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Study Finds Food Trucks are NOT a threat!

https://ij.org/press-release/new-report-food-trucks-not-a-threat-to-restaurant-industry/

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ARLINGTON, Va.—For years, critics of food trucks have argued they hurt already established restaurants within communities. But a new report released today by the Institute for Justice (IJ), “Food Truck Truth: Why Restaurants—and Cities—Have Nothing to Fear from Mobile Food Businesses,” shows more food trucks do not result in fewer restaurants. The report suggests food trucks actually complement the brick-and-mortar restaurant industry.

The study examined 12 years of census data on food trucks and restaurants and found that an increase in the number of food trucks in one year does not lead to a decrease in the number of restaurants the following year.

“The results of this study provide strong evidence that restaurants have nothing to fear when it comes to food trucks,” said IJ Senior Director of Strategic Research Dr. Dick Carpenter, a co-author of the report. “Far from threatening to put restaurants out of business, food trucks can coexist with restaurants and may even help the restaurant industry grow.”

In the period studied, 2005 to 2016, both the number of restaurants and the number of food trucks per county grew. And while the food truck industry grew at a faster rate, restaurants still vastly outnumber them. The average number of restaurants per county grew from 133 to 157, while the average number of food trucks per county increased from less than 1 to nearly 2.

The study also demonstrates that new food trucks do not lead to later restaurant closures. The authors found no statistically significant relationship between the number of food trucks in one year and the number of restaurants in the next. They did, however, find a positive and statistically significant relationship between food trucks and restaurants in the same year, suggesting food trucks complement the restaurant industry rather than detract from it.

Unfortunately, not everyone recognizes the benefits of food trucks. Many local governments have, often at the behest of restaurants and their associations, enacted regulations geared toward protecting restaurants from food trucks. Take the story of Benny Diaz. The city of Fort Pierce, Florida, barred Benny from operating his food truck, the Taco Trap, within 500 feet of any existing restaurants—even on private property. This unconstitutional law effectively prevented him from setting up shop anywhere in the city. Thankfully, with IJ’s help, Benny succeeded in having the law overturned. But many other cities, such as Newport, Rhode Island, continue to enforce similar “proximity restrictions,” with some city officials pushing for an outright ban on food trucks on one of the city’s main streets. Other cities cap the number of food trucks that can operate on their streets, limit how long trucks can operate in any one spot or restrict trucks in other ways.

The results of IJ’s study strongly suggest such policies are misguided.

“Cities should repeal restrictions designed to protect restaurants from food truck competition, leaving in place only legitimate health and safety regulations, and states should prevent cities from placing protectionist restrictions on food trucks in the first place” said IJ Researcher Kyle Sweetland, the report’s other co-author. “These reforms would right the injustice as well as promote consumer choice and a more vibrant local food scene.”

Through the National Street Vending Initiative, IJ has been standing up for the rights of food truck operators by challenging harmful, anticompetitive laws that prevent them from earning an honest living. In 2021, IJ launched a new case challenging a law in Tarpon Springs, Florida, that blocks food trucks from operating downtown unless they also have a brick-and-mortar establishment. IJ is also challenging a South Padre Island, Texas, law that caps the number of food trucks that can operate in the city at just 12.


Dan King

Communications Project Manager

dking@ij.org

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