26 Apr Best Ways to Set Up a Successful Food Truck Delivery Service in 2021
In 2019, we published The Beginner’s Guide to Opening a Food Truck Business, where we covered the basics of buying a food truck, choosing the right location, working with suppliers, and more.
Since then, much water has flown under the Golden Gate Bridge, and the post-Covid-19 foodservice industry is forever changed. Which brings us to the question: Is starting a food truck in 2021 still a good idea?
The short answer is YES. Food trucks in 2021 can be a lifeline for existing restaurants hit by Covid-19 or a low-cost alternative for first-time food entrepreneurs looking to start a new business. Food trucks are an excellent way for operators to leverage new location, market, and brand opportunities and raise a new kind of restaurant industry out of the ashes of the old one.
The long answer is IT DEPENDS. Obviously, the menu, brand, marketing, and many other factors need to be considered. But one thing, in particular, can make all the difference between a successful food truck business and a total debacle: Choosing the right food delivery system.
In this article, we look at the new delivery trends that are already taking over the food truck industry and how to choose the one that’s right for your mobile eatery business.
Table of Contents
Food Truck Industry Outlook after Covid-19
Before the coronavirus, the $1 billion food truck industry averaged a phenomenal yearly growth of 7.5% — four times faster than the fast-food sector as a whole. Most of the 26,200 trucks relied on lunch crowds and special events for their bread and butter. Meaning, it was crucial to choose a central location in a big city where office workers made up massive street traffic.
Once the pandemic hit, most people started working from home and avoiding large crowds. Parking lots near business centers and other profitable pre-pandemic spots suddenly dried up.
However, unlike brick-and-mortar restaurants, indoor regulations didn’t impose any restrictions on food trucks. Thanks to this, the industry’s growth was only reduced to 0.4% but not wholly demolished during 2020. In fact, the industry is set on a quick recovery. Throughout 2021 the market worth is expected to reach $1.4 billion – a 2.4% increase.
It’s Not All about Location Anymore
Location used to be the most critical success factor of a food truck. Well, not anymore. Instead of the proximity to large food traffic centers, what counts now are the operational convenience, partnering with a substantial commissary kitchen, and having the right delivery system in place.
During 2020, many food truck operators were smart enough to notice that, while financial districts and office areas were dried up, demand rose in suburban and non-traditional regions. Places like parks, residential street corners, close to essential businesses, hospitals, or factories had their demand increasing significantly.
In response, savvy food truck operators transitioned to a new, community-based model. In this model, the food gets pre-ordered and picked up to be eaten outdoors, from a convenient place such as a socially distant event, a small private gathering, parked at drive-in movie theaters, or simply show up in a suburban neighborhood.
Basically, when it comes to location, the most significant benefit of running a mobile eatery is to adapt as you go. Unlike traditional restaurants, food trucks can try different ways to take food straight to the guests and capitalize on many people staying and working from home.
The Rise of Food Truck Delivery and Order Ahead
2020 saw the home food delivery market reach a staggering $45 billion. With lockdowns in place, many restaurants turned to food delivery as their only lifeline. Besides, the declining use of cash has led to greater use of contactless digital payments and ordering.
Those mobile eateries that could afford it rolled out their own delivery system while others partnered with third-party delivery services such as UberEats, DoorDash, Postmates, GrubHub.
Either way, the food delivery boom, and the quickly developing delivery infrastructure encouraged both third-party delivery apps and food trucks to spread further out to peripheral areas and residential neighborhoods.
Alongside delivery, order-ahead is now the most popular way for people to buy food from a food truck. In 2020, over 50% of mobile restaurant revenue came from order-ahead sales. This is not a trend anymore – it’s an essential part of a food truck’s business plan.
What’s the Best Food Delivery System for Your Food Truck?
There are plenty of options for third-party delivery and order ahead systems to choose from. The thing to remember is this: You want to make pickup and delivery as easy and as profitable as possible for your business.
Every business is different, and the model needs to be tailored to the specific needs of your food truck. You can opt for either of these three options or mix and match until you find the right balance.
1. Partner with multiple third party delivery apps
Third-party delivery apps are the easiest way to get your food out to more people. It saves you from setting up your own delivery operation with couriers, vehicles, and all the logistics involved.
If you choose to partner with one third-party delivery service, you might as well partner with all of them and enjoy the increased brand visibility and customers they will bring you.
From the customer’s perspective, ordering from a third-party app is effortless. Diners are already subscribed to these services. If your restaurant isn’t on at least one of these apps, customers would not necessarily go the extra mile to look for it online or download another app.
The major downside is the service charges and commissions. These differ based on the platform, but most of them charge outrageous fees that cut deep into your margins. In April 2020, the fees of food delivery apps were capped at 15% in San Francisco.
The four most popular apps are:
- Postamates (owned by Uber)
-> Read more about a comparison between the top 4 third-party delivery apps.
2. Sign up for an order-ahead POS service
Before Covid-19, the most enjoyable part of eating at a food truck was socializing with people. Today, most of your customers prefer to skip the crowds, lines, and social interaction.
An order-ahead service allows diners to pre-order and pick up their food. This is now the more popular option both for convenience and social distancing reasons.
Every app and platform is different. Some are tailored made for food trucks, while others cater to all types of restaurants (and may therefore have more to offer in terms of features and services).
Some of the order-ahead POS platforms our food truck customers enjoy working with are:
- Best Food Truck
-> Read this article to compare the best POS systems for your mobile restaurant.
3. Build your own food truck delivery service and app
There are obvious benefits to building your in-house delivery system. For one thing, it saves you a lot of money in third-party delivery fees.
More importantly, it gives you control over your delivery team and the overall ordering experience — all fundamental parts of building the reputation and brand of your food truck.
On the other hand, training and building an app and an in-house team of couriers takes time and money, which might not be practical for a first-time food entrepreneur or a small food truck typically employs 1-2 people.
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