The food truck business, also known as the mobile kitchen business, is a popular form of F&B business gaining popularity in India. The food truck business in India has achieved an 8.4% annual growth rate despite facing regulatory hurdles, vague government guidelines, and other challenges. One of the most critical factors contributing to the growth of a food truck business is the relatively low investment required to start a business. Mobility factors is another added advantage that works in favor of a mobile kitchen. The article below will go through the step-to-step guide of opening a food truck business.
Benefits of opening a food truck business in India
Be your own boss:-
A food truck allows an entrepreneur to be his own boss with minimum risk. Professionals from the food industry who have the ambition to start a business but lack confidence and want to start something on a small scale can start the food truck business.
Asset light business:-
The food truck business in India is a classic example of an asset-light business model in the hospitality industry. The initial investment requirement is minimum, and hence a relatively easy way to get into the food business.
Flexible business model:-
Being a mobile kitchen, a food truck business has many advantages that a brick-and-mortar food business does not have. A food truck can park the vehicle outside the office premises during lunch hours, get great business, and then drive to other locations during lean hours. A food truck participates in food festivals or catering events organised by event management companies and corporations. The mobility factor of a food truck business in India gives it many added benefits.
Good stepping stone:-
A person who wants to enter a food business and start from a small venture can start his journey by operating a food truck business. An entrepreneur can get hands-on experience analysing data, latest customer trends, operational activity, marketing activity, and promotions on a small scale by operating a food truck business.
Business plan to start a food truck business in India
Like any business, even starting a food truck business needs planning. The food truck business plan will involve analysing the investment required for starting a business. The percentage-wise approximate cost breakup of running a truck will be as below:-
Staff salary, meal cost, staff welfare etc. -30%
COGS, namely raw material, fuel, packaging material etc. – 25%
Rent for base kitchen and premises where the vehicle will be parked – 15% (if any)
Supplementary expenses like vehicle repair and maintenance, insurance, permits etc. – 10%
The step-by-step guide for opening a food truck business in India or mobile kitchen will be as below:-
Choosing the right commercial vehicle for a food truck:-
The first step in starting a food truck business will be selecting an appropriate vehicle suitable for the cuisine you need to serve. A mini truck will be ideal for a food truck and costs around 8 to 10 lakhs. Companies like TATA, Mahindra & Mahindra and Ashok Leyland are the primary producers of such vehicles in India.
First-time food entrepreneurs who want to minimise their initial investment can opt for a second-hand vehicle, which will reduce the investment on the bus or truck by almost 50%. While purchasing a second-hand vehicle, budding entrepreneurs should check the bus or truck’s fitness certificate, insurance, registration, and road tax receipt. Since banning a vehicle older than ten years in the immediate future is anticipated due to environmental concerns, buying a vehicle not more than five years old is ideal.
Procurement of Kitchen equipment for the food truck business
A food truck will need kitchen equipment and fixtures like refrigerator, microwaves, griller, working table, etc., other than table or chairs required to make seating space for the clients, would cost around 2 to 3 lakhs. A second-hand purchase of kitchen equipment is usually not advisable as they typically don’t have a warranty in case of any defects. A food truck would also need supplies and food ingredients which will cost around 25000 to 30000. A new business should keep minimum supplies stock until they properly approximate the business flow and avoid wastage.
Licenses required for starting a food truck business in India
The food truck business does not have a well-defined regulatory framework in India. The law mandates no well-defined documents for a food truck business. However, all food businesses require mandatory licenses and permits to operate in India, and the food truck business will also need to issue the same. The list of the licenses required are as below:-
a) FSSAI Registration or License.
b) Shop and Establishment License.
c) Fire safety certificate.
d) NOC from RTO and local municipal body.
e) Kitchen Insurance.
Location for starting a food truck business in India
A place where the food truck business operates should have a large footfall with limited or no competition; students and professionals are ideal clients of a food truck business. Parking of the vehicle should not pose a nuisance to the pedestrians or locals. Heavy vehicles are restricted in crowded places or banned after specific timings, especially in city centre areas; hence, light commercial vehicles are ideal for food trucks.
Staff requirement for starting a food truck business in India.
The staffing of a food truck depends on the cuisine served and the scale of operation. If the food truck experiences busy rush hours, hiring two chefs and a helper will be ideal. The salary of a chef could be anywhere around 13000 to 15000, and that of a helper can be about 8000. If staff can take multiple responsibilities, e.g. a driver also doing a role of the cashier or a helper doing a part of delivery boy it will be ideal as this reduces the requirement for extra staff.
Point of sales software
All food businesses should have a point of sales or POS software for record-keeping of inventory and sales. A POS software helps keep customer details of the business safe. A point of sale software also allows guests to send promotional offers to clients using the data.
Marketing for Food truck
Food trucks can use pamphlets as a traditional mode of marketing; a limited number of pamphlets can be distributed to create awareness since most food trucks don’t have a delivery verticle. Another cheap way of marketing the food truck business is through social media. Food trucks have limited resources to invest in offline marketing mediums like print media as they are expensive and may not have the desired impact. On the other hand, marketing on social media is price effective and has an impact on the targeted audience.
Through social media, a food truck business can stay in touch with the client and inform them about the new dishes on the menu, discounts, special offers, or promotions. Other than social media, there are many offline modes of marketing like events and food festivals. Food truck festival is one such offline event where many foodies visit and is an excellent avenue to get word of mouth publicity.
Event management companies and corporates organise catering events that give opportunity for the food truck to do brisk business that acts as an alternate source of income and another source of lead generation through word of mouth.
Like every business, the food truck business has its flip side, especially a lack of regulatory guidelines. However, a proper business planning and mindful execution, a food truck business can survive and flourish in these testing times when most of the food business is struggling