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Business Plan

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Updating Your Food Truck Business Plan

Today we’ll discuss the importance of updating your food truck business plan and how this can increase the sales of your food truck business.

One thing almost all food truck business owners around the country need is more sales. Have you ever wondered how good business planning can help you find new customers for your mobile food business? The key for any owner is to take a step back from your daily routine and reconsider your strategy, as well as its impact on sales from your truck.

While you were busy building your mobile food empire, your local market or your customer base may have changed. You can sometimes identify these changes by asking other truck owners, searching online or joining a business class to give yourself some new angles.

Updating Your Food Truck Business Plan

After that, your goal should be to redevelop your food truck business plan by adding new sales initiatives to your mobile food empire milestones.

ach initiative should involve specific responsibilities that can be assigned to specific people within your organization, with start dates, end dates and budgets.

Here are a few steps that should set you on a trip to finding new customers for your rolling bistro and hopefully to higher sales as well:

Sell more to existing customers. This is the quickest path to healthy growth. The best example I’ve ever seen is a local computer store that reached out to its entire customer list and reminded them all that they were most likely overdue for upgrading their data storage, equipment, printers and software. The company created a special promotion and cleared a lot of their inventory in the process.

How could something like that work for a food truck business? The story illustrates how customers can be grateful for reminders, and be ready to say yes to improved performance. Essentially, there are three parts to it: Determining what you can offer that relates to your customers, how to turn it into an event and how to get the message out to customers.

And when you come up with something, put it into the milestones of your business plan. Give it a start date, end date, and a person in charge. Estimate additional sales so you’ll know, for next time, whether you underestimated or overestimated.

Review your pricing. Price is the most powerful marketing message you have. What’s most important isn’t the high or low of it, but how it matches your strategy.

Some food truck businesses are built around visible low pricing to bring people up to their service window and generate higher unit sales, while others offer higher quality ingredients and need a higher price to communicate that message. A problem with frequent low pricing is that your mobile food business may wind up losing customers who assume your menu items isn’t great because the price doesn’t match it.

Should you decide to revise your pricing, make sure you reflect that in your sales forecast, and in your marketing messages. Synchronize what you’re saying to your customers with what your price says to your customers. And then, most important, make sure you deliver the value you promise. Put that into your business plan as a task in the milestones.

Review your marketing message. That means both the core content of your message, and how you deliver it. Most food truck businesses use social media – particularly Twitter, Facebook, and LinkedIn to spread the word of upcoming menu changes or daily parking locations. Others truck owners are using older methods such as email marketing.

Find a way to make this effort concrete and measurable in your plan. Add specific measurement, whether it’s ads, page views, web visitors, retweets, Klout.com score, friends, links or whatever. And make sure to track results and follow up on results.

Expand into nearby markets. That means either selling something new and different to your existing customer base or selling what you’ve always sold to new types of customers. Either option is usually more realistic than trying to develop a completely new menu while trying to sell it to a different client base than you’re used to.

Whatever avenue you decide on, make sure to add it to your existing food truck business plan. As often as possible, include measurement and tracking so you can tell if you’ve successfully implemented the new plan. Then you follow up and review actual results regularly so you can see what’s going right and what isn’t, and make the necessary adjustments to maximize the profits your food truck brings in.

Do you have additional ways that updating your food truck business plan has helped your sales? Please feel free to share the below.

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As a start-up food truck owner, you may want to pay yourself last to conserve money for your business, but sometimes putting yourself first is the trick to succeeding.

With so many expenses to pay for your mobile food business such as a truck payment, commissary rent, food inventory and staff wages; it can be hard to fit your own salary in. And as a food truck vendor, you may assume you should put everything you make back into the business. Not so. The first thing you should do with your money is pay yourself first.

pay-yourself-first

Many food truck owners who bootstrapped their companies feel that paying themselves is a luxury; however, we feel (and will show you why) that it is a necessity for the success of your business.

Why You Deserve a Salary

If you’ve got a nice cushion of savings, you may not need a salary right now to pay your bills. But that could change, so it’s best to prepare for the day when your funds run out. Getting into the habit of paying yourself, even just a little bit, will give you money for personal expenses when things get tight or sales slow down. If your food truck business happens to fail one day, you would have gotten something for your efforts by paying yourself and saving money for that rainy day.

Giving yourself a salary can have tax benefits for certain business structured, as it will reduce your company’s profit. Talk to an accountant to find out what benefits your tax type (LLC, partnership, corporation) has with your salary.

Other benefits to paying yourself include:

  • You can save money for future business efforts or for personal use
  • You may work harder to increase revenues and thus your income
  • Investors (if you have them) see you are committed to growing your company
Build in Your Salary

Plan your salary from the beginning. When you set up your budget and food truck business plan, include at least a small salary (weekly, bi-weekly or monthly) for yourself. If you’re going to be seeking financing, having your salary built in is key, as it will increase the amount you ask for from investors. In this case, determine how much you need to live, as well as what you’re worth.

If you’re bootstrapping, start by paying yourself a modest salary, even if it’s just a few hundred dollars a week. This can increase as your profits grow. You can also pay yourself through employee benefits such as health insurance or 401K investment.

When to Not Pay Yourself

There are a few instances when you can delay paying yourself:

  • You don’t have enough to pay for your food truck employees’ paychecks or pay bills to your suppliers, delay paying yourself until these expenses are covered.
  • You have significant up front expenses, you can delay your compensation until all expenses are covered with money brought in from food sales.

You’ve achieved something great by starting a food truck business. As a culinary entrepreneur, you’re willing to take risks to grow your mobile food business. You deserve to be paid, just like any of your employees. Invest in yourself just like you do your food truck.

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So you’ve decided you want to start a food truck but you don’t have the start up capital to do it on your own. A business plan for your mobile food business is going to be an important first step, but if you’ve never written one, you may wonder what you have to do to complete this task.

how to start your food truck business plan

How does one get started on a business plan? There is no absolute route to follow, it depends on who you are, what you do well and how you think. The people who own food trucks (or those who want to) are all different.

An easy way to look at business plans is to see it as a collection of components or modules, that can be started wherever you feel most comfortable.

Here are five areas of a business plan you can start with depending on which one is best for you?

SWOT Analysis

This is a collection of thoughts organized into four categories: strengths, weaknesses, opportunities and threats. Ideally you gather a small group of people together for just an hour or two, you have somewhere to write out thoughts into bullet points. The SWOT almost always leads to simple, practical strategy.

It’s really hard to do a SWOT without thinking about how to focus on strengths, work around weaknesses, seize opportunities and avoid threats.

More information on creating a SWOT Analysis

Simple Sales Forecast

Your sales forecast is a snapshot of what you think your food truck revenues will be for a few months at the very least, ideally 12 months by month and two more years just annually. Break your forecast into tickets, average revenue per ticket, number of sales, average cost per ticket. From here, the math is simple. Sales is the number of tickets times revenue. Costs are tickets times average cost per ticket.

What happens to most people is that thinking through the details of the sales forecast gets you into business planning. You can’t help thinking about prices, costs, target markets, strategy and focus.

Mission Statement, Vision Statement and Mantra

The mission statement is about what your food truck business does for the customer, the employee, and the owner. The vision statement is a view of what you want your mobile food  business to be three years from now. And a mantra is a simple sentence summary.

Try to avoid simple hype. Test it yourself by asking these questions:

  • Does this describe my food truck in a way that it differentiates it from my competitors?
  • Would a customer read this and identify my business with it?
  • Is this what one customer would tell another about your food truck?

Develop your core market story.

Invent an ideal customer and tell yourself the story of how they identify a problem, or something he or she wants, searches for it, and finds your food truck. Make the story an explanation of what the problem was and how your mobile food business solved it.

Talk to 10 Prospective Customers

I’m always amazed at how much business thinking comes out of the simple process of talking to real people about your real business. Do it right: Find people willing to talk to you and take some time with them. Start by making sure they don’t think they are supposed to tell you what you want to hear, but rather, the truth.

Any one of these five first steps might be right for you. All of them can help you get going, and they are all good steps to take regardless of what follows.

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tip of the dayWhen preparing for the future of your food truck business, you will need two plans.

One you write down (the formal business plan), and one that’s unwritten, fluid, and evolving.

This blueprint of your food truck empire exists in your mind as a living, changing understanding of where you’re going, why you’re going there, and how you’re going to get there–all based on your current understanding of how the future of your mobile food truck business will unfold.

While your written business plan includes specific objectives, action steps, and clear assumptions, the unwritten one consists of gut feel, general direction, and broad priorities. Over time, as you gather information and test ideas, you’ll move many of these elements from hazy and unspoken to focused and written.

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As a food truck owner, you probably have a business plan that states what you want your food truck businesses to accomplish, what threats you see, your financial projections, and how much money it will take to get you onto the streets of your local market. But have you created a roadmap of how to get there, or just the story of what “there” looks like?

business roadmap

I have had the privilege of helping many prospective and existing food truck owners on a daily basis since starting mobile-cuisine.com. In almost every case, the mobile vendors have a business plan, but very few have a roadmap of how to achieve their goals or to monitor their progress along the way. That’s what I call the ‘missing link’.

You need to create a one-page, actionable, post-able, and unforgettable strategic plan that your entire mobile food organization can rally around. This process will help you identify priorities, ensure alignment within your team, and commit to decisions long enough to judge results that move you towards your one, three, and five-year objectives.

Here is a brief outline for which priorities to include on your food truck business roadmap:

Create and enlist objectives

This list should drive pretty much every decision within your mobile food organization. It is important to set both long and short-range goals. Long-range priorities do not change often and include: core-values, risky goals and priorities in the three- to five-year range. Short-range priorities include critical quarterly ”bumps in the road” that must be accomplished to move your organization toward the defined one year and three- to five-year goals.

Track your progress

Making goals is one thing. You should also vocalize them and identify key performance metrics that should help you know if you’re on the right track. Be sure to communicate your progress on your short-range and long-range goals.

Meet regularly

Schedule regular meetings to build rhythm and ensure accountability. I recommend holding a short meeting each day to gauge your team’s progress and to remedy any sticking points. At the weekly meeting, discuss “good news,” customer/employee feedback and review key performance metrics. Then, each quarter, take one to two days and review the past quarter vs. the plan. The goal of this meeting is to update the one-page plan, including any new three-month “bumps in the road” or bigger changes to your strategy.

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Your food truck may have a great menu or excellent service but your mobile food business won’t grow unless people know you’re out there. That requires marketing; online, mobile, on Google, Facebook, direct mail or even printed flyers on doorstep. But where do you begin?

It all starts with a marketing plan. A marketing plan for your food truck is s a written strategy to help achieve your goals and spread the word about your mobile kitchen on wheels.

Here are three apps food truck owners can use to help you figure out your needs, understand your competition and develop a cost-effective marketing strategy: 

Marketing Plan PremierMarketing Plan Premier

This comprehensive iPad app is both a fill-in-the-blank tool and a mini-marketing text book. Marketing Plan Premier relies heavily on the idea that all good businesses provide a solution to a consumer problem. The initial steps involve defining that problem and how your food truck solves it.

From there, the app helps you analyze your competitors, determine your target market and come up with a price. Finally, the app briefly runs you through options for advertising.

Once you fill in all the blanks, Marketing Plan Premier inserts your answers into a pre-written multi-page, executive summary. You can export the finished Word document by email or through Dropbox.

Price: $9.99

Marketing Plan AppMarketing Plan App

If you don’t need a lot of guidance, Marketing Plan App can get you similar results in less time. The app is available for iOS and Android, and it’s formatted to work with the smaller, mobile phone screen.

This app can help you craft everything from your Vision Statement and market analysis, to helping you determine your marketing budget. After you fill in the blanks, save the document as a PDF or Word doc, then email to export or print straight from your device.

Price: $9.99 for iOS, $7.99 for Android. 

MarketMyBizMarketMyBiz

This marketing plan app comes from a very unusual source: the government of Australia. MarketMyBiz is an app for the iPad or Android tablets. It isn’t as wide-ranging as Marketing Plan App, but the navigation structure is intuitive and you won’t get bogged down in boxes as you move from page to page.

This app also includes a section that helps you discover your weaknesses and helps you create a plan to address each one.

When you’re finished, MarketMyBiz compiles your answers into one, simple report that you can print from the tablet or email as a PDF.

Price: Free

Do you know of any other apps designed for solving marketing plans solutions? If so, please share them in the comment section below.

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food truck business plan

If you don’t have a food truck business plan yet, we explain the importance of it and why you need to start one today.

Have you ever thought that starting a food truck business or other variation of a mobile food eatery? Whether you are already culinary trained or a home based foodie who is interested in taking their show on the road, there are a few things to consider before taking the time, money or effort to begin your adventure. A common question we receive is how to attain capital for starting a food truck business.

In today’s economy, many have drained their savings accounts, and maxed out their personal credit lines. Because of this they need to reach out to others to get this money. The solution lies in coming up with a well thought out and professional food truck business plan that can be submitted when they apply for loans. Unfortunately, many people have never learned how to write a proper business plan and immediately look to the Internet to search for a food truck business plan sample or template they can purchase. In our opinion, this is the wrong solution.

Don’t buy a food truck business plan sample

When purchasing a food truck business plan sample, people often force their concept into the boilerplate template rather and creating a plan that highlights it. A friend of MCM had recently made this type of purchase, filled in the blanks and gave it to us to review. Our first question was how he had determined that within his first five years he would have 15% growth annually. His sheepish answer, “it was in the food truck business plan sample.”

There are certain points that financiers will look at when reviewing you loan application which will include a food truck business plan. Too many of the available templates just don’t cover them.

When you sit down to start writing your plan, you must remember that it is your argument to show your idea is worth backing. Those that use the excuse that they cannot write a food truck business plan are the same people who have never thought out all of the aspects of starting a food truck business. In other cases they may have thought out the business aspects, but have not taken the time to understand what holes exist in them.

Questions a food truck business plan should answer:

  • What problem or problems exist that your business is trying to solve?
  • What is the potential consumer’s pain?
  • How deep and compelling is this pain?
  • What solutions does your business have to resolve the problem(s)?
  • How much will it cost to solve these problems now?
  • What will the customer pay you to solve this problem?
  • How will solving this problem make your company a lot of money?
  • What alliances or relationships can you leverage with other companies to help yours?
  • How big can your business growth if given the requested capital?
  • How much cash do you need to find a path to profitability?
  • How will the skills of your business team, their business knowledge, and track record of execution make this happen?
  • What will be the investors’ exit strategy?

food truck business planOne additional word of advice; once you have written your food truck business plan but before you pass it on to a lender, do as our earlier example did, have it reviewed and read by a friend or relative. After they have read it, have them give you a verbal explanation as to how they think your new business will work, based on your plan. If they do not understand the plan or cannot explain the business concept from what you have provided, there is a very good chance that a financier will not understand the business concepts either.

If they have questions, incorporate the answers into the plan or clarify an answer so that the question is automatically resolved when the financier reads it. In most cases, this is a business that you know about. This becomes another stumbling block people will run into. They write their business plan so that it is self-explanatory, but leave it at that. The business plan you write for your future food truck, cart of catering venture must make sense to those who are reading it, and most of them, know nothing about our industry.

We hope this article was helpful for those of you who maybe thing about starting a food truck business.

Still have questions about writing a food truck business plan?

You can find a full breakdown of each food truck business plan section in my book, Running a Food Truck for Dummies. If you’ve read the book and still have questions please feel free to submit a question in the comment section below or to admin@mobile-cuisine.com, we promise to get back to you as soon as we possibly can about your food truck business plan.

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jump-start

One of the most popular articles to date at Mobile Cuisine is Writing a Food Truck Business Plan where we covered the aspects of writing a business plan for your future food truck business. Due to its popularity, we are in the process of putting together a through example of a plan that will be downloadable for our readers use. Until that project is finished, we have decided to add another article for those currently working on a plan and are having a tough time finishing it.

 

The most common question we receive on this topic is how long it should take to put a complete project together. Unfortunately, it’s not something that you should be able to develop overnight unless you have quite a bit of experience in putting business plans together. Because of this, we felt we would give you some tips to help in your business plan creation.

Rome Wasn’t Planned, Funded, and Built in One Day

The process of putting together a coherent business plan will probably take longer that you estimate. Along the way you will probably stop and think, “you know, we haven’t really thought our strategies out very well, have we?” or “we don’t really know our competition as well as we thought we did,” and you will take the time to hone your strategies and get up to speed on the competition before you finish the plan and present it to prospective lenders.

Start Small

Start your business plan as an outline. By breaking the large task down into smaller components, the task won’t seem as scary. Your business plan should be looked at as simply as the answers to a series of questions.

Change Things Up

The visual aspects of the document should not be overlooked. Color charts, tables of data to break up the text, paragraph headings and varying the type styles all contribute to making a plan easier to read and to clearly explain your thoughts.

Study

People who write novels are generally those who have read many, many, stories. They learn their craft by studying the works of their favorite authors. You need to do the same thing. Look at examples of business plans to get in your mind the writing style, the sequence in which the ideas are presented, and the parts to a plan.

Sample plans are available on the Internet at sites devoted to assisting entrepreneurs in just about every business. I would suggest looking at plans structured on a restaurant, bar or if you can find one, another food truck.

Pick An Easy Section

If you have never written a business plan before, you may have difficulty getting the project started. It will seem as though you have an awful lot of blank pages staring back at you. To get the plan moving, start with the section that is easiest for you, or of most interest.

Quality Time

People often underestimate the effort and energy it takes to write a business plan. They try to write it at night or when everything else at work is finished, in other words, when they are mentally and sometimes physically exhausted.

A better approach is to write the plan when you have energy available to put into it: go in early and think and write for an hour before the phones start ringing.

The First Draft

The first draft of your plan will undoubtedly resemble incoherent ramblings or a jumbled stream of ideas that look nothing like what you had hoped it would. Don’t let this get you frustrated.

Take A Break

Put the draft away for a few days, come back to it fresh, and begin revising and rewriting. Magically, after several more revisions, the ideas will all come together and the language of the plan will flow.

Your Plan Needs To Look And Sound Like You

Your business plan should reflect the personality of your management team, and the type of mobile business you want to create. As the reader (aka lender) goes through it, they should get to know the people involved in the company, their vision, their objectives, and their enthusiasm for the company and the mobile food industry. Tell the story of your food truck in your own voice.

Not Everyone Is A Professional Writer

Business plans are essentially works of fiction. They are documents that discuss what you imagine, plan and hope may occur in the future of your food truck business, not what has already occurred. This type of writing is difficult for everyone. You’ve heard of “writer’s block”.

The problems you are having keeping the words flowing are precisely the ones faced by professional writers, except many of them have to keep going because the publisher has given them a unreachable deadline and they’ve already spent their advance, but you of course, having read tip #1 Rome Wasn’t Planned, Funded, and Built in One Day have allowed plenty of time to finish the business plan; so there’s no reason to feel pressured. Right?

 

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tip of the day

We get a lot of inquiries from people kicking the tires so to speak, interested in opening their own food truck. For a lot of these individuals, owning a restaurant or a food truck has been a lifelong dream. They can imagine every detail, and its lines are filled with happy customers who will return again and again. For a lot of these people, they have a certain idea of what it is going to be like to own their own mobile food business. But oftentimes, when the preparation isn’t there, the reality is nothing like the dream.

Running a food truck can be a hard business to operate successfully. To convince the banks and yourself that you can make it in the mobile food industry, you must first do your homework.

Start with a business plan, including in-depth research on the market. The statistics prove it, but you still might be shocked at the number of food truck owners who have never created a business plan.

To ensure your success, a business plan is essential. Include details such as what makes your concept unique, your planned menu and type of service, your price points, a detailed evaluation of the market and your target demographics, your marketing plan, your financial plan, your operational plan, including your key players from industry experts and management to key suppliers and your CPA and attorney.

The financial plan, the most important part, must show on paper that you can make the concept work. Lenders of all types look for these key financial indicators to predict your success:

  • For every dollar you borrow, you plan on bringing in $1.25 in first-year revenue
  • Your overall debt stays between 8–12 percent
  • Your biggest expense, prime cost (total labor cost plus total cost of goods sold) stays under 55 to 60 percent (aim for 55 percent to be safe).

You’ve got a real shot of not only getting the funds to open, but a real shot at success if you do your research and create a strong business plan with smart financials.

If you’re reading this and you’re a food truck owner without a business plan, remember that it’s never too late to plan. You can still develop a business plan that will guide your business into the future. You might be surprised by what you find and what your restaurant’s potential is. For more information business plan creation, check out this food truck business plan article.

 

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