Food trucks closing due to unsustainable revenue
19 posts across 3 communities in the last 60 days; 84% from r/foodtrucks.
“Loss Leader? Bro, if you're losing $ on 3oz of ground beef and cheap nacho cheese in a tortilla @ $6 I dunno what to say... [re: What are you sick of seeing in food trucks?]”
“Best of luck! Friday was the last day at my brick and mortar after an 8 year run. It was a great location; but, it isn’t now. So glad to be back to mobile. Being stuck in a spot that dries up is a nightmare. Hard to stop trying to “get it to work again” due to the…”
“Below is the opinion of a consumer with literally zero behind the scenes knowledge this is just my take: Problem with food trucks is yall charge an arm and a leg for just ok food truck food. Like there is no reason EVER your food should cost me more than if I went to a nice…”
Multiple food truck owners report closing their businesses after failing to meet revenue targets, citing low wages, high costs, and market demand issues. Some note competition from sit-down diners.
SOURCES (43)
“Loss Leader? Bro, if you're losing $ on 3oz of ground beef and cheap nacho cheese in a tortilla @ $6 I dunno what to say... [re: What are you sick of seeing in food trucks?]”
“It’s a shitty business model where a commissary kitchen is making the profits and the venue can’t scale enough to make more. Restaurants make money off of volume, their margins aren’t at all fixed.”
“Right. Getting a food truck bootstrapped can be much harder than a full restaurant and neither one is easily accomplishable on your own. No one would fund us. Not a single one. We had stellar credit. We had enough collateral assets. "Too Risky" "Not enough experience" (keep in mind my wife has been an executive chef for years at this point) "Why don't you just take another mortgage on your house?" "Food trucks can't get traditional loans" "No”
“It would be nice for someone to produce an actual monthly itemized balance sheet here because people keep talking about how cheap it is. No one ever produces their gross and net values. Food Truck typically costs $45,000 to $200,000 to start, while Restaurant ranges from $175,000 to $750, 000. With a $244,500 lower median startup investment. Food Truck is the more accessible option for entrepreneurs on a tighter budget. Beyond upfront costs, consider the ongoing operational differences: Food Tru”
“If you’re expecting someone else to spoon feed you then a food truck isn’t for you.”
“Genuine question for anyone who has worked in the food service industry: If a restaurant has not been able to afford a truck in 2 months gets all their supplies from Kroger, doesn’t have enough money in the register to pay out tips for the day (26$) and the employees checks keep bouncing, what does that mean? Has anyone ever experienced this before? If so, how long before you showed up for your scheduled shift and there was a closed sign on the door? Asking for a friend submitted by”
Bad idea. If you can’t self finance at the moment. Don’t do it.
“Go to any big job site and look at the truck there. It's basically tacos burritos sandwiches and burgers to order. And in the hot door there is always already made chicken wings heated up frozen burritos chicken rice plates and chicken chow mein plates ready to go.”
“Beef is only going to get more expensive so be aware of that. Chicken prices have been pretty stable for us. We also run a burger/chicken tender sandwich truck and the smaller the menu the better. Just make sure you look into the local laws regarding foodtruck stationary parking and whether the land lot owner will agree. Restaurants do not like foodtrucks parked near their turf so be aware of that as well, as they may lobby against you. Best of luck!”
“It’s a shame the states make everything so hard to be an entrepreneur. That’s one of the reasons that makes Texas good with food trucks/trailers but, there again they changed how easy it used to be. We go through the fire marshal too.”
“It’s not hard negotiating with landlords with empty restaurants. Usually, can find a good bargain. Depends on what your menu is and what your history is but, it’s very doable.”
“Honestly, I know more restaurants that have closed to open even more successful food trucks. Brick & mortar is getting difficult and expensive. Food truck gives you the ability to move and have a wider audience, broadening your clientele. People get bored quick these days. From what I’ve seen and taking to others in the local food truck industry, stick with mobile.”
“I was in the black within the first month but I have history in the business. It’s all in your menu and pricing.”
“Yeah, everything is expensive. $22 tacos from a food truck dont exist and just serves to pass the blame for rising food and rent costs to food truck owners instead of putting blame on the rest of the pipeline by providing a fake non realistic number to shock. Its an asinine way of communicating a point and fools fools.”
“Best of luck! Friday was the last day at my brick and mortar after an 8 year run. It was a great location; but, it isn’t now. So glad to be back to mobile. Being stuck in a spot that dries up is a nightmare. Hard to stop trying to “get it to work again” due to the sunk-cost-fallacy effect. I doubt I will ever go back to a brick and mortar location; but, I hope it works out great for you!”
“Thanks for the reply. Ya we're expecting more headaches too, especially with staff and shifts to keep opening times. 5x sales sounds amazing though, is it in similar area as your truck was in?”
“Happens all the time. Restaurant owners feel the pinch from increased competition and unfortunately use legislation to keep even smaller businesses out. It’s very possible that a restaurant has strong financial backers being a chain restaurant (bj’s, eureka burger, etc) or at least have a few large investors spending six figures and likely inside connections to get things w city inspectors moving. Food trucks tho, and tent pop ups for that matter, are rarely in the other categories. Usually just”
“Does your food truck make profit? What are the profit margins for your food truck? I'd rather own a food truck that makes $50,000/year in profit than own a restaurant that makes $50,000/year in profit.”
“Commenting just to see what people say. We are in a similar situation with our food truck winding down and about to be for sale and potentially opening a brick location nearby. Good luck!”
“Food truck sales are definitely down all across this season due to the economy. Events charge a lot of $ to attend which pushes the price even higher. We have seen a continuous drop the last 2 years from customer spending. Ontario experienced”
“Also - what is the trend? Is it trending down over the last 3 years or up? I wouldn't want to buy a subway as many locations are on a downward trajectory. Arbys. Hardees. Etc.”
“back then yes. now? not really. here at least. depending on walkups is a surefire way to bankruptcy and insolvency in LA unless you are a taco guy with your whole family working for free (no labor cost).”
“oooph, those revenue numbers...I'm sorry you're going through the tough times. You guys down in FL seem to be generally hanging on by a thread this year.”
“Yea I've managed a couple restaurants over the years and any profit over 5% is considered GOOD. Most I've ever seen in a year is 9%. Id imagine its very similar for food trucks as it is restaurants. Keep food costs below 30%(25% is ideal but now adays can run as far up as 35%), Labor cost 30-40%, Truck Maintenance/rent for commissary kitchen/taxes/insurance/etc. 30%. All of these numbers can fluctuate based on circumstance of course.”
“I'm planning on shutting down my small restaurant soon, we have a griddle, a deep fryer, coolers, etc. and have someone who may be interested in buying our equipment and furniture, but I want to make sure I'm getting a fair price. Should I ask someone to come and assess the value of our FFE? In Google, I found a company called TagEx Brands, should I reach out to them and ask them to come in for an assessment? Has anyone worked with TagEx? Or should I just haggle with the person who's”
“Below is the opinion of a consumer with literally zero behind the scenes knowledge this is just my take: Problem with food trucks is yall charge an arm and a leg for just ok food truck food. Like there is no reason EVER your food should cost me more than if I went to a nice restaurant and sat down with good service. Yet every stall at an event is like 18.95 for a burger from some no name food truck; comes with fries tho how nice (75 cents for their special sauce tho). If your food truck doesn”
“i never said it was “so profitable”. why would the 3 food trucks that come ,twice a week each bother coming here at all if there was no profit?”
“Burgers and the usual accompaniments plus a few not-so-special unique items. We're in a food truck park with 4 other trucks and an outdoor bar and seating area. In a town of 32k-ish people there's over 100 licensed eateries, and I'd say maybe 20-25 are trucks, trailers, or carts. One location is open year round. That one is on its own lot with no other trucks and mostly is operated as a drive through style with one person on staff running bags to cars. The other two operate April-Oct”
“I made less than my state minimum wage last year and slightly above federal minimum wage and signed my half over to business partner. Who has done worse this summer as frankly i ran a more efficent kitchen but also the revenue not there. For the area were in a sit down diner was the market demand”
“Just to clarify- If I hit your truck in the same scenario that I’m talking about with the taco place, I might find out that it’s something I’d return for. I didn’t mean to take a dig at your food- it’s hard to judge off of pictures and not having tasted it so please understand I wasn’t trying to insult you.”