With the summertime comes a flock of food trucks on the streets of many other American cities, and especially in and around Denver. Just a decade ago, food trucks appeared to be no more than a trendy update to the lunch wagons and taco trucks of old. Now they represent a $2 billion industry.
A while back, the U.S. Chamber of Commerce Foundation declared Denver one of the best cities in the nation for starting a food truck business. In a review of 20 urban areas, and a survey of 288 food truck operators, the organization compared permitting and licensing, local restrictions and other factors. Ultimately, it concluded that Denver was second only to Portland, Oregon, in overall ease of opening a food truck business.
Perhaps the strongest reason for opening a food truck business is simply that it’s less expensive than opening a brick-and-mortar restaurant. According to some reports, a small food truck can be purchased for as low as $25,000, while opening a restaurant costs on average around $300,000 even without purchasing the building. Restaurant owners usually also want a liquor license, which costs $3,000 or more. Still, there are other costs involved that can bring the cost of opening a food truck to almost half the cost of opening a small standalone restaurant.
None of this means opening a food truck business is easy. As with any other type of business, it’s important to start a food truck business with the right legal structure. The goal, after all, is for the business to thrive and grow, and for the entrepreneur to have fun and make some money. All of that can be threatened when problems come up, as they inevitably do, and the business cannot deal with them effectively because of problems that began back in the business formation stage.
People considering opening their own food truck or other small business should talk to a business lawyer about the best ways to structure and plan their business for success.