Want to Start a Food Truck Franchise? Here’s Everything You Need to Know

A franchise business model is an agreement between an individual or organization that wants to start a business and an established company that already has a track record of success. With a food truck franchise, you can get the benefit of the established company's brand name, marketing, and operational systems, while gaining the flexibility and freedom to own and operate your own business.

In this article, we'll provide an overview of everything you need to know about food truck franchises and offer a few examples of popular franchise options. 

What is a Food Truck Franchise?

A franchise is a business model in which a company licenses its brand and business strategy to a third party for a fee. The franchisee (a.k.a the individual or company operating the franchise) agrees to follow the franchisor's systems and methods for operating their business. In the case of a food truck, this might include using the franchisor's recipes, menus, and branding, as well as attending training and support programs designed to help franchisees succeed. In return, the franchisee pays a percentage of their sales or a flat fee to the franchisor.

The franchisee is responsible for managing the day-to-day operations of the food truck, including sourcing ingredients, hiring and managing staff, and marketing the business. 

How Much Does a Food Truck Franchise Cost?

The cost of buying a food truck franchise can vary widely depending on a number of factors, including the specific franchise, the location of the business, and the size and type of food truck. Some common expenses that you can expect to pay when investing in a food truck franchise include:

• Franchise fees. This is a one-time fee that is paid to the franchisor in exchange for the right to use their brand and business model. Franchise fees can range from a few thousand dollars to several hundred thousand dollars, depending on the franchise.
• Equipment and supplies. Food truck franchises typically require the purchase of a food truck, as well as any necessary equipment and supplies, such as kitchen equipment, utensils, and serving items. The cost of these items can vary greatly depending on the size and complexity of the truck and the equipment needed.
• Training and support. Most food truck franchises offer training and support programs for their franchisees. These may include initial training at the franchisor's headquarters, ongoing support and guidance, and access to marketing materials and resources. The cost of these programs can vary, but is typically included in the franchise fee.
• Insurance. It is important to have insurance coverage for your food truck, including liability insurance and insurance for the vehicle itself. The cost of insurance can vary depending on the coverage you choose and the location of your business.

Overall, the cost of investing in a food truck franchise can range from a few thousand dollars to hundreds of thousands of dollars, depending on the specific franchise and the costs associated with starting and operating the business.

A food truck franchise offers easy access to inventory and even a truck most of the time. 

How Much Money Can I Make With a Food Truck Franchise?

It is difficult to provide an exact figure for how much one can make with a food truck franchise, as the profitability of a food truck business can vary widely depending on a number of factors like:

• The location of the business.
• The type of food being served.
• The competition in the area.
• The overall efficiency and success of the business.

That being said, many food trucks do very well. themselves. According to Toast, food trucks make $250,000 - $500,000 annually. However, it is important to note that this figure represents gross sales and does not take into account expenses such as employee salaries, rent or lease payments, insurance, and other operating costs.

In terms of these costs, it's worth noting a couple of things:

• Each food truck is unique.  Food truck businesses can vary greatly in terms of their size, menu offerings, and operating models. For example, a small food truck that operates at a single location and serves a limited menu may have lower gross sales compared to a larger food truck that operates at multiple locations and serves a wider variety of menu items.
• Your profits may change with the seasons. The profitability of a food truck franchise may be affected by factors such as seasonality and weather. For example, a food truck may experience lower sales during the winter months when fewer people are out and about, or during periods of inclement weather.

Pros & Cons of Starting a Food Truck Franchise

Pros of Starting a Food Truck Franchise

• Low startup costs. Compared to opening a traditional brick-and-mortar restaurant, starting a food truck franchise can have lower upfront costs. Food trucks typically require less equipment and have lower overhead costs, such as rent and utilities, while traditional restaurants need a larger staff and a physical property they have to maintain and pay for.
• Flexibility. Food trucks offer the ability to operate at different locations and events, which can provide more flexibility and allow the business to reach a wider variety of customers and operate when they want to.
• Proven business model. Franchising can provide a proven business model, with established systems and processes in place. This can help reduce the risk of starting a new business and provide support and guidance to the franchisee.
• Brand recognition. Many food truck franchises have already established a brand and reputation, which can help attract customers and establish trust in the business. This can help new business owners better deal with marketing needs. 
• Great potential for growth. With the right planning and execution, a food truck franchise can grow over time, potentially leading to additional revenue streams and opportunities for expansion.

Cons of Starting a Food Truck Franchise

• Franchise fees. Franchisees will be required to pay a franchise fee to the franchisor in exchange for the right to use their brand and business model. This can be a significant upfront cost, depending on the franchise.
• Ongoing royalty fees. In addition to the initial franchise fee, franchisees may be required to pay ongoing royalty fees to the franchisor, which are typically a percentage of the franchisee's sales. This can be a significant ongoing expense that can impact the franchisee's profitability.
• Limited control over the business. As a franchisee, the individual or company operating the food truck will be required to follow the franchisor's systems and methods for operating the business. This can limit the franchisee's ability to make decisions and adapt to changing market conditions.
• Contractual obligations. Franchise agreements typically include a number of contractual obligations that the franchisee must follow, including requirements for branding, marketing, and operating the business. Failing to meet these obligations can result in fines or termination of the franchise agreement.

While you’ll need upfront capital to get started, the costs of joining a food truck franchise are much lower than brick-and-mortar restaurants. 

5 of The Best Food Truck Franchise Opportunities

1. Kona Ice

Kona Ice is a shaved ice food truck business that offers franchise options all over the country. They currently have 1,200+ franchises across the United States, and it’s easy to see why. With low fees and an easy-to-prepare product, it’s a simple business to get up and running.  

• Required investment: About $140,000 for everything including the franchise fee, truck, and inventory. 
• Franchising fees: $15,000
• Royalty fees: $3,000 - $4,000

2. Cafe2U

For Australian residents, Cafe2U is a mobile coffee van that’s launched over 100 franchises around Australia. They’ll teach you everything you need to know and provide you with a Mercedes Benz Vito van and all the equipment you need to hit the road.

• Required investment: Must enquire through an online form. 
• Franchising fees: Must enquire through an online form. 
• Royalty fees: Must enquire through an online form. 

3. Cousins Maine Lobster

A Main-based lobster food truck franchise, Cousins Maine’s offers franchise opportunities outside of Maine as well. You’ll have hands-on training in Maine where you’ll participate on a lobster boat for the day.

• Required investment: Must contact them through an online form. 
• Franchising fees: Must contact them through an online form.
• Royalty fees: Must contact them through an online form.

4. ZooHoo’s Eatery

ZooHoo’s Eatery serves casual American fare and offers two models for franchising. The first is a semi-permanent structure that doesn’t need to be driven around, but is still small enough to make maintenance simple. The second is a trailer option, perfect for fairs and events.

• Required investment: ZooHoo’s requires a liquid cash investment between $20,000 - $45,000
• Franchising fees: $15,000 for semi-permanent locations or $10,000 for trailers. 
• Royalty fees: 4.5% of weekly sales.

5. The Dapper Doughnut

The Dapper Doughnut, as their name suggests, offers a mobile food truck that sells various gourmet doughnuts. They offer classroom sessions, webinars, on-the-job training, as well as additional on-site training as needed.

• Required investment: The company requires a minimum net worth of $350,000 and access to at least $100,000 in liquid capital, but you’ll need to contact a representative to find out the exact costs required to own a Dapper Doughnut truck. 
• Franchising fees: You’ll need to contact a representative to find out the exact costs.
• Royalty fees: You’ll need to contact a representative to find out the exact costs.

Is a Food Truck Franchise Right for You?

Before jumping into franchise ownership, there are several things that you need to consider first. To decide whether or not it is a smart business decision for you, take some time and think about the following:

• Research the market. It’s important to research your local market to determine if there is demand for the type of food that the franchise serves and if there is room for another food truck in the area. This may involve studying demographic data, analyzing the competition, and taking a survey of potential customers.
• Consider the costs. As with any business venture, you need to carefully consider the costs associated with starting and operating a food truck franchise. This may include the initial franchise fee, the cost of equipment and supplies, training and support fees, and ongoing expenses such as rent, insurance, and employee salaries.
• Evaluate the franchise agreement. Always make sure to review the franchise agreement and any other contracts or documents provided by the franchisor. This will help the reader understand their rights and obligations as a franchisee, as well as the support and resources that the franchisor will provide.
• Consider the level of support and training. A good franchise will provide ongoing support and training to help the franchisee succeed. This may include initial training, marketing materials, and ongoing guidance and support. 
• Think about personal goals and interests. Ultimately, it’s important to consider whether a food truck franchise aligns with your personal goals and interests. Running a food truck can be a rewarding and fulfilling experience, but it also requires hard work, dedication, and the ability to handle the challenges that come with running a small business.

Franchises provide on-the-job training, easily sellable products, and continued support as your business grows. 

Why Food Truck Franchises Are a Good Investment

As the popularity of food truck franchises continues to grow, it’s easy to see why they make a great investment. Food trucks offer a unique way to serve customers and can offer both financial and lifestyle benefits. Here are some of the reasons why food truck franchises make a good investment.

Food Trucks Are Trendy

Frankly, food trucks are just cool. Plus they’re becoming more and more popular. This makes it easier to attract customers, especially when you’re in a trendy area. Plus, food trucks offer something unique that customers can’t get from traditional restaurants.

Food Trucks Appeal to Foodies

Food truck franchises are a great way to appeal to foodies and adventurous eaters. Customers will be drawn to the variety and creativity of food truck fare, and they’ll be excited to try something new.

Food Trucks Are Fun

Food trucks are fun and exciting for customers, and they’re a great way to create an experience. Plus, food trucks have the ability to move frequently so one day they’re parked right next to the ocean, and the next they’re at an event in a downtown area. 

Food Trucks Are Memorable

Food trucks are hard to forget. Customers will remember the unique experience and the delicious food. Plus, food trucks are a great way to stand out from the competition.

Food Trucks Are Flexible

Food trucks can go where the customers are. This makes it easy to find new customers and take advantage of events and festivals. Plus, food trucks can be moved to different locations quickly and easily.

Food Trucks Offer Independence

Food truck franchises offer a great level of independence. You can choose the hours you work, the food you serve, and the locations you visit. This gives you the flexibility to do what works best for your business.

Food Trucks Have Built-In Marketing

Food trucks offer a great way to market your business. Your food truck itself is a moving billboard, and you can use it to promote your business at events and festivals. Plus, food trucks are a great way to generate social media buzz.

Food Trucks Have Relatively Low Start-Up Costs

Food truck franchises are relatively low risk compared to the more traditional restaurant path. Food truck start-up costs are usually lower than traditional restaurants, and the overhead costs are often lower as well. 

Where Can I Get a Food Truck Loan?

You can get a food truck loan through big-name banks, credit unions, and recommended food truck financing companies. These loans are term loans, so you’ll have a set repayment schedule and pay interest. You can use these loans to purchase a food truck and make any necessary repairs. 

Business Mentoring Organizations That Could Help

There are a number of organizations that can provide information and assistance to individuals or businesses interested in starting a food truck franchise. Some options include:

• International Franchise Association (IFA). The IFA is a trade association that represents the franchise industry and provides information and resources for franchisees and franchisors. They offer a variety of resources and tools, including a franchise directory, franchise financing resources, and educational seminars and events.
• Small Business Administration (SBA). The SBA is a government agency that provides assistance to small businesses, including those interested in starting a food truck franchise. They offer a variety of resources, such as counseling, training, and financing options.
• Franchise.com. This site provides information and resources for individuals interested in starting a franchise business, including a franchise directory and educational materials.
• Franchise Business Review. The Franchise Business Review provides independent research and reviews of franchise opportunities, including food truck franchises. They offer a variety of resources such as franchisee satisfaction surveys, a franchise directory, and educational materials.
• Local Chambers of Commerce. The local Chamber of Commerce in your area can be a good resource for information and assistance for businesses in the area, including those interested in starting a food truck franchise. They may offer networking events, training programs, and other resources to support small businesses.

Final Word

The food truck business is one of the fastest-growing segments in the restaurant industry. With lower overhead costs, the ability to customize menus, and a wide reach, it’s not a surprise that  food trucks have gained such a huge following.

A food truck franchise provides the opportunity to get into this business with a bit of a leg-up, allowing franchisees to benefit from the established brand name, marketing, and operational support. Before investing in a food truck franchise, it’s important to do your research, compare the different franchise opportunities, and understand the associated risks. With the right research and planning, you can be part of the exciting food truck industry before you know it.