We believe that food truck employees should know that they work in a low margin industry. Typically they won’t figure this out unless they’re told. Want to validate this point? Just ask a few of your employees how much money they think you make see how many say, “LOTS.” It’s time to give them a lesson on food truck economics.

This is because employees see, what many believe to be, large amounts of cash coming into the truck every day but most of them have no concept of what it costs to operate a mobile food business and how much profit remains after all the expenses are paid.

When employees assume the boss is getting rich, it can affect their attitude, behavior and what they might feel entitled to.

Food Truck Economics 101

We recently spoke with a vendor who holds creative meetings with each employee to educate them on the low margin nature of the food truck business. He explained that he conducts these meetings when a staff member first starts. He gives them 100 pennies and explains that the pennies represent a dollar in sales and they will be shown out of every dollar of sales what it costs each month to operate the food truck.

In this food truck economics class the employee is asked to pay:

  • 30 pennies for food and beverage vendors
  • 35 for payroll
  • 10 cents for fuel and truck maintenance
  • 10 for commissary rent and so on

After all the expenses are paid, the remaining pennies represent the amount of profit the truck earned. Whether there are 3, 5 or even 10 pennies left, it’s a whole lot less than most employees assume.

RELATED: How Food Truck Vendors Should React To Economic Ups and Downs

The Bottom Line

What this food truck economics lesson provides for each of his employees is a basic understanding why the little things like exact portioning, reducing waste and the hundreds of other seemingly meticulous steps he requires help to control costs and give him a shot at making a profit. This example will show some of them that owning a food truck is not the money making machine they may have thought.

Do you use a food truck economics class in your truck or do you use other teaching methods? We’d love to hear them. Share them in the comment section or social media. Facebook | Twitter