Food Truck

Street Vendor Restaurant Industry Gray Market player.

NYC notes

The four main types of carts are hot dog, kebab, coffee ("processing"), and fruit ("nonprocessing"). Processing carts cost between $15,000 and $30,000. A basic fruit cart costs about $1,000... The average daily revenue of a food cart is $200 to $300. Once overhead costs are subtracted--permit, garage rentals, transportation costs--the cart owner or operator is left with daily net earnings of $100 to $150. Because most vendors work only part of the year, their average annual take is $7,500 to $14,000, according to the most recent survey by the Street Vendor Project.

For recent immigrants like Bangladeshi vendor, Anwar Hussein, a chance to rent a cart with a permit from a vending company gave him the chance to work independently. He said he makes about $400 per week. His entire family, a wife, four daughters, a son and his mother, take time to work the cart. He told the Gotham Gazette, "I went to the hot dog company, I rented the pushcart, and I looked at the area around Canal Street. Every day at nine or ten, I pick up my pushcart from the garage downtown, buy merchandise from another garage, and push my cart to my spot on Broadway and Canal Street. I work from 10 to 7 - longer hours in the summer - every day of the week."

Shehea and Madeed work for an absentee owner who lives in Egypt, also their birth land. Shehea would not discuss sales figures, but a reporter who watched him work one afternoon estimated that he and Madeed served three customers every six to seven minutes at about a $6 check average... A one-man shop working from 11 a.m. to 4 p.m., Monday through Thursday, Kumar estimates that he serves three people every four minutes at about a $5 check average. Menu prices at his stand range from $1 to $4. He goes through 60 pounds of potatoes a day and uses up two 20-pound propane tanks every three days. He parks his cart at night in a Hell's Kitchen warehouse specially designed for food vendors and leased to them for $360 a month... Many big-name commercial retailers resent the presence of street vendors in front of their establishments. Several upscale retailing hubs on some blocks of the Upper East Side, Soho, Chelsea and other hot neighborhoods have zoned them out. In addition, aggressive homeless people can discourage customers, and sanitation police can slap businesses with fines as high as $1,000. Traffic cops also can dispense hefty fines on illegally parked trucks that pull the carts.

Today, (Dec'2008) just over a year after the Dessert Truck was opened for business, the vehicle attracts anywhere from 250 to 600 customers a day, employs 12, and makes $500,000 in annual revenue with a profit margin of 20 percent to 30 percent before taxes... "If I could get rid of the truck, I would do it immediately," said Chen of the pains of maintaining the vehicle, with all its engine troubles... Back in 1998, the city said it had issued all 3,100 two-year permits it had authorized for food carts. Yet there are 14,141 licensed food vendors out there, according to the Health Department... With such a massive gap between supply and demand, it is inevitable that a thriving underground Black Market has sprung up. Under New York City's rules, a cart, with its permit attached, may be leased to someone else, but a permit alone cannot be leased or sold... There has always been a network of brokers and friends who will make introductions between a seller with a permit and a potential buyer, and now the Internet has become fertile ground for many of these transactions. Chen found his two-year permit over a year ago on Craigslist, the popular classified website, and paid $8,500 for it, a price he considered somewhat of a bargain since he had heard the fee would be in the range of $10,000. And a recent check on Craigslist found one ad looking for a permit, another searching for a food vendor to work at his pushcart, and one more trying to sell the entire business - cart, permit, location. The original permit owner, who would have paid an upfront fee of $200 to get the permit and a $200 renewal fee every two years, can earn a nice profit at these prices. But the black market pushes the rates up considerably with each transaction. Sam Rosenberg, for example, put an ad on Craigslist offering to sell his entire business - a two-year old cart, a two-year cart license, a 1995 Dodge cargo van for supply storage, and a prime location in Soho - for $55,000. The ad promises a "great business opportunity," a chance to "make money from day one," and a guarantee to "get your money back in less than a year." "I'm asking cheap money, but I have to move back to California that's all," said Rosenberg, who bought the permit from the original owner for $7,000 three years ago, spent $25,000 to buy a cart, and pays $400 a month to rent a cart storage space in a garage in Astoria. In the three months since the ad was placed, he has had about 40 inquiries. "Most people who call me are new to the business, and they don't have the money or don't have the financing to give me cash right away. Maybe it's because we are living in tough times and the economy is bad." The 45-year-old Lebanese works at the cart from 8 a.m. to 4 p.m. on the weekdays and trades stocks on the side. His Middle Eastern menu of falafels, shish kebabs, French fries, and hotdogs attracts about 100 customers a day, he said, and brings in about $500 a week... In 2005, the Street VendorProject surveyed 100 vendors in Lower Manhattan and found that a street vendor may make up to $35,000 a year, after paying for food, cart storage, and taxes.

Feb6'2009 listing from business for sale category on Craigs List: $55k for 2 years old street cart "not a catering truck" with the remainder of 2 year permit; 1995 Dodge Cargo Van for supplies storage and towing the cart back and forth.

Aug'2009: good summary of costs and barriers.

Used truck market -

Many carts/bikes are made by WorksmanCycles.

Some of the Red Tape to jump through. (Occupational Licensing)

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