University at Buffalo School of Management

Buffalo Business - Autumn 2014

The magazine for alumni and friends of the UB School of Management

Issue link: http://ubschoolofmanagement.uberflip.com/i/359417

Contents of this Issue

Navigation

Page 16 of 31

thereby introducing them to other nearby businesses and attractions. For savvy restaurateurs looking to expand their operation, mobile busi- nesses represent a way to reach cus- tomers across town, promote their main location and experiment with new concepts. In fact, several major restaurant chains have done just that in recent years. Taco Bell, California Pizza Kitchen, White Castle and Dunkin Donuts, among others, have opened food trucks as a marketing platform and a low-cost way to test out new menu items before offering them nationwide. Even unrelated companies have taken advantage of the food truck craze; for example, to pro- mote "Cloudy with a Chance of Meatballs 2," Sony Pictures dispatched two food trucks for a monthlong tour, giving away free snacks inspired by the film. "A big question now becomes: Will the entry of major brands into the food truck industry hurt it?" asks Ulbrich. "Seeing big-name brands take advantage of this space may actually take away the hip and trendy factors that make food trucks attractive to potential customers." In future years, mobile businesses (see sidebar, page 13) will only become more mainstream thanks to increased press and word of mouth, TV shows like Food Network's "The Great Food Truck Race," and films like this summer's "Chef." In 2009, a survey by Datassential found that 40 percent of people had never heard of food trucks. Five years later, not only have most people heard of them, but 75 percent said food trucks have influenced their behaviors at restaurants and grocery stores. And those businesses have noticed. Fusion entrées, for instance, have appeared on stadium and ballpark menus coast to coast after dishes classified as "mixed eth- nicity" became the second most popular items on food truck menus, according to MenuTrends. Globe Life Park, home of the Texas Rangers, offers a two-foot-long Korean BBQ sandwich, while the Minnesota Twins' sta- dium melds Italian and Asian flavors in a porketta slug- ger, an egg roll served with red sauce and filled with porchetta and cream cheese. Experts, business owners and fans agree that food trucks aren't going away. "Food trucks have created a new niche dining expe- rience that people have come to love and crave," says Dorsaneo of Lloyd Taco Truck. "Maybe it's the thrill of the hunt and following your favorite truck on social media, or just standing in line chatting with people who share the same love of food, but one thing is for sure: I'm truly humbled every time I pass a new truck in Buffalo. I just think to myself, 'I started this here.'" x Autumn 2014 B B Experts agree the biggest challenge for food trucks is municipal regulations. Despite industry growth, laws in many areas inhibit mobile businesses by banning sales on public property or imposing strict time restrictions. A study by the National League of Cities found that permit fees vary widely, ranging from $110 to $1,500, and that most cities require three to five permits, each from dif- ferent departments, thereby increasing the workload for business owners and city officials. On the other hand, the study also showed that most cities have straightforward sanitation and food safety guidelines, including requiring trucks to have a commissary, a fixed-location kitchen where food is prepped. City leaders must grapple with concerns from restaurant owners who fear food trucks will infringe on their sales. But in a 2012 study by the National Restaurant Association, nearly half of food truck patrons said they would have eaten at home if they hadn't visited a food truck, suggesting the outing was spontaneous. Moreover, only 7 percent of lunch customers—when trucks generate the most revenue—said they would have otherwise eaten at a full-service restaurant. "I don't look at a brick-and-mortar as direct com- petition. If you want to have a nice sit-down meal, you won't eat at a food truck," says Szczepaniak. Likewise, because most trucks specialize in one type of food or drink, she doesn't stress about competing with other trucks. "In Buffalo, everyone is friendly and wants each other to do well," she assures. "Food trucks are still a rel- atively new concept, so the more there are, the better people understand them and the better the industry will perform. And when the industry does better, your busi- ness does better." The presence of food trucks can have positive effects for cities, particularly areas underserved by gro- cery stores or traditional restaurants. In Tampa, Mayor Bob Buckhorn hosts a monthly Food Truck Fiesta to bring people downtown for lunch. In Los Angeles, the annual LA Street Food Fest welcomes more than 100 vendors and sells out admission to 5,000 guests. And many cities, like Austin and San Francisco, have opened food truck parks, taking vacant lots and transforming them into vibrant food courts, often with a few trucks as permanent vendors. "Cities should look at food trucks as a strategic resource to help revitalize neighborhoods. The trucks can serve as additional eyes in that area, so the neighborhood becomes safer and more alive," says Jain. Here to stay While many brick-and-mortar establishments worry about losing business to food trucks, experts say that mobile vendors offer potential benefits for them, too. By promoting their location on social media, trucks attract clients who wouldn't otherwise visit an area, "Itmademefeel connectedtofood inawayI'dnever experienced,and Iknewthisnew wayoffood servicewasgoing tochangethe culinaryscene." — Chris Dorsaneo '03 Co-owner of Buffalo's first food truck, Lloyd Taco Truck

Articles in this issue

view archives of University at Buffalo School of Management - Buffalo Business - Autumn 2014