How to Raise Money For a Food Truck: Top Fundraising Strategies

August 16, 2024 | 8 min read Financial Assistance

Starting a food truck is a fantastic way to take your culinary passions to the next level without the financial commitment of opening a restaurant. Even though it’s the much less expensive option, launching a food truck business can still cost tens of thousands of dollars. If it’s your dream to hit the road with your culinary skills but you’re not sure how to raise money for a food truck, this guide can help. Learn about the expenses you’ll encounter and the best ways to finance your food truck business.

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Common food truck cost

According to the website toast,. Food trucks make an average of $250,000-$500,000 annually, or $20,000 – $42,000 monthly. While this may seem like a lot, you need to be aware that there will be start up and running costs to consider.

Like any business investment, food trucks have a wide range of costs. The website Square Up, lists some of the most basic food truck start-up costs.

The truck itself: $40,000 – $150,000 this depends on if you buy a new truck or preloved truck.
Initial inventory (including food): $2,000 – $3,000
Permits and licenses: $1,864–$28,276
Registration: $200 – $1,000
Labour -$50 – $100,000 per year
Insurance- you can expect to pay between $1,000 to $5,000 per year for comprehensive coverage, including general liability, vehicle insurance, and business interruption insurance.

Taking into account all other costs, like cookware, fuel, and repairs, the total cost of starting a food truck business is around $50,000 on the low end and $300,000 on the high end.

It is also important to consider ongoing costs. Here is a breakdown of some of the monthly expenses.

Electricity and water bills: On average, you might expect to pay $100 to $400 per month.
Propane: If your food truck relies on propane for cooking, heating, or refrigeration, propane expenses may range from $100 to $300 per month, depending on usage.
Waste Disposal: Monthly waste disposal fees can range from $50 to $200, depending on your location and the volume of waste generated.
Internet and Communication: monthly fees may vary from $50 to $100.
Phone: $20 to $50 per month.
Disposable Serveware: $100 to $300 per month, depending on usage.
Cleaning Supplies: monthly cost of $50 to $100 per month
Menu Boards: $100 to $500 per month.
POS Supplies: Receipt paper, ink cartridges, and other POS-related supplies may add another $50 to $100 per month.
Location – The location of your food truck will play a huge role in how many people visit it. A lot of heavy footfall locations will charge for you to be parked there. Costs vary depending on the area and time of day. It is best to put aside between $500 – $1000 a month for this.

Let’s talk food pricing

When thinking about how much you should be charging for your food. It is important to consider the price of the ingredients.

A formula most people use is called food cost percentage pricing. Here how it works:

Work out how much your ingredients cost
Decide how much you are going to charge for your dishes
Work out the food cost percentage using that price as a reference.

Need some help? Upmenu provided a handy breakdown on how to do the math. You can also get some inspiration from “most profitable food truck food” lists.

How to create a food truck business plan

Any successful business started with a solid plan and starting your food truck is no different. Here are the main things to consider when putting together your plan.

Do your research – Think about who you want your food truck to be for and find out everything about them. Think about what they like and what they dislike. This way you will be able to tailor your truck to meet their needs.
Know your competitors – Have a look at other food trucks in your area. Identify what their strengths and weaknesses are and consider your own. You can use this knowledge to develop unique branding that differentiates you from your competitors.
Marketing and sales – You may think a food truck is all about food but that is not the case. You also need to consider how to get the word out there about your truck. Consider social media, local advertising, partnerships and events that you can put on to attract customers to your truck.
Plan your menu– Make sure your menu is designed to be made in a food truck. Try to include dishes that reflect your personality and meet your target audience’s preferences.
Consider your finances -This is the most important part of your plan. Be sure to create a financial forecast including startup costs, monthly operating expenses, revenue projections and profitability analysis.

Wix has some great tips on how to plan and execute your food truck plan.

Options for paying for a food truck

Launching a food truck business is similar to starting any sort of business—you need time, dedication, and of course, seed money. So how do you fund a food truck right off the bat? These are the main ways you can get the funds you need to purchase a food truck:

Use personal savings

If you have a solid amount of money in savings, you can use this to purchase a new or used food truck outright, or put a down payment on a truck.

Rent or lease someone else’s food truck

Renting or leasing a food truck through a site like Road Stoves is a good option if you don’t have a lot of money up front, however, it can end up being more costly in the long run.

Try online crowdfunding

Many business owners are turning to online crowdfunding to jumpstart their dreams. Not only is online fundraising a fast and simple way to get financial support, but your fundraiser also raises awareness for your cause and builds a sense of community around your business.

Take out a loan

Some people have no other option but to take out a loan to get the seed money they need for their food truck business. Many loans can have very high interest rates and may not be the best decision for you, depending on your financial situation, so be sure to talk to a financial advisor before going this route.

5 tips for running a successful food truck fundraiser

1. Have a pre-launch game plan

Just like you’ll spend a good deal of time laying out a food truck business plan, you’ll also want to make sure you’ve done a bit of planning before you launch your fundraiser and share it with the world.

Compile a list of all of your contacts you’d like to reach out to about your fundraiser. This should include friends, family members, and business contacts.
Craft a donation request letter, email, or text message beforehand so you can send it as soon as you start your fundraiser.
Not sure how to ask for financial help? Read our blog post, How to Ask for Donations.
If you already have a presence in the local food scene, be sure to reach out to your contacts to tell them about your upcoming fundraising plans.

2. Tell a compelling story

Your fundraiser story is a critical part of your success, so it’s a good idea to spend some time putting it together and asking for feedback before you publish it.

Give your fundraiser an interesting and eye-catching fundraiser title.
Including photos and videos makes your story more engaging and helps others connect to your cause more.
Be sure to include financial details that help explain why you’re asking for the goal amount you’ve chosen. Donors will want to know exactly how you’ll use the funds.
Tell donors why your food truck dream means so much to you, and how the business will shape your future. These are the emotional details that can turn passive readers into active donors.

3. Read up on crowdfunding best practices

For even more helpful information on running a successful online fundraiser, be sure to take a look at these blog posts:

4. Involve your community offline

Sometimes, online promotion can only go so far. Since your food truck business will depend on community support in real life, it’s important to connect with neighbors, community members, and other business owners as much as you can. Use local food truck events as a way to get your foot in the door or as an opportunity to build relationships with other local food truck owners. There are so many ideas that can help you raise money fast.

5. Don’t forget fundraiser updates

After donating, your supporters will want to know how your business is going, how their donations made a difference, and what plans are on the horizon. Radio silence can discourage future support, while a steady stream of fundraiser updates will keep your business top of mind. Don’t forget to write a donation thank-you note after each contribution, too.

Fund your food truck dream today

Starting a new business takes bravery, and you should be proud of yourself for beginning this journey. Launch your online fundraiser today so that your friends, family, and community can rally around you and help your food truck startup succeed. GoFundMe is here to answer all your fundraising questions and to show you how it works.

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