Food truck vendors tend to excel in the areas of cooking, menu creativity, and customer interaction. But many don’t have to firm grasp of the business side of the food truck industry. Unfortunately, this lack of knowledge has led to the failure of some great concepts. You probably already know that it doesn’t take long for your financials to spiral out of control. Today I’ll provide some pointers to help keep your food truck financials from losing control.
Keep Control Of You Food Truck Financials
Know the numbers
If the only thing you understand about food truck finances is how much money you have at the end of the month, how will you know what the problem is? Understand concepts like profit margins and check averages and keep track of these calculations on a weekly or at the most, monthly schedule.
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Know what’s most profitable
Just because a menu item is more expensive than another doesn’t mean that it returns a higher profit. Determine which menu items make you the most money. With this data, you can train your service window staff to market them to your customers.
Create combo deals
Combo meals are popular for a reason. They allow customers to get more for their money, stay within their budgets, and simplify the ordering process. And food truck owners get a more consistent profit stream as well as providing a service that attracts repeat business you’re your happy customers.
Catering from food trucks has quickly become one of the most popular catering trends across the country. Although catering does present food truck owners some challenges, it’s a high margin service that food trucks are already equipped to provide.
It’s essential to create daily or weekly reports just to reconcile your cash drawer. These reports can explain which menu items are you big sellers and what stops give your truck the most sales. Reports will also show you sales trends that can allow you to tweak your menu to maximize profitability.
Protect against theft
Employee theft is significantly higher in the food service industry due to the accessibility of cash and high quality food products. Establishing systems for inventory management and cash accounting can cut down on the chances of being stolen from by your food truck staff members.
The Bottom Line
I’m not sure I’ve met a vendor who started a food truck business because they excelled at accounting. But at the same time, understanding the basic accounting concepts of food truck profitability and cost controls can help to determine if your food truck enjoys a long and profitable run, or shuts its service window after one season.
Do you have an additional food truck financials tip for new and existing food truck vendors to help them make it in this industry? Share your thoughts on this topic in the comment section, our food truck forum or social media. Twitter | Facebook
DISCLAIMER: Mobile Cuisine and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only. It is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisers before engaging in any transaction.