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6 Tips for Financing a Food Truck During a Pandemic

6 Tips for Financing a Food Truck During a Pandemic What You Need to Know About Food Truck Financing

What You Need to Know About Food Truck Financing

The food truck industry grew steadily between 2014 and 2019 as these mobile restaurants became a trendy way to serve different cuisines to a hungry clientele. In fact, the industry grew 6.8% year over year during that time, peaking at more than $1 billion.

Then the COVID-19 pandemic hit.

Like many industries, food trucks were hit hard by the impact of the coronavirus. While food trucks could continue to operate during the pandemic, the customers they relied on to stay afloat disappeared, especially in urban areas. 

Food trucks have long benefitted from parking in downtown metropolitan areas, feeding lunch to the masses of office workers. With more employees working remotely from home, the lunch crowd vanished. So did the demand for food trucks to attend large gatherings or other well-attended social events, forcing many to close their doors.

The Coming Food Truck Resurgence

Hopefully, for food truck owners the worst is now in the past. With states lifting restrictions and more people returning to normal life, the opportunities that originally spurred massive growth will soon return. Entrepreneurs interested in starting a food truck—or those who stopped during the heart of the pandemic—will soon want to re-enter the market.

Many, however, will require financing, both for the truck itself and equipment used inside. Here are a few things to consider when shopping for food truck financing.

1) Choose a commercial vehicle lender.

Food truck financing can be a little different than getting a loan for another small business. If you have good credit, you should be able to get a loan—but instead of approaching a bank, find lenders that specifically offer vehicle loans. Some companies even offer vehicle financing tailored for food trucks. As with other loans, food truck owners will need to make a down payment, put down some collateral, or include a co-signer.

2) Plan to purchase a truck in good condition. 

It may be tempting to buy a fixer-upper, but many companies will not provide commercial vehicle financing if the truck is not a worthy investment. Plus, there is nothing more frustrating than losing potential income from a lengthy breakdown. It may be worth it to pay a little extra for a reliable vehicle.

3) Consider a business credit.

A business credit card or business line of credit may be required. It can be difficult to start any business, and some creditors may want more information or a history of success in the food business before offering a loan. If you are starting new, it may be difficult to get a traditional loan. You may need to use business credit until you prove your business acumen to a larger lender. If that’s the case, food truck owners will need a good credit score and may have to offer personal collateral.

4) Don’t forget about equipment loans. 

Of course, food trucks require more than just the truck. They house special equipment, like a stovetop or a deep fryer, to cook food on demand; they also need refrigeration to keep ingredients safe. Equipment loans typically use the cooking items you are leasing as collateral, so if you default on a payment they will be taken away.

5) Leverage an SBA microloan. 

Perfect for food trucks, the US Small Business Administration’s Microloan Program provides up to $50,000 to borrowers. Borrowers can use these funds to purchase supplies, equipment, and food inventory. These can be an excellent way to get a food truck off the ground once the vehicle has been acquired.

6) Explore other ways to finance your food truck. 

Crowdfunding can be a viable method as well. Think Kickstarter or GoFundMe. Food trucks have boomed during the time of social media with trucks using Twitter, Facebook, and Instagram to announce their location, share pictures of what people are eating, and even release special deals. Food truck owners can get creative, offering loyal customers a small cut of the profits or a special per—five free meals per month, for example—in exchange for an investment.

The Bottom Line

The COVID-19 pandemic has brought great uncertainty to the food and beverage world, but it’s also time to rethink how things are done. Food trucks have proved to be a solid business for those who can make delicious food and find a market to sell it to. There are multiple ways to finance a food truck, so if you have the desire to get started, you can find several paths to lead you to your dream.

Used Semi-Truck Sales Down in 2020

How Dealerships Can Boost Their Semi-Truck Sales

If you’re involved with a semi-truck dealership, it might be no surprise to hear that used truck sales are significantly down from trends we’ve seen in previous years. In fact, the ACT reported that as of December, used semi-truck sales are down about 14 percent from last year. This has led to many reports of inflated inventory in many different dealerships across the United States, resulting in artificially low prices for many sellers out there. 

While this may sound like good news for those aiming to purchase a used truck, it sparks concern for dealerships. This buyers market can be a large hurdle for dealerships to overcome, but one of the main keys to success in this business is tackling industry fluctuations with grace. Here are some potential ideas that you can use to diversify your truck sales and decrease the overstock of used trucks on your lot.

Why Aren’t Used Trucks Selling as Well Lately? 

Before we can figure out how to solve the issue, it is important to consider where the dip in sales could be originating from. While the exact reasoning will vary dramatically by specific areas and dealerships, here are some possible reasons you’re not selling as many used semis. 

The National Driver Shortage

One of the biggest factors that is likely playing into used truck sales figures is decreased overall sales. There is currently a severe nationwide driver shortage throughout the entire trucking industry. Drivers are retiring at a rate that cannot be replenished by the current number of new drivers making their way into this profession. 

Overall, not as many drivers are entering the industry as would be ideal, and this translates to a lower customer pool for dealerships. Because the customer pool is smaller, this issue also creates an increased competitiveness between different dealerships for limited customers. This type of competition is known to drive prices down and minimize profit. 

New Trucks Are Getting More Popular

Many dealerships have reported that they tend to sell newer trucks rather than used ones. New trucks are becoming increasingly popular, especially with younger drivers. With so many advancements in trucking technology, as well as the rise of autonomous trucking on the horizon, it’s often too tempting to resist the call of a shiny new ride that has improved features. 

The demand for new trucks has risen even more severely with the ELD Mandate in full effect. New trucks are often already equipped, or at least more easily altered to meet the demands of the new logging devices. This added convenience and saved upgrade cost is often a big selling point for the consumer. Since this mandate is fairly recent, it will likely be affecting sale distribution for the remainder of 2020. Don’t be surprised if the customers on your lot are looker for a fresher model than the stockpile of used semis that you have piling up. 

What Can We Do About This? 

While we can pinpoint a few potential causes of the decrease in used semi sales, fixing the issue is easier said than done. While there will be no magic fix for your used truck sales numbers, there are definitely a few things that you can do to try to encourage a more diverse buying pattern from your customers. 

Increase Efforts for Used Truck Sales 

Increasing the energy and expenses towards lowering your used truck inventory could definitely aid in dwindling the overstock. If you have an allotted budget that is dedicated to advertising and promotional materials, perhaps those funds can be redistributed more effectively. Try gearing your promotional materials towards this effort. Advertise the excellent selection of used trucks that you have. Promote the bonuses of buying a used truck over a new truck. Customers are also always very cost-motivated, so hyping up the affordability of your used trucks will be key. 

Offering Incentives for Used Truck Buyers

If you and your dealership are in a good position to offer certain buying incentives for those looking to buy a used semi, it’s smart to do so in this current climate. Financial incentives will likely be the most effective, so if you can offer special pricing or discounts, that could definitely help you move product. Additionally, you can offer certain non-monetary incentives, such as offering a free or discounted service or add-on item. These sorts of things can motivate buyers who might have otherwise not have been interested in purchasing a used semi. 

Diversifying Your Business 

Overall, selling used trucks during a time such as this will be important, even if you’re selling enough new trucks to meet your goal numbers. Having a wide variety of sales is good for business in the long term. If you have this type of variety, you are less likely to be hit as hard when the market sways with trends and patterns. 

Here at Mission Financial, we understand the intricacies of this industry. If you need help with any sort of dealership lending, small fleet loans, simple interest inquiries, or add-on coverage, we are here to help. 

Pros and Cons of Purchasing a Used Semi-Truck


There are countless factors to consider when purchasing a semi-truck, and it’s important to carefully consider them all. In the complex and dynamic world of trucking, it’s easy to become overwhelmed with all of the various facets. One of the most important decisions when it comes to buying a semi-truck is whether to go with a new versus a used vehicle. While both have their individual pros and cons, many drivers choose to go with a used truck for various reasons.

If you’re considering purchasing your first semi-truck, it is important to consider the logistics of the purchase. Here are some factors to consider when weighing the pros and cons of a used semi-truck vs a new one.

Budget Talk

Obviously, one of the most important variables during this entire process is going to be your budgetary limitations, assuming they’re present. A used truck can be significantly cheaper than a new one, while still gaining all the features you want. A new truck tends to run you upwards of $150,000 and beyond. For many people, especially those for whom this is their first truck purchase, this is a wildly unobtainable expense, especially when trying to get started in the business.

A used truck gives you a more reasonable beginning expense that is likely more easily tackled while maintaining financial stability on your new journey. You can often find a used truck in  good condition for under $75,000, which is vastly more accessible for someone with a stricter budget.

A lower initial cost can also be immensely beneficial for your loaning process. The smaller cost means that you’ll have less to actually finance, leading to drastically lowered loan rates that can save you a lot of money down the road. Check out this helpful resource for more details on semi-truck loans and commercial vehicle financing.

Used Semi-Trucks are Lower Risk

Because the initial cost is lower, it also lowers your risk factors significantly in terms of financial loss. Lower costs up front mean that a change of course down the line is not as huge of a blow to your wallet when a particular truck doesn’t work out the way you might have initially intended. This is also a potential benefit to people or companies who are just starting out. New beginnings contain immensely exciting potential, but they also often aren’t the ideals that we dream of. Lowering initial investments help you keep your losses in check if you decide for a change in career path, or simply a shift in the direction of the company. A used truck allows for an easier change in track than a new truck, because the heavy commitment that comes with a new truck is far more binding. 

Potential for Great Quality

Going the used route for your semi-truck purchase doesn’t always mean that you have to sacrifice on the general quality of the truck. Used trucks, if they are somewhat recently produced or renovated, or simply well maintained by their previous owners, can be in excellent condition for you or your staff to utilize. Going for a model that is only a few years old might provide many of the same features that you would typically look for in a new truck, without the hefty price tag that comes along with the “new” sticker.

In fact, many seasoned trucking veterans prefer older trucks to their newer counterparts. It is often insisted that older trucks are sturdier, stronger, and generally more reliable than new trucks. When it comes to valuable opinions, it doesn’t get much more immediate than the drivers themselves, so make sure that you listen to their opinions and desires in order to make the best purchasing decisions for you or your company.

Used Semi-Trucks: Potential Pitfalls  

While there is a hefty plethora of reasonable benefits that come along with choosing a used truck over a new one, there are also different risks that come along with the territory. There are certain conditions associated with any used vehicle that put you at a higher risk for mechanical problems, increased repairs and heightened operational costs.

The cons of a used semi-truck include, but are not necessarily limited to:

  • Increased mileage
  • High-polluting, diesel engine
  • Internal wear and tear such as seat tears or any internal material damage
  • An unknown history that can lead to unexpected repairs or damages
  • Unknown habits of previous driver that could have led to excessive mechanical strain

Weighing the Pros and Cons

All of these factors add risk to your truck buying experience, but it’s up to you and your team to decide if you’re ready to tackle them for the financial benefits that a used truck provides. While a used semi contains many unknowns, many owner operators have found it to be the best option for their current situation. Just make sure that you do plenty of research and properly educate yourself before committing to such a significant purchase.

To get started in the wild world of trucking, apply for a semi-truck loan and begin the process today. You can also stay up to date on the latest industry news and gain insight into this dynamic field with our blog.


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