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‘Food Trucks’ are an Ever-Expanding Entrepreneurial Adventure

Staff from the Japan Local Government Center, attending the annual Congress of Cities in Seattle recently, sat in on a very interesting presentation about ‘mobile food vending’, or what are commonly called ‘food trucks’.

Mobile food vending or, as it is called more commonly, ‘food trucks’ would not seem to be a major issue for local governments. In fact, however, that is not the case. This part of the restaurant industry has been growing remarkably strongly in the past few years. So much so, that the National League of Cities (NLC) at this year’s annual conference in Seattle devoted a whole session to the subject. The session, indeed, was the result of an extensive report published by the NLC earlier in the year.

The first astonishing fact is that ‘food trucks’ generate about $650 million (approximately ¥65 billion) per year in revenue. What the session discussed, and is described in more detail in the report, was the difficulties and successes in managing this growing trend in food services for local government. At the conference, the cities of Seattle and Cleveland gave interesting presentations about how their local governments were coping with this surge in individual economic activity.

The presenters echoed much of what the report says; namely, that many local governments have out-dated and punitive regulations covering ‘food trucks’. In fact, most local government ordinances were written many years ago and dealt with a different type of mobile vending. These were the ice-cream trucks, hot-dog carts or sidewalk peddlers. The recommendation from the speakers was to update local government ordinances to meet the demands of this growing industry. Indeed, a balance between regulation and encouragement was needed.

As in the report, the speakers talked a lot about two of the most important points when regulating ‘food trucks’. First, local governments must look at the economic potential. ‘Food trucks’ increase economic activity in a spontaneous manner. They encourage ‘on the spur of the moment’ eating choices. The City of Seattle pointed out that successful ‘food truck’ entrepreneurs have even moved up to brick-and-mortar restaurants. The key is to make the permitting costs and ease of registration as simple and cheap as possible. Governments should not impose a barrier to potential ‘food truck’ entrepreneurs.

The second point the presenters made is perhaps the one that arouses most controversy: Where to place the ‘food truck’. Cities have conflicting interests. Their brick-and-mortar restaurants have complained about ‘food trucks’ parked outside their establishments. They see the ‘food trucks’ as interfering or even competing with their customers. So cities have developed regulations that have made it difficult for ‘food trucks’ to operate. Those regulations often have not been up-dated to deal with the advances that ‘food trucks’ have made in food safety and culinary choices. So, there is tension between established restaurants and these ‘food trucks’.

The presenters made many recommendations about how to develop a healthy relationship between ‘food trucks’ and brick and mortar restaurants. In all, there are four things that cities must consider: Economic activity (cities should encourage ‘food trucks’ as one way to improve the economic activity of downtowns); Food safety (‘food trucks’ must be inspected just like ordinary restaurants), Pedestrian and vehicle traffic safety (‘food trucks’ cannot obstruct sidewalks and must not be placed to cause traffic jams in busy city streets) and Placement (‘food trucks’ must be able to operate freely but not at the expense of established restaurants). Seattle has found that by passing careful ordinances that balance the interests of all the stakeholders in the restaurant industry competing interests can be encouraged to co-operate with each other. So, now, sometimes ‘food trucks’ can be seen to work with restaurants offering similar fare by offering restaurant menu items actually on the ‘food truck’, allowing the ‘food truck’ to be situated much closer to the restaurant than would normally be acceptable to an established restaurant. In turn, the restaurant will allow the ‘food truck’ to use its storage for ingredients and other items to meet the city regulations.

As the presenters emphasised, the right regulations can foster a healthy relationship between the two (‘food truck’ and restaurant) that can only enhance economic activity in the urban setting.

Senior Researcher
Seth Benjamin