Stay In Your Lane

0:00When you want your spring break to feel like and your kids pool day to feel like and your hotel bed to feel like oh and room service to feel like because at Hilton hospitality feels like your cabana is ready would you like fresh towels it matters where you stay book now at hilton.com Hilton for this day. This episode is brought to you by Nespresso introducing Virtua Up the latest and a long line of innovation from Nespresso it's innovation you can touch sense and taste in every single cup with a three-second start easy open lever and dedicated brew over ice button it's even easier to enjoy your coffee your way. Zip for yourself shop Virtua Up exclusively at nespresso.com today we're going to talk about some content that I see all the time spatted around Facebook you guys know the post it's a big

1:04headline says real talk what most food truck owners get wrong in their first year and then there's a whole list of lessons that sound solid whole bunch of comments that are full of facts and then so true and then fire emojis and I want to tell you right now some of it's correct problem is most of it's wrong it's very thin it's very generic it's missing the parts that actually keep you alive so we're gonna talk about that today. Hi my name is Bill Moore on the executive director of the National Street Food Vintage Association and welcome to the Tim Minifu truck training podcast today we're gonna talk about good advice bad advice I don't know what you're gonna call it but basically it's like someone says drive safe without explaining what breaks do what the weather does what the following distance is between the car in front of you or even just how to avoid a wreck hey drive safe would you tell your 12-year-old that would you tell your 16-year-old that are you gonna spend some time training so we're gonna break down the weaknesses of the advice of real talk for a food truck owner I hate to break this to you but there's somebody that's spending a whole bunch of money running ads on Facebook that are filled with nothing but AI generated

2:11garbage so let's break down some of these things being open doesn't mean you're making money well yep that's true but guess what it's also incomplete busy does not equal profitable but here's the weaknesses the things that are left out of that statement it tells people to track cost per item ticket average break even point like that's a simple weekend project and that's the advice is AI generated nonsense is suggesting and a food truck builder is putting out as if it's the gospel truth most new owners don't fail because they don't care about profit they fail because they don't know what numbers matter in the first place and they don't understand how to make decisions based on the results they're getting so here's what's missing out of that being open doesn't mean you're making money you gotta ask yourself what is your prime cost prime cost is that nonsensical accountant or executive suite terminology but prime cost is simply how much money you putting into food and labor what's your

3:12contribution margin on top sellers again another nonsensical number we don't talk about in the restaurant industry people in the executive suites do because that's what they talk about they have nothing else to do they don't have to wrap sandwiches or cook but you do the contribution margin is how much money after you've paid for the food and labor is left over for each individual item and the top sellers that money helps pay the bills you got to know what that number is for your top sellers now here's something I'll talk about what's your capacity limit you are limited as a food truck you either have a service capacity which is how many human beings you can put through the line or you have a cooking capacity which is how much food can you cook per hour or you have a storage capacity you can only store so much food before you run out you have those three capacities to deal with you don't understand what they are or you never max them out what you have is a marketing problem you need to be able to at least come close to maxing out your service if that's 60 people an hour then it's

4:1560 people an hour can you take and produce 60 orders an hour that's the minimum I want people to work towards most people are happy with four or five orders an hour what's your true operating cost per hour so including the prep time the cleanup time the travel time the shopping time what is that operational cost telling somebody to count your hours is cute advice but it doesn't help because it doesn't cover the simple things like when you prep sitting in your driveway at home when you have to drive to three different storage locations and then all of a sudden that two-hour event turns into a nine-hour day if you want that point to be useful food truck builder this posting all this AI nonsense your profit is decided before you ever open the window now there's a statement that you can get behind because if you're menu pricing and your processes don't work together selling more just makes you tired and it makes you tired faster all of this stuff has to work hand in hand if it doesn't all you're going to do is be frustrated and you may not understand why

5:17here's another point that they put in there cheap pricing attracts the wrong customers well sometimes but that's not the real issue and I'm going to say something is really unpopular cheap pricing doesn't just attract the wrong customer the wrong guest it also attracts the wrong math new owners under price because they don't know what their break even point is not because they're being cowards it's not because they're looking through the filter of their menu through their own cheap skate personality although some do the problem is they don't even know the break even point before they start to consider what's too expensive for a hot dog then that AI generated nonsense says the only exception is low item high volume trucks okay who is that actually what are you talking about high volume isn't a personality trait it's location strategy it's speed of service it's equipment set up for flow it's menu design for ease of ordering it's staffing it's operational procedures it's ordering systems that make sense to the guest it's production discipline so if you're going to talk pricing the real message should be

6:21you don't raise your prices to be fancy you raise your prices to survive and stay consistent that survival has to make sense to your business to your bottom line so when that price gets raised it has an impact typically people raise prices when they figure out they're not making any money that's not the problem your price structure most likely is not your problem the problem is you're not managing any of your expenses so raising prices only gives you more money to waste and you will waste it because you don't have the discipline to control your expenses already you raise your prices based on your costs going up your capacity being pushed because if you if your capacity is being pushed now we're into supply and demand the higher the demand which is your capacity being pushed the higher you can raise your prices to do what lower the demand so that you can stay within that not disappointing people envelope you need to stay in we don't run the food we don't exceed our capacities so people aren't disappointed but you've raised a price so you're actually

7:21making more money and you continue to raise a price until you see the demand go down economics 101 something you would think AI would know you also raise your prices based on your market things happen in your market that could justify a price increase your brand promise if you position yourself as being a gourmet burger truck people already expect it to cost more and you also base your prices on your guest experience that you're able to repeat so it's not just good food equals pricing it's also great service friendly service and the overall guest experience adds to that value that increases your menu one of the things that you've been saying this is you are the commodity and that's just a weird line no your offer is the commodity how you execute that offer is the differentiator so when AI says you're the commodity you ain't for sale what's for sale is your food and your service and your guest experience your menu should be smaller than you think oh my goodness

8:23AI got something right but it's missing the big why smaller menus win the post makes it sound like the only benefit is efficiency beats variety and that's not the main reason the main reason is this a big menu destroys your prep system it destroys your inventory discipline and it's very hard to train smaller menu means it's easier for guests to order from they don't have 30 choices to look at and read they can only remember four to five things before they forget the first one they read so reading a 30 item menu means they've forgotten 25 of the things have on there all you did was waste your time smaller menus reduce ingredients that you're carrying it increases repeatability it improves speed it stabilizes your food cost and like I said it makes ordering easy for your guests that you want to know what else is missing your menu should be designed around what you can produce at peak if you got 30 items on your menu you can't produce them when you get busy something breaks

9:26so what are you doing you're either slowing down and disappointing a whole bunch of people or you're running out and disappointing several people either way that's not a good business model and if you're designing it around you being slow why are you opening to begin with if the space for your grill your fryer cooking capacity your cold storage says six items and you list 18 you've already built chaos into your business you're not gonna be able to train you're not gonna be able to survive you are going to be frustrated you are not denies you are not the cheesecake factory you are not a sit down restaurant you are not a full kitchen as much as builders want to talk about yeah it's a kitchen all wheels know it ain't it's a production line a very fine production line go into a real kitchen you're going to have jacket and steam kettles you're going to have tip grittles you're going to have big things that produce a menu you're going to have stand up mixers you're going to have all kinds of equipment but it's not on a food truck you are the production line typically a kitchen

10:26restaurant sit down restaurant is going to have two areas are going to have a huge prep area again counter space lots of countertop equipment lots of stand up floor equipment big ovens they're going to have all the things to produce the food that is then what carried to the production line and then assembled and served from the production line you are not a full kitchen don't mean act like you're a full kitchen keep it simple social media does not replace location strategy well I asked correct on that but their event math was ridiculous they're giving rules like number one the rules and they're not if the event is not food focused 20% will eat if the event is food focused 80% will eat oh my god just stop that kind of math wrecks people stick to being a food truck builder build the best product you can and quit trying to teach people something you are clueless about food focused can mean what it's really cook off where people are eating samples a beer festival where people snack lightly a concert where the line surges for 45

11:33minutes and then die a holiday market where half of people are sipping cocoa and cookie the percentages are never universal never universal if it's food focused which it could be food truck Friday guess what 100% of people show up they're eating if there are some people that show up and don't eat y'all disappointed them because they went there to eat if it's not food focused only 20% eat what world are you living in could be 10% eat depends on what the events about how long it is could be 35 or 40% eat if you go to magic kingdom that's an event huge event yes it's a theme part but you don't go there just to hang out that's an event 365 day a year event guess what 100% of the people eat especially the ones that are not annual path holders because as an annual path holder you can leave the park and come back as much as you want but the people that are there for vacation they're eating because they don't want to leave the park which takes up time from all the rides and all the other stuff they want to do to go find a cheaper meal so they eat on site so please understand what you're getting yourself into and don't listen to this is how we recommend

12:38you do it and I generated garbage from a food truck builder what actually matters to you is a time of day an event is the dwell time which is how long to take people to decide event rules do they let food from the outside in are there competing options nearby is there a cheap restaurant across the street from the fairgrounds that people will just walk to and eat and then come back and get in the fair later in the day what about weather is there alcohol present that changes everything on how people eat what's a demographic if you lean towards kids and the demographic is going to be old people guess what you ain't selling much well it's going to be the layout in the foot traffic flow if they stick you by the dumpsters or by the the port of parties you might be dead all day long whereas someone else who's in a more centralized location is flat out busy what's their promotion strength of the event where's the truck placement again whether you can serve fast enough when the rush hit so location strategy matters within an event it matters if you're not in an event but you can't take fake certainty with 20% 80% give me a break build a solid food truck

13:43that's what I would love to see out of most builders especially the ones that resort to AI generated garbage I know they would not build their food truck off an AI generated blueprint they expect you to run your business off their AI generated business plan stop accepting events without a sales forecast and an exit plan that's what I recommend I can teach you how to do a sales forecast for every single event we'll get it pretty darn close to don't wing it that's a great message but again it's too vague now here's the advice they give under the don't wing it banner track numbers weekly you systems make decisions on data okay which systems which decisions with data new owners need a starter operating system which would include things like country inventory weekly have recipe costing sheets prep bars that tells you how much to prep based on sales daily sales buy location if you move around event recaps if you do big events labor hours how much are you putting in compared to your employees to your closers to your openers to your cleanup crew

14:48to your prep people a truck checklist a maintenance log a weekly cash review systems become another word people agree with and they never do because they don't know what a system is they don't know what they need to system a ties single transactions are fragile the AI generated garbage says seek clients not sales okay what the heck does that mean single transactions are fragile what you should be seeking instead of clients is building relationships you can survive a winner if you have repeat corporate lunches you can have recurring stops where you are the favored food truck and people are excited when you show up there you can have contracted catering if that's what they mean by clients then they need to say it otherwise you're eating and shaking your head going yeah it makes sense but you have no idea what to do bad leads are a business risk also true but doesn't explain how to vet something to make it not be a bad business risk bad leads just where you down bad leads

15:52also waste your product your labor your time your fuel and take away an opportunity you could have had to do something bigger and better the post says to investigate leads but it doesn't explain how what to look for you need a vetting checklist things like what's he expected attendance and how did you get that number last year's vendor average sales if you don't know why don't you know it the fee structure and what it includes exclusivity promises and if those are real or fake power access load in logistic what's the rain plan what's the refund plan what's the number of vendors what's the promotional plan the marketing plan and do they guarantee a minimum new owners need to know those things otherwise investigate leads is useless it becomes ask a couple of questions and hope they're telling the truth the AI generated downloadable PDF define success okay yes define your own success but how find the minimum level you're willing to work for well yeah that's actually

16:54strong but it's missing boundaries it's missing a decision rule define your success like this what's a minimum revenue you need per hour what's the minimum net profit goal you have per week what's a minimum guarantee for those private events what's the maximum hours you'll work per week what's the top three event times you will actively pursue and what's the bottom three you know to just ignore and stop chasing those dead ends and then you know what is stick to it that's a plan to define your success new owners say yes to everything because they're scared fear creates a random schedule it creates a random menu and it creates random pricing you can't build a business and you certainly can't build success on randomness now this particular post it was done about two weeks ago it doesn't mention two things that actually kill year number one food trucks now you're ready most year one food trucks don't fail because they don't know that profit matters they fail

17:56because they have no cash reserve they have little to no cash flow second reason they fail they don't understand their own capacity and their own speed of service i talk about these things consistently if you are opening today and generating sales and using all of those sales to pay a bill that was due yesterday you're living off cash flow and you can't do that very long because something's going to interrupt the cash flow to where those past due bills now start to tack on late fees start to tack on interest you're doing credit cards so now you're taking a bill that was two hundred dollars and turned it into two twenty five you've got to stay on top of things you've got to plan out and know when you need to be operational if you're opening today and doing six hundred dollars and all six hundred dollars is to pay past due bills what are you doing for inventory tomorrow today sales has to have many set aside to buy inventory for tomorrow if not all you're doing is digging a hole and quite efficiently digging a hole you have to understand your capacity and your speed of service if your sales require you to hit fifteen hundred dollars an hour what does

19:00that look like guess count wise what does that look like as far as getting the food out of the kitchen is it even possible you have a limit you need to know what that limit is a slow food truck isn't a busy food truck it's a food truck with a long line in slow output people post pictures all the time look at the line you see people deep no one cares what we care about is how quick did you get them through is that guess this number sixty if they stuck around and you're producing an order out every minute and taking an order every minute they're still in line sixty minute they weren't really hungry when they got in line were they because I know I'd have done left and got some food somewhere else I hate generic advice it annoys me to death it skips operational bottlenecks and tells people what they already know they just haven't really fought through so here's my takeaway that real talk post it ain't real it's evil and it's not enough advice within that nonsense to keep you alive it feels motivational it feels broad it feels like it's going to help

20:00but it's missing the hardcore disciplines that you need you need a cash flow discipline need to understand how many moves that your business need to understand what your capacities are which is service cooking and storage you need to understand how to vet a real event you need to understand what menu engineering is and you need to understand repeatable sales pipelines like corporate caterings private gigs recurring popular stops I want you to stop collecting advice I want you to commit to something that's going to build your food truck business moving forward if you don't know what that commitment is join our association the national street food vendors association in sfva.org we have 30 hours of detailed classes already available you can download and watch them all right now two day well in the next day is it'll take you 30 hours to go through we have weekly 30 minute

21:02or longer mini classes we have two hours of coaching group coaching every single week 19 dollars a month if you're not willing to spend 19 dollars a month when you're paying a teenager 25 dollars an hour your priorities are messed up stop collecting advice start building systems thank you guys so much for listening to the Tim Miniputra training podcast if you're finding everything helpful that we do please do two things for me number one hit the like subscribe follow whatever your platform wants you to do when you listen to somebody do it that way you get notified every time I put something out second thing go to nsfva.org and join today we can make a difference in your business got to join