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The Food-Truck Business Stinks
- smackfu 14y agoIt's like any other small business, where new people are overly optimistic about both sales and costs. If they have a business plan, it's all best cases, not realistic. And because the total dollar amounts are a lot lower than a proper restaurant, people can embark on it with just savings and home equity loans and friend investors... all of which do not require a realistic business plan. Then the sales don't materialize, they lose money every day they are out their busting their ass for 17 hours and throwing away food at the end of the day, and they end up selling the truck to the next food truck dreamer.
- zavulon 14y agoDid you read the article? The author is arguing it's not because of that at all, it's because of all unnecessary and conflicting rules and regulations that is in place.
- benihana 14y agoDon't forget selective enforcement, which is probably the biggest frustration and source of uncertainty and cost. Not knowing if doing one thing one day will be fine the next day are not conditions most businesses thrive in.
- JoeAltmaier 14y agoDon't park next to a school or food market? You can avoid that every day. I think that is a smoke screen for the real problem: a terrible business case.
- panacea 14y agoI'm ok with regulation pertaining to food standards and service. I'm equally ok with Apple's App Store curation. But it's a tricky line to get right. When visiting countries with street food cultures, you can generally do ok by following the local crowd. But that's because the local establishment isn't going to screw the pooch and poison the regular clientele if they can help it. We live in a society attempting to outsource trust, whether by government regulation, flimsy technological crowdsourced reputation or other equally ephemeral measures of quality.
- jcnnghm 14y agoThere isn't enough manpower to fine everyone doing anything wrong every day. Parking fines are generally much higher than the parking cost because it's impractical to catch every illegally parked vehicle every time; the whole idea is to make the expected cost of parking illegally greater than the expected cost of parking legally, while limiting the cost of enforcement. Similarly, I am under no delusion that speeding is fine on days I don't get caught.
- forinti 14y agoYou should look at the law and decide if you can operate within its confines. Counting on it not being enforced is not really a sound business strategy.
- nijk 14y agoRandom enforcement is fair play, and efficient. Biased enforcement is corruption.
- JoeAltmaier 14y agoYet the article listed only a handful of requirements - health certificate, and don't park next to a school or food market. What else? This doesn't seem like rocket science. It has to be the business case stinks. I can't see the regulation getting in the way, any more than other businesses.
- mrgoldenbrown 14y agoThere are plenty of examples in the article that you are skipping over. First of all, getting that health certificate you mention takes several months. And you need one for every employee. In a brick and mortar, you only need one, period. And you need to get your cart or truck cleaned at a specially licensed "commissary" every morning. Then you have the case of this lady: She had a street-vendor’s license, she said, but didn't understand that she also needed a separate permit for her cart. This whole situation with licenses costing money and being "leased", plus the commissaries, reminds me of the Boston cab situation right now - when you need to pay a bribe to be able to driver a cab for the day, regulation is definitely getting in the way.
- frankc 14y agoOne of my best friends owns a food truck in nyc and by association I've come to know a lot about the subject. 1) The requirement of a food handling license for every employee is not a trivial problem. It completely distorts the market for hiring, really making it almost impossible to do legally. Remember, this is not the kind of job where people stick around for years so a 2 month lead process in hiring is tolerable. And it's not like this food handling license is in any way helpful to maintaining the public health; its not required for regular restaurants (for every worker like in food trucks). 2) In reality there are next to no legal spots to park a food truck in nyc. In manhattan, pretty much every spot is metered, and therefore illegal. However, as long as no one complains, usually the cops leave you alone. Usually, but its unpredictable. 3) Arbitrary and capricious enforcement of health regulations by health inspectors that can lead to large fines and confiscation of your permit. Again, don't underestimate how big a deal this is. At any time, for approximately any reason if the inspector doesn't like you, your entire business can be shut down. Think about how patent lawsuits affect startups and then imagine that a class of patent inspectors can just bust in unannounced several times a month to shut you down. It's like that. 4) You can't actually get a permit legally because the city doesn't issue them any more. All food trucks get their permits on the black market and the costs is up to $20K per year now. It's not just the cost but also the hassle of having to deal with that. It's also completely stupid from the city's perspective as they could be auction off permits as they do for taxi medallions. Instead the benefit goes to people who just happen to have been issued a permit many years ago for $200. 5) You must park in a licensed commissary as mentioned in the article. It means you basically have to pay 3x in rent what you would if you could park legally in a private lot. And plus those places are actually completely filthy. I've been to several. All that said, the article is actually quite wrong about it not being a profitable business. The people I know are raking in cash hand over fist. There is huge demand as long as your food and concept are decent. If the city actually fixed some of these regulatory issues, there would be a huge explosions of trucks overnight.
- smackfu 14y agoMy point is that even in a perfect business environment, most food trucks would fail.
- VLM 14y agoThat's merely a side effect of the brick and mortar restaurants having more money therefore more political power than the food carts. If the food cart owners were millionaires and the brick and mortar restaurant operators were poor, I'm quite certain we'd be reading an article about how simple and clear the regulations are for food carts but its nearly impossible for poor illegal immigrants to open a brick and mortar restaurant without endless government pressure to close. The free market may have made America great, but a pretty good summary of our current problems is we're now trying the reverse of both in as many business fields as possible. There are numerous eCommerce analogies, etc.
- smutticus 14y agoI think you either didn't read the article or you completely missed the point of it.
- joonix 14y agoAnd yet the filthy vendor carts (not trucks) are everywhere you look, spewing their putrid clouds of smoke over passing pedestrians, without any requirement to display sanitation inspections (I'm not sure they are even subject to inspections). If you want a food truck you should go out to a city with friendlier regulations and where you would provide more novelty by being a more unique thing. Then again I'm not a big fan of these new wave food trucks anyways, they are always supremely overpriced. If I'm eating out of a truck, it's because I want to pay less than sitting at a restaurant.
- ScottWhigham 14y agoIf I'm eating out of a truck, it's because I want to pay less than sitting at a restaurant. Given that comment, my assumption would be that you haven't eaten at many food trucks in NYC. The food at some is downright delicious, while others it is crap. If I'm eating at a truck, it's because either (a) I need something super fast and the truck is closest/fastest, or (b) I like what the truck sells, or (c) I like the idea of portability and I don't want the only other portable options, or (d) the smell of the grill attracted me, or (e) etc... None of that equates to paying more/less than I should anywhere else.
- nijk 14y agoInteresing. Emitting Grill smell is an externality that should be taxed.
- potatolicious 14y agoIt's not so much the grill smell as it is the grill smoke. A lot of kebab stands in NYC cover half the intersection in a thick haze. It's mouth-watering when you're hungry, and annoying when you're not. Personally I don't care that the trucks emit smells, but if they're injecting so much smoke into the atmosphere that I can barely see, that's no longer cool.
- harryh 14y agoMaybe you should have to pay to avoid grill smells? http://en.wikipedia.org/wiki/Coase_theorem http://en.wikipedia.org/wiki/Coase_theorem
- kwijibob 14y agoIn my one visit to NYC (from o/s) I loved getting food from the trucks. They were cheap and tasty - we couldn't afford to go into restaurants or even diners.
- jellicle 14y agoAlternately: NYC doesn't really want to encourage a bunch of trucks to idle their 2MPG diesel engines all day while serving $10 waffles to ignorant tourists. The idea of a "food truck" is based on trying to cheat the system. The system is: you have to buy or rent property in order to locate a business there. However, the system has a loophole: large swathes of the city are designated as roads, sidewalks, highways (which is a technical term for the road allowance). These areas of the city are completely free to use, for anyone, on the condition that it's a short-term, passing-through, sort of use. So Mr. Brilliant says, "Hey! What if I just take over part of this free-to-use area without paying? I'll be able to charge as much as a property-leasing restaurant, but I'll get my land for free! I'll make a killing!" Except the city has self-defense measures against people who try to do that. They're called tow trucks and bylaw inspectors. Because your business model is not actually innovative or new but has been around since the dawn of cities. And so the white blood cells of the city harass the invading parasites that are trying to damage the city's ability to function, and life goes on, evermore and without end.
- jdminhbg 14y ago> The system is: you have to buy or rent property in order to locate a business there. This is where you begged the question.
- Alex3917 14y agoSpeaking of Taim, does anyone know how to replicate their harissa recipe? I've been buying it in the jars, but they don't even have an ingredient list on them. And none of the CPG harissas that I've tried have been nearly as good.
- benjamincburns 14y agoSounds ripe for an app. Grab a list of regulations regarding street food vendors, pull city data from OpenStreetMaps or Google, figure out where the "green zones" are to park, and warn food vendors when they're not parked in a green zone. At the same time, get the maps into the hands of some city lobbyists so that it's clear just how much of a tightrope walk this kind of operation can be.
- VLM 14y agoI think this is based on the assumption that the regulation exist for any reason other than brick and mortar establishments want less competition. If you introduce a technological fix, they'll merely pay the politicians to order the police to enforce random and conflicting cleanliness regulations or something like that. The way to "fix" the problem is to organize a PAC and lobby politicians and donate an amount of money to re-election campaigns similar to what the brick and mortar group donates. The problem is not even brick and mortar restaurants, 90% of them fail in a couple years, the REAL competition is restaurant supply houses and such who specialize in converting home equity loans into broken dreams. The food trucks are supposed to spend money at the supplyco renting tables and chairs, not buying a Ford Truck or whatever. The "real" permanent solution to the "feud" is to align goals, legislate that brick and mortar restaurants AND food trucks get all their "stuff" from the same suppliers, including tires or whatever. Or you can only rent food trucks, coincidentally from the same rich guys who own all the land restaurants also rent. Something like that.
- eitally 14y agoI wonder why US cities where food trucks are common haven't gone the Singapore route and setup regulated "hawker centers". Sure, it may not be quite as convenient for consumers, but it would solve a bunch of other problems.
- mseebach 14y agoSolving problems with a bias in favour of the city's convenience over the consumer's seems to be quite a way down the slippery slope already. Government being the servant of the people, and all.
- akgerber 14y agoPortland has "food truck pods" on the edges of downtown parking lots, as well as in parking lots throughout the city. They have an incredible diversity of cheap food, and the businesses are obviously low-overhead (often in trailers instead of trucks) and generally seem to be staffed by their proprietors. Here's a random blog post with pictures: http://blog.chowmenow.com/join-the-pod-y/ http://blog.chowmenow.com/join-the-pod-y/ It seems like a great way for a city to take an ugly downtown parking lot and make it a pedestrian draw. New York City doesn't really have surface parking lots anywhere with a lot of foot traffic, so that isn't really an applicable solution here.
- cmbaus 14y agoWhat happens if demand for the "pods" outstrips supply? How does the government decide who can setup a new pod? What could be interesting is if a privately owned parking lot did something like this.
- akgerber 14y agoAll the pods appeared to be on privately owned parking lots or otherwise vacant lots. E.G.: https://maps.google.com/maps?q=food+truck+pod&hl=en&ll=45.521008,-122.681582&spn=0.001227,0.001741&sll=45.562471,-122.69509&sspn=0.002441,0.003482&t=h&gl=us&hq=food+truck+pod&z=20&layer=c&cbll=45.520941,-122.681615&panoid=7h1js_z5f8Q3nmVuaZF5og&cbp=12,73.91,,0,-8.65 https://maps.google.com/maps?q=food+truck+pod&hl=en&...
- tonyb 14y agoAs a new food truck owner I can relate to this article. I'm in a different situation because my truck is more of a hobby than a job, but I do want it to pay for itself. As such we focus more on festivals, special events, and catering. Even then we are running into some regulation issues. We are fortunate enough to live and work in a city that is willing to work with us and understands the issues we face. It isn't that the law is bias against food trucks, but that it without considering mobile food vending and because of that is overly restrictive. For example if a local business ask us to come park in their parking lot and serve or sell food to their customers we have to get a special permit per location. And we are limited to the number of permits we can get per year and need to know the exact dates, times, and locations before applying. We get new request every week so there is no way for us to know in advance where we will be for the rest of the year. But just like any other business understanding and navigating the laws and regulations is part of the job. To be successful you need to plan and adapt accordingly.
- fennecfoxen 14y agoWouldn't it be great, though, if the laws and regulations were able to accomodate you (and other food trucks) while continuing to afford their basic food-safety and related goals? Then everybody wins. (Except corrupt businesses which thrive on the current system and will lobby against productive change.)
- mdesq 14y agoThese issues are exactly what people refer to as "first world problems." On the one hand, we want everything regulated just so in order to have a nice, well-engineered society with minimal risk and clean consciences when we buy food from another person. Then, whole swaths of affluent folks catch a craving for some good basic (or perhaps attractively quirky) street food and are shocked, shocked(!) when that kind of business is a tough thing to run in this environment.
- nijk 14y agoWhat does affluent have to do with it? Affluent can afford highly regulated trucks. Working class can't.
- acdha 14y ago> These issues are exactly what people refer to as "first world problems." On the one hand, we want everything regulated You need to re-read the article: the core theme is that there isn't a monolithic “we” requesting regulation but rather that the regulatory framework most of the public wants to assure safety, pollution, etc. has been captured by a smaller group of industry incumbents who are using it to prevent competition.
- eikaterine 14y agoThe article really doesn't make this situation sound like an unavoidable consequence of regulation. What part of " he strictly follows the rule insisting that every mobile-food employee has Health Department certification... And stationary restaurants, by the way, require that only a single employee on duty have a Health Department certification." sounds like an inevitable consequence of having regulations?
- YokoZar 14y agoAs the article points out, this sort of situation is exactly what creates the difference between first and third world nations. The only difference is that in countries like Ecuador most of the economy is like New York's food truck business.
- DucktourDreams 14y agoThis article has little to do with the food truck business and everything to do with NYC. Other cities have thriving food truck cultures which the author acknowledges in the final two sentences of the article.
- patmcguire 14y agoIs Biryani at 46th and 6th totally legal? Because they're running one on every corner of that intersection - I don't see how the enforcers couldn't have noticed.
- resu_nimda 14y agoThis article is entirely about rules and regulations specific to the the NYC area, the title is misleadingly grandiose and implies there is something inherently wrong with the food truck model. At the very end, the author barely mentions that Portland has a fully thriving food truck scene. Same thing here in Austin. There really are "four Wafels & Dinges trucks for every hot-dog cart." It can be done.
- fennecfoxen 14y agoIn its defense, it was published in the New York Times. Which has some interest in the NYC area. :P
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- smaili 14y agoI think food trucks can be a great business if the location is right. As some other people have pointed out, New York already has a ton of street vendors with probably half the price, so the barrier to entry is much higher. But for example in San Francisco, there are a few trucks near our offices that are ridiculously crowded because there is no other options around for at least a few blocks.
- davidf18 14y agoAs a Manhattan resident and worker, I feel the trucks are really annoying. They are large and block the landscape and the food doesn't appear to be appealing. Instead of the huge annoying trucks, I prefer to see that smaller carts which in most cases can serve the same food as the trucks. I would like to see higher quality food on the carts (and the trucks). Fruit stands in NYC are really nice as well...
- ttrreeww 14y agoAs long as the food is cheaper and good I'm all for it.
- dreamdu5t 14y agoUgh. New York Times: Bourgeoisie drivel and white house propaganda. We need to regulate the NYT.
- nolanguage 14y agoIn Durham, NC the food trucks have been a big part of the city's revitalization. It is, oddly enough, an area with plenty of vacant business space, but I believe the food truck owners here value the shorter time to launch, the lower start-up costs, and perhaps they find the perceived barrier to entry to be lower (in truth, I've seen some vendors go brick and mortar, and it took them a great deal of effort to get it rolling). In some areas the food trucks form synergistic relationships with bricks and mortars; a local brewery that doesn't serve its own food, hosts them every night and the entire area around it has become "The Spot" with 4 new businesses opening in the last year. Having moved here from New York, I'm familiar with the situation there as well. There aren't as many swaths of urban "blight", and there is already a good amount of foot traffic so the benefits don't feel quite as dramatic -- but then I didn't work in midtown (where the food offerings are so so bad).
- jadell 14y agoAnd as I assume it to be the case in most other food truck culture centers, many of the Durham trucks have used their mobile success to bootstrap a traditional brick-and-mortar shop (e.g. The Parlour, Monuts, Cocoa Cinnamon.) Allowing entrepreneurs to experiment with minimal risk can be an inexpensive and effective way to build a local economy.
- MartinCron 14y agomany of the Durham trucks have used their mobile success to bootstrap a traditional brick-and-mortar shop We're seeing the same thing in Seattle, as well. Some of my new favorite restaurants started life as food trucks and have moved up to more traditional quarters.
- tapatio 14y agoFood truck businesses don't stink, New York city does. They don't want the trucks there, plain and simple, and so they craft "zoning" laws to prevent them from doing business.
- CyberDroiD 14y agoThe food truck business is great in San Jose and other places. I agree with others: this seems to be a NYC problem.
- codex 14y agoThe food truck business is actually great--or at least better than the restaurant business. By owning the truck, which is mobile, the operator is freed from the tyranny of landlords, who simply raise the rent on successful restaurants to the point where it is impossible to make any real money.
- yoster 14y agoI loved eating hotdogs from the sidewalk vendors.... Quick, cheap, and tasty.