Mobile Food Services

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 5,900 mobile food service firms in the US operate food trucks and carts from which they sell prepared meals, snacks and beverages for immediate consumption to walk-up customers. Mobile food services also contract with individuals and businesses to cater food at events, such as parties, corporate gatherings and festivals.

Permit Restrictions

Food trucks are typically permitted and inspected by the city in which they operate and regulations can vary significantly from city to city.

Sensitivity to Economic Conditions

Food trucks that catered to construction sites and industrial parks were hit hard during the recent recession when construction and manufacturing declined and workers were laid off.

Industry size & Structure

A typical mobile food service firm operates out of a single location, employs 2-3 workers, and generates over $281,000 annually.

    • The mobile food service industry consists of about 5,900 companies which employ over 16,200 workers and generate about $1.7 billion annually.
    • The industry is highly fragmented with the 50 largest firms accounting for less than 15% of industry revenue.
    • Most companies are small, independent operators - about 83% employ less than 5 workers.
    • Cities with large numbers of food trucks include Los Angeles, Washington DC, San Francisco, Houston, and Miami.
    • Customer industries include individual consumers, event organizers, and businesses seeking mobile catering.
                                Industry Forecast
                                Mobile Food Services Industry Growth
                                Source: Vertical IQ and Inforum

                                Coronavirus Update

                                Apr 29, 2022 - Food Prices Skyrocket
                                • Food prices have been rising since mid-2021, but they are expected to increase further amid the Ukraine war and rising interest rates. On a seasonally adjusted basis, US food manufacturers’ prices rose 1.5% in March 2022 compared to the prior month, but unadjusted food prices grew 14.6% over March 2021, according to the US Bureau of Labor Statistics. While foodservice firms have tended to increase their prices as food costs rise, firms and their customers are not likely to get much relief. Food-away-from-home prices are expected to rise between 5.5% and 6.5% for all of 2022 compared to 2021, according to the food price outlook released in March by the US Department of Agriculture.
                                • New COVID-19 cases are decreasing nationally, leading to increased demand for food services. In late April 2022, the CDC announced that according to the agency’s research, about 60% of the US population had been infected with COVID-19 by February 2022. Some medical experts suggest the high rate of infection and the resulting increase in immunity among the US population may signal a new phase where infections cause less and less severe illness.
                                • In February 2022, 6% of accommodation and food services workers quit or left their jobs, the highest percentage of any US industry sector. In speaking about the overall level of quits in February, Daniel Zhao, senior economist at the career site Glassdoor, said, “These quits are still extremely high, and that shows the Great Resignation is still in full swing.”
                                • To cope with labor shortages, food services providers and restaurants are doing more than just offering better wages to retain their workers, according to Bar & Restaurant. Some have invested in technology, including new point-of-sale (POS) systems with handheld devices and QR code ordering kiosks to ease team member workloads. Others offer bonuses for employment referrals or have created clear upward mobility tracks.
                                • Russia’s invasion of Ukraine and the resulting sanctions by the US and its allies have roiled global energy markets, sending oil prices higher. Since the war began, the spot price for US Gulf Coast ultra-low sulfur diesel has risen 40% as of the week ending April 22. Rising food and fuel prices are a threat to mobile food service operators’ margins if the full increase in costs cannot be passed on to customers.
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