Certain aspects of going into business with a mobile food truck tend to be the same for most entrepreneurs. If you decide to pursue a food truck as a startup, you’ll need to take care of a few aspects, such as:
- Draft a business plan.
- Figure out what’s on the menu — and if you’re skilled enough to make these offerings.
- Choose a name and logo for the food truck and register both as a trademark.
- Incorporate the food truck or form an LLC.
- Determine financing, including whether or not you’ll rent or purchase a food truck and how you’ll pay for food purchases and supplies.
- Outfit a food truck inside and outside, from installing cooking equipment to creating fun, eye-catching designs and artwork that advertise your food truck and its offerings to consumers.
- Sign up for the proper food truck insurance.
Food trucks also require certain business licenses and permits. These documents are necessary in order for the food truck to operate and do business.
Licenses and permits may vary depending on your food truck’s location and the city, county, and state it does business in, so it’s never a good idea to presume your licenses and permits will be the exact same as what is required by other food trucks. The best thing to do is to check with your local Secretary of State to see which licenses and permits they require food trucks to obtain before operating the business.
Whether or not you decide to start a food truck, most businesses are required to obtain certain types of licenses and permits.
Here are the most common documents food trucks should have before delivering meals on wheels.
Commonly known as a basic business operation license, this is a permit that allows you to operate the food truck in your desired city, county, or state.
Having a business license helps the government identify the business. Once you have a business license, they may identify the business and track the food truck’s activities for tax purposes. It also verifies the legitimacy of your food truck. A business license assures the public that your food truck has met certain compliance requirements and helps protect public health.
Before applying for a business license, check in with the local Secretary of State. They’ll let you know if there are any additional requirements and fees associated with your application. Ask about renewals as well, so you don’t accidentally incur any fines for operating with an expired business license.
Employer Identification Number (EIN)
Do you plan to hire employees, even part-time ones, to work at your food truck? If so, you’ll need to complete an application for an employer identification number (EIN).
An EIN is a federal tax ID issued by the IRS to identify a business entity. It’s a little like a social security number, but much less sensitive for document usage. Whether you incorporated the food truck as an LLC or partnership, it’s generally advised that most entrepreneurs register for an EIN. Having an EIN allows you to open a business bank account and establish a credit profile.
What if you decide against hiring employees, intent on acting as a one-person show for your food truck? It’s still advised that you obtain an EIN. Once the business has been incorporated, you are considered to be its ‘employee.’ The IRS will need you to have an EIN so they can track the food truck and make sure it remains in compliance.
A food truck can’t park along the side of a street in a neighborhood and stay there for months on end. Most cities have certain zoning restrictions that allow food trucks to park only in specific areas where they have permission.
These laws tend to vary depending on the city and state, but you should obtain a parking permit for your food truck. Reach out to the county clerk for a full list of places where food trucks are and aren’t allowed to park. It’s also wise to ask if it’s necessary to pay a meter or follow parking sign rules, proximity bans within your area (for example, how closely an Italian food truck may park near an Italian brick and mortar establishment), and if you will need to store your food truck in a commissary for overnight parking.
No matter what kind of cuisine you’re serving to customers, the health department must conduct an inspection of your food truck, review it, and approve it.
Failing to obtain a health department permit spells big trouble for your business in the short- and long-term. After all, who feels comfortable eating from a food truck that hasn’t been given an “A” grade verification? A food truck that has been examined by the health department and approved can show the world they safely prepare and maintain food for customers.
The application process and fees, as always, may differ from city to city, but having an annual health permit is necessary for any food truck’s success. Once you have obtained a health permit, you may begin looking into other related permits like a food handler permit for employees and mobile food facility permit. Don’t forget to renew your permits on a regular basis — and if you don’t know how often you should renew these documents, consult with your local Secretary of State.
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Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.