Food Truck Business Plan and How to write one For Business Loans !
Welcome to marketing food online. And in this video, we are going to explain to food truck entrepreneurs who are going to start a food truck business, how to get a business plan put together for your food truck, business, and even cover what is in a business plan
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And how to write one. So we're going to dive into that and we're going to do it right now.
Damien, from marketing FoodOnline online and welcome back to marketing food online. And if you are watching our videos for the first time, you definitely want to hit the subscribe button. We've got over 700 plus videos to help you get your food business up and running, create a packaged food product, even start selling food from home, or even create a food truck. We've got a ton of resources and even a website that you have for free with ww.marketing food, online.com. So definitely check out our website. We've got tons of other free resources for you to check out. And we are going to dive into this video. We've had a lot of questions about writing business plans for food trucks and what exactly is it? So this video is not for veteran food truck owners. So if you already own a food truck and you're successful, that's fantastic.
Food Truck Business Plan and How to write one For Business Loans !
Good for you. And we are actually going to cover some ideas that are actually for those beginning. So if you're just getting into food truck business, and you're figuring out what should I do about a business plan? Cause I've heard you should write one. I've heard, maybe you shouldn't write one. And why do I really need one? So let me break it down for you. There's several parts to a business plan for any purpose. If it's whether a food truck, if it's a restaurant or any type of a business in general, when I started our, our food business over 12 years ago, the first business we dove into was actually an Italian bakery and my wife and I created cookies. We did gelato penny sandwiches. We did fresh breads. We had a variety of stuff in our bakery, but to be honest with you, we actually dove into it just because of necessity, because we were let go from our previous job and we needed to start this career, start this business for ourselves.
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And that's what we did. We actually did not create a business plan. And looking back on it, to be honest with you, I actually wish I did. So we transferred that business and went online and we kind of evolved online for the best a decade now. And it's actually been fantastic. We've done very, very well. And having a business plan is something of utter necessity. So what specifically though, does a food truck business plan look like? Okay. So number one, you need to start with, what's known as an executive summary. Okay. So it's basically going to be a, an outline and introduction. If you will, of what your food truck is going to be about. You're going to basically cover every aspect of what you're going to be doing. We have other sections within the business plan as we go on, we get into more specifics and details, but you want to encompass the whole vision you have for your food truck
Food Truck Business Plan and How to write one For Business Loans !
view of the plan for your business. You want to kind of figure out where you are, where you need to be, and basically how are you going to get there? Okay. Number two is going to be a company description. This is going to describe basically who you are as a food truck owner will be create the company, defines the company as specifically what the company and the food trucks going to be about. Are you looking to serve a certain type of cuisine? Are you going to be serving on you and go, you go into certain types of events. Are you going to be doing catering? These are things that you want to definitely talk about with the company description. So what exactly, what kind of a niche, if you will, are you going to be filling in the area where you live now?
You know, food trucks are obviously a mobile and you can go to a lot of different places. But as you go from different County to County, are you serving different types of food? Is there a specific person or a demographic that you're looking to serve? Because obviously everyone has different tastes in food. So that is something that you need to keep in mind. And as you explain that you want to know, you want to explain also what is it about yours? That's going to get other people to choose your food truck. Okay. So who is the competition that you would be competing against? And why is it that you think in your business plan? Why is it that you think your food is any better, your services, any better or the type of food that you're serving is better? Okay. So you want to encompass that basic ingredient if you will. No pun intended in the first part of that section too.
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Well, next up in section three root market analysis. So this is where you going to have to do a little bit of diving, basically understanding your community where you are. You want to find out specifically these four things, target your demographic, who is the demographic based upon the food that you're going to be serving, who is it you're looking to appeal to? Of course, everybody does not like every type of cuisine, but certain people do enjoy certain types of cuisines. So based upon that, who is it that your target demographic would be? What exactly are their needs? Number two, number three, where will you find them? So where exactly would they be? If they're going to be at certain events, you need to do a little bit of homework and find out what type of events locally are going to be the right ones for your food and your food truck.
Not every single event that you go to is going to be perfect for the type of food or the truck that you have. Next up, how are you going to attract them? So what methods are you going to use to basically attract those demographics? Once you find out who they are and where they would be, what methods would you be diving into in order for you to kind of market yourself and attract them? All right, so number four, number four is organization and management. This section, actually you want to dive into, of course, what will be as far as how is your business entity set up? So if you've incorporated yourself, you want to explain that you want to spell that out as a sole proprietorship. Is it a partnership? Is it an LLC, the actual structure itself, the business entity structure? How is it set up?
That goes under the organization and management section, which is number four of your food truck business plan. Now, also in this section, under the organization and management who owns the company and what percentage does each ownership do? They have? This is very, very important. Ownership is extremely when you are trying to get funding, banks want to know who is owning it. And how much of a percentage do they have? Is there only going to be two partners? Was it a 50 50? Sometimes for instance, as an example, our business is set up as a 50 50 LLC. My wife and I are listed as the owners. We have an equal share if you will, of the business. So in that for us also for tax purposes, it's been, been a beneficial for us to do that. But if you're seeking investment or going to a bank in your business plan in order for it to succeed and really convey the information that the banks are looking for, they want to know how the ownership is split up.
Okay? So next up, this may be a little confusing, but if you own the truck and you may not necessarily have a day-to-day operations, hands-on you have someone running it, you need to let the, let them know through your business plan, who is running the truck. And if somebody is specifically running the truck or you have a team of people who are they, what experiences do they have that merit? The fact that you basically have turned over your food truck to them and they're running it, what kind of experience did they have in the restaurant business and that type of industry, or even a food truck industry. And then what place where they work prior to you want to know what were they making? How much was their salaries, what were their responsibilities? Kind of a brief history of those people who are going to be in charge of the truck, because that's a big factor.
When it comes down to a banker or an investor, they want to know every parameter, every dynamic about your business. So letting them know who's running the show in a sense is going to give them a better foundation for them to make a good decision about giving you money or investing in your idea. All right. So number five, you want to explain your product, what it is specifically, obviously that you're selling now, in some cases, business plans have either the option of services or product, but your more or less product is going to be the service of your food. You're going to be making a specific menu. So you want to spell out for your investors who are looking at this business plan, describe in as detailed as possible. What specifically is the layout for your menu? Are you making a certain type of cuisine, a certain niche of cuisine, something that sells really good, where you are.
Do you have the clientele for that? Fantastic. Then you need to spell that out as the, as a menu and you need to give your potential investors and understanding of what that is going to be. And down the road, are you going to change your menu? And if you do make that in addition to the section five in your business plan too. So they know that maybe your menu is actually very easily adoptable to seasonality. It could be something that's seasonally driven. There may be certain times of the year that you know what, spring and summer I do more of this type of food. And that's good. It's going to be in during the fall and winter time, I'm actually going to attend these events because then I'm going to change up my menu and serve this. So having flexibility with your menu on your food truck, you don't always have to be in stone. That's one of the really cool things about having a mobile food business. Is that not only can you take yourself in a lot of different places, but you have the ability to change up your menu as you go to those different places.
All right. So next up is going to be section six. You want to put in your food truck, business plan, marketing and sales. So this is going to be an interesting part, which is going to be heavily upon your ability to market and promote your truck, which to be honest with you, and the majority of that will need to be done on social media. So you need to explain what types of either website you have set up, what type of social media accounts are you going to focus on Twitter and Instagram? Maybe? a lot of food trucks actually lean more so towards Instagram and Twitter, because you can do a lot of instant shots. You can have a lot of customers at certain events within seconds, posting images, thumbs up. They can also critique it and be on, on Twitter and Instagram at the same time and get that promotional aspects done right at certain events.
And that way you can build up a local following. But yes, you want to spell out anything that you're going to be doing on social media. Okay. You need to also include some type of a sales strategy. You want to have pricing for your menus. You want to have basically requirements for your minimum sales at other seasonal events or local events. You want to spell out to your potential investors, that your business plan understands what you're going to be required to sell in order for it to be profitable. If you're going to look at certain events, know how many people are there set sales goals? How many units do you need to sell in order for you not only to pay for your fee that you potentially have to pay to get into the event, pay create enough sales that you're going to meet payroll, make enough sales, that you're going to be profitable and not just simply breaking even. So these are the types of informations and a little bit of sales and potential projections that you think you're going to be doing in regards to these different events. So that's going to be under marketing
In sales. Alright,
So next one up is section seven, the financials. So basically this is going to be the area that you're going to spell out. What types of funds you're going to be needing for you to start. And you're going to be spelling out the types of requests that the amount of money that you're going to be looking for from an investor, but you need to be specific as to how that money is to be spent. So for instance, obviously if you're purchasing a truck and maybe it's a used truck, it sounds like a great price. And let's say, as an example, you're getting it for $15,000, $20,000, that's on a low end, but then you have to retrofit it and you need to have additional equipment put in and maybe even equipment taken out. And you have to hire that, have that customized to specifically what it is you're doing.
So now you're looking at dropping another 30,000 or 50,000 in it just to bring it up to where you want it to be and even bring it up to the health code standards that are going to be also required as well. So if you're doing that, this is where the section about funds comes into play, and you need to request, how much are you going to be looking for? And how much of that, and specifically break it down as to where it's going for equipment for labor, to have it put in for any type of modifications, additional hoods that have to be put into it as well refrigerations or coolants, deep fryers, whatever it may be. That's where you want to put it in, in section seven. You want to make sure that you're spelling out how much funding you need and where are the funds going?
All right. So section eight, this is going to be a super ultra kind of wrap it up at the end. But at this one's probably one of the most trickiest to do, and that is projecting your sales, okay. A sales projection. Now this is a real challenge to do, obviously, because number one, you probably have never done a food business of any kind, let alone a food truck. And how can you project what you would sell? Well, there are some ways that you can do that. Number one, research, the events you want to go to find out how many people will be going to those events, check with any information, data, or statistics that you can get from those events, the ones that are directing the events that are in charge of those events. See what kind of information you can get about the food sales at that event.
Then that way you can kind of project, if you were to attend that event, okay, how much would you actually sell guesstimate? You're going to have to really estimate this and figure out how much you would be selling there. And then that way you can figure out how much your profit would be, how many people you would need on staff, your expenses for that specific event. If it's one day, two day, three days or even a week. And then that way you have the ability to kind of forecast in a sense and figure out what kind of financial projections you're going to have over the next couple of years. Now, normally you want to do on average, about two to three years, some people go four or five or even six years out. To be honest with you, the one that we did when we started to write our business plan for our bakery, we did three years for us three years was sufficient because we had just started and based upon where we were, because we're not a food truck, we weren't able to go to a lot of places.
We were a brick and mortar. We were there at that location. So us to decree create that type of financial projection was a little bit easier. So it's a little trickier at food food trucks, because of the fact that you're going to different events that could fluctuate with the amount of people there, plus the amount of people buying food and the competition, how many food vendors, how many food trucks. So there's a lot of variables that are kind of unknown, but you can get a basic idea and you can create some financial projections. So since it's definitely something you can do, but you definitely have to do a little bit of homework on that. Okay. So now those are the eight sections to create a food truck business plan. And if you're looking to create a successful food truck business, these are some great things to sit down and truly think about prior to you making a commitment to start one.
Okay. So start a food truck is definitely is not something that you can do for a couple thousand dollars. That's no way some food carts literally cost about five, six, $7,000 or more, but a food truck is going to be a big investment, but there are a lot of food trucks who turn out some serious dough and some serious sales every year. So I would definitely take a look at this. These are some great tips to get you started. And if you have any questions about creating a food truck business plan, please let us know down below. And we will hop on those questions as soon as we can. And we'll see you guys on the next video.
Thanks for watching marketing food online. And if you are looking to create your own food truck, start a home-based food business under the cottage food law franchise, a food operation start a packaged food business, private label, your own food product, sell on Amazon, get your own online store or sell food online. Remember to subscribe and check out these videos for more resources, take care.
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