Special Report | April 2014 | By Daniel P. Smith

What Ever Happened to Food Trucks?

Red-hot just a few years ago, food trucks are entering a new maturity phase.

Food trucks evolve quick service restaurant industry with innovative trends.
Cofounder Natasha Case has turned her popular food truck Coolhaus into a major food and retail player.
Bookmark/Share this post with:
Email this story Email this story
Printer-friendly versionPrinter-friendly version

When QSR last checked in with Coolhaus as part of “America’s Top 20 Food Trucks,” in February 2011, business partners Natasha Case and Freya Estreller had just launched their second food truck, adding a roving kitchen in Austin, Texas, to their existing mobile unit in Los Angeles.

In the three years since, Coolhaus has added three additional food trucks (in New York, Miami, and Dallas), opened two L.A.-based brick-and-mortar stores, and wiggled its ice cream products into 1,500 grocery stores across the country.

For Coolhaus, as well as the entire food truck industry, so much has changed in the three short years since QSR profiled the 20 top food trucks. There have been reality TV shows and numerous pop culture references, an accepting public, a rising regulatory environment, and fierce competition. For some, like Coolhaus, the last three years have delivered blossoming, optimistic futures; for others, dreams came and went.

Still, food trucks remain a vibrant part of the American landscape, with an estimated 3 million food trucks scattered around cities on both coasts and across the heartland.

The story of the food truck is a story of past, present, and future, an undeniable tale of change.

From surge to saturation

When the Slapfish food truck first rolled onto the streets of Orange Country, California, in January 2011, co-owner Jethro Naude says it was one of the few trucks roaming the Orange County area. But by the end of that same year, Naude says, the local food truck scene had grown exponentially, from less than a dozen trucks to, by his count, more than 40. The competitive environment intensified and spots once easy to come by—on the street and at food truck events—became increasingly difficult to secure.

“As I see it, the food truck is a home run from the marketing standpoint, but from a financial standpoint, it’s just there.”

“And we were right in the middle of this fight,” says Naude, who had originally turned to a monthly lease on a food truck when he struggled to generate the capital to open a brick-and-mortar restaurant.

The surge of food trucks in Orange County and in other U.S. markets was not all that surprising to foodservice professionals considering the economic conditions with which it coincided. As unemployment rose during the recession, eager entrepreneurs—from bohemian, artist types to white-collar workers victimized by the economic downturn—looked at the food truck as an opportunity to seize their own fate, if not some fortune.

Some viewed the food truck as an alternative career; others were inspired to act on lingering ambitions. And of course, food trucks had the “it” factor in the food world.

Truck operators were forward thinking with their food, their marketing, and their interaction with guests. Culinary creations, from Korean tacos to gourmet cupcakes, were novel and unique, and operators leveraged social media to connect with customers beyond simply noting the lunchtime location. Food trucks built relationships by sharing information about their founders and their food, creating authentic connections and fans excited to contribute word-of-mouth buzz.

Alluring and energetic, the food truck scene flowed with charm and spirit, and few barriers to entry. With start-up costs ranging from a few thousand dollars for a leased truck to low six figures for an elaborate, customized mobile kitchen, many hustled into the food truck game between 2010 and 2012.

Even Portland, Oregon, a devoted foodie town that has claimed an active food cart scene since the mid-1980s, could not escape the rush. (In Portland, stationary food carts positioned in lots remain the norm, an alternative to the mobile kitchens commonplace in many other cities.) Brett Burmeister, managing editor of Food Carts Portland, a website that tracks the city’s vibrant food cart culture, says Portland hosted about 300 food carts in 2009. That number has since doubled, while the city has also witnessed the addition of mobile food trucks.

“It was almost like a gold rush,” Coolhaus’ Case says. “Everything was so turnkey. Someone would have an idea and they were on the road weeks later.”

Of course, much as our nation’s ambitious, wide-eyed western settlers discovered in the 19th Century, gold can be tough to come by. Today, many, including those deeply involved in the food truck scene, such as Case, Naude, and Burmeister, feel food trucks have plateaued.

“Over time,” Burmeister says, “the shine comes off the penny.”

In many cities across the country, food trucks have battled hefty competition and bureaucracy, including higher costs for licenses and permits. In 2009, for instance, the Coolhaus founders remember being asked to vend at First Fridays in Venice Beach, California; now, Case says, trucks pay a considerable amount to have a place at the event and make less money given the more saturated market.

For many, persistent operational challenges became too much to bear. Weather concerns, truck breakdowns, labor scheduling, planning, and purchasing stifled many an entrepreneur’s quest to make the food truck a sustainable enterprise.

“A food truck is not something you open and make a ton of money,” says Lisa Wood, who runs two Big-Ass Sandwiches food carts in Portland. “It’s a grind. You might be slamming business for about half the year; the other six months, though, it’s a battle.”

And as food trucks increased in number and attention, with many consumers substituting a food truck visit for a quick-service purchase, several major quick-service players responded with a ramped-up value proposition, NPD Group restaurant industry analyst Bonnie Riggs says.

“It’s tough to go up against that muscle,” Riggs says.

The constant fight, the seemingly never-ending struggle, strangled some food trucks, sending them to the industry graveyard, while once-motivated operators, burnt out from the battle, turned over their keys or sought new adventures or growth avenues in the foodservice arena.

“I think many rushed into food trucks thinking it was a panacea, a cost-effective way to open a restaurant, but they saw just how challenging and unrelenting the environment was,” says Richie Jackson, CEO of the Texas Restaurant Association.

As a result, the appeal of the happy-go-lucky entry into the food truck marketplace has seemingly subsided.

“As the investment of time and money has gone up, the excitement has faded away,” Naude says. “I think the good ol’ days of the food truck are gone.”

Pages