While food carts have left almost no corner unoccupied in the East 20s, they are not as resilient as they may seem. The trendy shops on wheels barely have an advantage over their immobile competitors in the down economy. The cost of operating a cart, while smaller than a full-blown establishment, is still substantial for the typical restaurateur.
Moshe’s Falafel Truck sits at 26th Street and Park Avenue from 11:30 am to 5 pm, and then moves to 19th Street and Sixth Avenue from 5:15 pm to “whenever there are no more people,” said the owner, “or when we run out of materials.” Posted next to the vendor’s window is a Kosher certification, a rarity in the restaurants in the neighborhood.
Like many other food carts, Moshe’s Falafel Truck moves with its clientele. Yet, catering to a wider area has not brought in the profit the owner saw when he first opened the shop. Where he once derived a modest income from his business, he is now making only enough to scrape by.
The Tasty Hot Dog Truck located on the corner opposite to Moshe’s Falafel is owned by a man who was ousted from his previous business by his business partners. He decided to open up a food truck in the East 20s, a neighborhood far from the store he once owned in Astoria, Queens.
After the initial $45,000 investment and vendor taxes, the owner makes enough to support his children. The truck opens from 8 am to 4 pm from Monday through Friday, selling breakfast pastries and coffee, and sandwiches for lunch.
The vendor license and start-up fees for food carts are relatively small compared to the costs of opening an establishment in the East 20s. The owners who own the food cart selling halal meat and rice platters on the corner of 25th Street and Lexington Avenue paid $200 for a two-year vendor license. The owner, Eisan Aslam, said that he and his brother bought their cart for $20,000 from a Chinese vendor in Queens Plaza, a wholesaler whom everyone in the halal cart business knows.
Aslam spoke while busily preparing platters for a line of waiting customers, mostly students from Baruch College. Meanwhile, the street where Moshe’s Falafel Truck sat only had a smattering of pedestrians, none of who stopped to buy a pita.
When the owner of this particular Moshe’s Falafel opened his business a year and a half ago, he had a decent return. The business earned enough for him to start paying back friends and family, from whom he scrounged the business’s start-up fees. He spent $100,000 in the initial investment, most of which he borrowed from financial institutions, and from his IRA and 401(k) accounts.
“Starting a small business is not easy,” he said. The ingredients in the food business usually take up 30-35% of all sales. Moshe’s Falafel is a franchise, with another truck selling the same food on 46th Street and Sixth Avenue. After paying franchising fees, the operators of the food carts pocket what little is left.
The owner buys all of the ingredients and materials necessary for preparing the falafel from a central kitchen in Manhattan, and prepares the hot food in the truck. He admitted that he does not have a background in food, but doesn’t need one as a franchisee. “People already know that Moshe’s brand of falafel is good falafel,” said the owner, “when they buy from me, they know what they’re getting.”
The owner helps build the brand by offering first-time customers a sample of his falafel. But lately, fewer people pass by, and his regular customers visit less often. “People don’t always have cash, and we don’t accept credit cards,” the owner said. With only a cut of the profit margin, he has had to reduce the number of employees he hires and do more of the work himself.
There was one other employee in the truck, servicing customers while the owner chopped the lettuce for the salad. As he offered a free falafel to an interested pedestrian, he wore a hopeful smile.