David Weber, President of the NYC Food Trucks Association (NYCFTA), and founding member of Rickshaw Dumplings sat down with Total Food Service to discuss a few of the issues facing the Food Truck Industry these days.
What are the major issues that the city’s food trucks are facing?
The first issue that we’re working on is the no vending from meter parking law. It has been on the books since 1965 and is 50 years out of date. This year, a State Supreme Court Justice ruled that food is merchandise and therefore cannot be sold from metered parking. We vehemently disagree with this in so far as merchandise is commonly understood to be a commodity that can be bought and sold. Our position is that a food product is prepared to order and is made exactly how you want it. For instance a hot dog with extra hot sauce and some mustard and relish has been elevated from the status of a commodity because once it is made to order, it’s not something you can resell to someone behind you in line. Our second concern is licensing.
How does licensing of your truck work and how would you like to see it modified?
Right now, each individual employee needs what’s called a mobile food vendor’s license. In order to get that license, each individual employee needs a sales tax certificate of authority, which is quite an onerous process. If you go to the City’s web site and try to sign up as an individual it’s quite a challenge and a long process. Once you do get through the process, it takes about two months for an employee to get a permit and license. It’s hard to get a full staff of really well trained hospitality professionals on board with these extra constraints.
How did you get into the business?
I entered a business plan competition in business school. I met my partner Kenny Lo while at the NYU Stern here in the city. He grew up wrapping and eating dumplings. He always wanted to do a dumpling concept. So we opened that in 2005 and as you know today we have four food trucks and two restaurants and we’re looking to open another restaurant this year.
What does the food truck industry bring to the city?
In addition to the aesthetics of what trucks bring to the streetscape, our trucks generate tax revenue, jobs and tourism. The City needs to get these regulations right. By doing so it will bring the very best into our industry and better quality of the restaurateurs that you have looking to get into the space and better quality food you’re going to have from both trucks and restaurants. And that’s all in the best interest for the customer.
There are many that say that the trucks and the restaurant industry are battling for the same dollar?
Food trucks make great hospitality incubators. It’s a great way to get started in the hospitality business and then grow into a brick and mortar restaurant. About a third of the members of our organization started as food trucks and have gone on to open brick and mortar restaurants. When you think about it there is competiton everywhere. For the lunch business there is quick service restaurants, sit down restaurants, grocery stores that are selling prepared food and even pharmacies like Duane Reade that are selling pre-packaged food. Healthy competition gives restaurants and food trucks a common goal of upping the ante to serve customers the very best and most creative fare. This was further illustrated when an executive vice president from the National Restaurant Association recently referred to food trucks as mobile restaurant units.
It seems as if sanitation always becomes an issue when talking about carts?
The standards that food trucks are held to are by and large the same as restaurants are. Our membership knows food has to be stored, cooked and held at the right temperatures. We all work from commercial kitchens that are monitored by the health department. We would welcome the entire process to become more transparent so the customers feel more comfortable, ordering from food trucks. It is important not to confuse a truck with a traditional hot dog cart sitting on a corner of a street. One of the things that are on the table is the idea of bringing the letter grade system from the restaurants to the truck industry. It’s been done in Los Angeles with great success for the food trucks because it basically gets them an opportunity to show that they’re running at the same level of excellence as a restaurant.
What does it take to run a successful cart business?
On the surface, there are many who think that the success of carts has been based solely on social media. Look there’s no question that social media makes it easier for customers to find these trucks. I think there are a number of things that play into it. The economy has made capital scarcer. So investing in a food truck is an easier hurdle than investing in a restaurant. But I think overwhelmingly, the most compelling reason that people come to our trucks is for the food. Trucks have a big advantage because of the nature of the business. They are constrained to about 60 to 80 square feet to operate in. So they need to make hard choices about what their product is going to be. You simply can’t have a deli on wheels or any menu that requires extensive storage. So you’re forced to specialize and I think that’s what food trucks offer, the best in breed product. When you go to a waffles truck, you’re getting the best waffle from a true waffle entrepreneur who is incredibly passionate about waffles. When you compare his $4.00 waffle to a restaurant with many items, he is of course going to serve a superior waffle.
One of your industry’s challenges appears to be the battle for key locations, what are your thoughts?
No question that the issues are, where can food trucks be and how many food trucks can be in any particular place? I do not think the market for food trucks in New York City is saturated. However, in the micro neighborhoods of New York City, there are definitely neighborhoods that are being overrun. And there needs to be a mechanism to allocate the number of food trucks per area. We need to work towards figuring out how many food trucks can be on a block or how close two food trucks could be together. We are working within our group and the City to find solutions. One of which might be the model we are working with in Long Island City.
How does the long island city program work?
Our Food Truck Association opened as an alternative for food trucks to street vending. It came about as a result of the metered route parking law. It’s been going extremely well, we’ve gotten a really great reception from the community in Long Island city and we would like to reproduce this, I don’t think that by itself food truck courts are going to save the food truck industry. I also would like to point out that under the LaGuardia administration years ago there was a big push to get all peddlers off the street. In that era all of these big public markets came into being. Like the Essex Street Market, La Marketa up in Harlem. And basically, what they did is ghetto-ize street vendors and push them all into one big hall. The restaurants and the brick and mortar establishments were all big supporters of this. But after it happened, the foot traffic on the street declined precipitously, and everybody’s sales went down. We see the same result 50 years later with these archaic laws. It will ultimately hurt all retail businesses. The goal is to get people out on the street and really activate public space.
What role does social media play?
It’s really interesting in that we’re still trying to make good sense of the best way to use social media. Our food trucks have done some interesting things in terms of brand building. It’s a better opportunity to connect with a customer and extremely helpful in having these food trucks get a foothold. The old school mentality of building a restaurant and building a food truck location are still pretty much the same. You need to think about location, location, location. The idea that you can twitter a location and 500 people are going to be out there waiting in line is not exactly the way things work in New York City.
How do food trucks go to market to buy product?
This has changed dramatically. Historically food trucks or street food were serving limited menus. So the coffee carts would all buy coffee from the same distributor and the hot dog carts all buy hot dogs and coca cola from the same distributor and the nut carts all buy their nuts from the same guy. All the purchasing was coming through a central commissary. Today, each individual concept has vastly different needs based on their menu. Most operators will find specialty sources for their menus and then support it with Restaurant Depot. Many larger distributors have minimums so you won’t see many Syscos delivering to our member’s trucks but there are many special smaller vendors out there that will cater to this market.
Are food trucks a fad and where will the next generation of food truck operators come from?
Food trucks are here to stay. Food trucks are a great way to incubate a business in terms of getting something started, honing the brand, honing the operation, figuring out who your customers are, and then being able to grow into a brick and mortar establishment. But much of the growth is also coming from the reverse where you can take an established restaurant concept and open food trucks to extend the footprint of the brand. I read earlier this week that Applebee’s has opened a food truck in Denver and The Gap is opening a food truck that’s going to drive across the country. And Jack in the Box has a food truck. When we opened the Rickshaw Truck, we opened it two years after we opened our brick and mortar restaurant and about a year after that, we got our first twitter that said, INCORRECTLY that the, the Rickshaw Truck had opened the Rickshaw Dumpling Bar when in fact, the Rickshaw Dumpling Bar had been there for three years. And I can tell you; we are being looked at as an exciting place to be by the vendor community. The amount of interest that we’ve gotten, from restaurant suppliers, insurance companies, point of sales companies, credit card companies who want to be in our space is exploding.