Skip to content

Food Trucks :: Food Truck Economics

Bobby Hossain’s day starts early. Along with his family, he runs a food truck called Phat Thai that serves his mother’s Thai recipes “with a modern twist.” Although he won’t be serving customers for nearly 4 hours, he wakes up by 7:30am. He is working a double shift in the truck (lunch and dinner), so his brother is on prep duty. Bobby buys any last minute supplies they need - ice, more bean sprouts - from Restaurant Depot while his brother cuts vegetables and slices meat at the kitchen space they use in a friend’s restaurant. His brother then drives the truck to their parents’ house. They load up and Bobby is on the road at 9:30.

From 11am-2pm they work at Mission Dispatch - a location in San Francisco’s Mission district that hosts food trucks. It brings in a dependable lunch crowd. Bobby’s mother cooks, his employee Frank takes orders, and Bobby hands out completed orders while helping the other two. After three hours, Phat Thai has served around 200 dishes.

Once the lunch crowd dies down, they return to the commissary, a space where they can clean dishes and dispose of garbage. Bobby checks whether he needs to get more supplies for tomorrow, preps, and then drives the truck to North Beach. From 5pm-8pm they will sell Thai dishes alongside other food trucks at a “market” of food trucks organized by Off The Grid. On busy days, they won’t have a chance to eat lunch.

Although it’s only half as busy as lunch, Phat Thai sells dinner to a dense crowd of families and professionals returning from work. By the time they serve their last customer, clean up, and park the truck, it’s approaching midnight. It’s one of Bobby’s busiest days. He and his brother only do double shifts twice a week. Since dinner is less lucrative than lunch, on other days they finish selling food by 3pm and he can get home by 5pm.

Compared to the original American food trucks (a.k.a. roach coaches) that frequented construction sites and baseball stadiums, food trucks like Phat Thai are a different breed. Instead of cheap, greasy fare, they sell $10 dishes featuring organic ingredients and fusions of different regional cuisines. Since their emergence as a social media sensation in 2008, they have asserted themselves as a force in the food scene, employing celebrated chefs and inspiring countless food reviews.

As a service that strips all the overhead costs of a restaurant down to the minimum requirements for selling food to customers, food trucks are also an irresistible metaphor for lean startups: the Silicon Valley practice of quickly rolling out a minimum viable product, allowing customers to try it, and engaging with them to improve your offering. Just as the falling cost of creating a website or app lowered the barriers to entry in the tech industry, food trucks allow aspiring restauranters to quickly put their creations in front of customers with minimal financial barriers.

But given that starting a restaurant is essentially a respectable way to throw money down a hole, are food trucks just mini money pits? What does it take to start and run a food truck? Why is a sandwich in a paper tray $10? Will food trucks disrupt the restaurant industry or is there a bubble?

Full Articles

Posted by Chloe Willcock | on