Cities That Push Out Food Trucks Are Only Hurting Themselves

The Washington Post recently had an in-depth article online looking at what it takes to start and run a successful truck. It is a fascinating peek inside the trucks and inside a concept that opens up small business ownership to Americans who lack the resources to purchase a traditional restaurant. It shows that a food truck is really the first rung on the ladder to building a successful business that can eventually employ dozens or even hundreds of individuals.

Food trucks burst onto the scene in American cities as the 2008 recession left millions out of work and savings accounts drained. With a substantially smaller investment, a great idea and a lot of work, an entrepreneur could earn a living and even gain a modest amount of local or even national fame.

Unfortunately, instead of seeing hard-working Americans doing the best they could in a bad situation, many cities acted to protect existing brick-and-mortar restaurants from new competition. For instance, in Chicago rules against parking within 200 feet of a brick-and-mortar restaurant effectively locked out honest truck operators from the prime areas in The Loop. The result was a loss of about one-third of total trucks.

One of the very Alderman who created the restriction is a restaurant owner himself. And big cities are not the only place where the protectionist instinct is alive and well. The chairman of the town board in tiny Gibraltar, Wisconsin is also a restaurant owner and banned all vending on wheels after a small shop opened a food truck in its parking lot.

Cities might think that they are acting in their own interest by favoring brick-and-mortar restaurants over mobile restaurants, but there is really no evidence that new choices drive old restaurants out of business or reduce local tax revenue. For instance, in Gibraltar, the existing restaurants along the waterfront often have long waits in the summertime. There’s plenty of customers for both the new and old food choices to thrive.

The average cost to set up a food truck in the nation’s capital is about $100,000. By contrast, it could cost $200,000 annually just to lease an existing restaurant space on the edge of downtown D.C. That’s far out of the reach of most Americans thinking about opening a business.

The first food truck owner interviewed in the Washington Post story is Captain Cookie and the Milkman owner Kirk Francis. Francis was able to launch his truck with just $30,000 in 2012. He didn’t stop there. Today, he has four trucks, a food hall location and a brick-and-mortar location.

While brick-and-mortar retailers often lobby for food truck regulations arguing that trucks are easier and cheaper to operate, one thing the Washington Post feature makes clear is the everyday difficulties faced by trucks. Income is totally dependent on the weather, conditions are cramped and most trucks don’t have an onboard bathroom. This is exactly why so many food truck owners use their proceeds to expand to a traditional storefront location.

D.C. has plenty of examples of trucks making the transition to brick-and-mortar: District Taco, TaKorean and BBQ Bus, just to name a few. The District Taco location in downtown D.C. hosted several unsuccessful lunchtime spots before business owner Chris Hoil took it over. Now, the line often snakes out the door.

When cities kick out the first rung on the ladder, they might think they are protecting their own tax revenue. Yet a busy, successful restaurant is a better revenue raiser than an empty one that has lost touch with customers’ tastes. Places such as Los Angeles and D.C. that have given trucks at least some room to grow have thriving brick-and-mortar restaurant scenes, not empty storefronts.

The Institute for Justice, through its National Vending Initiative, has represented food truck owners across the country as they fight against burdensome and anti-competitive regulations. These are hard-working restaurateurs who enjoy being their own boss. Whether they want to stay small, or whether they have big dreams, they are contributing to the vibrancy of their community and to the local economy.

Illegal and unconstitutional barriers hurt entrepreneurial Americans, but they also hurt cities who might miss out on becoming home to the next great food trend and thriving businesses.

JOIN THE FIGHT!   Sign up for newsletters:

JOIN THE FIGHT!