Food Truck Financing Advice | Tips to Start a Food Truck Business https://legionfoodtrucks.com/category/food-truck-financing/ Custom Food Trucks Tue, 30 May 2023 04:56:07 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.5 https://legionfoodtrucks.com/wp-content/uploads/2019/07/lft-favixon.png Food Truck Financing Advice | Tips to Start a Food Truck Business https://legionfoodtrucks.com/category/food-truck-financing/ 32 32 Starting a Food Truck Business Without Capital https://legionfoodtrucks.com/starting-a-food-truck-business/starting-a-food-truck-business-without-capital/ Tue, 23 May 2023 08:00:16 +0000 https://legionfoodtrucks.com/?p=5674858 If you’re interested in starting a food truck business, now is a perfect time. The food industry is changing tremendously, with much of these changes geared towards improving the experience for consumers.  Today, more consumers want food options on-the-go. If you don’t believe it, the average annual income of roughly 30% of food truck owners […]

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If you’re interested in starting a food truck business, now is a perfect time. The food industry is changing tremendously, with much of these changes geared towards improving the experience for consumers. 

Today, more consumers want food options on-the-go. If you don’t believe it, the average annual income of roughly 30% of food truck owners is between $150,000-$199,000. With that said, food trucks have become the perfect solution with their accessibility and the ability to provide consumers with on-the-go consumption.

If you’re preparing to start a food truck business or considering launching one, read on to learn how you can start a food truck business without capital. 

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4 Ways to Start a Food Truck Business Without Capital 

The food truck industry is certainly growing. But many people who step into this industry have little capital or no capital at all, resulting in a difficult start. The good news is, it’s possible to get your food truck business off-the-ground without much capital. Here are 4 ways to help you get started. 

1. Start With a Food Stall

Did you know that many individuals start with a food stall before investing in a food truck? A food truck can be costly. In fact, these trucks can range from $15,000 to upwards of $100,000. 

Starting with a food stall is a great choice if you’re ready to get going but don’t have the capital to make that kind of investment. You can begin selling your food using a stall and consider doing pop-ups in different areas to help get the word out.

As your business grows, you can begin putting money aside dedicated to purchasing your first food truck. 

2. Rent Equipment

Another option is to rent the equipment you need until you can gain enough capital to buy it outright. This can be especially helpful for food trucks that specialize in certain areas and need specific equipment. 

For instance, if you run a food truck that specializes in coffee, you will need things like a coffee and espresso machine to help you run your business. These machines can be costly depending on the brand. Renting can help offset those costs until your truck generates enough revenue. 

3. Get a Credit Card with a 0% APR

If your credit is in good health, then consider obtaining credit with 0% APR. At 0%, you won’t be charged interest on your purchase over a period of time. This means that you can purchase the things you need to get your food truck up and running without incurring additional fees.

With that said, if you choose to use a credit card to fund your food truck business, be sure to set a budget and have a plan of action on how you plan to pay the credit card off in a timely manner, otherwise it could be risky

4. Crowdfunding 

You’d be surprised at who is willing to invest in your food truck business. If you have a solid vision and business plan, you should consider crowdfunding. Crowdfunding has become extremely popular over the years for startup companies that need help funding their business

Think about what makes your food truck business unique, create your pitch, check over your business plan, and find the right crowdfunding platform that fits your needs.

Starting a food truck business is a rewarding experience. If you are looking for a truck that represents your business, contact us today to learn how we can custom-build your truck to fit your needs.
Download Our Financing Guide Today!

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How To Get Food Truck Financing With Bad Credit https://legionfoodtrucks.com/food-truck-financing/how-to-get-food-truck-financing-with-bad-credit/ Mon, 08 May 2023 08:00:10 +0000 https://legionfoodtrucks.com/?p=5675742 Food trucks are a growing trend, and there’s no doubt that they’ll continue to be around for years to come. However, if you don’t have the money to start up a food truck business, you may have to take out a loan. If you are looking for ways to finance your custom food truck, several […]

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Food trucks are a growing trend, and there’s no doubt that they’ll continue to be around for years to come. However, if you don’t have the money to start up a food truck business, you may have to take out a loan.

If you are looking for ways to finance your custom food truck, several options are available. Even if you have bad credit, you might even qualify for financing. 
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Tips for Getting Food Truck Financing With Bad Credit

Here are different tips to secure food truck financing with bad credit:

1. Try Boosting Your Credit Score

The first step in getting a loan for your food truck is boosting your credit score. You can increase your credit by paying off old debts, making sure you have enough cash on hand to cover the loan down payment and closing costs, and having an active account history. The better your credit score, the easier it is to get loan approval.

2. Build Down a Payment

It would be best to build down your monthly payments as much as possible. You can do this by finding a lender that offers low-interest rates or even zero percent interest loans. If you don’t qualify for a 0% interest rate loan, look into other lenders who offer lower interest rates.

3. Find Out What Type of Loan You Qualify For

Once you know what type of loan you want, find out which lenders will lend money for food truck financing with bad credit. Many ‌loans are available, including fixed-rate and adjustable-rate mortgages. Some lenders may only give you a certain amount of money based on your income level, while others will let you borrow more if you need it.

There are different food truck financing options available, such as:

Fixed-Rate Mortgages

A fixed-rate mortgage means that your interest rate won’t change until the end of the term. Most banks will tell you exactly when they expect their interest rates to go up so that you can plan accordingly. 

However, some borrowers worry about how long it takes to pay off such a large loan. A more extended repayment period can help you save money because you won’t make extra payments during the early loan.

Adjustable-Rate Mortgages

Adjustable-rate mortgages (ARM) are like fixed-rate mortgages, except they allow your interest rate to fluctuate throughout the loan length. 

The good thing is that ARM loans usually come with an introductory rate that adjusts annually. But, once your initial rate goes up, you’ll still be responsible for any additional increases.

No Money Down Loans

No money down loans require no down payment from you. Instead, you put all the money towards the purchase price. Of course, there are drawbacks to not putting anything down. First, you could lose a lot of equity in your home if you decide to sell later.

Food Truck Loan

4. Apply Online

Apply online once you have found a few lenders that you think might approve you for a food truck business loan. Many lenders now allow you to apply for a loan without ever meeting them in person. It saves time and makes applying for a loan faster.

5. Pay Off Other Debts Before Applying for a Loan

If you already owe any debt, make sure you pay it off before applying for a loan. Lenders usually require you to prove that you have paid all your bills on time.

Get Your Food Truck Financing Today!

Getting food truck financing with bad credit can seem daunting, but it doesn’t have to be. By following these tips, you’re more likely to get approval for a loan. For customized food trucks, contact us today.

Download Our Financing Guide Today!

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Filing Your Food Truck Taxes: 3 Deductions You Don’t Want to Miss https://legionfoodtrucks.com/food-truck-business-ownership/filing-your-food-truck-taxes-3-deductions-you-dont-want-to-miss/ Thu, 30 Mar 2023 09:57:09 +0000 https://legionfoodtrucks.com/?p=5675893 Are you concerned about your food truck taxes? If yes, you are a significant part of the in-demand mobile food industry—with an estimated 7.5% annual growth rate—standard in major and minor cities across the US. However, while making money by preparing tasty meals at your convenience can be nice, be ready to comply with lots […]

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Are you concerned about your food truck taxes? If yes, you are a significant part of the in-demand mobile food industry—with an estimated 7.5% annual growth rate—standard in major and minor cities across the US. However, while making money by preparing tasty meals at your convenience can be nice, be ready to comply with lots of state, federal, and local tax ordinances, as well as manage your food truck financing.

Complying with food truck taxes keeps your business fully operational and avoids the consequences of tax noncompliance. Below is a guide on filing your taxes and deductions you don’t want to miss.

food truck taxes

Food Truck Taxes: Tax Deductible Expenses

The costs of running your food truck business are deductible if they are ordinary and necessary. However, before defining these terms yourself, ensure you study the IRS’ definition of ‘regular and mandatory. Here are some of the standard deductions you should focus on to make the most of filing your taxes:

  • Business expenses
  • Equipment purchases
  • Vehicle expenses
  • Business Expenses

The costs of running a food truck include ongoing operational costs. Such operational costs may consist of the actual cost of food you prepare or the rent you pay for in a community kitchen. While some daily operational costs may not be considered hefty tax deductions, they may pile up over time. 

Therefore, ensure you track all these minor daily expenditures, and you will be amazed at how sizable the tax deduction will be at the end of the tax year. Such costs may include:

  • Food purchases
  • Utensils
  • Advertising costs
  • Employee salaries and wages.

Equipment Purchases

You can deduct a limited amount of the cost of purchasing new business equipment—from taxable income—in a year instead of depreciating the cost over time. Whether you need new ranges, grills, generators, ovens, or any large business equipment, you can claim a sizable, one-time tax deduction. Ensure you write it off when filing your taxes.

Vehicle Expenses

Vehicle-related expenses are part and parcel of operating a food truck business. The Internal Revenue Service (IRS) permits you to claim the standard mileage rate or deduct the actual food truck tax-related expenses. The standard mileage rate is a specified amount of money you can deduct for each business mile you drive.

When preparing to file your food truck expenses, ensure you keep a log of all the miles you cover with the track. Additionally, keep track of related costs such as parking fees and tolls since these may amount to a sizable deduction. 

Travel Expenses

It is possible to get tax deductions on expenses you incur when traveling for your food truck business. Ensure you keep logs and records showing the amount of every expense during your trip, whether accommodation, meals, or transportation. Additional crucial information you need to keep track of includes the exact period of the travel, essential locations, and venues—in case of a meeting—or the reasons for your travel. 

food truck taxes

Take Advantage of Your Deductions

Taking advantage of tax deductions when filing your food truck taxes helps reduce a certain amount from your taxable income and save plenty in tax. Are you planning on setting up a food truck business? Reach out to us to advise you on setting up a food truck business, including every critical business component such as financing and filing taxes. 

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Credit Card Financing Your Food Truck Business: Worth the Risk? https://legionfoodtrucks.com/food-truck-financing/credit-card-financing-your-food-truck-business-worth-the-risk/ Wed, 29 Mar 2023 08:00:40 +0000 https://legionfoodtrucks.com/?p=5676681 Credit card finance is one of the most popular mediums through which you can finance your food truck business. You get discounts on gas or food supplies, enjoy fraud protection in case your purchases don’t match what you ordered, and even get roadside assistance when your vehicle breaks down.  Nonetheless is it an option you […]

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Credit card finance is one of the most popular mediums through which you can finance your food truck business. You get discounts on gas or food supplies, enjoy fraud protection in case your purchases don’t match what you ordered, and even get roadside assistance when your vehicle breaks down. 

Nonetheless is it an option you can comfortably rely on to finance your business? Are there risks you should be wary about — risks that could put your business in a bad situation or worse situation than it is in? The simple answer to this is “Yes”, there are considerable risks with relying on credit cards as the sole method of financing your business. 

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The Risks of Credit Card Financing For Food Trucks

Credit cards are fine to use for normal, everyday business expenses if you know you will be able to pay it off at the end of the month. But relying on credit cards to finance things like equipment upgrades, payroll, or making risky investments can put you at high risk. 

Here are three risks of financing your food truck business with a credit card:

1. You Accrue More Cost 

It’s no news that credit card issuers charge you interest on the loans you take. However, the lower your credit score is, the higher your interest gets and the more stringent your repayment terms are. If you have a credit score under 580, which is considered bad, then you have a lot to worry about when it comes to credit card financing.

The massive interest charged on loans means purchasing a new truck or supplies for your food becomes more expensive than it ordinarily is. 

2. You May Overspend

When you have a credit score of 750 or above, your options for financing are enticingly extensive. You could apply to any issuer, or even multiple issuers, and get approved for a credit card with great repayment terms and perks in no time. 

Credit card issuers also make it very easy to spend from your credit limit, and with a good score, your balance can get as high as $50,000. The risk here is that when you don’t exercise self-control — when you max out your credit limit on each card you get, you may take out loans you can’t repay. 

What’s more, using up your credit limit without paying it back increases your credit utilization ratio (CUR). You should know that a high CUR has direct negative effects on your credit score, and having a decreasing credit score doesn’t spell out well with your other needs for financing. 

3. Penalties for Carrying Balances

When you don’t make your loan repayment for the month in full, you don’t just accrue penalty charges and a damaged credit score. You also carry your balance into the next month, and this attracts even higher interest rate charges — charges that could exceed over 20% of your loan. Attracting penalties and balance transfer charges then makes your purchases even more expensive than they already were and puts you in a stressful situation. How stressful can the situation get?

Well, you stand as a guarantor for every loan you take and if you constantly fail to repay these loans, you put yourself or your business at risk of bankruptcy. 

The Alternative to Credit Card Financing

As a small business owner looking for that extra funding, credit card finance could still be the perfect option for you. However, with the risks involved, you can find yourself in a bit of trouble.

To avoid this, you may then consider alternative methods of financing through our partners. Contact us to learn more about how you can upgrade your food truck business without spending more than you can afford.
Download Our Financing Guide Today!

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3 Ways To Finance a Food Truck Without a Bank Loan https://legionfoodtrucks.com/food-truck-financing/3-ways-to-finance-a-food-truck-without-a-bank-loan/ Tue, 28 Mar 2023 09:00:18 +0000 https://legionfoodtrucks.com/?p=5675025 Starting a food truck business can be a great way to generate a steady source of income in the long run. However, the capital needed to set it up may not be small for some people. Unless you have big fat savings account to finance everything yourself, you’ll have to look at different funding options […]

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Starting a food truck business can be a great way to generate a steady source of income in the long run. However, the capital needed to set it up may not be small for some people. Unless you have big fat savings account to finance everything yourself, you’ll have to look at different funding options to get your food truck up and running.

Why Getting a Bank Loan May Not Work for You

Getting a bank to approve your loan application requires a lot of homework on your part. First of all, your chance of getting approval depends a great deal on your credit score. If you have a messy credit history and a low credit score, your chance of getting denial is high. 

Even if you have a good credit score, you still need a lengthy business plan to prove to the bank that you have thought it through and have plans to make your ideas work. If your business plan is not practical or there are some calculation mistakes in it, the bank may laugh in your face then deny your application.

The whole process from preparing for an application to getting the money in your hand can take months, which is time-consuming.

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How to Buy a Food Truck With No Money: 3 Alternatives to a Bank Loan

Getting a bank loan is not the only way to get money for your food truck business. Here, we’ll have a look at great alternatives that can get you the funds you need much faster.

1. Crowdfunding

KickStarter and GoFundMe are two crowdfunding platforms that have been gaining traction in recent years. You don’t need to submit a lengthy business plan to get your project in front of the people, however, well-presented ideas and widely shared proposals always work better on these crowdfunding platforms. Small donations add up over time, and you can send each donor a small coupon for a meal at your food truck as a token of gratitude.

2. Microloans

The Small Business Administration’s Microloan program is for people who are looking to borrow less than $50,000. The average loan amount that most people apply for is just around $13,000. The conditions for these loans are much simpler than those of traditional bank loans. Plus, the money will get to your hands faster. 

3. Family Members to the Rescue

You might not have that $30,000 to start a food truck business, however, your rich uncle might. While this option seems like the easiest one, it isn’t. You still need to treat the money your family entrusts you with like a formal loan and not let them down. Maybe make them your business partner. This way, both can work together to make the idea work, and as we all know, two brains are better than one.

Food Truck Financing and Loans

Legion Food Trucks is more than a manufacturer. We help business owners and aspiring entrepreneurs will all aspects of the food truck business. Contact us today to learn more about how to finance a food truck, and the loan options available.

Download Our Financing Guide Today!

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A Guide to Revenue Based Financing For Food Trucks https://legionfoodtrucks.com/food-truck-financing/a-guide-to-revenue-based-financing-for-food-trucks/ Wed, 22 Mar 2023 08:00:15 +0000 https://legionfoodtrucks.com/?p=5676685 Starting a food truck business can be a costly adventure, especially if you don’t have the financial backing to kickstart and maintain this startup. Between your food truck, permit fees, kitchen supplies, and licensing, food truck costs can add up quickly. Revenue based financing gives you the financial backing to get you started without tapping […]

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Starting a food truck business can be a costly adventure, especially if you don’t have the financial backing to kickstart and maintain this startup. Between your food truck, permit fees, kitchen supplies, and licensing, food truck costs can add up quickly. Revenue based financing gives you the financial backing to get you started without tapping into your savings.

Capital is a necessity for mobile food truck owners looking to expand their business. However, it becomes incredibly difficult to grow the business without the funding to inject into the business. This post provides a comprehensive overview of revenue based financing and how to use it to scale your food truck business.

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What is Revenue Based Financing?

Revenue based financing is a form of loan that you agree to pay back to the lender over time with a promise of a portion of the business’s future revenue until you reach a fixed dollar amount. It involves the following features:

  • Fixed repayment target: it has a fixed repayment target agreed upon by the financier and the borrower that may take several years to clear.
  • Fixed repayment amount: most revenue based financing options have an interest amount of between 1,5 and 2.5 the principal amount. But this can be higher, depending on your agreement with the financier.
  • Flexible repayment periods: unlike other loans, revue-based funding options have very flexible repayment periods that allow you to pay back the amount agreed upon sooner if possible or later if need be.
  • No loss of equity: you don’t have to sell equity or relinquish some control of your business to qualify for revenue based funding.

When To Seek Revenue Based Financing

While revenue based funding may not be the best choice for every business, it remains a viable option for some companies looking for that financial boost to kickstart their business. Before pursuing revenue based funding, consider these factors:

  • The company must have an established revenue stream to back its debt service payments
  • The food truck business should have a stable, established market.
  • The company’s financials must be in order. You must accurately summarize the business’s revenue, debt, operating expenses, and future projections.

Before committing your food truck business to revenue based funding, we recommend considering the company’s long-term obligations. A loan is a loan and must be repaid under the agreed-upon lending terms. Therefore, while the revenue based funding option may seem to have fewer strings attached, treating it dismissively can be disastrous.

Revenue based financing appeals more to:

  • Companies not looking to sell equity or guarantee a loan.
  • Businesses with an already-established market
  • Food truck companies looking to launch a new food product.
  • Growth-stage businesses looking to hire additional staff
  • Food truck companies looking to scale up their marketing campaign

Revenue-based financing is a great alternative to private equity financing and debt financing.

How to Qualify for Revenue Based Financing

Now that you have a better understanding of revenue based funding, here are some things you need to know to increase your chances of qualifying for revenue based financing:

  • Demonstrate your growth potential: financiers need proof of your business’s profit margins, a healthy cash flow, and steady growth potential.
  • Demonstrate the numbers work: revenue based funding and loans are worthless if repaying them cripples your business’s cash flow.
  • Show how you plan to use the loan: lenders want assurance that you will use their money to grow your food truck business and work on repaying the loan interest and principal amount.

Revenue based financing is a critical yet effective way to raise your personal assets and grow your business.

Should You Consider Revenue Based Financing?

Whether you want to fund your food truck operations, buy new equipment, get another truck, or expand your already growing business, revenue based financing allows you to get the funding you need where traditional banks may not help. Starting and growing a food truck business can be very costly, especially if you don’t have enough cash flow or savings to cushion you from the expenses. Revenue based finances help make this possible.  Contact our highly capable team at Legion Food Trucks for more information on food truck financing options.

Download Our Financing Guide Today!

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What Can I Use Food Truck Financing For? https://legionfoodtrucks.com/uncategorized/what-can-i-use-food-truck-financing-for/ Wed, 07 Dec 2022 08:00:43 +0000 https://legionfoodtrucks.com/?p=5676465 With the growing popularity of food trucks, more businesses and prospective business owners are applying for  food truck financing to maximize their profitability. Unlike traditional restaurant financing, food truck financing may require less capital. However, it still has its fair share of costs.  Food truck financing can help you improve and expand your business and […]

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With the growing popularity of food trucks, more businesses and prospective business owners are applying for  food truck financing to maximize their profitability. Unlike traditional restaurant financing, food truck financing may require less capital. However, it still has its fair share of costs. 

Food truck financing can help you improve and expand your business and stand out from your competition. What are the best ways to use your food truck loan once you get it? Find out below what you can use food truck financing for.

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Ways to Use Your Food Truck Financing

Ways you can use your food truck loan include:

Starting a Food Truck Business or Expanding

Starting a food truck business can cost you from $28,000 to $250,000. On the one side, this can be a relatively affordable figure compared to the actual costs of starting a traditional restaurant. 

On the other hand, accessing such funds can be challenging unless you have sufficient savings. The cost of acquiring business permits and purchasing a truck, ingredients, or machinery can be high for a starter. 

Fortunately, with food truck financing, you can avoid paying out-of-pocket and start your food truck business effortlessly. You can supplement the business loan with your savings to reduce the burden of financing down the line. 

You can also use food truck financing to open up a separate branch or truck. Having been in the food truck industry, you should know the financial strains of starting a food truck as you venture into expansion.

Truck Repair

As with any mechanical equipment, your food truck comprises functional moving parts susceptible to tear, wear, and breakdown. Has your food truck broken down recently? A food truck loan can help you cover the costs of truck repair and parts replacement to help you reduce downtime and resume operations. 

Upgrade Equipment

Kitchen equipment tends to lose functionality and value due to constant usage. While the cost of upgrading kitchen equipment can be high, their ROI makes the investment worth it. However, some kitchen equipment can be costly, depending on the brand, features, and type. With food truck financing, you can upgrade your food truck equipment and streamline your operations. 

food truck equipment

Invest in Business Marketing

Marketing initiatives can increase your brand awareness and customer reach. Whether you want to outsource your marketing or hire an in-house marketer, you will need to invest in marketing initiatives. Food truck financing can help you run a strong marketing campaign. Investing in a good marketing agency can help you realize an impressive ROI and make the loan worthwhile. 

Expand Your Menu

A unique menu is an effective way to appeal to different customers. Conversely, a limited menu can also discourage away customers. With food truck financing, you can seek to increase your product offerings and stand out for fresh, unique menus. 

Hire New Staff

The more your food truck industry grows, the more staff you will need to keep up with the demand. Get a business loan to help you hire, recruit, and fairly compensate new staff. 

Get The Assistance You Need

Generally, food truck financing covers your operating costs, allowing you to provide value without unnecessary downtimes. Working with a food truck expert can help you avoid setbacks and maximize your business potential in the food industry.

At Legion Food Trucks, we can help you start a food truck industry and strategize your venture for success. Contact us to help you create a food truck business and use your food truck financing efficiently. 

Download Our Financing Guide Today!

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How to Finance a Food Truck with Bad Credit https://legionfoodtrucks.com/food-truck-financing/how-to-finance-a-food-truck-with-bad-credit/ Wed, 03 Aug 2022 09:58:19 +0000 https://legionfoodtrucks.com/?p=5676214 The food truck business is a rising trend and will be prevalent for decades to come. However, you might face challenges getting into the business if you lack the funds to finance a food truck High-end food trucks typically start at around $80,000 for the vehicle alone. Once you add up equipment costs, marketing investments, […]

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The food truck business is a rising trend and will be prevalent for decades to come. However, you might face challenges getting into the business if you lack the funds to finance a food truck

High-end food trucks typically start at around $80,000 for the vehicle alone. Once you add up equipment costs, marketing investments, and inventory expenses, that number can climb even higher. If you’re already feeling the sticker shock, you’ll be glad to know that many different financing options are available – even if you have bad or no credit.

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Finance Food Truck With a Bad Credit

Several lenders evaluate your application holistically, considering your business strategy, annual income, and past repayment history, even if your credit score is frequently the critical determinant in determining if you qualify for a loan.

Considering alternative financing options, such as equipment funding, which enables you to use your purchase as collateral, or using a line of credit, which allows you to increase the number of funds you have access to, can help you purchase a food truck if you’re short on cash. 

Here are four tips you can use to get financing with bad credit.

       1. Build a Payment Down

The ideal solution would be to reduce your monthly installments to the lowest. Choose a lender that provides loans with low or even no interest to achieve this. Look into lenders offering lower interest rates if you are not eligible for a 0% interest rate loan.

       2. Consider Improving Your Credit Score

Increasing your credit score is the first step to acquiring financing for your food truck. Clearing off old debts, ensuring you have enough on hand to fund the loans, down payments and closing charges, and maintaining an active credit history are all ways you can improve your credit. The easier it is to approve a loan, the higher your credit score.

       3. Settle Other Debts Before Borrowing

Settle any debts you may have first before borrowing. Typically, lenders want proof that you’ve paid all of your payments on time.

       4. Check the Loan You Qualify

Find lenders who can lend you money for a food truck with lousy credit once you’ve decided what kind of loan you want. There are many loans available, including mortgages with fixed and adjustable rates. Depending on your income level, some lenders might only lend you a particular amount, while others offer more if you need it.

Finance Your Food Truck Right Away!

Getting a finance food truck with adverse credit may seem challenging, but it doesn’t have to be. Following these tips will give you a better chance of getting a loan approved so you can get your food truck business off the ground as soon as possible.

We provide food truck financing to our clients who need it at Legion Food Trucks. Take advantage of our partners’ financing options to give your food truck a solid foundation. Contact us today for more information and to get a customized food truck.

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How to Apply for a Food Truck Loan https://legionfoodtrucks.com/food-truck-financing/how-to-apply-for-a-food-truck-loan/ Wed, 20 Jul 2022 09:11:20 +0000 https://legionfoodtrucks.com/?p=5676191 The food truck business is one of the most growing trends in the restaurant industry. When planning to venture into the business, you must dig deep into your pocket by investing in initial supplies, items, and personnel. It may seem costly, but there are plenty of opportunities to access a food truck loan and start […]

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The food truck business is one of the most growing trends in the restaurant industry. When planning to venture into the business, you must dig deep into your pocket by investing in initial supplies, items, and personnel. It may seem costly, but there are plenty of opportunities to access a food truck loan and start the business efficiently without spending your entire life’s savings.

This article will discuss the different types of loans available, what they are used for, and how to apply for a food truck loan.

Food Truck Loan

Different Types of Food Truck Loans Available for You

If you want to finance your food truck business, you have a few different options. They may differ based on the specifications you need as a borrower, the loan size, and the cost. As a result, it’s wise to explore available loan options to obtain the most outstanding deal if you’re looking for a food truck loan.

You can choose from the choices below if you need a long-term or short-term food truck loan.

Equipment Loan

An equipment loan is ideal if you need a fast-food truck loan with a cheap interest rate. These loans employ the food truck equipment you’re buying as collateral, resulting in a lower interest rate than some of the other alternatives on the list. In the event of a default, the lender is authorized to liquidate equipment to make the difference.

To qualify for this type of loan, you must have strong credit and maybe make a down payment on the items, ranging from 5% to 20% of the overall cost.

Small Business Administration (SBA) Loans

If you have a vested financial stake in an American-based business, you may be eligible for SBA loans to establish a food truck business. Through certified and verified loan providers, an SBA loan can assist you in avoiding financial risk.

Business Lines of Credit

A line of credit is another alternative for a food truck loan. Unlike a loan, which offers you a lump sum upfront and requires you to pay it back over the loan’s term, a line of credit allows you to draw money out should you need it and only pay back the amount you use. However, small business finds it challenging to get this type of loan because banks require you to have an excellent financial standing.

Business Term Loan

A business term loan is a suitable alternative for food trucks that need to finance a specific expense. It relieves the worry of not being sure how you’ll pay for something by allowing you to take out a lump sum payment that will be reimbursed at the end of the agreed term length.

How To Apply for Food Truck Loan

You can only apply for a food truck loan if you meet some general requirements. For example, to qualify for an online loan, you must have been in operation for at least six months and have a monthly revenue of at least $10,000.

As previously stated, some new businesses find it difficult to obtain bank loans because the conditions may include being in business for not less than two years. Moreover, if you do not meet the minimum criteria, you may be forced to offer collateral for a down payment along with your loan application.

Get Started with Legion Food Truck Financing

Getting a loan may seem complicated for most food truck business owners; however, at Legion Food Trucks, we make your goal of starting a food truck business a reality. We’ll help you find the right loan for your business and even help you with the applications.  Get in touch with us to begin exploring your financing options today.

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Elements of a Successful Food Truck Business Plan https://legionfoodtrucks.com/food-truck-business-plan/elements-of-a-successful-food-truck-business-plan/ Wed, 23 Feb 2022 09:26:26 +0000 https://legionfoodtrucks.com/?p=5675851 Even before the pandemic, established restaurants and franchises were using food trucks as a way to expand their business and reach new demographics. That trend has accelerated in the past 18 months due to restaurant closures and a general drop in attendance.  Whether you are an established restaurant looking to expand or an aspiring entrepreneur […]

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Even before the pandemic, established restaurants and franchises were using food trucks as a way to expand their business and reach new demographics. That trend has accelerated in the past 18 months due to restaurant closures and a general drop in attendance. 

Whether you are an established restaurant looking to expand or an aspiring entrepreneur in search of a new business opportunity, the food truck business may be your answer. But first, you’ll need to come up with a business plan. This post will teach about the main elements to include in your food truck business plan.

food truck business plan

What are the Main Elements of a Food Truck Business Plan?

There are several advantages to having a food truck business plan. It helps you know your focus, determine your financial needs, and understand your competitors. An excellent food truck business plan should help you achieve these benefits. Here are the main sections to consider in your food truck business plan. 

 Executive Summary

This is the first section of a business plan. It highlights what your company is about, how you want it to grow, and why you think your business will grow. A good executive summary should identify a gap in the food trucking business that your company seeks to fill. Therefore, the key topics to include are as follows:

  • Your target food
  • Your target location
  • Why the kind of food you intend to sell will be successful in your target area
  • Budget 
  • Goals 

Company Description

In this section, you should convey the uniqueness of your business to the existing market. Essentially, here is where you expand on the topics you’ve mentioned in the executive summary section. Some of the questions to answer in this question are as follows:

  1. The type of food truck you’ll be running (truck, food cart, or trailer)
  2. Why your food truck is different from the brick-and-mortar location
  3. Whether you’ll prepare your food from the truck or a commissary kitchen
  4. Your specific niche
  5. The uniqueness of your food truck menu

Market Analysis

This section explains how your food truck business fits the existing market. It requires extensive research about the food trucking industry. Your market analysis section should cover the following:

  • A description of the current food industry growth rate, current trade, and significant consumer group
  • A description of the socioeconomic status, geographical area, and age group
  • A definition of the size and potential of your business 
  • Your prices, gross margin level, and other crucial financial information 

Business Organization and Management

This section outlines how you’ll organize and manage your business. It should include a detailed profile of your managerial team and information about your company’s ownership. You should have the following:

  1. Your business’s legal structure 
  2. Full names of every owner 
  3. The percentage that every company owner holds
  4. Stock information
  5. Type of ownership

Marketing and Sales

The marketing and sales section should aim at building customer loyalty. Therefore, you must include how you handle your marketing and sales processes. You can choose to adopt a unique food truck design, create unique selling points, offer prices, and so forth. All this depends on your market research.

food truck business plan

Create Your Food Truck Business Plan with Legion Food Trucks

The success of your food truck business starts with a successful business plan. There’s no better way to make a reliable plan than partnering with an experienced team in the food truck industry. Legion Food Trucks fits as your ideal partner for your food truck business start-up. Our team can help you establish your business that meets your unique goals. Contact us today, and let’s get started.

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