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Food & Drinks

Food trucks are struggling in Hong Kong. So why is business booming for Hongkonger Adam Wong in Beijing?

Movable business booms as it rolls into public parks and office areas alike

PUBLISHED : Saturday, 09 December, 2017, 1:00pm
UPDATED : Saturday, 09 December, 2017, 10:37pm

While food truck operators in Hong Kong are grasping at every hard-earned cent they can get, one entrepreneur in Beijing is happily counting the millions pumped into his mobile business.

Hongkonger Adam Wong Hung-for, co-founder of Gulu Gulu in Beijing, has already received 10 million yuan (US$1.5 million) from three investors this year for his food truck business in the nation’s capital.

The investors – two Hongkongers and a mainlander – have committed to a total of 100 million yuan (US$15 million) as his business grows. Wong said he planned to expand his fleet of electric-run trucks from the current five to 100 vehicles within 18 months.

“Food trucks have been popular in foreign countries for a very long time,” the 34-year-old entrepreneur said. “They are basically movable restaurants. This is something that could really work in mainland China.

“The problem with restaurants located in office areas, for example, is that you could get a lot of customers coming for breakfast and lunch. But you don’t get businesses at night after office hours. Food trucks can solve this problem because the vehicles can move.”

Wong started running other businesses on the mainland in 2012. And his blueprint for this one is anything but ordinary.

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Unlike conventional food truck operations in Hong Kong and overseas in which the cooking takes place inside the vehicles, Wong’s staff prepare and pack the food at a licensed central kitchen before the boxed offerings are loaded onto his vehicles. The food includes Sichuan boiled beef, seafood baked rice, hot dogs and other choices.

Every day, his staff drive the trucks to different locations such as public parks and office areas after they secure approval from estate management or relevant government bodies to park at a site.

Customers can order through Gulu Gulu’s smartphone application and then pick up their food boxes when their meals roll in. Wong has secured the required approvals to turn his trucks into food delivery vehicles.

But because the food preparation takes place elsewhere, no cooking licence is required on board. Wong consulted lawyers so that everything was legal.

“If you sign a contract to rent a restaurant for five years, you need to spend money on the decoration and make sure it complies with fire safety regulations,” the former accountant noted.

“Five years later, the landlords might raise your rent or not let you rent the place any more,” he added. “In such cases, you will be losing everything you’ve invested.”

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Wong said he drew inspiration from the Hong Kong government’s food truck scheme, which has already seen three of its original 16 vendors pull out since the plan launched in February.

He claimed it only took him a few days to think about how to turn the scheme into a viable business in Beijing.

In Hong Kong the vendors have struggled in the face of strict regulations and high costs. The trucks may only sell food at eight designated tourist locations. Some vendors have complained that business is especially bad at certain places where pedestrian traffic is low.

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Some said they had invested HK$1 million (US$128,000) on their truck. By comparison, Wong has spent about 500,000 yuan (US$75,500) on each of his five environmentally-friendly trucks.

The entrepreneur made clear he had no interest in joining the food truck contest in his hometown. But he said that if he were to join, he would buy all 16 trucks and persuade Hong Kong officials to let him park the vehicles at one location to turn it into a food truck market.

Mainland China can offer so many opportunities that Hong Kong cannot match at all
Adam Wong, Gulu Gulu co-founder

Wong’s trucks rolled out on Beijing roads in October. Each has been selling between 100 and 200 food boxes daily. The boxes are priced between 25 yuan and 38 yuan.

He estimated reaching a daily total revenue of about 700,000 yuan once his company had 100 trucks. That would mean a revenue of about 255 million yuan (US$38.5 million) per year.

But Wong had no plans for his company to staff 100 trucks, citing manpower challenges. Instead, he said, he would rent the trucks out to interested parties. He was also seeking partnerships with well-known food brands to sell their delicacies aboard his trucks.

Wong opted for electric-run trucks in Beijing because he could more easily find places to charge the vehicles there than in Hong Kong. The charging stations around the capital can be found with just a few taps of a smartphone application.

“Mainland China can offer so many opportunities that Hong Kong cannot match at all,” he said. “The country’s population, its economic growth and developments in information technology are what Hong Kong cannot offer.”

Watch: Hong Kong’s five rules for its food trucks