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Food trucks may be less risky investments than restaurants

On Behalf of | Sep 12, 2016 | Commercial Real Estate |

Many people are passionate about investing in the California restaurant industry. However, restaurants can be very expensive to operate and difficult to make money from. Opening a food truck could be a less expensive alternative that may have a better chance of success for a first-time commercial real estate investor.

Food trucks are mobile street food businesses that have become very popular in recent years. From 2010 to 2015, the food truck sector grew by 9.3 percent, and the street food industry is now valued at $1 billion. Food trucks are much cheaper to open and operate than restaurants because they require far fewer employees, and costs like rent and utilities are greatly reduced. The cost of the truck itself could be as low as $15,000.

Another benefit of opening a food truck is that they are mobile, and food truck owners can try out different locations before settling on the location that is the most profitable for their business. One of the drawbacks of owning a food truck is that they require a big time commitment as the lack of storage means that owners often spend much of their work days running errands to support the operation of their truck.

Though opening a food truck is much less expensive than opening a restaurant, there are still substantial business expenses such as food, equipment, fuel, staff and licensing fees. A commercial real estate attorney may be able to help an entrepreneur develop a business plan for a food truck endeavor.