Colorado Food Trucks: Behind the Business

Bird Dog BBQ Food Truck Colorado SpringsThe national food truck industry is estimated to have reached $2.7 billion in revenue in 2017, according to Emergent Research. The explosion we all have seen of Colorado food trucks validates this data here in our home state. Experts cite the ease of entry into the market, low startup costs, low overhead, and ability to move if business isn’t booming as top reasons for the industry’s growth. With social media as the main marketing tool and a warm embrace from the majority of community members, the trend to go mobile makes sense. Or does it? For us at Bird Dog BBQ, the jury is still out.  

Ease of Entry / Low Startup Costs 

Yes, you can do a bunch of research, fill out a bunch of paperwork, pay a manageable amount of money and get inspected and licensed and then open up your Colorado food truck. The key thing here is you can, “pay a manageable amount of money”. In Colorado Springs, El Paso County Public Health lists more than 220 licensed mobile vendors in its system, including nearly 40 “prepackaged” mobiles, primarily serving ice cream. Why? In order to open a restaurant, a business owner is looking at $500,000 minimum upfront. To open a Colorado food truck, that number dips to between $15,000-$30,000. This is an amount that the majority of the population can qualify for in a loan from Prosper, can get from remortgaging their house, or can piece together by maxing out a few credit cards. It is the perfect business model for restaurant industry professionals looking to strike out on their own, individuals in corporate office jobs who are seeking a more meaningful profession, or driven, intelligent people who want to work for themselves but don’t have oodles of money to invest in their entrepreneurial endeavors. On the flip side, once you’re up and running, to be profitable, operations become your life. “I wish I would have known that it’s an endless cycle of long, long hours day in and day out.” As Jacob Bartlett of the Mastiff truck said, “We don’t work full time. We work all the time.”  

Low Overhead / Simplistic Operations 

Having a small menu and limited space offer plenty of benefits. A Colorado food truck owner has less inventory to manage, less product to prep, less staff to hire and less space to set up and break down than a typical restaurant owner. They can be up and running in no time, can execute their menu with precision, and can track their profits with more simplistic formulas than traditional restaurantsHowever, they also have additional things to worry about, such as liability ensued by driving the unit around or hiring people to do so, the competency and trustworthiness of event coordinators, and THE WEATHER! Think about the statistics, with 3.8 million licensed drivers in Colorado, one in every 33 Colorado drivers will be in a crash this year, that’s a 33% chance of an insurance claim on a mobile unit, while only 8.8% of the 563,917 small businesses in Colorado made an insurance claim in 2017.  Colorado food truck owners also have to manage storage of additional inventory and the truck itself, as well as manage and take time to complete the preparation and breakdown before and after an event at an approved commissary. Phew! Sorry to be such a Negative Nancy over here, really, we think it’s just a different set of hassles, no more and no less. Do you think otherwise? Let us know in the comments section at the bottom of this article! 

Ability to Move 

Having a Colorado food truck means that it can go wherever the people are. If a food truck picks a location that has no customers, they can pack up and move! Well, kinda. It may sound like a no-brainer, but you’d be surprised how many places don’t allow food trucks or put a cap on the number of food truck permits allowed at any given time. In Colorado Springs for example, you are only allocated 3 on street permits within the city per year for public vending. You have to apply for them months before you plan on opening and they come with additional costs and rules. You are also not allowed to vend on any private property without filing specific permit forms with the owner of the property and paying negotiated rent for your space. If you want to vend at an event, you will pay an initial reservation fee up front that can be anywhere between $200- $1,200 and is non-refundable (think about our Colorado weather here and you can imagine the stress). In addition, you will pay anywhere between 10%-30% of your sales in commissions to the event promoter.  “The nature of the food truck industry relies a lot on chance and luck; you roll the dice every time you go to an event without a guarantee of sales. Sometime you score big and other times you lose money.” We agree with this sentiment from Stephanie with Seabirds Truck 

Marketing/ Community Involvement 

This aspect of owning a food truck seems the most beneficial. Colorado food truck owners are able to serve their cuisine to a host of customers within whatever range they define. They are able to participate in community festivals and charity events, as well as provide alternative lunch options for large businesses in their communities. They are able to attract new customers to their brick and mortar locations (if they have any) because they can now access areas that would previously have been unreachable. In addition, the conception and growth of the food truck industry in Colorado has happened alongside the growth and acceptance of social media as a legitimate marketing platform. Food truck owners are able to utilize social media as their primary marketing tool, which is virtually free to them. Compare this to traditional marketing methods of TV, radio, and print and these owners are saving a huge chunk of time and money. They are also getting the added benefit of real customer interaction, allowing them to tailor their growth based not on predictions and historical industry data, but by feedback from their actual customers.  

Carl – Bird Dog BBQ’s Food Trailer 

This entire article stems from the completion of Bird Dog BBQ’s first season operating a Colorado food truck. In truth, it is actually a trailer, and his name is Carl. He was built over the winter between 2017-2018 by the owner of Bird Dog BBQ in his backyard! If you feel that some of this information is biased, you’re right. Anyone can just recite facts they read off the internet but we have facts that have come from a season of experience. That being said, what this article conveys is not the truth, but a compilation of ideas from food truck owners throughout the country. We would love to hear your thoughts, as we evaluate the pros and cons, talk to our mentors, and plan our 2019 season. 

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