The food truck industry

Categories: FoodMarketingTruck

The food truck industry is booming and more trucks are popping up all over the nation. Grand Rapids is one area in Michigan where this industry is really taking off. Over the past few years more trucks have been seen in the Grand Rapids area, serving multiple classes various kinds of delicious and affordable food. The Smitten Mitten will be joining other local food trucks this summer in the downtown streets of Grand Rapids. This new venture is made up of three current employees; the owner, head chef and sous chef.

Cassondra is the CEO of The Smitten Mitten, and has hired Jess as the head chef and Torey as the sous chef. Cassondra has over four years in the food and beverage industry, and has advanced business management and communication skills. Jess has over six years of experience in the restaurant business, and Torey has just over four years of experience working in the kitchen as a prep chef.

General management, sales, marketing and food preparation are all well-covered with the current staff.

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Future positions needing to be filled are an account and financial manager. The long-term goal is to hire these positions directly into the business. The hiring process may take a an extended amount of time due to the fact that the best needs to be hired. Applicants will be interviewed for the positions and must have a minimum of 5 years of experience and hold at least a bachelor’s degree in finance. The Smitten Mitten provides a mobile catering service to the locals in downtown Grand Rapids.

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This establishment is starting its business in the summer of 2015. The new venture plans on gaining competitive advantage through the knowledge of this industry. The employees’ background in customer service will be the advantage needed to win over their competitors. The Smitten Mitten provides delicious food that everyone craves right to their party or to them on the streets of down town. There is a wide range of almost unlimited food choices, and therefore caters to a very diverse group of customers.

Taste testing will be required for all foods that may be placed onto the menu at any time. Another aspect in which the business leaders plan to test is the customer service given to the customers. This testing will never stop because the owner of the business knows that there is always room for improvement. In 2012 the revenue for the food truck industry was 650 million, and is forecasted to increase to 2.7 billion by 2017 (Myrick, 2013). Grand Rapids will be helping boost these revenues because of the newly passed zoning rules. These rules allow for year-around food truck hosting on the streets of Grand Rapids. The art Museum alone is helping the trucks by giving them a spot on the Wege Plaza to rotate throughout the spring and summer months. The target market for the food truck industry is people aging between 25 and 34. People within this age group are more likely to be out on the town during all the events that take place downtown every year.

They are also the ones looking for a quick and affordable bite to eat, that allows them to not spend a lot of money and not have to prepare it themselves. The Smitten Mitten plans to be located with the other competition on Wedge Plaza next to the Art Museum. After gaining its customer base, the company will then expand to new places around town to attract more buyers. The company will begin with one truck, but with the projected growth in the first five years, more trucks will be added to expand the business. The Smitten Mitten will keep a customer count, total sales, and average per person sales, which will be tracked daily, monthly and annually.

This will allow the company to make sure it stays on track for success. Because the competition is getting stronger within this industry, the Smitten Mitten is placing lots of focus on its marketing to get the business name out to the community. Our Michigan-made food products campaign will help the truck gain advantage in the market, because the company buys its fresh food from local farm markets. By giving out coupons to potential customers, and marketing via the company logo on the trucks, The Smitten Mitten is planning for success.

The Smitten Mitten will need $53,500 in start-up capital for a successful launch of the business. The owner contribution of cash and assets is 56% with the remaining 44% obtained through outside investors and a 5-year commercial loan. The projected gross profit margin is 89%, due to moderate overhead costs and the ability to charge the consumer a gracious amout per unit sold. Through financial ratio and breakeven analyses, company leaders are confident in the financial plan and its projected outcomes.

Management Team


The founding team members of The Smitten Mitten have over four years in the food and beverage service industry within the restaurant, bar and golf course industries. The founding team members of The Smitten Mitten have advanced business management and communication skills, are well versed in the service industries, and have extensive experience in customer service and customer satisfaction.

Critical Tasks

Critical tasks at The Smitten Mitten will be accomplished through collaborative team focus, creativity and discipline, and the vision to be the best in the mobile catering industry. The team at The Smitten Mitten is extremely goal oriented and always remembers that its customers are the most important part of its business. All team members at The Smitten Mitten establish and meet goals by completing tasks on-time and by giving every effort to satisfy both internal and customer demands.

Gap Analysis

The primary positions within The Smitten Mitten, consisting of management, sales & marketing, and food preparation staff are well covered. The primary positions needing to be filled are local and regional drivers, and eventually, and accounting/finance manager. Senior management of The Smitten Mitten plan to launch the business utilizing a Certified Public Accountant (CPA) to manage all financial matters within the organization. The long-term goal for this position is to hire an accounting/finance manager directly into the business.

Organization Plan

The Smitten Mitten is a specialized mobile catering business, established in 2015 as a Sole Proprietorship, that provides a wide range of mobile catered foods to customers in the inner-city and rural areas. The Smitten Mitten is structured with the company owner acting as director over the sales & marketing and food preparation staffs, and also currently over the customer service drivers. All of the sales & marketing and food preparation staff are direct hire, whereas the customer service drivers are split between direct hire employees and contracted drivers. The company provides mobile catering service to local businesses, downtown settings, events and parties.

The owner of The Smitten Mitten believes the business can gain a competitive advantage through the knowledge of the industry, extensive history in quality customer service, and the ability to provide a single-source solution to the demands of its customers. The company will remain within close demographics until a stable clientele is established. Once this stabilization has been achieved, the leaders of The Smitten Mitten believe they will be able to expand to additional cities and regions. Product/Service Development Plan

Detailed description and unique features/benefits of product/service

The company specializes in catered delicious foods that everyone craves; right to their party or found on the streets during the beautiful days of fall, spring and summer. We do not specify in one area of food, we cover a wide range of snack, and meal foods. We provide a range of food and sweets for an affordable price. The company goes above and beyond to make a customer’s food exactly how they would want it. We go for personalization and getting to know our customers we serve.

Plan for prototyping and testing

The company plans to do continues testing on the food and service in which we will be giving to our customers. We will have many people do taste testing of every bit of food that we prepare. Each time we come out with a new meal, the business plans on bringing people in to taste the food before we make it for the public. Another aspect we plan on testing is the service we are giving to the customers. Each employee will go through customer service training to ensure we are giving the best service as possible. This testing will never stop, because we will always be training our employees in every aspect of this business.

Tasks and timeline to completion

The winter months normally last through the end of March and into early April, therefore The Smitten Mitten plans on completing all of their testing before May of 2015. After the business is up and going there will be a three week testing period. This is implemented for when we introduce new foods to the menu. This will allow for our cooks to play around with the recipe and for taste testing to take place.

Acquisition of intellectual property

At this time we do not see any need for any intellectual property.

Industry Analysis

Over the last few years the food truck industry has boomed beyond anyone’s imagination. There are many people who have a love for food and have a dream to open a restaurant of their own one day. More people are opting out and going into the food vendor industry, instead of the restaurant industry. It is said that “by 2017 food trucks will generate about 2.7 billion dollars in revenue. This is an increase from the 650 million in 2012 (Myrick, 2013). The barrier of entry is a lot less than the traditional restaurant because of the must lower capital costs.

Technology has been a big game changer for the food truck industry. According to Katy McLaughlin, technology has made the food industry grow much more than what it was before. It allows the trucks to pick up in a short notice and move to where the customers are located (Ehrlich, 2015). Businesses might also develop an App that their customers can download, which may allow the truck’s location to be shared as well as the daily specials or upcoming deals displayed.

Another great technology to use is social media, such as; Twitter, Instagram and Facebook can determine where the most people are and what events are most popular. They can also have their own page for their business which will allow their customers to know where they will be located that day. Social media can also be used to receive feedback for improvements. It is good to have a suggestion box on-site, but more people are getting used to writing reviews online. Social media is a great way to hear back from your customers and know what can be done better or what they want done differently.

The future is bright for the food truck industry in the Grand Rapids area. New zoning rules were passed by the city in 2012 that allow for year-round food truck hosting. Food trucks are allowed to be available to the public every day from 7am to 10pm on weekdays and from 7am to 11pm on the weekends. The Grand Rapids Art Museum is expecting a rotation on food trucks on the Wege Plaza that is located right next to Rosa Parks Circle. Rosa Parks Circle is the heart of Grand Rapids and brings in the most people in the spring, summer and fall times. The atmosphere is great and there is always something happening downtown to draw in a crowd each day (Ellison, 2014). Competition will be a little strong with the new ordinance and the Art Museum drawing in more customers will bring more trucks to the area. Grand Rapids is continuing to grow each year and the competition will only keep growing within the city.

Target Market

The biggest buyers from food trucks are younger adults and parents with children at home. It is said that the largest consumer are those aged between 25 and 34, and they typically spend around $45 a month (Ehrlich, 2015). The pain that is being cured is the ability for individuals to pay a small amount for their meal, and also saving time not having to prepare the meal themselves. The customer demand is for fast, affordable and delicious food. The Smitten Mitten will provide fast and inexpensive food, not to mention how delicious it will be. We will be able to provide our delicious food at the most convenient times. Because our target market is for younger adults and people aging from 25-34 we will be most available for those walking downtown Grand Rapids, visiting Art prize, downtown festivals, Irish on Ionia, all of the 5k, 10k and other races, and many other events that take place downtown.

Competitor Analysis & Competitive Advantage

There are not many food trucks in the Grand Rapids area, but over the last few years there have been a few more popping up. The Smitten Mitten will be one the few that will be joining the streets of downtown Grand Rapids. We will have a competitive advantage as we advertise our food as local cuisine. We plan to get all of our food, ingredients, sauces and more from the markets around Michigan. Everything in our food truck will be Michigan made. We are helping the local farmers as we will get fresh produce from them, as well as supporting the ‘Made in Michigan’ campaign. Therefore, all of our food will be fresh right from the markets and we will be able to give customers slightly healthier choices that are still delicious like any of the food you would get from a food vendor. All of our products will be environmentally friendly, so we can give back to the community as we try and help reduce less trash build up.

Distribution Channels and Entry Strategy

The Smitten Mitten plans on teaming up first with the Art Museum to claim a spot in front of their building a few times a week with the other trucks. This will get us in the game and get people to know who we are. Our goal is to be well-known and a favorite by the end of the summer of the first year we open. We plan on having a soft-opening that will allow people to come and try our food, free of cost. This will allow us to help customers get familiar with us and give us some feedback before we officially open.

When we are open we will have our marketing representative go around with flyers and free samples to get the word out that we are here and ready for their business. We plan to stand out from the other trucks; we are based around Michigan therefore our truck will be designed to reflect Michigan and focus a little more on Grand Rapids. All the major structures will be beautifully painted all over our truck. We won’t just be a truck selling food, we will be a moving piece of artwork that people will be able to enjoy (Sonnenshein, 2011).

Coupons will be given out and the first 100 customers will receive special offers. The Smitten Mitten will go above and beyond to attract the customers. We plan on using social media a lot to let our customers know where we are, but also give them the opportunity to know about deals and promotions. If a customer can prove that they are following us on social media they will get a discount off of their food or will be given a coupon for their next visit. This will allow us to gain regular and loyal customers that we are going to strive for (Sonnenshein, 2011).

Operational Plan

Facilities and Location

The Smitten Mitten will be located in the downtown streets of Grand Rapids. It is planned to start out being parked by the Art Museum; but to venture out to places around town throughout the year. As of right now we are only going to have one truck; but if the first few years goes as planned we will expand in the first five years of opening. All of the management and financial paper work will be done at the office. This office will be a personal office that will be ran from my household.

Business Process

The business process is quite simplistic at the Smitten Mitten. There are five business processes within the company’s operations, including purchasing, development, manufacturing, packaging and sales. The business process begins with the purchase of all materials necessary to complete the business process. These purchased materials include ingredients needed to make the food sold from the food truck, and maintenance, repair and operations (MRO) items. The development process is where trials are made on different recipes and ‘concoctions’ to come up with future products to sell to the consumer. The manufacturing process consists of the actual creation, baking or cooking of the food products that will be sold to the customer out of the truck. The packaging process is critical to the marketability of the company’s products, as it is what first catches the consumers’ eye as they approach the truck. Lastly, the actual sale of the truck’s goods and the processing of the customers’ payment is what completes the business process.

Plan for Outsourcing

The only outsourcing The Smitten Mitten will be doing will be for our accounting and finance manager. We will launch the business using a Certified Public Accountant (CPA) to manage all of our financials within our business. We hope that the outsourcing will be short terms because in the future our goal is to hire an accountant/finance manager directly into The Smitten Mitten.

Plan for Manufacturing/Distribution

As previously stated in the business process section, the manufacturing of the company’s products includes the creation, baking or cooking of the food sold to the consumer. There are some products that need only be created from raw ingredients, i.e. salads, wraps, sub sandwiches, etc. Other products need to be baked, i.e. cakes, cookies, muffins, etc. And lastly, products such as soups, hot meat sandwiches, fried foods, etc. need to be cooked. It is important to the profitability of the company to accurately balance the inventory levels so not to create waste from expired products, but have enough inventory on hand to be able to supply the demand of the consumers. The company distributes all of its products through retail sales from the mobile food truck. This allows for a simplified distribution process that is low-cost and sustainable.

Marketing Plan

Purpose of marketing plan, business identity

According to the American Marketing Association (AMA), a brand is defined as “a name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of other sellers” (Lake, 2015). It is important to understand that branding is about getting potential customers to see you as a solution to their needs, and not about getting the target market to pick your company over the competition. The leadership team at Smitten Mitten realizes the importance of creating brand recognition for its products. The marketing plan has been created to effectively get the company’s brand name to the market and to effectively identify the business as the best solution to its customer’s needs and problems.

Target market and unique market niche

The target market of Smitten Mitten is people who are looking for a quick meal at a reasonable price. In today’s fast-paced business world, it is important for individuals to have the opportunity to purchase their lunch quickly, and without busting their budget. When the leaders of Smitten Mitten were defining the target market of the business, target market information was gathered through market analysis. This information included the targeted market primary characteristics; the size of the primary target market; the extent of targeted market share; what form of media will be used to reach the prospective target market; and the evaluation of the competition. Knowing the target market will allow Smitten Mitten to gain competitive advantage and capitalize on its niche of providing quality food made towards local cuisine.

Customer Acquisition Plan

Acquiring new customers is very important for an upstart company to become a stable and sustainable business. It is also important for the business to develop a long-term marketing plan for the retention of its valuable customers. The leaders at Smitten Mitten realize that the best way to market the company’s brand and products is by the creation of a company website and through advertising through social media. It is social media sites, such as Facebook and Twitter, where the organization will be able to connect with potential customers. This form of marketing and advertising has mainstreamed Smitten Mitten’s marketing plan, and is the most cost effective form of advertising. It is through social media where the business will be able to reach the majority of its target market, and gain customer loyalty.

Marketing strategy and tactics

Each day will begin with the customer count, total sales, and average per person sales goals. These metrics will be tracked on a daily, monthly, and annual basis. It is important for the success and longevity of the business to always know where we stand against the company’s budgeting goals. Because the food truck industry is becoming increasingly more competitive, the leaders of Smitten Mitten have determined that the best marketing strategy to use is Product Differentiation. According to Business Dictionary, Product Differentiation is defined as, “Development or incorporation of attributes (such as benefits, price, quality, styling, service, etc.) that a product’s intended customers perceive to be different and desirable. Advertising and promotion of a product is based on its differentiating characteristics’ Product differentiation, 2015). This will allow Smitten Mitten to differentiate itself from the competition and distinguish the business from others in the market.

Growth Plan

Strategy for growth

The Smitten Mitten will focus on its financials for the first season the business is open. On the off season the management team will work intense hours and review all of the financials to ensure the business is on the correct path to success. The company’s long-term goal is to add more trucks to be put in different locations around Michigan. The company will continue to devote two hours of time, a day to social media. This will allow the business to stay connected to its current customers, as well as gaining more potential customers. The business will be able to share its menu, specials, pictures and upcoming events where its services will be located. Social media will also allow business personnel the opportunity to give responses to customer reviews, which will help in the growth of the business.

Resources required (personal, facilities, equipment, capital)

The business will need to make sure that the accountant is available to look over the financial numbers on a daily basis and help to make mid to long-term budgetary assumptions. The Smitten Mitten will need to acquire a facility where production activities can take place, and one where all team members can gather together and have meetings when needed. A tablet will be purchased for the business to make sure there will always have a technological device on-hand to stay connected to social media.

Infrastructure changes resulting from growth

As the business continues through its growth stages, additional resources and personnel will be required to accommodate the additional growth. It is necessary to add additional resources, such as food and ingredient inventories and fleet services (food trucks), as the demand for the company’s services increases. It will also be important to add additional personnel to the infrastructure of the organization to accommodate the growth of the business. Additional food preparers will be necessary in the area of production, additional drivers will be required to drive the additional food trucks added to the fleet, and the addition of a middle manager may be necessary to direct the additional scheduling workload.

Contingency Plan

Strategies for dealing with deviations from the plan

If the business financials end up where it is not necessary to add more trucks, the company will put more resources into the existing truck. It is part of the business plan to grow into more trucks five or more years down the road, but that will be based on future positive financial statements. If it is known early on that the company is not going to make its financial goals, the business leaders will make the operational adjustments necessary to reach the long-term goals of the organization. The company’s one truck will be the test on how the business is going to measure up to its goals. If the business can make it past the first two years, the company’s future will look bright.

Strategies for harvesting the wealth created from the business

The wealth harvested from the business will be put back into the business to make the organization grow better and larger. Financial gains will allow for bigger menus, as well as specialty items in the future. The money will also be invested into new equipment, trucks and personnel to grow lager as a business. We will continue to improve as a business, as well as growing into something that people have desired to see in the local area. No money made will go to waste, as we plan on making sure everyone is paid fairly and all of our equipment is up-to-date and properly maintained.

Financial Plan

The creation of a structured financial plan is key to the success of The Smitten Mitten. Banks and private investors will base their funding decisions on the information provided within this financial plan. Besides providing a plan of the company’s financial needs, this plan is to ensure that the company remains liquid and ultimately becomes a profitable and sustainable business. Since the sales and earnings projections in the financial plan are based on certain assumptions and expectations, the plan must continuously be revised so that discrepancies can be resolved for continued success. The data inputs for this financial plan are based on market estimates. The estimated revenues are based on the projection of employing one part-time driver and two full-time food preparers. The projected business expenses are based on industry research.

The company’s financial strategy is summarized as follows.

The initial start-up funds requirement is estimated to be $53,500. This amount will be achieved by an initial owner investment of $30,000, an additional $15,000 from outside investors, and $8,500 to be borrowed on a commercial loan. Although this will get the company started, additional capital requirements will be necessary to sustain and grow the company in future years. The growth rate for the business is expected to increase steadily throughout the first three years. The revenue and profitability for The Smitten Mitten is dependent on the level of acceptance of the company’s products within the many markets within the region. The business growth strategy remains in the profitability of the company’s products, and within the ability to add additional vehicles to its fleet.

The projected gross profit margin is relatively high at 89.54%, due to the fact that the business has moderate overhead costs and is able to command a gracious amount per unit sold. The net profitability of the business is controlled by management’s ability to maintain low fixed operating expenses. It is anticipated that operating expenses will remain stable and will continue to be in-line with increased revenue.

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The food truck industry. (2016, Sep 24). Retrieved from

The food truck industry

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