Tags Posts tagged with "Start Up"

Start Up

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accounting tips

Unless you were an accountant before deciding to become a food truck owner, the word “accounting” probably makes you a bit uneasy. For new food truck owners, this feeling is usually much worse. After all, bad bookkeeping when a business opens not only puts you in a hole in the short term, it can come back to bite you in the backside over time. Don’t forget; even start-up food truck businesses can get audited.

Now that we’ve made you feel even more uncomfortable, there are ways you can avoid having your tax submissions getting flagged by the IRS. Here are a four beginner accounting tips to help start your mobile food business.

4 Accounting Tips For New Food Truck Owners

Make It Part Of Your Schedule

In the same way that you go through your email every morning, or in the same way that you tirelessly prep for each day in your truck, make your accounting work a habit. Set a recurring alarm on in calendar: “Review The Financials!” The frequency you do this is up to you, but you need to set aside time for accounting at least once a month, if not more.

Learn The Jargon

The terminology of accounting can seem like it’s another language and in some cases it is. Accrual? Imprest System? Key Ratios? Accounting jargon isn’t usually in the average person’s day to day vocabulary.  So take some time to understand the basics. The U.S. Small Business Administration’s Small Business Center is a great place to start.

Find The Right Software

Find the accounting software that you feel comfortable using. Don’t simply grab the first one you find. Research the various options you have and relate them to the way in which you will be using it? Do you have POS system that will provide financial reports? Find software that is compatible with these reports.

Look For Advice Locally

Chances are, if you spend enough time trying to figure out an accounting issue, you could. But the reality is, you’ve got a food truck business to operate. Since you need to file taxes quarterly (not just annually) you need to place a bit of urgency to get these issues solved. Speak with other local food truck or restaurant owners in your area. The years of accounting they have seen will probably lead to an answer faster than any other place you look.

Food truck owners familiar with the SCORE program offered in communities across the country have used this group as a local resource to get accounting questions answered.

Another route is to set up food truck owner working groups where you can invite a local accountant to speak on common problems the group members run into. Look for an accountant or bookkeeper who specializes in food service businesses. If nothing more, they’ll be a voice of comfort if you receive some alarmingly confusing IRS mail.

Once you have taken these steps you’ll realize that accounting doesn’t need to be scary. Start off on the right foot and you might actually find that it’s fun. Ultimately, you need to understand the financials in your business to be able to make corrections if your profit just isn’t where it needs to be.

Do you have more accounting tips for the new food truck owners out there? Please share them with us in the comment section below, Tweet us or share them on our Facebook page.

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Start Up Food Truck Business Tips

While I have yet to open my own food truck, I have been watching the industry for a long time now. I have kept an eye on many of the food trucks that have opened since 2010 and watched as many have succeeded beyond their owners wildest dreams.

At the same time, I have seen many food truck operators flounder. Running a food truck is not an easy road to follow, but if done properly it can be the most rewarding venture you will ever enter into. We hope the following list of start up food truck business tips helps you steer down the path to success.

8 Start Up Food Truck Business Tips:

Focus. Many first-time food truck operators feel the need to jump at every “opportunity” they are approached with. Opportunities are often wolves in sheep’s clothing. Avoid getting side-tracked. Juggling multiple ventures will spread you thin and limit both your effectiveness and productivity. Do one thing perfectly (your food), not 10 things poorly. If you feel the need to jump onto another project, that might mean something about your original concept.
Know what you do. Do what you know. Don’t start a food truck simply because it seems sexy or boasts large hypothetical profit margins and returns. Do what you love. Mobile food businesses built around your strengths and talents will have a greater chance of success. It’s not only important to create a profitable mobile venture, it’s also important that you’re happy managing and growing it day in and day out. If your heart isn’t in it, you will not be successful.
Say it in 30 seconds or don’t say it at all. From a chance encounter with an investor, a curious customer or even a local news crew, always be ready to pitch your food truck. State your truck’s mission, service and goals in a clear and concise manner. Fit the pitch to the person. Less is always more.
Know what you know, what you don’t know and who knows what you don’t. No one knows everything, so don’t come off as a know-it-all. Surround yourself with advisers and mentors who will nurture you to become a better mobile food vendor. Find successful, knowledgeable individuals in the food truck or restaurant industry with whom you share common interests and mutual business goals that see value in working with you for the long-term.
Act like a startup. Forget about a fancy office and fat expense account. Your wallet is your company’s life-blood. Practice and perfect the art of being frugal. Watch every dollar and triple-check every expense. Maintain a low overhead and manage your cash flow effectively.
Learn under fire. No food truck business book (although Running a Food Truck for Dummies comes close :)) or business plan can predict the future or fully prepare you to become a successful food truck operator. There is no such thing as the perfect plan. There is no perfect road or one less traveled. Never jump right into a food truck business without any thought or planning, but don’t spend months or years waiting to execute. You will become well-rounded when tested under fire. The most important thing you can do is learn from your mistakes–and never make the same mistake twice.
Be healthy. Owning a food truck is a lifestyle, not a 9-to-5 profession. Working to the point of exhaustion will burn you out and make you less productive. Don’t make excuses. Eat right, exercise and find time for yourself.
Don’t fall victim to your own B.S.  Don’t talk the talk unless you can walk the walk. Impress with action not conversation. Endorse your business enthusiastically, yet tastefully. Avoid exaggerating truths and touting far reaching goals as certainties. In short, put up or shut up.

While there are many more tips that I could have given, this list is a great starting point. If you have additional tips, please feel free to share them in the comment section below.

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reality check sign

Jumping into the mobile food industry without first understanding the effect it will have on your personal financial situation is a serious mistake. Too many food truck start-up owners I’ve spoken with haven’t taken the time to calculate the real financial impact before jumping in with both feet.

I think a lot of people mistakenly believe that when they start a food truck there will be money coming in right away. You can certainly hope there will be some revenue soon, but probably not enough to pay yourself.

From a personal financial perspective, there are three major questions you need to ask yourself:

How Much Can You Afford to Lose?

Some people are willing to gamble everything they’ve got to get their food vending business on the road. They are so committed to their concept and vision that nothing else matters. Reckless? Perhaps. There are many stories of people who were on the brink of bankruptcy and refused to give up their dream—but their persistence, determination, and passion paid off because they hung in there and were able to go the distance. Of course, there are even more stories in which the opposite is true.

Other potential food truck owners don’t want to risk any of their personal assets. Often, people tell me that they don’t have any money to start their business, or they simply don’t want to invest any of their own funds, so they want to know how to get a loan. Please Note: No lender is going to offer you a loan if you don’t have any skin in the game.

You’ve got to put your money on the line, too. Unfortunately, there’s no rule of thumb formula that suggests how much money you should invest in your new food truck business. That answer depends on your own circumstances. However, you should know that food trucks rarely get funded by using other people’s money. This is particularly true if you are a first-time vendor, without any record of success.

How Long Can You Survive?

In the early stages of most food trucks, most don’t generate enough money to pay the owner a salary, so in your financial assessment you need to consider the likely loss of income.

Most experts recommend that you have at least six to twelve months of living expenses saved before you launch your mobile food business. If you have a spouse or significant other who can support you or share expenses for a while, that will certainly make the transition from employee to vendor easier. But it also means that whoever is going to cover the bills for a while needs to be as committed to your business success as you are. Set realistic expectations in terms of how long it may take before you can generate an income again, keeping in mind that it always takes longer than you think it will. Do a personal financial review and create a budget. Without your income, you may need to do some belt-tightening.

What If Your Food Truck Fails?

Yes, it’s important to always think positively about your food truck venture, but you also have to be realistic, by planning for the worst-case scenario. So what are you going to do if your food truck fails? You’ve lost both time and financial investment; can you live with the consequences?

Consider your age. How long do you have to rebound financially from a failed business? The younger you are, the better your chances are of recovering. Be very careful about using retirement savings for the initial capital your business needs, especially if you are over 40. Beyond a certain point, it becomes difficult to rebuild your retirement nest egg. Also, keep in mind the taxes and penalties that may be imposed should you decide to tap into those funds. I know that when you need money to get started it is tempting to dip into that pot, particularly when you are confident your business is going to be a success. But remember, the odds are not in your favor.

Your Personal Credit Rating

Although it isn’t easy to obtain financing for a food truck business, it isn’t impossible. However, if you are seeking funding to start your business, you have to make sure your personal credit is in good standing. Your personal credit rating will also be important for establishing credit with suppliers.

If you don’t know what your credit rating is, you can obtain one free credit report annually from each of the major credit rating agencies: Equifax, Experian, and TransUnion.

Once you receive your credit report, review it to make sure it’s accurate. If you find errors on the report, get them corrected. If you have a low score, now is the time to try to improve it.

On A Final Note

Becoming a food truck owner has its advantages and disadvantages, its risks and rewards. You’ll face adverse situations caused by circumstances out of your control and overcoming these setbacks and keeping your mobile food business profitable will require long hours of hard work.

Now ignoring everything else I’ve written up to this point, there is one thing I can assure you. From all of the vendors I have spoken with over the years, I have learned that starting and growing a mobile food business is one of the most rewarding experiences you’ll ever encounter. It’s your baby and when it works as planned nothing beats it.

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food truck advertising

Spring is in the air and more food trucks are getting ready to launch their grand openings. So how do they get the word out to their community? Do they just pull up to their first stop and hope that the wrap on their truck is enticing enough to get their first customers?

In many cases we’ve seen some food truck owners fall flat with lack luster opening day/week/month performances.

Advertising has always been a way to get the word out about new businesses; unfortunately, many truck vendors miss the opportunity to shine because they neglected to build an audience or customer base before their inaugural push.

Here is a sample food truck ad campaign that will get a line started at your service window.

Business Name: <Insert Your Truck Here>

Slogan: <Insert Your Truck Slogan Here>

Locations: In list form provide all of your scheduled stops for the week (location and day). We’ve provided some examples.

  • Local Mall (Monday/Thursday)
  • Downtown Plaza (Tuesday/Friday)
  • Local Bar or Pub (Wednesday/Saturday)

Printed Advertisements

Here are few ways you can use print media to advertise your campaign.

  • Flyers at each shopping center entrance with dates/times
  • Newspaper ad/BOGO coupon
  • Local entertainment magazine feature story with owner
  • Flyers at community center and library.
  • Flyers in the pub you are partnering with.

Radio/TV:

Want to use the public airways to get your message out? Here are some topics to pitch your local affiliates.

  • Interview on local television morning show about truck concept and campaign.
  • Live radio remote from food truck grand opening.

Signage

Even though your food truck is a huge sign, there are other ways to inform the public about your location with the help of directional signage.

  • Signs on stakes with arrows at each location while truck present.
  • Sign at each location indicating when truck will return.
  • Sign on mall or bar marquee introducing food truck.

Social Media

This is where food trucks have shined…and for good reason. Most of these can be done for little cost (if any at all).

  • Facebook page: Check In for a free upgrade to a large shake.
  • Twitter: Daily tweets about locations, discounts and specials of the day.
  • Instagram: Show us your Instagram pic for 50% off your next visit.

Giveaways

People who may know nothing about you (especially if you are preparing to launch your grand opening) are always enticed with the offer of free or discounted food.

  • Free drink coupons for people who attended a movie at the mall. Bring in your movie ticket stub for 10% off your purchase.
  • Register on your website to win a week of free entrees.
  • Bring a friend the next day to receive 50% off for you, 10% for friend.

Please be warned…an advertising campaign will get initial customers to show up, but the food your team serves and the service you provide will be what brings them back.

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10 commandments of starting a food truck business

From my years of covering the mobile food industry and speaking with some of the most successful food truck vendors, I have created this list of 10 factors that most often contribute to the ultimate success or failure of any new food truck.

  1. Thou Shall Work In Foodservice Industry First. Cook, clean and manage some personnel. Hands-on experience working with staff and serving the public will tell you if you are a fit for the mobile food industry. If this isn’t a possibility, speak with folks who can explain the hours and tasks a food truck owner needs to be able to deal with to succeed.
  2. Thou Shall Define Your Concept. Don’t try to do too much. You can add and modify a little as you go to stay fresh, but don’t confuse the customer with too much at your grand opening.
  3. Thou Shall Research Local Food Truck Legislation. Not understanding how your local municipality regulates the mobile food industry can quickly lead to improper food truck builds, wasted time and money. This research will also inform you what it will take and how much it will cost to get fully permitted and licensed.
  4. Thou Shall Plan Ahead. Building a successful food truck business requires a lot of planning. This must include creating a fully executed business plan. This tool will help you (and possible investors) understand your concept and what you will need in order to operate and thrive.
  5. Thou Shall Lead & Supervise. Be involved in everything from the layout and construction of your food truck kitchen to the hiring of employees. Opening a food truck requires an owner who is present and leads their mobile food business.
  6. Thou Shall Preform Site Selection. You don’t have to be an expert in market analysis, but before you start, select a few local spots where your truck will operate. Once again, speak with food truck owners in your area, almost all of them will tell you their experiences with certain parking locations.
  7. Thou Shall Develop A Budget. Don’t forget the little things when budgeting for your first year of business. Build in contingency and operating capital for at least your first six months of operation.
  8. Thou Shall Select Your Suppliers. Visit and compare your bakery, produce, meat and grocery suppliers. Team up with businesses based on service and quality, not just price.
  9. Thou Shall Conduct Training. You only get one chance to open. Allow employees enough time to learn your systems and hold two or three dry -run tests before your grand opening.
  10. Thou Shall Never Fear Failure. In order for you to succeed you need to face risks. Believe in what you are doing.

What say you? While there are plenty of other issues new food truck owners will face, I felt that these 10 commandments are the top factors someone planning to start a food truck business needs to understand.

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While scanning through our vast Twitter feed daily, we are able to monitor the food truck industry for trends. One of the most recent finding we have stumbled across is that food truck owners tend to stay in start-up mode way too long.

foot on brake food truck

Keeping your mobile food business in start-up mode is like driving your truck with the brakes applied. If you keep telling people you are new to the industry or still figuring things out,  you’ll never be able to take actions for real growth.

After reading this article we hope you’ll realize that it’s time to move your food truck from start-up to growth mode and from planning to actually doing. In two or three years, you want to be able to look back at your start-up phase as an important part of your thriving mobile food business’ history. You want to say something like, “I remember when I was the only one working in my kitchen prepping for my daily shifts. Now I employ 6 people and am on my way to owning a restaurant.”

This is the mindset we want you to move towards and here are five ways to do it:

Delegate

When you’re first starting your food truck business, in most cases you are handling everything. To begin growing you have to start investing in people to do tasks you can no longer do. We have found that nearly three quarters of all food trucks start with zero employees, which underscores the resistance some vendors have to delegating. You have to grow your business. Stop thinking that people cost money; your lack of production and failure to grow your food truck business will ultimately cost far more.

Pick Your Battles

Don’t get wrapped up for a week deciding on a logo when it ultimately doesn’t matter. Your food truck brand will evolve as your business evolves, so your logo is likely to change. There are far more important things to obsess over such as building a great menu, gaining customers and making money.

Get Attention

One of the most common problems start-up food trucks have is becoming known. Your most important task early on will be to spread the word about yourself and your mobile food business. Ultimately it’s the way to new and returning faces to your service window. In recent news, Candy Yoder of San Antonio had some issues with a venue banning her truck because of the name she selected “CockAsian”. She got national media attention (including a mention during last week’s Saturday Night Live), and offended some people. While she may have ruffled some feathers, her menu is turning criticism into loyal customers. Get out there and get attention, get critics and then get customers.

Throw A Change-up

Instead of saying “I own a small food truck company,” say “I own a food truck company that serves high quality <insert your food here>. It’s like nothing you’ve ever tasted.” Notice the difference? The first makes you seem small and insignificant. It makes no claim. The second makes you seem unique, confident and capable of being a huge success. Know how to pitch yourself and your food truck. Be ready to explain what your mobile food business does that is better, faster and of value to your local marketplace.

Create Urgency

If you start a food truck without setting specific timelines for action and achievements, you will be stuck in park forever. Pressuring yourself to perform should not lead to inferior products leaving your truck; it will end up with projects getting finished. Urgency is key to getting things done.

Your vision is not improved by staying in start-up mode. It’s time to stomp on the accelerator and become a food truck that is grabbing market share from the other more established players in your area.

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During the research for our list of the Top 20 US Cities to Open a Food Truck we looked at a number of variables that helped define those cities that a new food truck vendor would be able to build their brand with the best chances of success. To follow up that article we thought it would be fun to develop what we call Food Truck Utopia.

food truck utopia

We understand that a Food Truck Utopia will probably never exist, but can certainly be looked at as a model for cities to strive for.

The City

Politicians: FTU is governed by a group of individuals that are open and accepting to all small business. They refuse to protect one industry over another, and provide the local population with the ability to make their own choices when it comes to how they spend their money.

They will also have great communication with the food truck vendors at all times, not just when problems arise.

Legislation: The laws and ordinances that are developed to oversee the city’s food truck vendors will only be in place to protect the health and safety of the public. The fees to operate will be fair and consistent with all small businesses.

Also, food trucks will be able to park where there is space as long as they do not cause traffic or public safety problems. There will be no buffer zones, mandatory gps tracking, limited number of permits or time limits for parking.

Business: The business community within our city limits will not look at food trucks as competition and will not petition our politicians with requests to create a “level playing field.” They will understand that food trucks only provide the consumer with multiple dining choices.

The business owners will have the ability and desire to keep regular communication with the food truck organization to resolve problems they may have with it’s members.

Weather: Our city will have moderate temps throughout the year, but at the same time there are seasonal changes that require food trucks to consider menu changes that reflect the change in temperatures. The weather cannot cause the consumer base to want to stay indoors (ie heavy rain, extreme hot or cold temps).

The People

The vast majority of the residents will be foodies or people who appreciate creative culinary techniques. The FTU population will be employed middle to upper-middle class citizens of all ages, gender, creeds and races. They will be tech savvy and highly involved with social media. There will be consistent growth in the population, as well as continual growth in their disposable income.

The general public will spend a lot of their time outside of the home in our downtown areas and public spaces. Our citizens will also do a lot of catering for personal events or for the businesses they work for. As a final point, the people will go out of their way to attend the many food truck events that take place year round.

The Organization

There will be a strong food truck organization with direct communication to its members, local business leaders and politicians. The organization make sure its members follow the legislation put in place, keep their disagreements in house and provide a single voice to the community. The FTUMVA will make sure trucks do not squat on their favorite parking locations, stay mobile (read change locations daily) and keep them from parking in front of direct competing brick and mortar businesses.

The organization will also work with local businesses and charities to provide the members business and partnership opportunities. The will be educational classes (culinary technique and business management) provided to new and existing vendors and mediation work between members and other businesses that may have issues arise.

Additional Factors

  • Large number of commissaries or commercial kitchens to select from.
  • Public spaces where food truck events can take place.
  • An abundance of street parking.
  • Pedestrian friendly streets with a high foot traffic count at most times of the day.
  • Bars and businesses willing to partner with food truck organization members to fill their needs for catering for their own customers.
  • A fully staffed and trained health department to oversea the trucks and the kitchens they work from.
  • Surrounding communities that accept our food trucks within their city limits.
  • A large population of people within driving distance of our community full of people who want to visit our food trucks.

Please note that the city a food truck operates in is only a small piece of the puzzle of what makes for a successful food truck business. Yes it’s important, but the primary factors that build strong mobile food businesses are:

  • Concept
  • Quality of food
  • Quality of service
  • Ability of staff
  • Management of the business side of the operation (keeping food and overhead costs down, managing suppliers, marketing, networking)

Without a firm grasp and execution all of these principles it doesn’t matter where your truck parks or how open your community is to the mobile food industry, success will be nearly impossible to achieve.

We’d love to hear your thoughts on what a food truck utopia would look like. Please feel free to add your thoughts or suggestions in the comment section below.

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Before you run out and quit your day job to jump into the mobile food industry, take a moment to think about this major decision. While becoming a mobile food vendor is an exciting endeavor, it’s just not for everyone.

food truck question mark

Remember that this culinary adventure should be looked at as a long-term lifestyle change and commitment. You will pour blood, sweat, tears, and money into your food truck business, and if it doesn’t work out, you won’t be able to recoup that investment.

Here are a few reasons why starting a food truck may not be right for you:

Passion Without a Plan. While passion is requirement for a successful food truck business, it’s simply not enough. You also need to determine how you’ll make money and grow your business. If the idea of developing a business plan bores you or stresses you out, it might not be a good fit.

Not Enough Passion. Looking back at our first point; you have to be passionate and excited about starting a food truck business. You should be able to see yourself building your mobile food business for years to come. You need to be willing to do whatever it takes (work 80 hours a week, see your family less) to realize your dreams of food truck ownership. If you’re not, then it’s just not worth the pain of starting a food truck business to find that out.

Short on Money. Starting a food truck is not going to get you rich quick. It can take months before you turn a profit, and in the meantime, you’ll need enough cash to pay your daily personal and business expenses.

Big Changes. Maybe you just got married, or had a baby. If you’re in a transitional stage in your life, starting a mobile food business will add to the already high levels of stress you’re experiencing. Starting your food truck should probably be put on hold until things slow down.

You Just Want to be the Boss. If the appeal of not having an overbearing boss to answer to is your driver for starting a food truck business, consider this: your customers will be your new bosses. They’ll dictate much to what you do and how you do it. If they don’t like your menu, they won’t buy it.

You’re the Breadwinner. Shifting from one salary to support your family to an erratic, mobile food vendor’s paycheck is one many families can’t handle. If your family finances will suffer if you quit your current job, wait until you have six to twelve months of living expenses in the bank.

No Experience. Although you’ve worked in a white collar job for years, you’ve dreamed of opening a cupcake truck. If you’ve got mad baking skills, that might help you survive, but if you have no experience in, finding locations to park a truck, buying baking supplies, and managing staff, you may find yourself struggling.

You Want to do What you Love. Why would this be a reason to not start a food truck? Unfortunately, few people do that thing they love 40 hours a week. In the previous example, you may find that, while you really enjoy the baking portion of the work, you’re actually doing very little of that in between the administrative tasks a food truck owner is responsible for. You’ll be busy creating employee schedules, making deposits at the bank, keeping up on social media and dealing with your suppliers. Someone else may have to handle the baking.

Knowledge of the Business Side of Things. While you don’t need an MBA to be a food truck operator, it helps to have a basic understanding of marketing, accounting, management and finance. You can take continuing education courses at your local community college, read books and websites (hint: mobile-cuisine.com), or simply teach yourself

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In our efforts to assist the mobile food industry, Mobile Cuisine Magazine has consistently provided business information for food truck and food cart owners. With the rapid expansion of the industry many cities in the country have more than a dozen food trucks patrolling their streets now. Because of this trending growth, there have been numerous requests submitted to us to provide information on organizing food truck groups to give these areas a single focused voice to discuss their local issues.

Have you been thinking about starting a new, nonprofit, tax-exempt organization specifically centered on the mobile food vendors in your city or region? Have you tried to decide whether you should organize as a 501 c3 or c6? Do you even know the difference between them?

The c3 and c6 are similar in terms of exemption from income taxes, their qualifying characteristics, the application process (IRS Form 1023 vs. 1024), and the various rules governing their ongoing activities can be quite different.

It is helpful to first understand the distinction between a “nonprofit” and a “tax-exempt” entity. “Nonprofit” refers to an entity’s incorporation/organizational status as governed by state law, whereas “tax-exempt” refers to federal income tax exemption governed by the Internal Revenue Code. The c3 and c6 are two of the most common IRS tax-exempt statuses for nonprofits.

To qualify for either exempt status, a nonprofit must meet specific tests which are outlined in IRS Publication 557, Chapters 3 and 4, available at www.IRS.gov. One common requirement of a tax-exempt entity is that your net earnings may not benefit private shareholders or individuals. Once organized, c3 and c6 organizations are both required to file annual IRS Form 990, 990-EZ, or 990-N depending on their size. They may also be required to file 990-T and pay taxes if they have “unrelated business income.” While the applicable IRS schedules and required disclosures of the c3 and c6 vary, all tax exempt entities are expected to have strong governance policies and practices in place and the new 990 wants to know a great deal about them.

Which exempt classification is right for you? Here are some common differences:

501(c)(3)

  • Operated exclusively for charitable, educational, religious, literary, or scientific purposes
  • Includes membership associations (e.g., professional society), if the purpose is to advance the profession with respect to “educational” activities
  • Lobbying and political activities are significantly restricted. A c3 will lose tax-exempt status if the IRS determines that it has engaged in “substantial” lobbying activities

Special Advantages of the c3 include:

  • Enhanced fundraising advantages, such as eligibility to receive tax-deductible “charitable contributions” and gifts of property and eligibility to receive many grants
  • Eligibility to receive other state and local tax exemptions (e.g., sales tax)

Example of nonprofit 501(c)(3): Urban Justice Center – Street Vendor Project

501(c)(6)

  • Operated to promote a common business interest, and to improve business conditions in the industry
  • A membership organization (e.g., business league, industry trade association), advancing a common business interest
  • Allowed a wide-range of lobbying. Yet, the main stipulation is that a c6 is required to disclose to membership the % of their annual dues that is lobbying (i.e., non-deductible to members for tax purposes)
  • Dues or other payments to a c6 are only deductible to the extent that they serve an “ordinary and necessary” business purpose of the payer

Examples of nonprofit 501(c)(6): DCMFVA: DC Mobile Food Vendors Association, SoCal Mobile Food Vendors’ Association

As you can see, there are several similarities and distinct differences within the world of the 501(c); and c3/c6 represents only two of several types. When creating a new nonprofit organization for the mobile food vendors in your city or region, it is always recommended to consult with legal, tax, and association management professionals with the background and experience to help you make an informed decision and to protect your ongoing tax-exempt status.

If you have any additional tips for those interested in forming a new nonprofit, please drop us a message or leave it here in the comments section.

 

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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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