When you start your own food truck businesses, you immediately start thinking about growth. Maybe you just dream of opening a second truck, or you might envision opening brick and mortar locations across the country. Unfortunately, food truck owners don’t consider that a food truck business is growing too fast can lead to the company’s demise. You can easily find yourself lacking working capital, which is one of the biggest contributing factors to the failure.
You and your food truck can avoid the dangers of overgrowth. By managing your business correctly and scaling up properly, you’ll be able to lead your food truck to the road to success.
And while expansion is always good, what smart vendors should look and strive for is controlled expansion.
Here are five signs that your food truck business is growing too fast. While these aren’t all of the signs, these are some of the most common problems, and it is essential to know these signs, because uncontrollable expansion is the easiest way for a food truck to go out of business.
5 Signs Your Food Truck Business Is Growing Too Fast
Expenses begin to outweigh your revenues
The first of our signs your business is growing too fast relates to cash flow. When money going out your service window is more than what’s coming in, you know you’re in trouble. For a food truck, cash flow problems can stem from rapid expansion because a growing business translates to growing business costs. Don’t forget, when you expand your food truck business, so will your expenses, and if cash going out of your business is more than what’s coming in, you might be forced to borrow and take on debt. Your food truck needs to be self-sustainable, which means that all business expenses should be catered for through your revenues.
Customer complaints are growing
An increasing number of customer complaints and negative feedback is one of the biggest signs that you might have to reassess how your expansion is affecting your business. Food trucks usually can provide individual attention to each one of their customers, and provide custom solutions for them. When your food truck empire grows, you may be forced to cut corners, which could end up producing an increase in customer complaints.
You and your employees are overworked, and unhappy
Are you overworking yourself and your employees? Are you all unhappy and as a result, is your productivity slipping? If your food truck is growing too quickly, naturally a large proportion of the added burden will have to be dealt with. This usually results in a dip in productivity, and a rise in employee absenteeism and turnover. You could find yourself busy with hiring and training new staff, when other aspects of your food truck business need your attention.
If you’ve been working 24/7 in order to run your food truck you might be overworked as well. You need time to relax and overworking yourself will just make you hate what you do.
Shifting focus from quality to quantity
One of the biggest red-flags of an over extended food truck is when they start prioritizing quantity over quality. Customers will notice this change, and you will end up losing business. Never lose sight of what makes a food truck successful: it’s emphasis on providing high quality food for a good value.
You start losing customers
The last of our signs your food truck business is growing too fast is when you start losing your customer base. Customer retention is essential. Your food truck’s ability to keep existing customers, while adding profitable ones, is a benchmark of success. If your customers start feeling that they’re not being given proper attention, their complaints are not being handled properly, and that there’s a dip in quality of your menu, you may end up losing customers.
The Bottom Line
For your food truck to succeed, your food truck needs to grow. But it’s hard enough to grow in the first place, so make sure that you handle it properly when that success comes. Keep an eye the food truck systems you have in place, your staff, and your cash reserves. Successful growth requires taking the time to plan and prepare to sustain all three of these areas as the lines at your service window get longer.
Do you know of any food trucks where their business is growing too fast? First of all, send them the link to this article, then share your opinions of how they over extended. You can share your ideas in the comment section below or on social media. Facebook | Twitter