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kuchikomi

Food truck business may be low risk, but hardly high return

16 Comments

“My [Hispanic] culture is a very dominant culture, and it’s imposing and it’s causing problems. If you don’t do something about it, you’re going to have taco trucks on every corner.”

So warned Marco Gutierrez, the founder of Latinos for Trump, in an interview on MSNBC TV last September.

The much-quoted remark prompted a storm of tweets and had Americans throughout the 50 states debating. A majority seemed to say, "So what's wrong with that?" After all, tasty and affordable tacos are as American as apple pie -- aren't they?

Tacos -- the Mexican kind -- are less likely to be found being hawked by trucks in Japan than are "takoyaki" (octopus balls), but as Nikkan Gendai (Dec 10) reports, more and more people have been taking to food trucks to hawk their wares, either as a sideline to their regular occupation, or as an attempt to achieve financial independence. Setting up shop at festivals or in areas of Tokyo lacking competing businesses such as convenience stores, the numbers of food trucks in the capital are estimated to range somewhere from 1,000 to 2,000.

The tabloid sent a reporter to interview Susumu Hirayama, operator of the consultancy "Kurusyoku Kitchencarz Life Ido" (http://www.idou-hanbai.jp ) about the business side of the operation.

"Start-up costs for a restaurant run in increments of 10 million yen," Hirayama tells Nikkan Gendai. "Then there are running costs, such as rents, etc. And if the business fails, you can still expect outlays of up to 3 million yen just to shut it down. So starting a business on the street has the merit of minimizing risks."

In most cases, a food truck -- typically a small wagon -- can be manned by a single operator. The rear seats are modified into the working area, which usually requires a 40-liter tank for water; a gas burner for cooking; and a small electric generator. The whole setup can be purchased for anywhere between several hundreds of thousands of yen to 1.5 million yen. The cost is usually doubled to 3 million yen if the operator decides to contract with a franchise.

A key factor to consider is where to set up operations. The traffic laws prohibit operation without permission on public thoroughfares, which means food trucks are basically limited to privately owned streets and driveways, or at festivals and events.

"The organizers of events may require payment of several hundreds of thousands of yen per day," points out Hirayama. "So the best way to operate is to negotiate renting a space from the property owner, in much the same way as do vending machine operators.

"Another way is to join together with other food trucks and set up the equivalent of a 'yatai-mura' (food stall village). The usual cost in this case is 15% of the daily revenues. On top of that, you can expect outlays of 30% for raw materials. So roughly half remains as working profit."

To estimate income, Hirayama suggests a rule of thumb of 30,000 yen in sales per day times perhaps 20 days a month, which would leave 300,000 yen after operating costs. Prices of food items are usually set between restaurants on the high end and convenience stores on the low end.

To attract business, it's important to come up with a theme or concept, and be able to offer a "kanban shohin" (the main item displayed in the sign on the truck).

Hirayama also pointed out that customers enjoy watching a show of the food being prepared, and often prefer to opt for a tasty hot meal from a food truck over take-out from a supermarket or convenience store.

"About 80 or 90% of sales by successful food truck operators tend to be from their repeat customers," he said.

© Japan Today

©2019 GPlusMedia Inc.

16 Comments
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Once in a while there'll be a shawarma (doner kebab) truck in Hachioji. OMG they're so gooood! I've seen too many taco yaki trucks and crepes trucks. I think people may be getting tired of those. I think Mexican food trucks would be very popular.

6 ( +7 / -1 )

@sensei258 I completely agree.

Maybe some Japanese entrepreneurs should visit Portland, Oregon to see what all kinds of wonderful food can be sold from trucks. http://www.foodcartsportland.com

The hygiene concern is no more an issue for food trucks than it is for Michelin starred restaurants. The only actual holdup I can see is that it might well be in some areas local 'families' control the street vending rights.

2 ( +4 / -2 )

The hygiene concern is no more an issue for food trucks than it is for Michelin starred restaurants.

Michelin Restaurants have restrooms. Food trucks don't.

-1 ( +5 / -6 )

How about the regulations JT?

1 ( +2 / -1 )

Part of the difficulty is find places where it's okay to park the truck all day, or for the weekend. Even then, there's usually a fee. The shawarma truck guy told us they have to pay 2,000 yen a day to the city.

5 ( +5 / -0 )

Good subject, but what the heck are the first 3 paragraphs doing in this story?? Trump, Hispanics, USA politics...a weird lead-in to good story that has nothing to do with Trump, Hispanics, politics... or the USA. Like another article was accidentally spliced into to the intro.

4 ( +5 / -1 )

KUCHIKOMI is so often just obnoxious - occasionally amusing (but here, not so much).

0 ( +0 / -0 )

i wonder if you could set up in one of those coin parking?

0 ( +0 / -0 )

The shawarma truck guy told us they have to pay 2,000 yen a day to the city.

That's chump change.

1 ( +1 / -0 )

Food trucks?

Groan, annoying and absolutely pointless in Japan, where delicious and very economical food of all types are sold all along the streets.

-5 ( +0 / -5 )

I am dying to open up a food truck in Kyushu someday, but according to a friend that's a local bar/restaurant owner here, the city office is not accepting new registration for mobile food vendors

Apparently the town looks down on the industry and finds the trucks to be either an eyesore, or just they just get in the way

Either way, it would be nice to have a few more takeout places here. If not food trucks, then a place with a street facing window would suffice!

1 ( +1 / -0 )

A friend once operated an ice cream truck but kept getting chased away by yakuza because he refused to pay them a fee to park which they claimed they controlled. He lasted six months because it was difficult to find a place to park and do business, unless it was far from foot traffic.

1 ( +2 / -1 )

"the merit of minimizing risks"

Pretty sure that this guy does not know the meaning of "minimizing."

0 ( +0 / -0 )

"Low risk" probably only pertains to the size of the investment, not the likelihood of losing it.

If someone goes into debt for it, it's high risk to them, not low risk just because the cost is low. The cost is relative to the risker's situation.

I've seen food trucks in USA selling for around $70K USD, just for truck with equipment (don't remember if used or new).

kolohe: A friend once operated an ice cream truck but kept getting chased away by yakuza because he refused to pay them a fee to park

Saw a comedy skit once where a guy bought an ice cream truck from an old man. The competition was kind of feral (had baseball bats or something like that). Guy had his own bat but by the end wound up selling the truck back to the old man (that was the punch line, somehow). Don't remember if it was Korean or Japanese, but it was kind of like a Bennie Hill or Mr. Bean skit.

-1 ( +0 / -1 )

The shawarma truck guy told us they have to pay 2,000 yen a day to the city.

Never heard of it. I guess it a mobile curry house.

-1 ( +0 / -1 )

Not curry. Gyros / Mediterranean sandwich wraps, with meat cut from a stack on a vertical rotisserie. (Arabic 'shawarma' and Greek 'gyros' are both derived from 'turning'.)

https://en.wikipedia.org/wiki/File:%E0%B4%B7%E0%B4%B5%E0%B5%BC%E0%B4%AE%E0%B5%8D%E0%B4%AE.JPG

1 ( +2 / -1 )

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