Fancy running a food truck business? Selangor draws up guidelines and regulations

KUALA LUMPUR, Dec 19 — The Selangor state government wants to get hawkers off the streets and into food trucks.

Selangor state executive councillor Amirudin Shari said Selangor's Smart Truck programme is part of their long-term plan to create a systematic business structure for hawkers in line with the goal of making Selangor a smart city.

"This is part of our urbanisation plan for Petaling Jaya and Shah Alam. Currently we have a problem with image.

“We have a big city, nice city, smart city but at the same time, we have hawkers who sell food in a poorly structured manner," Amirudin, who is in charge of youth development, sports, cultural and entrepreneurship development, told Malay Mail Online.

Selangor drew up guidelines and regulations for food truck operators which were finalised in October.

How the guidelines came into being

Amirudin said the guidelines had to be drafted from scratch as there weren’t any available examples on regulations for food truck operators throughout Malaysia.

Selangor local government officials flew to Singapore and Sydney, Australia, to learn about the food truck sector there and to apply the initiatives behind these success stories.

"Since 2014, I received many comments... for us to think about the food truck business as it has become a trend now. I visited about three food truck carnivals held in Shah Alam and Petaling Jaya which were small scale programmes, and from that, in early 2015, I had special discussions with the local councils in Selangor to tap into this sector," said Amirudin.

In order to upgrade the hawker concept into something more modern and structured, Amirudin, together with Selangor's local council officials, studied and amended 13 local laws to facilitate the food truck business in the state.

“There are laws for static and mobile hawkers, but food trucks come in between the two,” said Amirudin.

"The local councils also didn't know how to charge them and there was dissatisfaction between licensed restaurant owners, hawkers and food truck operators, with the former two accusing food trucks of affecting their business by parking and operating nearby.

"So, the guidelines and policies were just to synchronise and to make sure that everybody receives fair treatment," he added.

He said the guidelines will be closely monitored until March 2017. Currently, those intending to operate a food truck must first purchase the vehicle which must then be sent to the Computerised Vehicle Inspection Centre (Puspakom).

Next, they have to submit the Puspakom certification to the local councils which govern their business venues and then apply for a permit, which must be renewed every six months.

This business permit, Amirudin said, costs RM1,080 for a six-month period and includes a garbage collection service charge by the local council.

There is also a parking charge for food truck operators who use the special parking lots prepared by the local councils. The charges vary, depending on the time and duration of their operation.

A time limit of between two and four hours is imposed on each food truck, after which it must leave and operate at another venue. The parking lot charges also differ in different local councils.

"It's normal that when you have a truck, you will then park at potential areas 24/7. Then, it’s no longer a food truck business," Amirudin said, adding that the local councils have also prepared several special lots just for licensed food truck operators.

"Also, in other countries, the food trucks are for takeaways but so far here in Malaysia because of the ‘lepak’ culture, they also want to have a place to sit and open some chairs. So we have to look into all this," he added.

"We have appointed a manager in every local council and they have to manage the food trucks, the timing, locations etc.  Everything is in order, so we know where the food truck operators go and who are not disciplined so we can fine them.

"Hopefully, in this trial mode of three to four months, we can make amendments and perhaps even consider allowing food truck operators to open up tables and chairs.”

Amirudin said that currently, Selangor has about 130 licensed food truck operators. He projected the numbers will double come 2018.

Special incentives for food truck operators, ‘pasar malam’ upgrades

In 2015, the state government approved a RM140 million annual budget for its new Hijrah micro-credit loans for budding entrepreneurs, including food truck operators.

The programme offers loans between RM3,000 and RM50,000.

Amirudin hopes the programme which was launched last year will enable would-be operators to at least afford a down-payment for their business, or to get a truck.

"You can get a good truck for about RM70,000. That's why I try to link these business owners to the Hijrah micro-credit loan.

"The response from the food truck operators has been overwhelming and they are happy that we are going to great lengths to accommodate them. Before this, their business model was illegal but now we have legalised it and are even offering funding," he said.

However, Amirudin said he realised that the state government would not be able to completely abolish the hawker stall concept, still a widely favoured eatery option by both the young and old.

He now has his sights on changing the image of weekend night markets (pasar malam) and morning markets (pasar pagi) by making them more child- and public-friendly, with special spaces for children as well as good toilets.

"In developed countries, they also have hawkers but they are very presentable and not dirty. The poor hygiene is what affects the city's image," he added.

Amirudin is also considering creating a special Selangor Smart Truck app to enable patrons to track their favourite food trucks.

"Food trucks got to move around, so this will give the business an edge as they will still have customers coming to them," he added.

Need to cut red tape

Ismadi Ismail said his permit only allows him to operate at a specific area and he would need to fork out an extra RM1,000 to operate in another area despite it being within the vicinity. — Picture by Yusof Mat Isack business grow. — Picture by Yusof Mat Isa

Food truck operators, of course, are hoping for better regulatory policies, citing expensive permit charges and limited operating areas as obstacles right now.

Ismadi Ismail, 43, who runs his food truck business in Section 14 Petaling Jaya, said: "I have been here for six months, and before that, I was running a canteen. So I bought myself a truck and started this business, but it’s really expensive and I am not making enough to cover the expenses.

"The RM1,000 permit must be renewed every six months. They say it's the Petaling Jaya City Council (MBPJ) permit but it seems like I am only paying for the parking lot rental actually. Then there's Puspakom inspection, insurance and road tax renewal every six months, which all comes to over RM4,000," he told Malay Mail Online.

Ismadi said that the permit only allows him to operate at a specific area and he would need to fork out an extra RM1,000 to operate at another area, even if it’s within the vicinity.

Anor Farisha said more needs to be done to help up-and-coming food truck businesses like hers. — Picture by Yusof Mat Isa

Another food truck operator, Anor Farisha, 30, agreed with Ismadi said. The single mother of two wants the state government to allow food truck operators like her to operate anywhere in Selangor without having to apply for permits from every local council.

"Make it easier for us to get the permits. It's very taxing now. Too much red tape. Local councils are quick to penalise but not that efficient in helping," said Anor, who sells beverages.

She is part of the Puchong food trucks community and is now in the midst of applying for a business license after seven months of operation.

 "I am part of a food truck community. When we have an event, we all move together. That's how we work," she said.

Zamri Kassim, 53, only started his food truck business this year. "For now, I am making enough to cover my overhead costs because I work from day to night.

Zamri Kassim, who only started his food truck business this year, thinks a grant from the state government would help him. — Picture by Yusof Mat Isa

But I think a grant from the state government would be good to develop our business. Loans have high interest and it’s quite taxing as my ingredients are mostly imported," he told Malay Mail Online.

Noor Firdaus Abu Mansor, a 34-year-old seasoned food truck business owner, echoed Anor's sentiment, calling for a single-permit system.

"We would like, in the future, to have only one license for one local council to enable us to operate anywhere in the area. Now we got to pay for every different locations. The more locations, the more you pay.”

The father of two, however, said that the licensing process is much better than it was about two years ago.

He said it was the lack of a proper guideline for food truck operators which made things difficult, coupled with hygiene issues.
Noor Firdaus Abu Mansor wants a single-permit system which he says will help the food truck business grow. — Picture by Yusof Mat Isa