The cost of production for everything keeps going up. Consequently, margins are growing slimmer, and as if no one is paying attention to anything, new businesses are emerging at an unprecedented rate. As a food truck owner, it’s worth noting that the market is pretty unfriendly, and success is partly down to how closely you monitor the details of your food production process.The following tips will help you increase revenue from your food truck business without compromising quality or hiking prices irrationally:
1. Pay attention to your inventory.
Running a food truck with an endless food catalog is something to take pride in. However, vast inventories don`t necessarily translate to huge profits. Smaller, more compact ones yield more if the sorting phase is executed well.
To create a more lucrative inventory, consider viewing and assessing the performance of each item on your menu separately. Check if you’re buying or cooking too much of the costliest items or if there are foods that don’t meet the demand.
Daily inventory checks can help you avoid food wastage and put your money to better use. It can help you understand what needs restocking and what hasn’t been bought for days. Unless you’re using an automated inventory management system, it’s good that you take your books seriously. Seemingly small mistakes can prove detrimental to your business’ bottom line.
2. Set up a website.
Business websites are criminally underrated. In this era of smartphones and the Internet, having a website exposes you to people that will only buy after conducting online research. That’s a whopping 81 percent of American buyers, according to a 2019 study by GE Capital Retail Bank.
With a website, your business gets more visibility on the World Wide Web and puts on a more professional and reliable look. Consider getting a professional web developer to help you set up your site and optimize it for search engines.
3. Choose your food vehicle wisely.
Since most of your capital is going to be spent on purchasing the food vehicle, your choice will have an impact on how long it takes you to break even. If you buy a huge truck to sell low-profit items, it will take you ages to start making a profit. The costs of maintaining it may also take a chunk out of your day-to-day revenue, slowing down your growth rate.
Established manufacturers such as Craftsmen IND offer three types of food vehicles:
- Food carts: Food carts are the smallest type of street food vehicle. They cost less and are easier to manage, hence more suitable for small scale road-side vendors and anyone starting small. Any vehicle can tow a normal-sized food cart, so you can use your own car for this purpose.
- Food trucks: Many mobile catering businesses with several employees prefer full-sized food trucks to food carts because they are more spacious and offer plenty of flexibility. If you prepare the food on-site, a food truck is the best option for you. Note, however, that some states don’t permit this. If on-site preparation is the only reason you’re going for a food truck instead of a cart, then it’s good to confirm you’ll be allowed to.
- Food trailers: In size, food trailers are similar to food trucks and can contain kitchen compartments, and everything needed to start and run an online restaurant, but they can`t move on their own. You need a separate truck to tow the trailer to its destination every day. From a cost and convenience point of view, a food truck may be more economical and easier to manage than a food trailer. However, if you already have a towing vehicle, a food trailer would be more cost-effective.
- Choose the right products.
How you choose your products and meals shouldn`t be based strictly on your tastes and abilities. The food truck market is competitive and needs you to be versatile and flexible. Rigidity will increase your risk of losing bulk-buyers and people who prefer getting all their products under one roof to more inclusive vendors.
You need to be aware of the market you operate in and the most popular foods in specific localities. Understand the trends of the day and always be among the first to take them up. Add some creativity when necessary, but only risk what you can lose.
5. Accurate recipe portioning is crucial.
Accurately portioning your recipes is no child`s play, but that`s where the profit margins are hidden. Consider tracking each food item separately, so you know how the prices of specific ingredients change in real-time.
A meal that was your central profit maker in the summer could be the reason you’re making losses in the winter. Changes in seasons and other indirect factors bring with them fluctuations in ingredient prices, which can reduce or increase the profitability of certain items in foreseeable periods.
Portioning your recipes can thus serve as a planning tool for your food truck business.
6. Order the right food amounts.
One common mistake restaurant managers make is ordering too much of individual menu items or ingredients. The downsides of this are evident if you operate on a budget. Even if you have the money to buy supplies to last you a month, there are enough reasons not to go down that route.
Firstly, you don’t know what’s going to happen in the next few days. What if your freezer conks out, or for another reason, you’re unable to open for a few days or weeks?
Secondly, cooks may be prompted to serve too much of the abundant ingredient or meal under the assumption that “we have too much of it because it’s easy to acquire.”
What`s more, you risk losing the ability to buy other food items and ingredients because you exhausted your fund.
Thankfully, these days, we have automation, which has made the ordering process a lot easier. You can see which items are on-demand and which ones aren’t as well as view short and long-term trends in both the region and the industry.
7. Offer specials and coupons.
Everyone fancies a deal of some kind. If the next food truck offers gifts or discounts in exchange for filling out surveys or writing reviews online, customers will choose them over you.
Whether your closest rivals are doing it or not, discount cards and coupons on top of daily specials are worth trying out. They can grab the attention of customers shopping on a budget and those that can`t identify a more significant dissimilarity point between you and the next vendor.
8. Find new locations.
One main advantage of operating a mobile catering business over a traditional restaurant is that you can go wherever you want with a food truck. People don’t have to come to you. You have the option to find them instead.
Places with high human traffic are the most suitable for road-side food trucks. If some of your current locations don`t fetch you as much business as they used to, consider finding new areas.
Occasionally, you can try out special events. Some events not only give you extra hours to operate, but also give you the platform to sell yourself to new people. Farmers’ markets, festivals, concerts, and truck parks can all prove lucrative for food truck businesses.
9. Develop a marketing plan.
Low-cost word-of-mouth marketing works like magic, but you need to serve and satisfy customers first to get that going. A good marketing strategy is what will fetch you the first-time business you’re eyeing.
There are several advertising options you can invest in, depending on your budget: digital, TV, and print are a few examples. A digital marketing strategy paired with local SEO can do wonders for your food truck, given most food truck customers are millennials who tend to conduct local searches before heading out to shop.
Get your business on social media, use paid ads to push its visibility, and make it pop up in local searches, particularly if you have fixed locations you serve.
10. Focus on customer satisfaction.
They say the customer is always right, and rightly so. It doesn’t matter how much effort you put into selecting or cooking a meal. If the customer doesn’t like it, you’ve missed the mark because they are who you prepared it for.
Most customers won’t come back if they are dissatisfied with a service on their first visit. However, encouraging feedback can buy your second chances, especially from individuals who prioritize customer service.
Success in the mobile catering business is easier said than done. Many people make good sales, but end up with losses because they didn’t pay attention to their finances. The above tips will help you reduce the cost of operating your food truck and maximize revenue in most business and customer-friendly manner. They can apply to you whether you have an established business or are new to the food truck world.