Business Plan for a Food Truck: Costs, Profit and Loss, and Key Performance Indicators

This business plan covers the costs, profit and loss, and key performance indicators for a food truck. It includes a summary of the business idea, fixed and variable costs, budgeted profit and loss statement, budgeted cash flow statement, breakeven point and margin of safety, and key performance indicators to monitor progress.

BUSINESS PLAN

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Summary of Business Idea along with analysis of risk faced and sources of initial funding for
the business:.................................................................................................................................3
Discussion of Key fixed and variable cost associated with the business:...................................5
Budgeted Profit and Loss Statement for the First year of Operations:........................................6
Budgeted Cash Flow Statement for the First year of Operations:...............................................6
Breakeven Point and Margin of Safety:.......................................................................................7
Key Performance indicators to monitor the progress of Food Truck:.........................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business Plan refers to projected plan with has been prepared considering the goals and
objectives that the entity or business wants to achieve in the future. Those business plans are
considered to be successful which covers every financial and non-financial aspects for the
organisation as both the factors plays the vital role within the corporations. These reports consist
of the business plan relating to food struck that serves the food to general public all around the
corner of the city as it run on the vehicle and covers maximum consumers as it can be and
considers to be economical as compare to starting the business at those places which required
space on rent to start a food chain. This statement shows the overall idea of the plan and cost
associated with the business in terms of fixed and variable. It also provides the projected
financial statement of a year along with break even point analysis and margin of safety so that
profitability of the start-up can be judged accordingly (anak Siba, Maruthaveeran, and Ujang,
2020).
MAIN BODY
Summary of Business Idea along with analysis of risk faced and sources of initial funding for the
business:
 Industry:
Companies on this enterprise put together food and snacks for instant intake from
motorized motors or nonmotorized carts, inclusive of meals trucks, ice cream trucks,
cellular concession stands, and warm canine carts. No principal corporations dominate
the enterprise (Burton, 2020).
 Nature of business:
About 2.5 billion humans round the arena buy meals from cell meals retailers and road
kiosks every day, consistent with the Food and Agriculture Organization of the United
Nations. Demand for cell meals offerings is excessive in Asia and Latin America, as road
meals is a culinary staple in nations along with Brazil, Thailand, and Indonesia. The U.S.
cell meals offerings enterprise consists of approximately five,500 establishments (single-
region corporations and branches of multi-region corporations) with blended annual sales
of approximately $three billion, consistent with Food Truck Nation.
 Nature of Competition:

Demand is pushed via way of means of customer tastes, private income, and nearby
demographics. The profitability of man or woman organizations relies upon on region
selection, meals quality, and powerful marketing. Large organizations have blessings in
call reputation and economies of scale in meals and gadget purchasing. Small
organizations can compete efficaciously via way of means of focusing on particular
meals merchandise and leveraging relationships with nearby suppliers. The enterprise is
fragmented: the pinnacle 50 organizations account for approximately 30% of revenue
(Charlebois, Juhasz, and Vézeau, 2021).
 Key Success factors:
Offering a particular, differentiated menu:
Why are clients going to consume the meals and what are the particular offering of the
food truck. The business is now no longer simply competing in opposition to all different
cell meals vendors, but the competition is with each different meal’s choice at the market.
First impressions with the aid of using the business clients is crucial, the menu has the
capacity to live with a patron lengthy after they’ve ordered from it
Effective exceptional control:
Food vans should preserve exceptional requirements for each their industrial kitchen and
the meals they produce and serve. The food truck nearby council’s meals protection
regulators yearly looks at business cell meals enterprise to make certain. Each country
has a legislative act that coincides with the Australian New Zealand Food Standards Code
to make certain meals on the market is secure and appropriate for human intake and to
save the food truck deceptive behaviour with regards to the sale of meals. A communique
streamline together along with business nearby council will make certain that enterprise
is regulating those requirements (Durmanov, Umarov, and Mirzayev, 2021).
Proximity to key markets:
This is a no brainer. It is crucial for the food truck to be placed in busy regions with big
foot visitors to maximize their sales ability. Whether that be at nearby network events,
markets, or a council approved park and serve location.
Ability to manipulate inventory on hand:

In order in the enterprise to maximize profits, the business should have a meals gadget in
region that avoids wastage and spoilage of components which in flip will lessen charges
to the enterprise.
Building and keeping a network:
Repeat clients are the coronary heart of any hospitality enterprise. They are those that flip
up each Wednesday for his or her Taco’s with a grin from ear to ear. They are those that
convey own circle of relatives and friends. Most of all, unswerving clients create logo
loyalty and growth logo attention via phrase of mouth referrals (Flanigan and Lynch,
2018).
Discussion of Key fixed and variable cost associated with the business:
 Main Cost Incurred:
The main cost incurrent in the form of fixed and variable cost in food truck business are
being tabulate below:
FIXED COSTS
Salaries (Fixed) £44,400
Assistant £26,400
General cleaning £18,000
Petrol/Diesel £19,200
Furniture On Truck £4,200
Marketing/Adv £4,500
Electricity/Gas £5,400
Equipment's depreciation £4,200
Truck Maintenance £15,000
Initial costs
Baking Machines £2,500
Truck Purchase £150
Kitchen Equipment’s £100
Fripteuse £125
Boilers £150
Cutlery £50
Tables and chairs £275
Others £180
Total fixed costs £1,44,830
 Assumption relating to Cost:

It has been assumed in the above cost is that such cost is necessary to start the business
and it has been increased by 10 % on per annum basis.
 Fixed Cost:
The fixed cost involved in food truck business has been maintenance cost and purchase
cost of the truck, salary payment to chef and helpers, maintenance cost of truck, furniture
and kitchen equipment’s used to make the food etc.
 Variable Cost:
The variable cost has been the food ingratiates which are being used to make the food and
food truck main food has been hot dogs, burgers, smoothie and sandwiches which are
sold on the regular basis (Marek, 2018).
 Comment on Cost:
The fixed and variable cost are being increasing depend upon the demand and supply of
the products offered by the business. The variable cost involved will be reduced on per
unit basis if sales volume be increased by the food truck.
Budgeted Profit and Loss Statement for the First year of Operations:
 Budgeted Profit and loss Statement:
The profit and loss statement of the food truck on projected basis are being covered in
excel in the detailed manner.
(Covered in Excel)
 Assumptions consider in preparing the statement:
It has been assumed that the sales and profit will be increased gradually on per month
basis but there are decrease in sales units also depending upon the demand of the product.
Budgeted Cash Flow Statement for the First year of Operations:
 Budgeted Cash flow statement:
The cash flow statement is being prepared on excel of the product sold by Food truck.
(Covered in Excel)
 Assumption Consider in preparing the budget:
It has been assumed that cash is received and paid evenly throughout the 12 months
period and profit and loss statement and cash flows are being equal.

Breakeven Point and Margin of Safety:
 Break Even point chart:
Calculation of Break - Even Point
Products Fixed Cost Contribution Fixed Cost / Contribution
Hot Dogs 61337.7131 4.95 12388.17365
Smoothie 54320.9742 3.27 16608.88013
Burger 50544.0214 5.15 9807.080046
Sandwiches 152.75 1.08 141.6986187
Key Performance indicators to monitor the progress of Food Truck:
Key overall performance indicators (KPIs) are quantifiable measurements that mirror the
elements you’ve deemed essential to the fulfilment of your cell meals business. Performance
indicator specific to Food truck are being explained below:
Food cost percent:
How plenty is the food truck normal meal and how typically calculate the meals fee as a percent
of the overall commercial enterprise charges. Food truck degree it via way of means of including
their meals purchases for the week and evaluating the ones figures in their weekly meal’s
income. Depending at the sort of delicacies they serve, this quantity can variety from 25 to 35
percentage (Närvänen, Mattila, and Mesiranta, 2021).
Weekly income:
This quantity is certainly considered one among the same old income-associated numbers that
everybody seems at. The weekly income can range extensively from one truck to the next. The
key quantity to have a take a observe is any alternate the business locates from week to week and
the way it compares to preceding years.
Total exertions fee:
Total exertions fee is certainly considered one among the most important charges the business
incurs as a meals truck owner. Hence, the purpose the entity needs to continuously preserve song
of it. The exertions fee has to variety from 25 to 35 percentage of the business overall charges.
Total exertions fee consists of earnings or hourly wages, benefits, insurance, retirement, and
bonuses which the entity pay to herself and their personnel (Schramm, 2018).

Labour hours:
How many hours do the business personnel paintings at some point of a sure time frame is
crucial in the business? The business can examine those hours in opposition to their income to
degree the productiveness of their body of workers.
Turnover:
Count the positions the business employ, after which divide this quantity via way of means of the
quantity of humans they have hired at some point of a sure duration of time (Szyliowicz and
Green, 2019).

CONCLUSION
Business Plan refers to projected plan with has been organized thinking about the desires
and goals that the entity or commercial enterprise desires to acquire withinside the future. Those
commercial enterprise plans are taken into consideration to achieve success which covers each
monetary and non-monetary components for the enterprise as each the elements performs the
essential position in the corporations. These reviews encompass the marketing strategy regarding
meals struck that serves the meals to popular public all over the nook of the town because it run
at the automobile and covers most customers as it may be and considers to be competitively
priced as evaluate to beginning the commercial enterprise at the ones locations which required
area on hire to begin a meals chain. This assertion indicates the general concept of the plan and
value related to the commercial enterprise in phrases of constant and variable. It additionally
offers the projected monetary assertion of a 12 months together with smash even factor
evaluation and margin of protection in order that profitability of the start-up may be judged
accordingly.

REFERENCES
Books and Journals
anak Siba, M.A.J., Maruthaveeran, S. and Ujang, N., 2020. Investigating the use and constraints
associated with green outdoor environment at workplaces: What do the office
employees in Kuala Lumpur say? Urban Forestry & Urban Greening, 51, p.126692.
Burton, J., 2020. Supporting entrepreneurs when it matters: optimising capital allocation for
impact. Journal of Entrepreneurship and Public Policy.
Charlebois, S., Juhasz, M., and Vézeau, J., 2021. A review of Canadian and international food
safety systems: Issues and recommendations for the future. Comprehensive Reviews in
Food Science and Food Safety, 20(5), pp.5043-5066.
Durmanov, A., Umarov, S., and Mirzayev, S., 2021. Development of the organizational and
economic mechanisms of greenhouse industry in the Republic of Uzbekistan. Journal of
Environmental Management & Tourism, 12(2), pp.331-340.
Flanigan, K.A. and Lynch, J.P., 2018, June. Community engagement using urban sensing:
technology development and deployment studies. In Workshop of the European Group
for Intelligent Computing in Engineering (pp. 92-110). Springer, Cham.
Marek, E.U., 2018. The post-incarceration kitchen: Food-based community organizing and
employment after imprisonment. American Studies, 57(3), pp.57-79.
Närvänen, E., Mattila, M. and Mesiranta, N., 2021. Institutional work in food waste reduction:
Start-ups' role in moving towards a circular economy. Industrial Marketing
Management, 93, pp.605-616.
Schramm, C.J., 2018. Burn the Business Plan: What Great Entrepreneurs Really Do. Simon and
Schuster.
Szyliowicz, D. and Green, T.G., 2019. Making strategy “Real”: Using reality television for
innovating teaching approaches. The International Journal of Management
Education, 17(3), p.100304.
Weissman, E., Robinson, J. and Cecio, W., 2020. The promise and pitfalls of mobile markets: an
exploratory survey of mobile food retailers in the United States and Canada. Agriculture
and Human Values, 37(3), pp.895-906.