You need to look into the local market to see what the mobile food industry potential is. See how many other food trucks are in the area and how they’re doing. You will want to show that you are getting into a market that actually has a future and the potential for growth. While you won’t be able to guarantee your speculation, showing that there is a thriving industry or a need for this industry in the area is a key goal of this section.
Continued research into the area will show you what your competition is doing and how they have done in the past. This will allow you the opportunity to create a clear structure and description of how you will compete with others who are already doing what you want to do.
You can write this section with these specific questions in mind:
What other food trucks and mobile food business are in the area?
You need to think about who is already present in the market you want to enter. Your investors already are thinking about whether there is too much competition for you to be a success, and you need to show you have considered this too.
Take some time to list the different mobile food businesses in your area, what they offer, what their pricing structures look like, etc. Not only should you be looking at the food trucks, but also other venues which may be offering the foods that you do.
You will want to make sure that you also talk about different businesses, offering the same items as you, that have closed in your area. Consider what other businesses are opening up in your target area as well, to discuss how they might impact the way that your business will or will not succeed.
You need to visit all of the places that you have listed in this section and begin to assess their business as any investor would. Try to visit at least two of your competitors in order to include your findings in this business plan.
You will want to look at their:
Find out where they are located and how this impacts the way they do business.
- Local traffic patterns
- Relative location to sources of demand – i.e. local companies
- Sign visibility
Take some time to look at that way your competition looks in the area.
- Exterior appearance
You will also want to look at the menus of your competition to see what they have to offer that’s similar to your own menu.
- Theme of the menu
- Selection of items
- Price range
- Value for price
- Signature items
Tasting what your competition has to offer will allow you to compare your own food quality and ability to impress customers.
- Portion size
You might need to visit your competitors more than once to see if their menu items continue to taste the same with each visit, or you can ask friends and family to do some research for you.
How your competition operates will help you compare your businesses as well.
- Hours and days of operation
- Style of their service
Quality of service:
Find out what the quality of the service is at your competition to see whether you are competing or offering something new.
- Service speed
- Customer service
You will also want to talk about anything else your competition might have to offer that you don’t offer, or that you do offer.
- Business growth
- Type of customers
- Local reputation
- Online reputation
- Website quality
- Franchise affiliation
- Other offerings – catering, ordering ahead, etc.
Once you have reviewed your competition, you need to give your overall impression of what they have to offer, and whether your business can be a success in relation to the market.
Think about what the strengths of the competition are and what the weaknesses are. This will give your investors a sense of your ability to prosper in your business idea.
With all of this information, you don’t want to overwhelm the reader, but you will want to create a clear summary of your findings.
You may want to assign a brief 1 to 5 rating system for each of the bulleted ideas above, unless they require further explanation. With 1 being the lowest marking and 5 being the highest, a person can easily read the analysis and see what your findings were.
Honesty is the best policy here as you want to make sure you’re being truthful about what your competition has to offer, and if they’re doing things better than you have planned to run your business.
Once you have created these ratings, find a way to create an overall score for the establishment, and then write up a short paragraph to summarize the findings. This will ensure that your reader knows what you think of your competition.
And even if you find that your competition is far better than you expected, you can begin to adjust your business idea, based on your findings. For example, if you notice that others are doing local and organic produce in their food trucks, then why not find a way to use only farmers that are also environmentally aware and friendly? Try to find a way to carve out your niche and you’ll increase interest in your business plan.