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Resource Center > Article
Food Trucks’ Success Pressures Restaurant Industry
9 Aug 12 Posted by: Kathleen C Lanza
in In The News
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The number of franchise and business opportunities available in the rapidly growing food truck industry is growing exponentially each and every day. And why wouldn’t it be? The industrious and forward-thinking entrepreneurs who have blazed a trail by putting their epicurean delights on wheels have virtually revolutionized the way many of us plan our lunch hour. Have mobile phone, will travel...if the food is worth the trip, right?

Well it seems that the popularity of food trucks now has gained enough traction that their very presence in some of America’s largest cities is causing quite a stir. According to today’s Wall Street Journal, bricks-and-mortar restaurants in cities such as Boston, Chicago, St. Louis and Seattle are really feeling the competitive heat, especially from trucks with fully loaded kitchens that can and do offer gourmet fare. Their response? Enact laws that will dictate where and for how long food trucks can serve customers in proximity to their more fixed-location competition.

Of course, food truck operators are fighting back, arguing that two restaurants can open up alongside one another without enduring similar scrutiny or restrictions. After all, it’s a free market, and customers should be able to choose where they eat, they say. But that’s not all. Seems the regulations with regard to food trucks have not kept up with the times in many places, having been initially created to manage little more than ice-cream and hot-dog sales.

In an industry that has evolved so quickly, many cities just don’t have the laws on the books to manage the resulting competitive dynamic in a fair and equitable way. And restaurant owners claim they are the ones paying the highest price for it, not the food truck vendors.

According to Cary Silva, co-owner of El Gaucho Luca’s Café in Las Vegas, who is quoted in the Wall Street Journal article, “They (the food trucks) come during our busiest hours and park in front of us. We spend a lot on advertising and promotions to bring people downtown, and (they) benefit from that.” Point well taken, but there’s yet more to consider. Food trucks don’t just steal foot traffic, they also take up crucial and oftentimes limited customer parking spots, and many of them even play loud music that distracts outside diners. Moreover, certain cities’ food trucks have banded together to create what one business owner refers to as a “transient food court.”

While some cities have been successful in creating and enforcing new regulations to address these issues, others ― El Paso, Texas for instance ― have not been. In fact, the city was forced to overturn its food-truck ordinance after a number of vendors banded together and fought back.

Bert Gall is an attorney and a member of the law firm that helped the plaintiffs prevail in that case. According to him, the concept of economic protectionism is not strong enough to warrant the kind of governmental intervention that is now taking place around the country. Obviously, a judge it Texas had to agree.

Regardless of where you stand on this complicated issue, two things are certain: 1) Food trucks and the business opportunities they provide are a force to be reckoned with that is here to stay, and 2) The debate about how to resolve these issues has only really just begun.

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