How to Steer Around the Legal, Marketing and Operational Challenges of Modern Mobile Foodservice

This country's first experience with mobile food started decades ago with trucks plodding down the streets of Los Angeles selling tacos, burritos and other foods to whoever happened to be near. Over time, a few bad apples ruined the reputation for the rest and the trucks came to be infamously known as "roach coaches." Those days seem to be well behind us now.

With the mobile food truck craze sweeping the nation, from the West Coast in Los Angeles, San Francisco, Seattle and Portland, Oregon, to mid-nation in Austin, Texas, and further east in New York and, possibly soon, Chicago, wannabe restaurateurs and even longtime operators are looking to expand beyond the confines of the brick-and-mortar restaurant, on a physical, social and creative level.

Last spring, the National Restaurant Association took hold of this growing trend with an exhibit during its annual restaurant show in Chicago, which featured fully equipped trucks and a series of panel discussions led by Aaron Noveshen, co-founder of Mobi Munch in San Francisco, Ludo Lefebvre of LudoBites and Mary Sue Milliken along with Susan Feniger of Border Grill Truck in Los Angeles, and other industry veterans.

The mobile food truck trend seemed to gain its most momentum during the hard-hitting recession of 2008 and 2009 when restaurateurs had tighter budgets but just as big or bigger dreams, and many industry workers lost their jobs amid staff cuts. Much of the popularity behind the trucks, as a result, stems from their relative affordability.

The costs of purchasing, leasing and equipping food trucks, while they can run as high as the hundreds of thousands, are still no matchup to opening a traditional restaurant, which can run up a tab well into the millions. For that reason, they're a more affordable option for both up-and-coming and seasoned restaurateurs looking to open their own operation without the enormous down payment.

There are several reasons why food trucks are good for both operators and city residents, according to Phillip Foss, a seasoned, fine-dining chef who opened Meatyballs Mobile last year in Chicago after leaving his head chef post at the three-star Lockwood Restaurant. "But No. 1, they create more jobs because they create more opportunities for business," he says. "Going the food truck route is definitely an inexpensive start-up option. I was out of Lockwood one day and on the streets of Chicago the next without having to raise barely any capital."

Friend and fellow food truck operator Matt Maroni of Gaztro-Wagon agrees. "The start-up costs compared with brick-and-mortar are significantly lower."

Aside from financial opportunities, food trucks also open up opportunities for more creativity, in menuing and marketing. Truck operators looking to compete in the game must figure out a menu that's super portable, tasty, easy to eat and, well, fun and cool. Mobile food trucks these days also seem to have the creative flair to back up the food, from artist-painted trucks to catchy, interactive websites, staff with approachable, hip personalities, and a social media platform that's as much about function (revealing location equals more sales) as it is about building that dialogue between customers and strengthening brand identity.

"We're now a cultural movement," says Bo Kwon, owner of KOi Fusion, a Korean-American-Latino fusion food truck in Portland. "It's something trendy people can latch on to. I purposely have tried to intertwine myself with social media outlets, nightclubs, magazines -- certain things that would represent us on the cutting edge." Just as the dot.com era introduced us to the "Wild West" of this new thing called the Internet, the World Wide Web, the mobile food trend has not only brought in a wave of new options for eating outside the home, it's also brought with it a mini-information overload. This article will serve as a first place to start in navigating the confusion of how to begin and where to look for the right resources. Because just like the Internet, rules and laws regarding these trucks are still slow to develop as set-in-stone guidelines.

Rules of the Game

With every food prep situation comes health inspectors. For food trucks, it's no different. Despite the reputation they may have had for being able to skirt the inspections years ago, truck operators must follow the same health inspection guidelines, codes and schedules as traditional restaurants, but in many cases having wheels gives them the red flag. Milliken and Feniger's trucks are subject to unannounced visits from health inspectors, who know of their locations because of the location permits they must secure, but possibly from their Twitter feed as well.

"It was really important for us to make sure we would be able to keep things at the temperature the health department required while still doing the preparation we wanted to do," Milliken says. Kwon also sees regular inspectors every few months at both scheduled and unannounced times.

Just as health codes vary from city to city, so do the laws regulating, or prohibiting, these trucks on the street. Los Angeles, which has a long history of mobile food trucks and other street food a la pushcarts, has continued to allow this new wave of "upscale" trucks on the city streets, but "you can't just go wherever you want," says Feniger of Border Grill Truck. Operators still need to obtain permits for certain locations, except during private parties, which offer more freedom because they're off city grounds.

"L.A. has a long history of taco trucks and mobile food and the more congested the city gets it makes sense to bring delicious, fresh, high-quality food to places where there are a lot of people who are held captive for one reason or another," Feniger says. By that she's referring to both "food desert" areas where higher-quality food may be hard to come by as well as sporting and cultural events where sales can skyrocket. Feniger and Milliken regularly set up shop outside art galleries on the first Friday of each month when they have parties and showings. They also work daily like caterers to book spots at other events, such as music concerts and other events.

...I think the food trucks are great, and they've really energized the restaurant business with new flavors and simplified operations by taking the food to the streets. For the first time in years of teaching, I have a couple of students wanting to do food trucks for their restaurant start-up business plans. But at the same time, the trucks are also causing some issues in the city... - Phil Mott, hospitality instructor at Kendall College in Chicago

In San Francisco, city officials have played into the growing trend by addressing current regulations and setting new ones to make it easier for trucks to get in the game. A series of proposed regulations would reduce the number of inspections for food carts and trucks from several inspections per year to just one annual inspection as well as allow them to work with the fire department as an alternative to the health department. Should the proposed regulations go through, truck owners will also be able to secure permits for multiple locations from the public works department, rather than getting one per location from the police department. The proposal also calls for significant reductions in the cost of such permits as well as boosted opportunities for financing other costs.

Even Cleveland operators are jumping on the mobile bandwagon, though not without their own set of challenges. Truck operators there have noted concerns over the high costs associated with regulations requiring multiple permits, including health and fire inspection certificates as well as catering and vending licenses, among others. Like San Francisco, however, city officials are looking to relax some of these regulations, including reducing the permit requirements to just one application and fee.

Many say Portland, second to Los Angeles, has led the nation in the food truck revolution. Home to more than 400 food trucks, the city's still different from others in that many of the trucks are not mobile, but rather stationed in "truck pods," a larger one being the 10th Avenue truck pod where office workers can venture to the area and choose among 20 different trucks for a quick and easy lunch. Another truck pod stationed near many of Portland's bars and nightclubs offer the perfect snacks for hungry late-night frolickers.

"Portland has a more relaxed attitude toward food trucks," says Kwon, who opened KOi Fusion two years ago. "You see more trailers that stay put, and only certain cities allow that. Portland's population is not as bunched up as, say, New York, and there's a little more space. There is also more private property in the city area, something you definitely wouldn't see in New York or L.A. A lot of the owners of these open lots lease space to cart owners."

Kwon, however, prefers mobile over stationary any day. "For me, I chose the opposite route," Kwon says. "I didn't want to be stuck in the same, stereotypical cart life as everyone else. Having a truck is more valuable to me because I have the ability to find customers rather than wait for them to find me."

Theft also runs rampant at some of these truck pods, Kwon says. By parking his truck in a closed, secure garage within the central commissary kitchen he leases for the bulk of his food prep, Kwon naturally avoids this danger. He also doubled up on his truck's security by buying the truck with the equipment not only bolted to the truck but welded together as well, making it impossible for thieves to pick off ovens and other expensive pieces at a time. More on that later.

Getting back to the legality of food trucks nationwide, Chicago allows food trucks to roam the streets, but stands alone among the big cities in its ban of cooking while on the truck. Instead, truck operators must prepare and cook all food in a licensed commercial kitchen off-site and then try to keep the food warm on the truck before serving it on the road. Cooking on street pushcarts is also strictly prohibited and the city's strict on permit regulation for those; this is why you won't find a hot dog or shawarma sandwich on the street like you might in Manhattan.

Atlanta has regulations regarding cooking on trucks and carts similar to Chicago - they don't allow it, just yet. But the community has slowly been lobbying for changes to be made there as well. For now, many mobile food trucks operate in the outlying suburbs.

The Wheels

So you've done your research on local codes and regulations regarding food trucks. Now what? Problem is, most operators don't know where to begin looking for information on how to buy a truck.

A few companies consult operators on these needs and some suppliers offer food truck equipment customization and installation.

Kwon was lucky. His friend had already started a successful Korean taco truck operation, Koji, in Los Angeles, selling 500 meals a day, give or take. "I had to fly down there and see it for myself," he says. Once he did, the idea was sold. Armed with his marketing and business background and love of food and cooking thanks to growing up with his Korean parents' cooking, Kwon set out to purchase the best truck and equipment he could find - contacting his friend's company for the truck, AA Catering. Something to note: Many mobile food truck operators are reluctant to share those secrets but with a few phone calls and online research that information can be found. Back in Portland, Kwon worked with a local restaurant supplier to not only purchase the equipment he needed but have it installed and welded together for, as mentioned earlier, security reasons and to make cleaning easier, something he does thoroughly after every shift back at the central commissary kitchen/warehouse space he rents.

"I didn't just want to buy an old box truck and put a bunch of kitchen parts in it," says Kwon, who works with a grill, flat-top charbroiler, steam tables and two fryers, all welded together. "It was a little more money in the beginning, but I feel more comfortable sleeping at night. It's bulletproof; I could drive this thing off a cliff and still start it up." That, combined with full-fledged insurance, just like a traditional restaurant, helps as well, especially in the case of food trucks that use high propane levels and present more of a fire hazard.

Speaking of propane, most truck operators use gas-powered generators to run the equipment, and the Border Grill Truck even uses recycled fryer oil from the restaurant. The LudoBites truck demonstrated similar use of recycled fryer oil at the National Restaurant Association show exhibit last spring.

Meals on Wheels

Food truck menus aren't like your typical restaurant lineup. The food has to be a little more creative, a little more portable, not too messy, and certainly very tasty to compete with traditional restaurants. But this comes easy for many of the food truck operators of today, as many come to the scene as ex-chefs of two, three, even four-star dining spots. They also bring with them the passion and creativity needed to make themselves stand out from other trucks and restaurants as a start-up business.

For Milliken and Feniger, creating a slightly "upscale," but authentic street food menu for their truck came very easily for them.

"Mary Sue and I, in all of our travels over the last 30 years through Mexico and California, we've always eaten off trucks or the stands and I think that's been very inspirational to us," Feniger says. With a three-decade history of restaurant ownership and a legendary track record of introducing non-Latinos to traditional, authentic Latino food in California and around the country, the multiple award-winning duo had always considered running a food truck of their own, but the timing, and the trend, only became relevant a couple of years ago.

An instant success, with more than 500 meals served a day and many more during events, the Border Grill Truck has a larger menu than most, serving up a range of quesadillas and tacos, including the popular fish tacos and one stuffed with Yucatan-style pork slow-roasted in banana leaves and with homemade tortillas (prepared at the restaurant off the truck). Their fried avocado dipped in various types of seeds and a Peruvian-style ceviche in cone-shaped tortilla shells have also proved regular favorites.

Feniger and Milliken are also known for their dedication to using local, organic, seasonal ingredients, the best they can find, and well before that movement swept the nation. Kwon also looks to source the highest-quality ingredients, even starting off calling himself Korean Organic Infusion before he realized the challenges with sourcing organic for each and every ingredient in the menu to back up the name. Though the "O" now stands for Oregon, Kwon still sources organics where he can, and sourcing naturally raised meats helps bump up that level of sophistication that food truck operators really need these days to compete. At Koi Fusion, crowds come in droves for the tasty tacos stuffed with Korean barbecued pork, beef and chicken with kimchi, napa cabbage and other traditional Korean ingredients in a fusion of Latin and Asian flavors.

"I worked on a Mexican food truck for free for two months when I came back from LA and was thinking about starting my own truck," Kwon says. Unlike Los Angeles, Portland doesn't have a lot of Korean-Americans so I wasn't sure it would work, but I knew the city is a huge foodie town and if this food was going to work anywhere, it would work here." And it has. Kwon lines up the crowds every time he shows up in a new place.

Just as important to menu development for food truck operators is pricing. They must keep their prices low enough to present an affordable alternative to a full-service lunch or dinner, but to make up for that they need to be able to sell higher volumes and really bump up their marketing efforts.

"My tacos are only $2, but many people will come and buy 10 tacos at a time, and then they're spending $20, which is the same amount they'd spend if they went to a sit-down restaurant."

Kwon also boosts his profits by saving money enlisting his family and friends to help him on the truck, but realizes he will need to invest in full- or part-time staffers soon to match his volumes.

Speed also helps, Feniger says. "You have to be able to put the food out very quickly. Speed is critical to match the price point -- our check average is $7 or $8 a person, so we must work quickly and that can be a challenge for many restaurants."

Marketing Mobile

To drive those sales, social media is essential. Most truck operators use Twitter to announce their whereabouts and build up their lines. They also use the platform as a way to answer questions and engage in ongoing dialogues to build not just loyal customers, but in many cases friends, and to further the growth of the food truck revolution. In many ways, truck operators represent the next wave of restaurant hospitality and customer service.

Choosing locations can make or break a day in sales, too. Kwon, who used to work in the nightclub industry when he was younger, looks to his continuing relationships with the bars and clubs in his area to park himself across the street, just in time for the hungry bargoers to leave at 2 a.m. and look for food.

His bouncer and manager friends also help him out by pointing these patrons directly to him. The truck operators are getting a little more press by the day, and many local newspapers and other media outlets, such as the Chicago Tribune and Zagat, nationally, will record, announce and otherwise "tweet" the locations of multiple food trucks at a time for their readers.

At a very minimum, truck operators also use their websites to post schedules, but it's important to note that these websites aren't just your plain-old, rinky dinky site. While truck operators may not invest as much upfront in a fancy bar or state-of-the-art dining room décor, they must invest in a great Web designer who can make their website an extension of their brand. Kwon's site, www.koifusionpdx.com, is fun and catchy, with tons of photos and even a space to enter in e-mail and other information (a smart marketing trick), plus it's constantly updated with bloglike entries and his changing schedule.

Milliken and Feniger's main restaurant site, www.bordergrill.com, feeds directly to their Twitter account with the truck's announcements and schedules, and it also has a space for visitors to contact them directly about events.

Competitive Issues

In Portland, the food truck setup, with stationary trailers parked on top of each other, creates a culture of street food competition that Kwon precisely wanted to avoid by adding wheels. Now they're all getting resistance from nearby brick-and-mortar restaurants.

"Some restaurants are complaining because there's so much competition from the truck pods," Kwon says. "A lot of the truck owners are putting tables and chairs out and even building decks and patios outside their trailer so those are getting quickly red-flagged and shut down."

The main issue of contention, says Phil Mott, a hospitality instructor at Kendall College in Chicago, is that the brick-and-mortar restaurants say they have to play by certain rules, so the truck operators should too. This lack of groundwork, constantly changing legislation and endless lobbying, and the "newness" of it all is precisely what's getting the competition, i.e., traditional restaurants, slightly concerned, and in some cases, pretty ticked off. This is especially the case in Chicago, where legislation regarding the trucks is just in the initial stages of development.

"I think we're getting a bit of a fight back from the brick-and-mortar restaurants because what's happening is in Chicago the food truck situation is sort of this 'middle of the night' pirate operation because of the lack of regulations, and so you have people flying under the radar all over the place," Mott says. "As a result, they're seeing more calls of complaints and fines."

In an example of this backlash, one high-end steakhouse restaurant called the police to complain about a food truck operator parking close to their doors, and illegally. Other truck operators are seeing their parking tickets add up, and one even had an officer chase him by bike. Until the city can figure out how to set up an infrastructure for location permits and other guidelines these trucks can follow, the confusion and resentment will continue to build, Mott says.

Food truck proponents argue that the customers who flock to the business lunch spots in the city aren't the same ones going to the food trucks at the same time. "Food trucks certainly aren't the same competition -- it's a $6 check average versus a $30 one, for instance, but the restaurants are saying, 'I have this nice restaurant and I don't want a food truck blocking my place in front of my restaurant, it doesn't look good and it may be taking up my valet stand and they're parked illegally.'" It all comes down to an issue of fairness for them, Mott says. If they had to put the money and effort into getting the right permits and following code, the truck should too.

"I think the food trucks are great, and they've really energized the restaurant business with new flavors and simplified operations by taking the food to the streets," Mott says. "For the first time in years of teaching I have a couple of students wanting to do food trucks for their restaurant start-up business plans. But at the same time, the trucks are also causing some issues in the city."

Where the Rubber Meets the Road

Some truck critics say the trucks should use their mobility to an advantage and sell only in areas where restaurants aren't, including the food deserts of Chicago. "In this case, someone could take an organic food truck around to help those who don't have access to fresh food," Mott says. "Someday, will we get food carts in Chicago? If not carts, I can certainly see someone opening up a walk-up window on Michigan Avenue and selling food out of that. We're really seeing the stretching of what food trucks mean."

In the case of food trucks, just like the Internet's development, time will only tell when it comes to regulations surrounding the trend, or movement. Until then, do your research, invest in the best, use social media, open your creative minds, and you may have a food truck of your own.

Words of Wisdom:

Starting Up a Food Truck

Here's a short list of the top five things to do before opening a food truck.

1. Research your city's codes and laws regarding food trucks. Some municipalities require food truck operators to prepare foods in a central commissary before serving off the truck, as in Chicago. Others require only certain foods to be prepared that way, or none at all, but they may have stricter laws regarding permits and where to park.

2. Have fun with the menu. Food truck menus are creative, fun, even quirky (one Portland truck serves Spam grilled cheese sandwiches), but at the very least the food should be tasty, filling, easy to eat and portable.

3. Get active on Twitter and Facebook. Twitter is the method of choice for most operators looking to communicate with their customers and tell them where they'll be and when. It not only helps build sales, but also a rapport and serves as a marketing launching pad to strengthen brand identity.

4. Make good investments early on. Even though starting up a food truck costs significantly less than brick-and-mortar, don't be cheap. Do your research and invest in the best equipment and installation you can get to prevent breakdowns and other bad surprises while on the road and, worst, during your limited time to serve customers. Make sure you have a good generator if you'll be working in inclement weather conditions.

5. Think beyond your usual drop-off points. Most truck operators have their regular routes with a few surprises thrown in, but branch out into catering and private events, sporting events, music concerts and other special gatherings for a revenue boost. Private events also offer more freedom (serving alcohol is one) because you're off city property.