CALL 904-397-0246

9755 S.R. 121 SOUTH - MACCLENNY FL 32063
HOURS: M-F - 8 a.m. to 4:30 p.m. (EASTERN TIME)

January 13, 2016 Staff

Can You Franchise a Food Truck Business?

Rotolo's Food Truck.

The quick answer is “yes!” The big questions are “should you?” and “do you want to?” Brand sustainability, time and capital investment to franchise your concept are big factors in making the decision.

Is your food truck business successful and running like a well oiled machine? If you have success with regular vending locations, a solid event and catering history, expansion may be the next profitable step. Franchising may catch your attention as a way of increasing your income streams from one truck to two with less effort and expense. Franchising eliminates the day to day operational responsibilities of additional trucks; your franchisees assume all capital and operating expenses as well as oversight and management.

A sustainable mobile food business may indicate readiness to expand. Remember that well oiled machine mentioned above? Food truck businesses with operating manuals, recipe books and hands-off owner management are optimized for enduring profit. Food truckers with systems in place for accounting to cleaning the truck may be ready to expand. If you can go on vacation or get sick and your truck business continues to run smoothly without you, your ground work is in place for expansion without twice the effort.

Time and Capital

The time and financial capital required to open another truck may be out of reach. Franchising is a regulated form of doing business, one that puts the responsibilities and risks on the franchisees who pay a fee to buy into the franchise – the brand, concept and support are included in the franchisee’s investment. The capital required to franchise your business is much less than opening another truck, and the return on the investment can be high. Legal and business set-up fees and franchise materials (recipes, operational manuals and brand intangibles such as logos are the bulk of a franchisor’s expenses. Franchise fees and royalties are on the plus side of the spreadsheet for an expanding food truck franchisor. While there is no guarantee of income outpacing expense, with careful planning, franchising may be the way to profitable expansion for a food truck brand.

Once franchised, the franchisor (original business owner) takes on the new and different role of running the franchise system – supporting all the franchises – rather than just the one business, taking attention from the day to day management and operation of the original food truck. It may or may not be for you. Food truckers by nature are an independent bunch, often involving the owner’s personality and effort into the core of the business and driving success. Owners who can quantify their brand, products, services and management, and let it go with someone else running a nearly identical business are those who may succeed in franchising.

As your brand becomes successful and you look to grow, evaluate your interest in your own day to day work. The daily grind of food trucking burns out many operators; franchising is a way to expand and take the work from the food truck into the office for most owners.

The Shark Tank Model

The most visible franchised food truck brand is Cousins Maine Lobster, (video above) which notably started as Jim Tselikis’ and Sabin Lomac’s single food truck in 2012, received an investment from ABC’s Shark Tank’s Barbara Corcoran, expanded to four trucks in Southern California, franchises operating in ten regions throughout the US, rolled out home delivery nationwide, and opened their first brick and mortar restaurant in 2015. The cousins worked hard and did their homework to succeed with their first truck to a level that impressed Corcoran for an investment, leading to rapid expansion and continued success for themselves, their investor and now franchisees.  Building an empire is not easy, and the cousins continue to work long, hard hours. Franchising their operation has been a way to rapidly expand, apparently quite successfully.

Growth comes in many forms for food truck businesses:  brick and mortar, additional trucks, partners, franchising. Every expansion carries risk. The franchise may carry the least financial risk for the original owner/franchisor, but possibly the highest risk for the brand. Each outlet’s success is reliant in at least some part on the success of the entire brand. If a franchisee stumbles enough to tarnish the brand, the original business can suffer. Franchising in distant locations may prevent or lower this risk, but still must be considered before a franchise agreement is in place. If you’re at the point of expansion, it can definitely be a profitable direction for your food truck business.

Have Questions about Custom Builds?

Call Us or Submit the Form Below to Contact M&R Specialty Trailers and Trucks.