’re starting out on your own food truck journey and wondering if this is the right path for you then this is the episode for you. In today’s audio lesson we share the good and the bad of operating a food truck business, the estimated cost to get started, and some of the top performing menu ideas in mobile food.

If you’ve got a food truck dream, you’ve probably put considerable thought into what it will be like to operate. You can imagine greeting guests, serving meals at events, making people smile, cooking the food you love. Being personally fulfilled while making money and being your own boss is the vision. And we have good news. This really is what owning and operating a food truck can be like.

Malcolm Bedell of Ancho Honey.

But it’s not all sunshine and roses in the food truck industry either. Like any other business there are bills that need to be paid, traveling to events can prove tiring, mechanical breakdowns and an endless amount of prep work and cleanup that must be completed. It’s important you understand these real business challenges before releasing the safety harness and diving into this venture full-time. Click play below to find out if this business is right for you and download our presentation to follow along.



Like so many things in life, you shouldn’t start a food truck business if you don’t have the right personality. For example, if you prefer working alone this industry may not be a good fit. You’ll be regularly talking to customers, suppliers, and event promoters in this business. Don’t like working weekends? Friday nights and weekends are the most profitable days for many of these businesses.

What You’ll Learn

• What it’s really like to operate a food truck. The good and bad.
• All the costs involved in starting a food truck business.
• Characteristics of successful food truck businesses. Plus, high-profit menu ideas.
• How food trucks actually make their money.
• The next steps you need to take if you would like to get involved in this $1 billion per year industry.

Download Now: Sign up for the Food Truck Business Kit that Includes Cost Analysis Spreadsheet and Business Plan Template

The Food Truck Case Study

You’ve stumbled upon a real-time case study on starting a food truck featuring entrepreneur Malcolm Bedell of Ancho Honey food truck / restaurant based out of Tenants Harbor, Maine. In this series we follow along with Bedell as he goes through the process of writing a business plan, seeking funding, developing a menu, getting a food truck manufactured and finally hitting the streets of Tenant’s Harbor to sell his sandwiches.

Hey ma! Look what I made on my truck!

Bookmark and share this page with others as it will serve as a table of contents for future updates on the progress of Bedell’s business.

The crazy thing about this case study is that it’s a work in progress. Bedell’s experience could result in fame, fortune, and he could become an incredible inspiration for other budding culinary entrepreneurs. On the flip side, the business could fail and serve as a warning to other dreamers.

Learn More

Order up!

How to Start a Food Truck Business in 6(ish) Steps – Get an overview of the basic steps to start this business. This is a great place to begin.

The Complete Breakdown of Food Truck Operation Costs – Find out how much it will realistically cost to start a food truck business.

Food Truck License and Permits – Use this checklist to determine everything you’ll need to legally open a food truck business.

How to Write a Food Truck Business Plan – Get to know a little bit about the background of Salvagno and learn the process he’s used to write a business plan. A copy and template of his business plan are included within the post.

Creating a Menu and Sourcing Product – Learn how to create a unique menu and source product for a food truck business.

How to Finance a Food Truck – Learn how to scrape together the cash required to purchase a food truck. Hint: Most food truck owners use a variety of funding sources.

Navigating City Regulations and Health Code Requirements – Find out how to find out about the local laws of a city and why an LLC was the right business entity to form. There are also tips for identifying the laws in your city as well.

How to Choose a Food Truck Builder – Our hero buys a custom truck for $35,000. See what the process of working with a manufacturer was like along with some of the difficulties he experienced while getting the truck.

Stuff that Goes Wrong When You Start a Mobile Food Business – Much has happened since the last time I spoke with Anthony Salvagno. The truck arrived from his builder, which became a much more interesting story than it should have been. We also go in-depth into all the different hurdles encountered while starting a business so far.

The First Summer on a Food Truck – See what the first season operating a food truck is really like.

Order our full guide on what it’s really like operating a food truck in your first year.

The post The Ultimate Food Truck Case Study for 2022 appeared first on Food Truck Empire.

Thinking about launching a KickStarter or IndieGogo campaign to raise funds for your business or project? Our goal is to help you avoid the crowdfunding mistakes we’re seeing everywhere in 2021.

First a little background about today’s audio lesson brought to you by Gusto. Malcolm Bedell successfully launched one of the biggest food truck campaigns in KickStarter history back in 2015 raising $29,457. You can check out the KickStarter campaign here to watch the video, see campaign perks, and learn the entire story.

401 backers pledged $29,457 for Malcolm Bedell’s campaign.

Malcolm and I have held classes together teaching the mechanics of launching a successful campaign from recording a video pitch, writing good ad copy, adding photos, and creating perks. But what we’ve learned is the mechanical steps aren’t the issue in the graveyard of failed crowdfunding campaigns.

In fact, most of the KickStarter videos and ad copy we’ve seen are pretty darn good. The basic pieces of a crowdfunding campaigns aren’t the main point of failure. Bottom line, the basic tips you’ll find on hundreds of articles published on the subject of recording a good crowdfunding video isn’t what will actually make or break the campaign.

Our goal with this post is to give you direction on where to focus most of your time and effort in addition to revealing where most of your time should be spent. Let’s dig into each of these crowdfunding campaign killers and explain how to avoid them: 

1. The things you do before the launch is what’s most important.
2. All or nothing.
3. No status updates.
4. Hard to fulfill / bottom line killing perks.

The things you do before the launch is what’s most important.

Last week I got an email from Dave. I knew Dave had been working toward opening a food truck business for a couple years and sent me a link to his campaign on IndieGoGo. I clicked the link to check it out and support the cause.

Here’s what I discovered. The campaign had actually started 10 days prior and was scheduled to end in about a week. To date there had been a couple hundred dollars raised for a goal of $15,000. It was clear to me that Dave’s campaign would not be fully funded from the second I hit the page. There was no excitement, activity, and the campaign was about to end.

This is the trailer Malcolm purchased with campaign funds.

Unfortunately, this is a problem I’ve seen with campaigns before. The entrepreneur invests weeks recording a video, creating bonuses, writing a story for the campaign page, but because don’t take any time to notify people in advance of the campaign open. Since there’s no promotion in advance of the campaign opening, the fundraiser doesn’t go anywhere. There’s crickets on launch day and the entrepreneur is left wondering what when wrong.

It doesn’t matter how great your video is if people don’t know about the launch. If your entire plan to promote your crowdfunding campaign is posting two updates on Facebook and telling your best friend about it, I’m sorry to say your fundraising effort is destined to fail.

Fortunately, you’re reading this so you can avoid this crippling mistake. Instead of notifying people about your campaign after it’s already open, start the contact people the campaign a full 30 days in advance of your campaign open date. This is exactly what Malcolm did to raise nearly $30,000 for a food trailer. Here’s the basic 30 day pre-launch plan that you can follow too.

30-Day Pre-Launch Outreach Sample Plan: 

• Direct message all of your Facebook, Instagram, Twitter or other social media friends to let them know you have a campaign launching in 30 days.
• Email all your friends, co-workers, and family members about the crowdfunding campaign 30 days in advance.
• Compile a list of websites, blogs, and local newspapers / writers and contact them about your campaign. Be open to conducting interviews for these people of the press.

You should spend the time writing a personalize message to each person you contact. Explain your campaigns goals, when you plan to launch and the importance of “Day 1” donations in the message. Yes… This will take a very long time.

Reader Note: The most successful campaigns overall have a “first 24 hour” rush of donations. This helps build social proof and momentum for the campaign. A big first day is critical because it gets people excited. You can parlay this excitement into more press and more donations. This is an important step to get people emotionally invested in the campaign. If you don’t have a big first couple days, you’re unlikely to secure funding.

All or Nothing.

If you don’t hit your campaign goals, the business doesn’t open. Without your donation, the dream ends. It sounds harsh and it is. But this is a point you need to hammer home in your campaign marketing.

When Malcolm clicked published on his crowdfunding campaign there were no backup plans. Malcolm didn’t have enough money or good enough credit for bank loan. Either he raised the money or got another desk job. Those were the two outcomes. How much harder to you would work toward something if the stakes were this high?

Learn how two mom’s raised $47,000 on KickStarter for a cracker company. 

Another campaign I supported made this critical mistake. On social media, the owner promoted their crowdfunding campaign. This is good. But they also stated that they were going to get the money to start the business even if the campaign failed with a loan, dipping into retirement savings or whatever. These sorts backup plans make it less likely to conjure the emotional response required to get a donation.

People get behind all or nothing causes. Make sure everyone understands how critical their investment is in your business. No donation. No business. Period.

No On-Going Updates

The most successful crowdfunding campaigns are on-going events. The best campaigns have landmarks or mini goals that are hit. You want to notify your subscribers, fans, followers, friends and family about each goal you cross off the list. Here are a few updates you’ll want to make sure to share with your campaign followers:

Attention Founders: Get a New Food Business Case Study with Revenue Numbers Delivered To Your Inbox Each Week

• Pre-launch message about a month before campaign kicks off.
• Campaign is starting soon! Notify everyone about your campaign and send a link to your KickStarter page a 4 – 7 days in advance of the opening.
• Night before. Notifying everyone again about the campaign and stress the importance of day one donations.
• Campaign is live! Announce to everyone when campaign is live so they can donate. Call people and do anything you can to get people to take out their credit cards and donate right away. Ask them to share this campaign link with everyone.
• Plan to post campaign update videos 12, 24, and 48 hours after your campaign launches, thanking supporters for their backing and letting them know that their donations are bringing your dream to life. Record these with your iPhone. No editing required.
• Announcement of first income marker hit. Ideally at this point you’ll hit some donation threshold, maybe that’s $1,000, $2,000 or $5,000. When you hit a big round number that looks impressive, make sure to notify everyone. This helps generate excitement that this campaign could actually work out.
• Other update options. There are other landmarks you might hit like getting interviewed by a blogger, getting press in your local paper. Share some other examples of momentum for the campaign. Express how thankful you are to everyone who already donated. Announce an exciting perk that supporters can get.
• The Final Hours of the Campaign. In the last 24 hours of a campaign, you really need to get aggressive by letting people know this is the last chance to contribute and support this incredible cause.
• Post campaign wrap up. Let people know how you did. Let folks know when the bonuses are coming.

As you can see there’s plenty to update people on about any campaign. It’s critical to provide on-going updates because some you know people might have forgotten about your campaign. They may not have opened the first email from you. They might have gotten an urgent call at the exact moment they planned to contribute.

Following this process ensures your message is heard through all the noise. Remember, while this campaign is a big deal to you, it’s just another status update or email to someone else. Do everything you can to stay top of mind.

Hard to Fulfill / Bottom Line Killing Perks 

One of the most popular tips for launching a successful crowdfunding campaign is to give away really amazing rewards to run a successful campaign. This advice is fine and well, but be careful promising too much when it comes to campaign rewards.

Related Reading: How Fat Leaf Water Raised $30k+ for a Cactus Water Sports Beverage

After all you’re getting into the food business, not the t-shirt fulfillment business. The last thing you want to do after hitting your crowdfunding goal is to spend the next month of your life fulfilling rewards instead of getting a funded business off the ground. This happens more than you might think.

Some of the low-level rewards given to backers.

Another mistake we advise against is investing in perks that eat away at your campaign profits. One of the campaign mistakes Malcolm regrets is offering tin lunch boxes to supporters of a certain level. The tin lunch box with an engraved logo was cool, but a pain to fulfill and expensive. Not only did Malcolm need to wait for a few lunch boxes to be shipped to his home that cost around $30 with shipping. Malcolm then needed to individually mail every lunch box the supporters address too.

Instead of offering high-cost packages for backers, try keep fulfillment of rewards simple and affordable. Twitter shoutouts, a digital book, an exclusive cooking class held on Zoom, a tour of your restaurant kitchen after it opens, a 30-minute consulting phone call, naming a sandwich after someone on the menu, or even sending bumper stickers. None of these perks require much fulfillment effort.

Don’t think reward fulfillment is an issue? There’s an entire industry of reward fulfillment services you can work with after your campaign ends to manage getting rewards shipped. Working with one of these companies will eat into the profitability of a campaign, but they also allow you to get on with running your business.

So there you have it. The most common mistakes we see with campaigns that didn’t gain traction over the past year. If you want to get more inspiration on other ways that entrepreneurs have launched their own crowdfunding campaign, check out our case studies below.

• How Bissy Energy Founded a Plant-Based Kolanut Energy Powder and Coffee Alternative (Raised $33,300 on KickStarter)
• How Two Moms Launched Keto Cracker Company Defy Foods (Raised More than $47,000 with Crowdfunding)
• How NoSpike Pre-sold $10,000 of Diabetic Friendly Shakes on KickStarter

The post Four Epic Crowdfunding Mistakes That Kill Campaigns (2022 Edition) appeared first on Food Truck Empire.

Planning to conduct a SWOT analysis for your food truck business? That’s really smart! Going through the process of identifying your strengths, weaknesses, opportunities, and threats (SWOT) will help you be more prepared for the realities of operating a mobile food unit.

The SWOT analysis offers a deeper understanding of what makes you different locally and how you’ll specifically address shortcomings of the business. While it’s impossible to foresee every possible downturn that could happen in a food truck business, completing this template will have you more prepared for what’s to come.

SWOT analysis for a food truck.

In today’s audio lesson, I’ll explain how to write a SWOT analysis in addition to providing examples of strengths and weaknesses of food truck businesses. Today’s episode is brought to you by our awesome sponsor that can help manage your payroll for a food truck or restaurant, Gusto. If you’d like to download the SWOT analysis template in PDF or PowerPoint right away, click on the navigation below.

• Strengths 
• Weaknesses
• Opportunities
• Threats
• Download Template

Strengths

Here’s an example list of advantages for most food truck businesses.

Mobile: You aren’t stuck in one location or forced to sign a long term lease. This is one of the biggest advantages of operating a food truck or trailer. If you sign a lease, the demographics or economy of the area could decline in the coming years. This business model allows you to follow the money.

More Flexibility: If you don’t want to work one day, you can more easily take the day off with a food truck. If you find out Wednesdays are not profitable days to be in business, you don’t need to work that day. If you own a restaurant, you’ll be obligated to be open for business 6 or 7 days a week in most cases.

Lower Startup Cost and Financial Risk: To open a small restaurant it’s not uncommon to require $250,000 – $1 million in capital. That’s simply not a realistic amount of money for everyone to get their hands on. Food trucks and trailers on the other hand can be started for less than $100,000 even after factoring the cost of permits, licenses, initial inventory and equipment.

Marketing: Food trucks are basically rolling billboards for the business. If you’re out and about participating in festivals, fairs, and corporate events, people will get to know your business. The more visible you are in public, the more opportunities for catering gigs and other opportunities will come your way.

Weaknesses

Evaluate the weakness of your business.

Here are some of the top challenges facing this type of business. I also suggest steps you can take to combat these weaknesses.

Mechanical Break Downs: Just like your automobile, a food truck requires regular maintenance and will need to be repaired. Make sure you have a reliable mechanic on call in case of break downs.

Limited Volume of Sales: One challenge operating a food truck is that you have a limited amount of storage and refrigerator space. That means if you have a busy lunch service and run out of food, you’ll miss out on potential sales. One way to counteract this problem is to have a “runner” on call who can get you more supplies when needed. Have someone on call before your biggest events of the year.

No Fixed Location / Schedule: One benefit of a brick-and-mortar restaurant is the fact diners know where to find you and when you’re open. In other words, when people are hungry they know exactly where to get ahold of you. Since most food trucks operate at different locations each week, it can be more difficult to build up a loyal customer base that turns into repeat sales.

Opportunities 

Here are a few examples of opportunities many food truck vendors could take advantage of to improve their business operations.

Increase Speed: If you reduce the amount of time it takes to serve a customer on average you’ll make more money. Big restaurant chains like Chipotle and McDonald’s are obsessed with cutting drive-thru wait times because it means more transactions. Simple ways to improve your speed would be to reduce the number of complex menu items on your food truck and find ways to prep or preheat ingredients. You could also add contactless payment options through a point-of-sale system to reduce friction while paying.

Related Reading: The Complete Breakdown of Food Truck Operation Costs

Source New Suppliers: You never want to end up beholden to a single supplier for meats, buns, or anything else. Always make sure you’ve got a backup list of suppliers for all of your ingredients to ensure you’re ready to vend even if someone goes out of business, decides not to carry a key ingredient any longer, or raises prices.

Improve Marketing: One opportunity is to have better marketing than other local food trucks on social media websites like Instagram. In most markets, you could easily have better food photos than your competition with nothing more than a modern version of the iPhone. With any down time on the truck, take advantage of the break to create promotional content about your business.

Threats

Here are some threats to the profitability of any food truck business.

Accidents: An accident on the road is a real hazard for this type of business. Every time you take your food truck out on the road and vend there is a certain amount of risk you accept. To protect against real business danger, make sure you have good insurance and drive safely.

Vending Locations: There are all sorts of reasons a once profitable vending location could become unprofitable. There could be law changes that prevent from vending or new ownership could take over a food truck pod and increases the monthly rent too much. Whatever the catalyst, you need to be constantly looking for new vending locations. You never want to be reliant on a single location to operate a successful business.

In-Depth Podcast Series: The Ultimate Food Truck Case Study 

Cost of Doing Business: Sometimes that cost of doing business will increase in an unexpected way. Suddenly gas prices might rise due to a global crisis in the Middle East. There could be a beef shortage that sends sirloin cost sky high. In situations like this you need to be mentally flexible and ready to adapt your food truck menu at a moments notice to remain profitable.

Download Food Truck SWOT Analysis Template

Download the food truck SWOT analysis document in PDF below. You can print off or download this template to input your own strengths, weaknesses, opportunities, and threats into the corresponding box.

• Download SWOT Analysis Template in PDF

The Final Word

Two food trucks in Chicago.

Keep in mind that there are internal and external threats to your business. Internal threats are the hazards you have the most control over. One example of this is making sure the food truck is maintained on a regular basis with oil changes. This simple action will help prevent future mechanical failures.

The external threats can be harder to identify and prepare for. As an example, in certain markets food trucks were required to shut down temporarily due to national lockdowns and government restrictions. Additionally, almost all of the fairs and festivals where food truck vendors make the most of the money were canceled or postponed. This is an an example of an external factor that can stop a business in its tracks.

If you’re starting a mobile food business, don’t forget to download our Food Truck Business Kit. This free resource gives you immediate access to our 20-page business plan and cost analysis spreadsheet.

The post My Ultimate Food Truck SWOT Analysis Template: Free Download appeared first on Food Truck Empire.

Thinking about starting a burger restaurant or truck? We conduct a deep dive into the $100+ billion dollar burger restaurant industry in the United States, the estimated costs to get started, and profit potential for this massive food business opportunity. The companion podcast for this market analysis is brought to you by our sponsor Gusto.

Burger Industry Analysis Outline: 

1. Introduction to the burger industry
2. Options for creativity with burgers
3. Economics of burgers
   1. Cost breakdown and potential markups/margins
   2. How we do burgers at Ancho Honey.

Introduction

In the United States, our appetite for cheeseburgers is showing no sign of slowing down. Whether you prefer more fanciful creations made with custom grinds of beef and topped with seared foie gras and pickled bing cherries, or more humble sackfuls of grease-soaked sliders, there’s a new independent hamburger restaurant to suit your cravings popping up every day nationwide, making the burger industry is valued at nearly $100 billion dollar per year. And it’s easy to see why; culturally, burgers are the great equalizer, enjoyed by almost everyone across geographic and economic lines.

Burgers are, to my way of thinking, basically a perfect food, almost diabolically designed to ping all of the pleasure centers of your brain. When confronted with a big hit of protein and carbohydrate, along with heaping helpings of sugar, fat, and salt, most of us are nearly powerless to resist…which is what makes burgers a safe bet for any aspiring food business entrepreneur. 

Burgers are also recession-proof; in economic boom times, consumers celebrate with a burger and a beer, and when the economy slows, burgers provide customers an inexpensive way to enjoy a meal outside of the house. In some areas, burgers are even proving themselves to be pandemic-proof; many sit down burger restaurants have managed to transition neatly from sit-down table service to curbside or delivery options, thanks to the ability of burgers to travel reasonably well. A photo of two of my “burger night” burgers are below.  

Two burgers with brioche sesame seed buns.

Adding a once-weekly “Burger Night” to our operations at Ancho Honey, my grab-and-go restaurant in coastal Maine, has been positively transformative for our business, and today, we’re going to talk about why that is, and how you can replicate that success in your own business.

Burgers Don’t Scare Anybody

One of the main reasons I’ve come to fully embrace the burger-centric part of our business is simple: Burgers don’t scare anybody. As a cook, I’m constantly brainstorming new ideas for new dishes, combining flavors in funky ways that, if presented on a plate, might seem challenging or off-putting to some customers. I can pile those same elements on a burger, however, and instantly have customers understand both what they’re eating, and what I’m trying to do.

Related Reading: How I Opened a Restaurant with No Money and a 540 Credit Score

A $28 entrée festooned with piles of unusual vegetables, drizzled with elaborate sauces, and artfully splashed with compotes may alienate some customers; arrange them on a quarter pound of seared ground beef, however, and those same customers are instantly familiar with what you’re trying to do, and may even appreciate it more. Using burgers as a sort of pallet allows us, as cooks, to be experimental, without having to worry that we’re going to scare off customers.

Options for creativity with burgers

I find a lot of reassurance in the fact that there are a certain set of “rules” when it comes to constructing a new burger idea; a burger has to, at its most basic, contain a stack of meat, cheese, bread, and usually some type of vegetable topping and sauce. This confines you to a set of rules make it much easier to create new ideas, because really, you’re just plugging new ingredients into a defined set of columns.

Burger with mushrooms.

I believe that a good burger contains the following elements: A seared protein, to provide salty heft and char. Some kind of cheese, for fatty ooze. Something crunchy. Something acidic. Sometimes, something spicy. And something sweet. Let’s think of it this way:

Meat + cheese + crunchy + acidic or spicy + sweet.

Combine all or most of those elements into one burger, and you’ll almost always come up with something amazing. And the options for what you can plug into those main categories are almost limitless.

For example, using the formula above gets us:

• Beef burger + sharp cheddar + arugula +pickled red onions
• Lamb burger + feta + shredded cabbage + tzatziki
• Chicken burger + blue cheese + shredded romaine + wing sauce + sweet pickles

Once you have this formula in place, and are thinking of new ways to get all of those contrasting elements in play, the options for burger creativity become basically limitless.

Sometimes, I’ll also use some sort of “metaphor” for creating a new burger, or in other words, taking some other real-world food item, and figuring out how to translate it to burger form. Here in New England, I’d been stuck thinking about a traditional dish we serve called a “boiled dinner.” The name is almost as uninspiring as the dish itself: A pot filled with corned beef, potatoes, cabbage, and turnips, boiled to oblivion and served to kids in Maine at least once a month, all winter long.

Still…even though the original dish isn’t super inspiring, there’s something about that combination of flavors that triggers nostalgia in some locals, so I wanted to translate each of those elements to burger form. Our “Boiled Dinner Burger” combined a third pound of seared ground beef, and then plugged in the rest of the formula to figure out the rest: swiss cheese (melt!), crunchy cabbage slaw (crunch!), fried potato sticks (crunch!), shredded corned beef (salt!), and a drizzle of Guinness mustard aioli (acid!).

It was a big hit.

You can use this same structure to convert almost any real-world dish into burger form, which opens entirely new pathways to creativity, and will get your customers buzzing about your product like never before.

Burgers are Instagram Food

When it comes to marketing your business on social media, it doesn’t get much easier or more effective than featuring gorgeous photos of big, messy, drippy burgers; social media users love them, and you’ll find your “likes” and shares tend to be much higher, when posting this type of content.

That’s why the Ancho Honey Instagram feed has been, for the last year or so, almost 80% pictures of our latest burger specials; they get clicks, they generate interest, and they get shared more than any other type of content we post. Build your business around burgers, add in some basic food photography skills, and your social media marketing efforts practically take care of themselves.

The Economics of Burgers

Total burger cost breakdown.

From a pure dollars-and-cents perspective, burgers continue to make good sense. But choosing where to invest in your burgers, and where to save, is an important part of figuring out how to build your burger business.

Here’s the cost breakdown of a burger at our restaurant: 

• Burger patty: $1.30
• Seeded Brioche Bun: $0.68
• 2 Slices of American Cheese: $0.22
• Caramelized onion, lettuce, tomato, burger sauce: $0.50 (approx.)

Total Cost Per Burger: $2.70

According to consumer surveys, the quality of the beef used at a burger restaurant is the top consideration among customers; the array of toppings available are a close second. This means, that, for most businesses, you’ll have to decide where you want to place your focus.

Do you want to buy your own slabs of chuck and short rib, and fresh-grind your beef every day to your own custom proportions of fat and lean, making the quality of your beef your signature? Or do you want to offer a dizzying array of topping combinations, allowing customers to customize to their hearts’ content?

Related Reading: Cooking is My Passion. Should I Start a Restaurant?

The reality is, unless you plan to have your burger cost $24 dollars (and some places definitely do!), you probably won’t be able to do both. The decision on where to place your focus probably has a lot to do with where you live, who your customers are, and what kinds of competition exist in the marketplace.

When I first started in this business, I bought the best of everything. Heritage-breed pork from a local butcher. Custom baked bread loaves from my favorite bakery. Artisinal cheeses from a local cheesemonger. And yes, the food was incredible. However, the price at which I had to sell that food was, at least for the area I live, prohibitive.

Introducing the Ancho Double.

It took some time to figure out how to balance that sweet spot, between quality and cost, because believe it or not, some of the high cost of your ingredients doesn’t translate into value in the minds of most customers. I quickly figured out where to skimp, and where to splash out, in terms of my budget. Since pork tends to all taste the same after 12 hours in a smoker, I began buying pork from a national distributor.

I couldn’t taste the difference, and neither could my customers. Instead, I chose to keep spending money where customers could “see” it, in toppings like cheese and foundations like bread. Those things, they could understand, and pay more for…the pork, not so much. This way, I was able to drop my price to a level customers were happy with, while not really sacrificing the quality of my product.

Whether you decide to pour your money into your beef blend, or into an array of toppings that are totally bonkers and will get people talking, it’s probably a decision to make early on. While both approaches are completely valid and bring their own types of success, figuring out early where to spend, and where to save, will guide much of your decision making down the road.

How We Do Things at Ancho Honey

The evolution of our Burger Night at Ancho Honey has been nothing short of remarkable. What began as a gimmicky plan to generate a little extra weekly revenue during our off-season, has rapidly evolved into the biggest moneymaker of our entire week. Let’s talk a little bit about each element of our $6.95 house burger, the “AnchoBurger,” to see how it evolved over time in terms of preparation and cost.

The Burger

We decided early on that custom beef blends were not for us, and that instead, we wanted to do a volume-based business, where we were able to offer our burger inexpensively, and create hordes of customer traffic. On our most recent Burger Night, we sold 134 burgers in about three hours; that’s one burger every 80 seconds. When we first launched our Burger Night, however, things were much slower; a “successful” night meant producing more like 20 burgers.

Back then, we bought plain-old 80/20 ground beef from our distributor, pressed it thin by hand, and counted on a perfect sear on the flat top and a custom seasoning blend to give our burgers their character. While this allowed us to spend less on ingredients, as traffic grew, the labor costs became prohibitive.

Related Reading: 11 Best (No Cost) Restaurant Marketing Ideas

During what I think of as the “transition” period, where sales were strong but volume hadn’t yet gone totally crazy, my staff and I would spend 2-3 hours in the afternoon pressing out burger patties by hand. This quickly became unreasonable; whole portions of the day were being lost to basic burger prep, and I had to find a pre-formed solution.

After trying several different products, I finally found a third-pound burger patty that arrives fresh (never frozen), with a shape that doesn’t look too machine made, and most importantly to me, a diameter that perfectly matches our bun.

Because they arrive fully formed and ready to cook, I’m paying a bit higher price than I would for bulk ground beef, but the time and labor savings make it worth it. Through my distributor, I pay $52 for a 40-count case, or about $1.30 per burger.

The Bun

Look, buns are important to me. Perhaps overly so. But I think a good bun is what separates a good burger form a bad one. Finding a bun that will stand up to the onslaught of toppings I put on it without getting soggy or falling apart, was a bit of a challenge.

I also wanted a bun that would look great on Instagram, as well as trigger a sort of idealized, nostalgic fast food aesthetic in the minds of my customers. I finally settled on a seeded brioche bun, which costs $33 for a case of 48, or around 68 cents per bun.

The Toppings

Our burger is topped simply with two slices of American cheese, caramelized onions, chopped lettuce, a slice of tomato, and a house burger sauce that we make from scratch. The biggest cost factor here is the cheese; I pay $19 for 160 slices, or about 11 cents per slice, or 22 cents per burger.

When we first started, I was buying frozen and pre-cooked caramelized onions, but not only were they expensive (relative to, y’know, an onion), but I was running out of them constantly, and they proved easier to prep ourselves. Between the onions, lettuce, tomato, and burger sauce, let’s assume we’re adding another 50 cents to the cost of each burger.

The Pricing

If you’ve been following along with the math as you’ve been reading, you’ve probably noticed that every house AnchoBurger we sell costs us about $2.70 cents, which means that according to the standard pricing model for restaurants, we should be selling it for around $8. And believe me, plenty of other industry folks in my area have told me that, relative to the quality, $6.95 is an absolute bargain for the burgers we are producing. But I keep them priced low for a few reasons.

First, it gets people in the door, and since our business is in its infancy, there’s a certain marketing benefit to letting people know about the quality of our food. Second, where I live, unfortunately, we have two main competitors in the burger business: Fast food places, and crummy bars. The fast food places sell their burger for a buck, and they’re not very good.

Related Reading: 201 Burger Slogans and Caption Ideas Perfect for Social Media Marketing 

The bars sell their burger for $15 bucks, and they’re also not very good. I wanted to hit a sweet spot that’s more competitive with a fast food place’s pricing, but with quality that blows theirs away; similarly, my pricing seems like a bargain compared to the bars and restaurants in town, who are serving burgers that are, quite simply, not as good.

Could I charge an extra dollar per burger, and make an extra $100 a night? Probably. Would it create as much buzz and excitement, and feel like an “event” that will draw customers in for some of my higher-margin items? Probably not.

How Ancho Honey’s Future Will (Probably) Be Built on Burgers

More burgers in this guys future.

At our restaurant, we’re at a bit of a crossroads, with a lot of different options available for moving forward. Our Burger Nights have transformed our business, quadrupling both the number of customers we serve each week, as well as our sales (even on our non-burger selling days).

The next logical step would seem to be throwing more of our efforts into our cheeseburgers, overhauling the menu to be more burger-focused, and making them always available.

But I have reservations about this: Making burgers a part of our regular menu would mean a significant investment in new kitchen equipment, including a bigger griddle and an upgraded exhaust system.

I also wonder if part of the success of Burger Night isn’t due in part to the artificial scarcity of our offering; if burgers were available anytime, would the ravenous demand for them be as high?

These are the right kinds of problems to have, however, and the right questions to be asking. Growing our burger business will likely be a big part of Ancho Honey’s growth over the next year, and whether you choose to start slinging them one night a week, or build an entire business around them, cheeseburgers could be the key to your business’ success, as well.

If you would like to get more long-form deep dives into different industries like this sign up for our free food business community with more than 45,000+ active subscribers.

The post Market Analysis for the $100+ Billion Per Year Burger Business appeared first on Food Truck Empire.

Have an idea for a food business, but are short on funds to make it happen? One of the best ways to put your business in front of angel investors is with a pitch deck.

On this page, we break down everything you need to make a pitch deck that can be presented to investors, friends, or customers. We even provide templates and samples you can download on this page for free. Here’s what you’ll need to get started: 

• What is a pitch deck?
• Sections of a pitch deck
• Pitch deck templates
• How to prepare for a pitch deck presentation

What is a pitch deck?

A pitch deck is a short presentation document used to express the basic concept of a business, including how revenue will be generated, cost to get started, and marketing plan. Pitch decks are generally short (between 10 – 15 slides in length) and can be presented to a group of potential investors in under 10 minutes.

The entire point of a pitch deck is to get straight to the point of what your business does and how you intend to make money. This is not intended to be an in-depth like a business plan where you’ll explain the detailed the financials of the business. This is a short document that helps you explain what your business does in a few minutes.

Related Reading: How Super Batter Pancake and Waffle Mix Got into 15 Retailers in 6 Months

Sections of a pitch deck

The pitch deck included in this post is designed for a new or existing food business startups. Here’s what to include in a pitch deck.

Title: This slide lists the name company name, year the business is being founded, and the name of the founder (probably you!).

My example title slide.

About Us: Briefly describe your business and mission. Tell us about the food you plan to serve. This only needs to be 2 – 3 paragraphs in length.

Team: List the members of your team. For most startup food businesses this is usually only one or two people. If you have multiple team members, make sure to clearly identify each persons role in the company.

Impact on Community: Does your company have a social benefit? The goal of your business could be to help raise money for a non-profit in your area. The program could also provide job training for at-risk youth. Your impact on the community could be as simple as providing healthy meals to customers in your community.

Menu: What type of food do you plan to sell at your food truck or restaurant? If you have a food product business like Keto-friendly crackers, describe the products and flavor options here instead.

Operations Schedule: How often do you plan to vend or work on the business? If you are a mobile food business, be working a lot of weekends as this is the busiest time for most of these businesses. You can break out the operations schedule by day and hours.

Vending Locations: Where exactly do you plan to vend and sell your food? Is there a specific farmers market you’ve got in mind? Do you plan to open a restaurant at a local strip-mall? Tell us where you plan to sell your food. If you’re opening a CPG business, you should list the specific stores where you would like to get a retail or sell online through an e-commerce store.

Competitive Analysis: Identify your competitors and list them here. You will use this competitive analysis to help identify what makes company unique. Be sure to include details like pricing or marketing approach.

My competitive analysis example slide.

What’s Different: Describe how you business is unique in the local or national market. Does your product offer health benefits, distinct flavors, unique branding, or other advantages that will help your business standout from what’s currently available in the market.

Estimated Startup Costs: Determine how much money you’ll need to open the business. Common startup costs for a food business include equipment (cooking equipment, food trailer), permits, initial inventory, and insurance.

Funding the Business: Where do you plan to get the funds needed to start the business based on your estimated startup cost? Here you will list personal funds, friends / family donations, and the amount you’re hoping to get from investors. Don’t forget to include the specific amount of money you intend to raise from each section.

• Personal funds: This is funding for the business that you bring to the table. Investors like to see you bringing some money to the table to ensure you’ve got skin in the game. This money could come from a savings account or 401K.
• Friends / family: This is money raised for your business from people you already know that believe in your business. This could be from your mom, sister, brother, rich uncle, or a childhood friend.
• Other plans to fund: List the other ways are you planning to fund the business. Credit cards? Bank loan? Crowdfunding?
• Investor requested funds: If you plan to participate in our Mobile Food Challenge, please share how much investment you’re requesting here.

Target daily sales goal: This slide helps you get clear on the amount of sales you need to be happy and comfortable with the business. This target daily sales goal should at a minimum cover all your monthly expenses to operate the business.

Here’s the formula you’ll need to estimate in this section:

goal number of sales X average ticket value = gross sales goal

Longterm vision: List your longterm goals for the business. These can be short bulleted statements. Think in terms of the next 5 – 10 years. This section is a good place to articulate any plans to scale the business in the future.

Example goals: 

• Expand into a second mobile unit
• Expand from mobile into a restaurant location.
• Donate 10,000 meals to local food shelf in 10 years.

Pitch Deck Templates

Here are my pitch deck templates available on Google Docs. You can save these files to your computer and edit with your own business information.

• Blank Pitch Deck Template – Download this template with basic instruction on filling out the document.
• Completed Pitch Deck Sample – Here is a completed pitch deck that includes financial numbers, longterm vision, and other components of a pitch deck. This is intended to provide you an example of how to complete each slide.

If you don’t like the design of this pitch deck, not to worry. There are literally thousands of pitch decks available online by conducting a quick Google search or exploring Google Docs. Just keep in mind that many of these documents were intended for tech startups so you will need to adjust the slide topics to make sense for a food business.

How to prepare for a pitch deck presentation 

Most pitches are now conducted live and online.

After you’ve got your pitch deck finalized there’s still one more step. Making the plea to investors for the capital needed to start the business. Historically, a pitch deck presentation would happen live in front of investors behind closed boardroom doors. But times have changed. These pitches usually occur virtually on Zoom meetings.

Serious about starting a mobile food business? Click here to get our free business kit. 

After you’ve taken the time to put together a pitch deck, you don’t want to drop the ball at the five yard line with a poor presentation. Common issues that pop-up in these live pitches include wrong screens being shared, poor audio, or a bad internet connection. Hiccups like these not only throw you off your game, but they can make you look unprepared. Not a good message to send to investors!

Here are best practices to ensure your pitch goes smoothly in an online setting. Many of these mistakes I’ve been guilty of so don’t feel bad if they’ve happened to you.

• Poor internet connection: As more participants that join a meeting, the internet connection can lag if you don’t have a strong signal. Before presenting make sure you’re in an area with a strong connection. Before presenting, I make sure to go to the room closest to my router. In some parts of my house, the signal is weak and can lead to issues. Make sure you choose a place with a strong internet connection whether it’s your own home or co-working space before presenting.
• Close down applications: The last thing you want is to get an instant message from a college roommate while presenting your business idea. Make sure to shut down all other applications before making your pitch. This can also help you computer run faster during the presentation.
• Choose a quiet location: Dogs barking in background. Kids running amok. It’s all part of an everyday Zoom presentation, but do everything you can to keep things on your end quiet. This might mean leaving your house for the presentation. I’ve done a lot of Zoom meetings from my garage.
• Practice presenting: Try to keep your presentation at 10 minutes max. Time yourself going through the deck. Let the panelists know before you start the presentation that this will only require 10 minutes of their time and then you will open things up for questions.
• Know your numbers: If you’ve ever seen an episode of Shark Tank, you understand how important knowing the financials of a business is to prospective investors. Come prepared with answers about unit cost, what you’ll use the funds toward, and sales projections.

By utilizing this template and developing a strong pitch, you can literally enter any room and be prepared to explain a business idea… whether it’s in person or online. We look forward to seeing your pitches!

If you’d like to join our free online community of 45,000+ food business founders, click here. Each week we send a new food business case with revenue numbers for you to learn from. When you sign up you’ll also be invited to watch the Mobile Food Challenge pitches live even if you don’t plan to submit a pitch yourself.

The post Download My Pitch Deck Template for Food Businesses (Free) appeared first on Food Truck Empire.

I got a question from one of our food business academy premium members last week that I felt would be valuable to share with all the readers / listeners of this podcast. She asked about the best ways to test market her new food products and get feedback.  The answer is in the notes below and audio lesson — thanks for sending in the question, Haley!

What is Test Marketing? 

Test marketing is a way to see if there’s demand for your product. Without testing, it’s possible you could be creating a food product that no one wants. If nobody wants your product, you unfortunately don’t have a business.

Test marketing is often over-looked as an “I don’t have to do that” step of starting a food business. But, it’s arguably the most important step – even more so than packaging design, costing, and distribution strategy.

Without test marketing, your product might fail. And failure isn’t an option when you’ve got so much money, time, and resources tied up into your little food company that could (or couldn’t).

Hydrant mailed free samples to bloggers and social media influencers to ask for product feedback.

Here’s what you’ll learn in this podcast:

• Why test marketing is crucial to the success of your food business
• Where to do your test marketing (and why you have to be careful with friends and family)
• The proven 5-step plan to test marketing (this is exactly what I do to test market new flavors for Green Mountain Mustard
• Examples of small food businesses that failed test market their products. Like a grasshopper candy maker at a local farmers market.
• Learn the secret benefits of test marketing and how the product gets customers involved in the recipe development process. We’ve tried inventive new mustard flavors like cinnamon mustard and sweet potato mustard and people always flock to our booth to try those new flavors. Most of these flavors never see a full production run.
• Find out how our show sponsor Gusto can help manage payroll and HR for specialty food businesses.

How to Test Market a Food Product

Have you been playing around in your home kitchen, trying to come up with the next best chocolate chip cookie? Or maybe, you’ve got the “secret sauce”.

Creating a food product is one thing. But, making a product consumers buy over and over again is tough.

That’s why test marketing your new food idea is the way to go.

Test marketing gives you an idea of who would buy your product, for how much money, and if they would change anything about it.

I used test marketing to determine each of these mustard flavors.

Of course, when you’re testing something out, a million things could go wrong. You could get a false sense of hope, you could find out that, while delicious, people won’t buy your product. Or, the worst – no one’s a fan. Hard to believe with food products, I know, but it’s happened to me before.

So how do you get the biggest bang for your buck from your test marketing efforts?

It’s not easy. You’ll likely be test marketing for several months before you pull the trigger. But don’t worry! Once you get an idea for what your customers like, you’ll get more clarity on the specific products that are going to be a success.

For now, let’s get your first test marketing under way. Here’s a few specific ways to get started.

6 tips to help you test market your food product:

One of our early labels.

1. Don’t let family and friends give you feedback

Family members are supposed to be honest, right? Not exactly. When I was test marketing my energy bars and mustard, family members often sugar-coated their feedback. They weren’t upfront with me. Same with friends – they want to be supportive which means they tell you what you want to hear. This ultimately means you don’t get the best feedback.

To find people who aren’t friends and family, ask co-workers at work, post an ad on Craigslist looking for focus group participants, or give your family a couple test products and tell them to bring it to work. Since their co-workers don’t know you, they’ll be honest.

Related Reading: 25-Step Plan to Make Your Food Company a Reality

2. Perfect one product

Test marketing a line of 10 products is overwhelming. It creates decision paralysis for your test group. Plus, it can alter the taste of products if you have them taste multiple varieties. By focusing on one flavor, you’re able to perfect that recipe. Then, when you’re successful with one, use your test group to expand your product line.

After you’ve got one food product customers crave don’t stop the testing there. Continue going through the process for each new flavor you add.

One example of a company that followed this exact rollout process is called Bitchin’ Sauce out of Carlsbad, California. The original Bitchin’ Sauce is a unique lemon and garlic dip made from almonds with a similar texture to hummus. This single flavor launched the Bitchin’ Sauce brand that’s now sold in major retailers like Costco. Only after building momentum and proving their concept did the company start to release other flavors like pesto and chipotle. They did not release multiple flavors at once to kick off the business. Launching with eight or more flavors would have infinitely complicated the process for this family run operation. Keep things simple in the beginning!

3. Retailers are not your customers

The first place many companies just starting out go for research is their local grocery store. And that’s not a good idea. Sure, it’s awesome to get the buyer’s attention, but retailers aren’t your customer. The retailer’s customers are the ones  buying your product. By staying focused on consumers, you’ll get the feedback you need to found a fantastic food company.

More photos of our mustard line.

4. Prepare for criticism

Let’s face it – not everyone is going to LOVE your food product. In fact, just a few weeks ago, I was told one of my test mustard flavors “sucked”. I kid you not. While 8 out of 10 customers are likely to think your product is worth buying, it’s the other 20% you should pay attention to. Why don’t they like it? What can you do better? Taking this criticism and feedback is important. It helps you make a product 100% of people enjoy.

5. Craft a 30-second pitch

“Try this and tell me what you think” is probably one the worst ways to get a customer to try your product. It’s bland, boring, and not engaging. Work on a short pitch about your product. What makes it different? Do you have unique ingredients? This pitch is not only useful for consumers, but you’ll need it when it comes to selling your product to retailers.

Test marketing is necessary to start a food business and produce a product consumers are going to fall in love with. Just making salsa, brownies, or spice blends because you like to cook isn’t a great reason to start your food business. Why?

It reminds me of a quote I heard from one of my marketing professors in college:

“Make what people will buy – not what you want to sell”

That quote is spot on. If customers like chunks in their salsa, make it chunky. If customers only want to buy your triple chocolate fudge sauce then discontinue the other flavors. Focus on what your customers are telling you, respond in a timely manner, and watch your food business take off.

6. Get survey responses from people that tasted your sample. 

Create a short 2 – 4 question survey to help document feedback. Here a few specific questions I would include in these short forms. Make sure these surveys can be completed in less than 3 minutes.

• Would you purchase this product?
• How much would you pay for the product?
• Can you describe the flavor to me in your own words?
• Do you have any improvements or suggestions you would like implemented?

By asking these specific questions you’ll get a better understanding of whether or not people will actually pay for your food product and get specific ideas on ways to improve the recipe if needed.

Take this feedback home and look for patterns. If one tester thinks the product is to thin or too thick, don’t worry about it. If you see a trend those are the pieces of feedback you want to take action on.

Processing feedback from test marketing events

Getting flavor feedback at a local farmer’s market.

One final bonus tip. Do your best to get into a zen state of mind when you’re accepting feedback (aka criticism) about your flavors and food. Believe it or not, many founders will go through the process of test marketing their food product only to throw out the results for any number of reasons.

Maybe they tested providing free samples at the wrong location without a market fit. Maybe the batch wasn’t quite right on that day. Maybe the samplers don’t know good food when they taste it!

Related Reading: Menu & Recipe Cost Template – Download My Spreadsheet

While the reasons listed above can in fact be true in certain situations. Don’t continue to move forward with the same approach to a food business if you tested your idea across multiple events and received the same type of feedback. Don’t fall in love with an idea that’s destined to fail and lose you money.

If a food item doesn’t resonate with customers, don’t take it to heart either. Just because no one liked your first food idea it’s in no way a reflection on your skills or ability to launch a successful food brand. Head back to the test kitchen and start brain storming another food idea you can bring into the world.

Do you have any test marketing tips for people who want to launch their food business? Let me know in the comments. If you want to more case studies like this one from proven food founders, don’t forget to join our community of 40,000+ members. Each week we’ll send you a new case study straight to your inbox.

The post 6 Smart Tips to Test Market Your Food Product appeared first on Food Truck Empire.