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At our SFoodie blog, we like to talk up how it's the summer of food trucks, and in last week's Eat review, I surveyed seven of the newcomers. Common wisdom about food trucks is that they offer budding restaurateurs a cheap and easy way to break into the restaurant industry. In some cities — Oakland and Emeryville, for example — they indeed do.
Five years ago, though, when I did some research to figure out why there were so many taco trucks in Oakland and so few in San Francisco, I learned that it was this city's complex, expensive permitting process that kept so many mobile restaurateurs locked out.
Are the new generation of better-funded, marketing-savvy food trucks facing the same permitting obstacles? It appears so. I spoke to SF Cart Project's Matt Cohen, a consultant who works with aspiring food truck vendors and organizes Off the Grid night markets, about the cost of rolling onto the streets of San Francisco.
Kauffman: So, Matt, how much does it cost a food truck for the proper permits to sell food on the street?
Cohen: It depends. There are two permitting distinctions: selling on private property or selling on public property, which means streets or sidewalks. If you want to sell on public property, the cost of obtaining a new mobile catering permit from the San Francisco Police Department is $9,300. Now, a portion of that goes to the tax collector, a portion to the health department, a portion to the fire department.
With that permit, you can apply to sell at up to five locations. Each must be at least two blocks or 300 feet away from a similar food vendor — either a brick-and-mortar business or another mobile catering vehicle.
Kauffman: Wait. What do you mean by "similar food vendor"?
Cohen: It's up to individual permit officers to determine, and that's where issues have come up in the past. Is water a similar food type? How about soda? Are french fries the same or different from falafel? There's a lack of clarity.
The other interesting and unusual thing about the permit process is that the $9,300 fee entitles you to apply. Theoretically, you submit your application for five locations, but if none are approved, the city can keep your application fee and you still don't get a permit.
Why would you risk that kind of money with rules that are so poorly defined? Technically, there is no police department permit that would allow a vendor to park in only one location on the street. Again, why would you spend $9,300 to apply for only one location? Economically, it makes no sense.
Kauffman: What about parking the truck on private property?
Cohen: Selling on private property is permitted separately, through the health department. If you find a nice parking lot in the Financial District to rent, you can pay $439 to the health department and another $300 to the fire department; if the zoning for the lot is correct, the permit is granted.
Now, that sounds pretty reasonable for one location. But then if you want to add a separate location? The health department has to do another inspection on the same truck, and you have to file the same paperwork and pay the exact same fees. The only difference is one piece of paper you have to get from the zoning department. So if you have five locations, you're out $3,500 in permit fees.
Another quirk of [applying to sell on private property in San Francisco] is that in order to get inspected by the health department, you have to provide a physical address that you're going to sell from. It's a Catch-22 for many new food trucks. There is a way for trucks to apply for a health inspection without that — by saying they're using the truck to work catering events — but in S.F., technically you can't run a catering operation and sell to the public.
Kauffman: Renting the property is in addition to the licensed commercial kitchen that a truck owner must rent to prepare most of its food at, right?
Cohen: Yes. As a part of the California health code, all mobile food vendors have to operate out of a commissary.
Kauffman: This goes against what most people think about food trucks — that they're a cheap way to get into the business.
Cohen: Well, I think that the initial costs are still very reasonable. Realistically, even the cheapest restaurant in San Francisco is going to cost $200,000 to get started. With an inexpensive mobile catering vehicle, you can get up and running for $50,000. ... But then you're not guaranteed anything. Getting the truck is the easiest part of getting started. You have to talk to dozens of parking-lot owners and the police department and do research to find very particular locations where you can sell your food. The initial cost is lower, but the actual path to profitability is much less certain.
A lot of people think that because food trucks are popular that they're a guaranteed success. Working a truck is really difficult.