Food Truck Industry to Grow from 615M to 2.7B in 5 Years
The mobile food industry is growing! This is something we have been saying for the last two years, but now we have an idea how much. Below is a review of the study by Steve King of Emergent Research.
Food trucks are hot. They represent local, fresh, fusion, authentic and hip all in one convenient dining experience. Research indicates that food trucks are not just a fad, but a viable market segment with significant competitive advantages relative to quick serve, fast food and take-out food vendors.
Jumping onto the foodwagon, Intuit recently released “Food Trucks Motor Into the Mainstream,” the latest Intuit 2020 Research Report that assesses trends and impacts of the rapidly growing food truck industry in the U.S.
Emergent Research, Intuit’s partner on this research project, forecasts the food truck industry to continue its rapid growth. By 2017 food trucks will generate about $2.7 billion in revenue. This is a fourfold increase from the 2012 food truck revenue estimate of $650 million provided by the National Restaurant Association.
Research for this study took place from May-August 2012. As part of the study, Emergent Research conducted in-person interviews with 272 food truck customers. The team also interviewed 27 food truck owners or managers in person, by email or on the phone. All interviews were conducted in San Francisco or nearby suburbs.
The Customer Experience
Survey results show that food truck customers like the food and enjoy the experience. More than 90 percent of the diners interviewed rated food truck quality as either excellent (43 percent or good (48 percent). Just over 80 percent of those interviewed used words like fun, exciting, new, different, unusual and unique when asked why they dined at food trucks.
Diners also like the speed and convenience of food trucks and are willing to pay for quality. The average customer interviewed spent $9.80 at lunch and $14.99 at dinner. Almost all diners interviewed said they planned to continue patronizing food trucks.
Food Trucks as a Business
Interviews with food truck owners and operators revealed a very Silicon Valley flavor. Most food trucks were started and operated much like lean tech startups. Reflecting the tech industry’s Lean Startup movement described by entrepreneur Eric Ries, food truck owners focus on rapid prototyping, business flexibility, cash and resource conservation and a laser-like focus on customers to quickly adapt to market needs.
- Food trucks cost much less to start and run than a traditional brick-and-mortar restaurant. They can also quickly and easily test new concepts, menus and recipes.
- Food trucks are tightly focused on their customers, interacting closely and intimately with patrons every day, both in-person and through the extensive use of social media. These interactions provide instant insights into menu and food preferences.
The food truck industry has tapped into powerful consumer trends, especially the desire for fresh, local, quality food served quickly and conveniently. They can test new products real-time with daily menus. Using social media and geolocation tools, they broadcast new food concepts while being easily found in unique and often changing locations. These trends, coupled with their low cost and flexible business model, will drive food trucks to continued success.
Read the entire report <here>
Emergent Research: Steve King and Carolyn Ockels are partners at Emergent Research, a consulting firm focused on the most dynamic sector of the global economy – small businesses. Together with Intuit, they’ve authored The Intuit 2020 Report and The Intuit Future of Small Business report series that look at significant trends and forces affecting small businesses and consumers. Follow Emergent Research on Twitter, @smallbizlabs.