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

                                May 31, 2022 - More Than Half of Consumers to Cut Back on Dining Out
                                • Rising housing, food, and gasoline prices may leave consumers with less money for dining away from home. In a recent CNBC poll conducted by Momentive, 52% said they would cut back on dining out if inflation persists. More than three-quarters of survey respondents reported worrying that higher prices will prompt them to rethink their financial choices.
                                • Food prices have been rising since mid-2021, but they are expected to increase further amid the Ukraine war and rising interest rates. US food manufacturers’ prices rose 2.7% in April 2022 compared to the prior month but grew 14.5% over April 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 6% and 7% for all of 2022 compared to 2021, according to the food price outlook released in May by the US Department of Agriculture.
                                • New COVID-19 cases are increasing nationally, which could affect demand for catering services. In late May 2022, the US averaged about 110,000 new cases per day, or about 30% higher than they were two weeks earlier. However, actual case counts were probably higher due to home-testing and more uncounted cases. While cases were on the rise, they were still a small fraction of what they were during the Omicron surge.
                                • In March 2022, 6.1% of accommodation and food services workers quit or left their jobs, the highest percentage of any US industry sector. "Workers continue to quit and get hired at fast rates in today's economy. This 'churn' is a positive sign of a strengthening labor market where workers can quit, search, and obtain new opportunities,” said Elise Gould, senior economist at the Economic Policy Institute.
                                • 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 30% as of the week ending May 20. 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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