The food truck industry has become one of the fastest growing sectors in the United States. But it wasn’t until 2008 economic collapse that we saw food trucks start to take off. As a result of the recession, many restaurants were closing, and highly qualified chefs found themselves out of a job and quite literally thrown on the streets. So with a consumer’s need for quality and variety that fast food dollar menus couldn’t provide, chefs found a way to meet this demand by way of food trucks, and with that Gourmet Street Food was born. However, owning or leasing a food truck is not easy; it takes a lot of hard work and more often than not, the one thing standing in between them and reaching their goal is getting a lease or a loan.
According to Statistic Brain, the average start-up cost for a Food Truck is $90,300. It is unlikely that the average person has that kind of money laying around, so it makes sense that they would look into financing their food truck. But just like any start-up, a bank isn’t going to hand over cash because someone has a dream – don’t we all wish this was the case?
When applying for a lease or a loan, a food truck entrepreneur needs to have a lot of heart, but it also helps to have a detailed business plan in place. Food Truck Entrepreneur Maria Bonita developed a comprehensive business plan when they applied for a loan at First National Bank, which allowed them to show the lender that they have a targeted strategy to protect their investment. Not only does a bank consider an applicant’s business plan, but they will also examine their credit, collateral, and the kind of property they will be purchasing. While an older truck may seem like the better deal, a lender may view it as a bigger risk, since they will have a hard time reselling it if the loan defaults. A less risky option for a Food Truck Entrepreneur and a Lender would be leasing a food truck, which would give the lessee the opportunity to see if the industry is right for them before they become a purchaser. Furthermore, organizations like the Small Business Administration have programs in place to help entrepreneurs find the necessary capital to start a small business.
With so many institutions now recognizing the potential that these entrepreneurs bring, it shouldn’t be a surprise that the elevated mobile fooderie trend has continued to grow over the years, and it’s not looking to stop anytime soon. In 2015, the industry increased their revenue by 12.4% to bring the yearly total to $1,200,000,000. These numbers alone prove that it’s not just the American Dream that is benefiting from the Food Truck Industry, but it’s also the American Economy.