FOOD a rocketed boom. Despite fierce competition within
Posted On May 18, 2019
FOOD TRUCK BUSINESS PLAN
Food trucks are commonly seen in foreign countries and considered a
thriving business there, but in Pakistan this trend is not very common. Over
the last few years food industry has gained quite lot of attention and people
are becoming more open to changes.
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This particular industry in Pakistan seen to be undergoing a rocketed
boom. Despite fierce competition within the industry, it has managed to report
profitability and is well-received by the public.
In Pakistan, statistics have revealed that the fast
food industry is the second largest industry, with approximately 169 million
consumers, as reported in 2013. Furthermore, this sector accounts for 16% of
the total employment in manufacturing sector. An industry with such dynamics
has a great probability of exceptional growth in future as well.
Within this industry, food truck would be a new concept for most of the
Pakistani’s. As we all know Pakistani’s love to eat, and they have recently
opened themselves to new food experiences. Accordingly, we believe that with
the right marketing strategy we can make our business thrive.
DETAILED DESCRIPTION OF OUR BUSINESS
The food truck Business is a mobile food business that would provide
food services to customers. The truck carrying the food would drive to a
suitable location within easy access of customers so that they can easily walk
up to the truck’s window and order their food. Only healthy and hygienic food
will be served in our food truck that is both tasty and affordable.
A food truck can carry quite a variety of foods and some sophisticated
equipment for cooking, storing, preparing foods and serving. Traditional food
trucks were known for providing lunches, typically sandwiches, kebabs, burgers
and other standard fare for the lunch crowd.
Food trucks are larger than carts. The trucks can handle more business
as they can carry more food. However, food trucks need more space to park both
when doing business and when off-duty.
There are two types of food trucks. One is the mobile food preparation
vehicle (MFPV) where food is prepared as customers wait, hopefully not very
long. The other is the industrial catering vehicle (ICV), which sells only
prepackaged foods. For our business we would drive an MFPV (mobile food
preparation vehicle) as this fits our business description. We would prepare
the food on the spot for the customers so as to keep the food fresh and
The food Truck will help provide community with healthy, sustainable,
affordable and simple food that is both pleasing to the eye and tasty.
To become the most popular and successful food truck in Islamabad by
providing a complete package of tasty, healthy and affordable food with quality
customer service on wheels.
The Food Truck provides the solution of convenience to consumers in
Islamabad area, by offering healthy and sustainable food at a competitive
price. The value proposition reaches the consumer, as it provides sustainable
solutions to many of their environmental and social problems such as affordability
The food truck is a value driven business that provides accessibility,
high quality sustainable food, convenience, all that at comparatively low
prices. Our truck provides our customers with accessibility and convenience in
three ways as mentioned below:
providing healthy meals quickly.
the food in front of the customer so it ensure hygiene
By driving near customer’s
workplace so they can easily have good food within their lunch break and reach
office in time.
Another competitive advantage is that the food will be consistent in
quality, taste and price and this service will be reliable.
Our business will focus towards providing the
following values to our consumers:
6. Sense of
Porter’s Five Forces Framework:
Threat of New Entrants:
The Fast Food/Restaurant industry in Pakistan is highly fragmented;
occupied with many quick service and dine in restaurants and numerous cafes and
coffee shops including café burnout or papa roti. These brands are extremely
valuable, boasting strong customer loyalty and recognition; indicating
consistent quality and service. Key players including chaaye khana and street 1
Cafe adapt their marketing orientation to suit local cultures and social norms,
strengthening the brand and avoiding consumer alienation.
Established cafes and restaurants have the resources to retaliate
aggressively through pricing promotions, deterring new players from entering
the marketplace. New entrants lack economies of scale, which existing cafes
have developed over time, and utilize to remain competitive in this low-margin,
high-turnover industry. However, social media websites have evened the playing
field in terms of marketing communications; they allow firms to efficiently
communicate their message inexpensively. Initial capital outlay and fixed costs
are low, encouraging new entrants.
In this situation we would be one of a kind food truck. However, the
imitability of the product is such that the threat of new entrant is very high.
In these circumstances or brand identity and customer loyalty are the only
things preventing new entry.
Threat of substitutions:
Substitutes are readily available. Fast food products and readymade
products are available in any nearby restaurant, dine-in and cafes. However,
convenience is the value adding component of the service which reduces the
threat of substitutes but with many differentiated players and varying service
offerings, customers can select the best value option. Consumers can cook at
home cheaply, but this lacks the convenience element which people require
nowadays. Even though the switching between substitutes is low and market is
highly fragmented, we would any edge over other cafes, being a one of a kind
food truck in the area. ,.
Power of buyers:
The market’s competitiveness increases buyer power and customers are
price sensitive with no or low switching cost between providers. However, key
players attempt to reduce buyer power, offering a product range which caters
for the entire demographic, rather than one specific segment. For example we
would target youth with our snacks menu and attract professionals by providing
different fast food choices like sandwiches, soups, salads and beverages.
Already present fast food services target the segment, for which the products
offered by them are well affordable as compared to their total spending. High
brand value and customer loyalty has reduced buyers’ bargaining power. Buyer
purchase criteria in this market is primarily based on convenience and enjoying
good quality food.
Power of Suppliers:
A fast food truck selling on quality core characteristic cannot afford
to compromise on quality. The quality of the produces has to meet certain
standards. The suppliers are not highly differentiated in this industry that is
if quality is not met by one supplier a switch can between suppliers, so as to
not compromise on quality
The direct competitors of our food truck would be eating places Cafe
Burnout, Clique Café, Kuch Khaas Gallery Café, Gloria Jean’s and Pappa Roti and
indirect competitors include all the thelay walas as well. Competition is
primarily cost based with restaurants and cafes continuously investing in their
production and service processes to undercut competitors.
Exit costs are low and branding is the most prevalent weapon for
competing, mostly through social networking sites.
Political factor can have the major impact on threat of entry. In a
country where there is uncertainty and definite political unrest; lead to a
negative impact on potential investors. The firm has to abide by the policies
and market regulations imposed by the government of Pakistan. The level of
corruption is high and fast food services may use unethical ways to increase
their profit margins.
Due to the high income disparity and the adverse economic conditions,
unemployment is on the rise due to which the labor cost is decreasing,
increasing the wealth of already well off people which is our target market,
aiding in the growth of fast food services alike. The products and service
offered by them are under the disposable income of our target market. Inflation
which is high in our target region, may provoke higher wage demands from
employees and raise costs.
Due to increasing Health Awareness and consumers’ changing Attitude
towards healthy products it is now important for fast food services to offer
healthier selections within their menus. People are now more status conscious
in our society, opinions and attitudes of other people matter. Even the choice
of place to eat is considered important and signify your status. Consumers now
prefer these high end café, fast food services and restaurants. Increasing
consumer awareness about food products, flavors and tastes has led to a demand
in more varieties to choose from. Convenience is also an important factor in
our society which constitutes a segment of working class which prefer a fast
food service, dine-in restaurant or a café than to cook at home.
With the advancement in technology and innovation the efficiency of
operations can be increased. Technological Innovations attracts people
attention and can be an edge for the operating firms. Modernist-Technological
themed café, fast food services and restaurant with for example Wi-Fi
facilities and soothing music playing in the background are getting more
importance in consumer’s mind.
The market in this scenario for us will be the region of Rawalpindi and
Islamabad to begin with. Depending upon the reaction we receive from the market
as well as the time needed to understand the market and the people’s reaction
to it; we will consider expanding to other major cities in the country.
Our target market will range from about 15 to 40. The range of people
mostly comprise of teenagers and young adults that like to eat out or on the go
as well as corporate people that are short on time and care for a quick and
healthy meal on a hurried basis. We will target places like F-8 Markaz and Blue
Area which are the hub of corporate ventures yet often lack the aspect of quick
and healthy meals in the surrounding area. We also intend on targeting the youth
present in universities across the two cities who are interested in fresh and
healthy food which is different from what their daily dose of repetitive food
seems to be. The pricing of our food will also accordingly cater to the target
market at hand and we will work on providing food as cheap as possible.
Our competition in this case we would consider to be all the restaurants
in the areas that we will aim to cater to as they are alternatives to our
service. Certain trucks of ours will constantly be on the move and will stop at
whatever area seems appropriate to a food truck. This can range from areas like
Gol market in F-7 which is popular in times of cricket season as people all
gather to watch the match on the big screen, certain melas around the city
where we can set up our truck
and provide fresh and hot food, commercial and shopping areas across the
city during the time of Eid, such as PWD shopping area, Commercial Market
As our food will be mobile depending upon the need and demand, the
competition for us will also differ and range depending upon the areas we are
focusing and ranging upon. Certain areas like F-8 markaz will lack in
competition as there are very few restaurants in the area which the corporate
market has access to and the option of eating in.
We could also consider one aspect of our competition to be the thelay
walay outside of schools and colleges as they also provide on the go mobile
food, however, the type of food they provide are mostly snacks and do not have
the same type of food as out food trucks will e.g salads, burgers, sandwiches,
We will test our different menus to begin with and see which suits best
with the people. There might be certain types of food popular in one area, like
fast food in universities, which we could cater to in that particular area
alone or even have specific food trucks that offer one type of food while other
offer other types.
The business would have the first movers’ advantage in the market as no
such direct competition is present in the market for a food truck. The business
would also have a novelty value of being one of its kind, which can be
ultimately utilized from the marketing perspective.
The food truck would be the producer and distributor
of its own service, i.e. it will fall in the middle of the supply chain between
its suppliers and its customers. This is the best method to ensure quality
which has been our main focus throughout.
One thing to consider is that we will be starting with
Islamabad and Rawalpindi region, where we will be required to have a permit for
the business. We would have to get a license from the Directorate of Municipal
Administration of the civic authority before starting any commercial activity
in the federal capital. The licenses will have the whole information of the
business and the business-holder.
The following procedure is
required to be followed to register and set up a business. *
Obtain approval of company name
through the Securities and Exchange Commission of Pakistan website
Pay the fees for name
registration and company incorporation using bank challans at the designated
Muslim Commercial Bank (MCB)
Register the company for
incorporation with the Securities and Exchange Commission of Pakistan (SECP)
through online e-Services
Obtain digital signatures from
the National Institutional Facilitation Technologies (NIFT) through the SECP
Register for income tax by
applying for a National Tax Number (NTN) at the tax facilitation center of the
Regional Tax Office (RTO) of the Federal Board of Revenue (FBR)
Register for sales tax by
applying for a Sales Tax Number (STN) at the tax facilitation center of the
Regional Tax Office (RTO) of the Federal Board of Revenue (FBR)
for professional tax with the Excise and Taxation Department of the District
with the Employees Social Security Institution (ESSI)
with the Employees Old Age Benefits Institution (EOBI)
10. Register under the West Pakistan Shops and Establishment Ordinance 1969
with the Labor Department of the District
After having gone through the procedure we shall move on to the design
of the business canvas model which gives a visual representation of the
*Information obtained from the
World Bank Group: Subnational Doing Business in Pakistan
2010 data for Islamabad