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InsiderOnline Blog: December 2012

Restaurants and Food Trucks—Two Flavors that Go Together

Food trucks—the target of much regulation designed to protect restaurants from competition—are good for a city’s restaurant scene, and even established restaurants are starting to see they benefit, too, report Bert Gall and Lancee Kurcab:

Austin’s food trucks and food trailers are a rising tide lifting all boats in the local restaurant industry; one way they have done so is by attracting more people—both new residents and tourists—into the city. In Houston, restaurants have experienced increased business generated by food trucks parking nearby and drawing more people to the restaurants’ neighborhoods. It is for this reason that restaurant owners have asked the Houston City Council to ease existing laws that make it difficult for food trucks to operate. And in Las Vegas, George Harris, the owner of Mundo, an award-winning upscale restaurant in Las Vegas, has observed that food trucks help his business by bringing new customers to the neighborhood.

Furthermore, historical evidence suggests that banning food trucks from an area in which they currently operate will harm nearby restaurants by decreasing the number of potential customers. For example, when street vendors were banned from New York’s Lower East Side and Chicago’s Maxwell Street Market, brick-and-mortar businesses complained that they suffered lower revenues as a result.

Simply put, food trucks draw people out of their offices and homes and into the community, opening their eyes to all of the meal options their neighborhood has to offer.

As Gall and Kurcab observe, there’s nothing unfair about using a different business model, as long as everyone is free to use whatever business model he wants. Restaurants, in fact, are using food trucks, too:

All over the country, restaurant owners are launching their own food trucks. For example, the owners of Curried, an Indian restaurant in Chicago, started a food truck with the same name in order to better market the restaurant. Mission accomplished: “We’ve definitely seen an increase in business at the restaurant,” says Scott Gregerson, Curried’s managing partner. Jose Hernandez, general manager at POPS Cheesestakes in Las Vegas, says that the business at the restaurant’s physical location has been boosted by the restaurant’s food truck: “The truck has been great advertising.” [“Seven Myths and Realities about Food Trucks: Why the Facts Support Food Truck Freedom,” Institute for Justice, November 2012]

Posted on 12/07/12 11:11 AM by Alex Adrianson

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