Food Truck Equipment

A significant portion of your budget should be allocated to equipping your food truck. With proper equipment, you will be able to prepare quality food both quickly and efficiently. Generally, start-up expenses for a food truck will vary depending on the type and quality of equipment you choose. Common items you need to start your food truck business include cooking equipment, refrigeration equipment, holding equipment, washing equipment, safety equipment, a ventilation system, and a payment processing system.

How Much It Typically Costs

Depending on the size of your truck and the type of cuisine you plan to be serving, you can spend between $50,000 and $200,000 to equip your food truck. Kitchen equipment alone will cost you anywhere from $3,000 to $10,000 while safety equipment will set you back $1,000 to $3,000. However, if you are working with a tight budget, you can buy more affordable equipment and upgrade it as your business grows or lease the equipment.

Typical Price for Building a Food Truck

Every truck is different. You can choose to buy a brand-new food truck, buy a used one, or build a food truck from scratch. A new, fully-fitted food truck will cost between $50,000 and $175,000 while a pre-owned one can go for $30,000 to $100,000. If you opt to buy a vehicle and convert it into a food truck, you can expect the cost of building it to be at least $50,000. The good news is that building one allows you to design and build every aspect of the food truck to your liking.

Other Equipment Expenses

Equipment makes for one of the major start-up expenses for a food truck. Apart from the cost of purchasing these items, there are several other expenses associated with the equipment. They include the cost of:

• Converting the vehicle into a quality mobile kitchen
• Installing the equipment in the vehicle
• Running costs and expenses related to repairs and maintenance of the equipment

Restaurant Equipment

Most of the appliances and equipment needed in a food truck are also required in a brick-and-mortar restaurant. However, food trucks have less equipment owing to the limited space. Oftentimes, traditional restaurants will feature commercial kitchen equipment.

How Much It Typically Costs

Restaurant equipment costs can vary extensively depending on the size of the restaurant as well as the size and capacity of the equipment. Other factors that will affect these costs are the brand and quality, energy efficiency, and additional features of the equipment. Lastly, the expenses will be determined by whether the equipment is new or used. Typically, the average cost of kitchen and bar equipment for a restaurant is $115,655. 

Equipment Expenses You Can Expect

Once you have acquired the necessary equipment for your restaurant, there are a few additional expenses you need to plan for such as:

• Design and equipment installation costs
• Maintenance costs
• Replacement costs

Make the Right Move for Your Business

Here at Legion Food Trucks, we are a food truck manufacturer located in South El Monte, CA. In addition to building top-of-the-line food trucks, we also provide you with the information, guidance, and mentorship needed to ensure you start your business on the right foot. This includes explaining the different start-up expenses for a food truck so you can plan better. Contact us to learn more about how we can help you achieve success in your food truck business.

The post Food Truck vs. Restaurant: Breaking Down Start Up Costs appeared first on Legion Food Trucks.

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. 

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.

The post Starting a Food Truck Business Without Capital appeared first on Legion Food Trucks.

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. 

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.

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.

The post How To Get Food Truck Financing With Bad Credit appeared first on Legion Food Trucks.

Is a food truck a good investment?

The investment in a brick and mortar restaurant is a high-risk gamble because of several key factors including poor staff, lack of startup funding, and lack of food industry experience. The food trucks have a lower startup investment than regular restaurants. Also starting small with a food truck can allow you to control your brand and image and retain customers.

Benefits a Food Truck vs. a Restaurant

Food trucks can be very profitable and make good business ventures. But are they better than a brick-and-mortar restaurant? Here are some things to consider:

Quality Control

When you are operating a food truck, you have better control over how the food is prepared and stored. You control the open and close schedule and potential daily specials. However, in a brick and mortar restaurant, you could be dealing with customers who liked their food a week ago, but now they don’t like it today.  Part of the blame rests on cooking equipment and time of day.  In a food truck business, you have stronger quality control, you can set the presentation of the food when it leaves the truck.

Money and the Bottom Line

Opening a brick and mortar restaurant could end up costing you up to $800 per square foot. However, a food truck business could cost about $200,000 on average, depending on where you buy the food truck. The bottom line is, investing in a food truck will usually require a smaller upfront investment. It’s also worth noting that food trucks have lower overhead costs which means greater profit margins. Of course, this doesn’t exactly mean than food trucks are more profitable than restaurants, but they are generally considered safer investments for new business owners or those who don’t want to take out a business loan.

Ability to Relocate at Any Time

With a food truck business, you can relocate to where the crowd is, whether it’s a festival or a local farmer’s market. This gives you the opportunity to reach new audiences and test different markets.

When you have a brick and mortar store, you have one shot at picking a location and hoping will bring in the crowds. Bad locations or concepts that don’t appeal to the surrounding demographic can often be a death sentence for brick and mortar restaurants. 

Choose Your Move Wisely

Is a food truck a good investment? Are restaurants better? A food truck business allows you to expand your customer base by being able to travel and having better exposure than the average brick and mortar restaurant. You can adjust your menu at any time with a food truck to adapt to your customer base and cultural tastes. With a brick and mortar restaurant, your customer base only comes from the nearby area, but you can draw your food truck customer base from anywhere when you properly market it. 

Legion Food Trucks can help you find the right food truck when you are ready to start your restaurant on wheels. Visit our website to learn more and apply for food truck financing today!

The post Is a Food Truck a Better Investment Than a Restaurant? appeared first on Legion Food Trucks.

In this article, we’ll break down the different factors that can influence the cost of a food truck to give you a better idea of what you can expect.

Breaking Down the Cost of a Food Truck

The costs you incur in starting the food truck business vary just like any other business depending on your locations and the quality of products you choose to stock for your business. However, the following are some of the basics that you will include in your startup. The business has both fixed costs and variable costs.

Fixed costs

Fixed costs in the food truck business include purchasing the equipment and the licensing fees at the start of the business. The equipment you have to purchase includes; the truck, a vinyl wrap, and kitchen equipment for the truck. You will also have to register your point-of-sale system and incur costs on other legal requirements that might vary based on your location. You might incur additional costs on items such as uniforms and setting up a website. 

Variable costs

Variable costs in the food truck business include the expenses you incur while running the business. The cost depends on the business you transact in a day. They include expenditures such as commissary, fuel, labor, restocking your food and beverages, paper products, and truck maintenance. 

Additional Food Truck Costs

To ensure that you have everything in your startup budget, you need to consider miscellaneous expenditures when starting the business. It would help if you had a startup capital that could run your business in the first few months before the business begins generating returns. Additional requirements to factor in your budget include renting additional cooking space, hiring a social media advertiser, or extra parking space from time to time. 

Food Truck Financing Options

It would help if you got financial aid for your new food truck business. The financing will help ease the startup cost. Financing the food truck will also provide you the opportunity to invest your startup capital in improving the quality of other business aspects such that you get to deliver the best service to customers. 

Financing your food truck business requires that you develop a business plan. Coming up with a plan gives you a chance to consider your menu, your target customers, and the marketing approach that you intend to use. You need to conduct research and capture all market demographics before launching your food truck business. 

Get Your Free Food Truck Quote

The average price of a food truck will vary depending on factors such as size, equipment, location, inventory, and other expenses. To get a free food truck quote and receive a rough estimate of your food truck costs, use our interactive food truck builder today. And if you need help with financing, you can download and submit your finance application through our website.

The post What Is the Average Cost of a Food Truck in 2023? appeared first on Legion Food Trucks.

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. 

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.

The post Credit Card Financing Your Food Truck Business: Worth the Risk? appeared first on Legion Food Trucks.

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.

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.

The post A Guide to Revenue Based Financing For Food Trucks appeared first on Legion Food Trucks.

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.

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. 

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. 

The post What Can I Use Food Truck Financing For? appeared first on Legion Food Trucks.

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.

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.

The post How to Finance a Food Truck with Bad Credit appeared first on Legion Food Trucks.

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