You have a dream to enter the food industry but looking for an affordable solution? Food cart business is the most ideal solution for you as you can start this business in a very economical and pocket friendly way. This is a food business with minimum risk, lowest investment and it is most popular among the food lovers in India. This is the most suitable business idea for upcoming food entrepreneurs as in recent times food cart business is flourishing like anything as craze of street food among foodies is unbelievable. So in case you are planning to enter the food business, it is advisable to start a food cart business as compared to a restaurant. But keep in mind that it is not that easy at all as it sounds. You need to do thorough research before starting any business whether it is a small or a big business.
Starting any business is not a child’s play so before starting a food cart business, you have to do a detailed research on various points listed below: –
- Complete market research of product that you are planning to sell
- Demography and detail about who is your target customer?
- Most important is the location where you are planning to put up a food cart
- Food business licensing and certificates like FSSAI, etc.
- Study the kind of existing food carts and competitors in that area
- Taking utmost care about hygiene which is very important in these times
- Vendor from whom you will be purchasing the food cart is also important as the design, look and feel of your cart will be very important to attract your customers.
Later, you can also plan to buy a software or app for your food cart or food truck or POS (Point of Sales) solution so that your business is completely streamlined. For the beginning you can start without it just to keep your investment in limit but you have to keep this in mind and keep a separate budget for this as you will definitely require this when your business grows in coming months.
Budget estimate for your food cart / food truck business*
- Custom designed food cart or food truck = Rs.50,000 approx.
- Kitchen equipment = Rs.15,000 approx.
- Raw material to start with = Rs.10,000 approx.
- Licensing and registration fee = Rs.10,000 approx
- Staff including chef & helping staff = Rs.30,000 approx.
- Initial marketing budget for leaflets, banners, posters, etc. = Rs.5,000 approx.
- Miscellaneous expenses = Rs.5,000 approx.
Total setup initial cost of a food cart business comes out be Rs.1,25,000* approx and it may vary depending on various other aspects.
Crucial points you need to consider while starting a food cart business
Product – This is the first and most important factor around which your whole food cart business will revolve around. It may be possible that you have a different taste or liking but before starting a business you have to consider the taste and demand of your target customer. Generally a food cart serves fast food and quick serving products but if you have a different USP and want to stand out of others in competition, you can think of something more innovative.
Location – It is very important factor as far as your investment and pricing will be decided. The location that you have to purchase on rent will cost you depending on the location & area and also based on the location you can set the price of your product. As depending on the location and gentry in that location you can set the product price. Also, depending on the location you can find out what kind of competition you have in that area. You need to visit the location you are thinking about to understand the whole situation especially in weekends.
Licensing & Registrations – FSSAI (Food Safety and Standard Authority of India) registration for street vendors is needed to be taken by everyone in India. You can contact Municipal Corporation for the same and can easily apply for registration if you have all valid documents. The fee may vary depending on the state you are living.
Cart & Equipment – The food cart cost will vary from Rs.25,000 to some lacs depending on the size, quality, product you are planning to sell & few other factors. A decent metallic cart will be designed and fabricated by a fabricator in around Rs.50,000. You will also require to purchase equipments and commercial LPG cylinder which is one of the recurring cost.
Raw material – Your raw material cost is also important and it will also depend on the product you are selling. It is important that you cannot exceed the product cost otherwise your customers will move to some other alternate. Also, you cannot decrease the cost too much as you need to earn profit out of it. That is the reason it is important to find an optimum pricing for your product.
Staff & Manpower – Maximum two to three persons are enough for running a food truck business as it is a small business and being a startup and you as a rising entrepreneur would surely like to cut down maximum cost on manpower. You can tell your staff to prepare semi finished products so that efforts can be minimized.
Advantages of Starting a Food Cart Business
The low startup cost is one of the major factors that help you to start the food business as compared to a restaurant. There are many popular brands in food chains who have also started as a food carts.
Challenges in a Food Cart Business
Generally, food carts have to face lot of issues from the local police and authorities. Your competitors who are more influential also may create problems. Weather can also be another challenge because in that case you may experience low or maybe absolutely no business and sale that day.
Food cart business needs lot of ground work but that’s for sure if you have properly focused, have good quality food, keep care of hygiene, have good cost, etc. you will definitely succeed in this business.