Editor's note: This article was excerpted from our Food Truck startup guide, available from the Entrepreneur Bookstore.
Today, a new generation of street-food lovers is lining up at food trucks and food carts like never before. Little do they know that neither food trucks nor food carts are new to the streets of American cities. Like so many other popular trends, they are the latest version of a long-standing part of American and world culture. Yet the street-food industry has never enjoyed so much publicity or notoriety.
According to Los Angeles-based industry-research firm IBISWorld, the street-food business -- including mobile food trucks and nonmechanized carts -- is a $1 billion industry that has seen an 8.4 percent growth rate from 2007 to 2012. It's very entrepreneurial: 78 percent of operators have four or fewer employees. The true number of these businesses is difficult to count, since the mobile food industry is comprised of food trucks, food carts and kiosks, which have appeared in malls as well as at train and bus stations, airports, stadiums, conference centers, resorts, and other locations in recent years.
Food-industry observers claim that the food-truck business is increasing largely in response to the slow-growing economy. People are seeking inexpensive breakfasts and lunches. Also, employees today are often pressed for time, with more work and shorter lunch hours. These factors make the mobile-food concept more appealing than ever.
From an entrepreneurial standpoint, kiosks, carts, trailers, and food trucks have a lower overhead than restaurants and can be moved if one location does not generate enough business. Rather than having to determine where to open a restaurant and worry about the old real-estate adage "location, location, location," the owner can actually drive to a new location, location, location if business is poor.For customers, you add the convenience of having food favorites right outside a particular location -- or inside with a kiosk -- and meet several needs by serving mobile food. First, you offer food that is cost friendly because you need not pay wait staff or bussers. You also offer the convenience of quick service. In many cases you provide food choices that can save those on a busy schedule from the need to sit down. Typically customers can eat street foods while en route to their next destination. Finally, mobile food is often fun to eat and (if it's good) great to talk about.
Related Book: Start Your Own Food Truck Business