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A Food Cart Named Desire
Traditional street food vendors have been joined by young upstarts eager to make their fortunes. Is there room for them all to make a living on the streets of New York?
By
The icy wind blasted people deeper into their coats as they quickened their steps along Third Avenue and rushed to get to their destinations. At the corner of St. Marks, a white truck with its engine humming enticed some to slow their pace; a few couldn’t resist and scurried over. The vehicle, adorned with pictures of hot chocolate and bowls of warm pudding, had become a nightly fixture at this intersection where students, artists, and other assorted East Village denizens hurried by. Even with Starbucks just across the sidewalk and an array of eateries up and down the street, the Dessert Truck beckoned. A woman, her woolen cap yanked over her ears, ordered a bread pudding. “It’s so cold tonight. Isn’t business slower because of the cold,” she asked as she waited for her dessert. “Not at all,” her server replied as he handed her a bowl filled with the confection and accepted her $5 bill. Within a minute, she was on her way, bent low against the wind.
Inside the truck, Chris Chen slapped the $5 bill on top of a thick wad of cash and replaced the bundle into his jeans pocket. With the hood of a varsity sweater drawn over his head, the 24-year-old comes across as a techie-type at an Internet start-up. But his casual manner gives him away as more than just a part-timer working his way through college. Chen is the boss of an enterprise with big ambitions. Bustling about the tiny space, he moves easily from torching a small tub of crème brulee, to sprinkling cocoa chips on a dark chocolate mousse and scooping vanilla ice cream onto baked apples. The dessert creations are stacked side-by-side in a refrigerator, ready to roll out once a customer decides what he wants. A Dell laptop rests an arm-shot away, glowing with a spreadsheet of business projections. “The goal was never to serve out of a truck,” said Chen, who has an MBA from Columbia University. “We did it because there will be a market. We did this to be big. Serving on the street was right for that, and we thought it would be cool.” Today, just over a year after the Dessert Truck was opened for business, the vehicle attracts anywhere from 250 to 600 customers a day, employs 12, and makes $500,000 in annual revenue with a profit margin of 20 percent to 30 percent before taxes. Together with his business partner Jerome Chang, a former pastry sous chef at New York’s famed Le Cirque restaurant, Chen hopes to open a chain of dessert stores around the world, beginning in spring 2009 with a store on the Lower East Side of New York. First stop: a truck at the corner of St. Marks and Third Avenue.
Chen’s Dessert Truck is a new wrinkle in a trade that is as old as the city itself. The food cart business teems with thousands of vendors, mostly immigrants taking to the streets with their carts with no grander goals than to make a living. They are descendents of the first pushcart peddlers, who were regulated by the city as early as 1691 and hawked their wares on carts that they rented for seventy-five cents a day. In fact, many successful New York enterprises, such as D’Agostino’s supermarkets and Cohen Fashion Optical, got their start as pushcarts on the Lower East Side. Today, these small enterprises are a burgeoning industry in which entrepreneurs and immigrants operate side by side, jostling for cart permits that are actively traded on a black market.
Just as it was seen as a gateway into the city’s economic opportunities in the past, street food vending is still viewed by many people as a way to be independent and enterprising. The vendors contributed as much as $107 million to the city’s $11 billion in restaurant sales in 2005, according to estimates by the New York City Economic Development Corp. But the real figure is much more, if one counts the food suppliers and the cart manufacturers who make anywhere from a few hundred bucks to tens of thousands of dollars on each cart. Back in 1998, the city said it had issued all 3,100 two-year permits it had authorized for food carts. Yet there are 14,141 licensed food vendors out there, according to the Health Department. Many of them, unable to get a cart permit, end up working for those who do have one, renting one off the black market, or simply selling their food without one.
With such a massive gap between supply and demand, it is inevitable that a thriving underground market has sprung up. Under New York City’s rules, a cart, with its permit attached, may be leased to someone else, but a permit alone cannot be leased or sold. “It is, however, difficult to enforce this,” said Sara Markt, a spokeswoman from the Department of Health, which regulates the cart licenses and manages and enforces the city’s health and safety regulations. “But we will follow up if we receive evidence that someone has sold a permit.” In addition, the city conducts inspections on weekends about seven months a year during summer and fall to check for vendors without permits, and those caught selling the permits could have them revoked. “These inspections are driven by what inspectors find in a given neighborhood, inspection history, and complaints,” she said. But vendors have found ways to get around the rules. There has always been a network of brokers and friends who will make introductions between a seller with a permit and a potential buyer, and now the Internet has become fertile ground for many of these transactions. Chen found his two-year permit over a year ago on Craigslist, the popular classified website, and paid $8,500 for it, a price he considered somewhat of a bargain since he had heard the fee would be in the range of $10,000. And a recent check on Craigslist found one ad looking for a permit, another searching for a food vendor to work at his pushcart, and one more trying to sell the entire business – cart, permit, location.
The original permit owner, who would have paid an upfront fee of $200 to get the permit and a $200 renewal fee every two years, can earn a nice profit at these prices. But the black market pushes the rates up considerably with each transaction. Sam Rosenberg, for example, put an ad on Craigslist offering to sell his entire business — a two-year old cart, a two-year cart license, a 1995 Dodge cargo van for supply storage, and a prime location in Soho — for $55,000. The ad promises a “great business opportunity,” a chance to “make money from day one,” and a guarantee to “get your money back in less than a year.” “I’m asking cheap money, but I have to move back to California that’s all,” said Rosenberg, who bought the permit from the original owner for $7,000 three years ago, spent $25,000 to buy a cart, and pays $400 a month to rent a cart storage space in a garage in Astoria. In the three months since the ad was placed, he has had about 40 inquiries. “Most people who call me are new to the business, and they don’t have the money or don’t have the financing to give me cash right away. Maybe it’s because we are living in tough times and the economy is bad.” The 45-year-old Lebanese works at the cart from 8 a.m. to 4 p.m. on the weekdays and trades stocks on the side. His Middle Eastern menu of falafels, shish kebabs, French fries, and hotdogs attracts about 100 customers a day, he said, and brings in about $500 a week. “It’s like any other business, no big deal. The food business at least is very consistent, but for the stock market, what can you do? Of course I’ll miss New York and the business. It’s not like pushing buttons on a computer, which I can do anywhere in the world.”
REGULATE AND DEBATE
The thriving black market for cart permits has fueled calls for reform. One solution: increase the number of permits. On November 14, the City Council heard testimony in support of a bill to authorize a total of 25,000 permits, a significant jump from the current 3,100. Testifying in the Council chamber, Rafael Samanez, a member of a street vending group, said: “Amid the worst economic crisis in decades, the city has a chance to create thousands of new jobs by increasing the number of food cart permits and general license permits.” But not everyone agreed. Michael Murphy, a member of the New York State Restaurant Association, argued that the proposal was a “direct threat to thousands of neighborhood retailers who are struggling in an era of rising rent, higher taxes, and increased regulatory abuse.” Leo Berisha of the Famous Famiglia Pizzeria on the corner of 8th Street and Broadway offered similar sentiments. His shop, which is just beside the 8th Street train station, has long served as a convenient pit stop for many commuters and New York University students stopping by for a slice of pizza. But Berisha now fears more competition from the likes of the cart vendor across the street selling lamb and rice. “We got rent to pay here, we got taxes to pay, and we hire lots of people. If there are carts on four different corners, our business goes down by 20 percent. That’s how it is.”
Another solution: control growth by clamping down on illegal street vending. Barely a week after the City Council meeting, on November 20, some 30 people squeezed into Room 709 in the Emigrant Industrial Savings Bank on Chambers Street for a community board meeting on how to resolve the issue of illegal street vending. It was 10 minutes after 6 p.m., and as everyone waited for the meeting to get under way, they chatted about Thanksgiving plans and their favorite holidays. The board members, about a dozen men and women dressed in casual after-work clothes, sat around a conference table. Three men in suits and ties from the Downtown Alliance, an administrator of the business improvement district in Lower Manhattan, lined one end of the room, and representatives from the business community filled the other end. Meanwhile, Sean Basinski, director of a nonprofit advocacy group called the Street Vendor Project, gathered his team of five street vendors in the hallway to give one final briefing before entering the room to make their case.
In an hour-long presentation, Basinski urged the board to support moves to provide more cart permits, open up more streets for vending, and reduce fines. The regulations were restrictive and enforcement practices were arbitrary, he said. Then, one by one, the five vendors came forward and related their stories of life working on the street. Thumping a yellow cardboard box stuffed with pink slips, vendor James Williams argued that many of the 60,000-odd tickets written by the police last year for vendor-related cases were unfair. “What do you do about fruit flies in August if you sell fruit,” asked Grace Aydin, who operates a cart in the Financial District. “Well, you can soak them in vinegar or something,” a board member replied. “The point is, if the rules are there, just follow them. Why make life difficult for yourself?” said another. Pauline Yu, from the Community Liaison Office of the Mayor, said: “The city is not in the business of putting people out of business. But the fact is there are many illegal vendors and vendors doing illegal things out there. It’s not selective enforcement.”
The mood after the presentation was upbeat as Basinski spoke to his team while they waited for the elevator in the dimly lit corridor. “So you guys okay? What do you think? How did we do,” he asked. The group did not think the city would take up their suggestions of issuing more permits and space for street vending anytime soon, but they took heart in one thing. “We came prepared and I think the people in the room didn’t expect that from us,” said Williams, clutching his box of pink papers. “I think we are getting more of a voice. At least we are being heard now,” he added, as those around him nodded in agreement.
TALE OF TWO CARTS
Even as a food cart is an anchor to a meager living for the majority of vendors, it is the stepping stone to wider success for entrepreneurs like Chen. Back at the Dessert Truck, he talks about his plans for worldwide dessert domination. He and his partner, who spent a year conceptualizing the idea for the business, are ready for the next phase of expansion. With his contacts made at business school, he has been talking to investors about funding for his chain of stores. “If I could get rid of the truck, I would do it immediately,” said Chen of the pains of maintaining the vehicle, with all its engine troubles. But he has no regrets. “It was a great decision. Career-wise, my friends are all worried about losing their jobs, but I’m thinking of growing my business.” Indeed, there is a wide gulf between these entrepreneurs with their fancy food and snazzy web pages, and the scores of other vendors living from day to day peddling everything from candied nuts and hotdogs to falafels and pretzels. “There are maybe 20 or so carts like the Dessert Truck out there, but the vast number are doing this because they have few other options,” Basinski said. For his organization’s members, which number about 750, working a food cart is barely a living. In 2005, the Street Vendor Project surveyed 100 vendors in Lower Manhattan and found that a street vendor may make up to $35,000 a year, after paying for food, cart storage, and taxes.
Outside the Stern Business School at New York University, the kebab man who dishes out chicken and rice to the students who stop by his cart before class, is feeling the chill of his trade. Shahidul, 45, began selling food on the streets in 1991 for $65 a day. Today, 15 years later, his boss pays him $70 a day to work about 10 hours. “I try to ask for more money, but now, I’m not so sure. There is so much more competition on the streets today.” On a Tuesday evening in November, the temperature was close to freezing. Shahidul was feeling sick and decided to close the business early. He scraped the hard residue of grime from the grill and wiped down the stove. The stale smell of processed lamb and hotdogs lingered on him. A father of four children, the Bangladeshi native said he left his country where he had worked at a newspaper because of the political turmoil. “I didn’t ever think I would be doing this, but what options do I have when my English is no good and there are no jobs? I love New York, so I stayed. And at least I can be independent on the streets.”
Dave Vendley (center, in baseball cap) moved from California to join his brothers in running their Cal-Mex food carts in New York City's Soho. Photo: Joyce Koh
The independence that attracted Shahidul also drew the three Vendley brothers to the business. They run the popular Cal-Mex food stand Calexico just a stone’s throw away from Shahidul’s cart in Soho. The brothers, Jesse, Brian, and Dave, have two carts and hire nine people – three to work in the central kitchen and three for each cart: one to take orders, one to grill, and another to assemble all the ingredients in a hefty taco or burrito. The idea for the cart came from Jesse, 40, who had always wanted to open a restaurant but ditched that plan when he realized that a cart was much cheaper to run. The oldest brother, who still works in advertising, slowly recruited the entire family. Brian, 28, joined up after he graduated from California State University. Dave, 25, was cajoled into helping out one summer two years ago and decided to drop out of Mira Costa College in San Diego to stay with the company. “It was something I really wanted to do with the family,” he says now. “It was definitely a risk. I gave up a lot – school, my music and my apartment. But I’ve always looked up to Jesse a lot, he was a big idol of mine. And it was a good opportunity to never have a boss and be fully independent.”
As music from Iron Maiden blasted from one of the carts at Prince and Wooster streets, Dave, wearing a Knicks baseball cap and green Adidas sneakers, was busy taking orders from a growing lunchtime queue that had swelled to 12 people. “The basic idea was we wanted to sell food we grew up eating,” he said. “Nothing against hotdogs or pretzels, but how much more interesting would it be if the Sri Lankan man sells food from his country, or the Dominican lady sells her local food? Street food now doesn’t really reflect that, but I think there’s a positive evolution going on.” Barely two years after the brothers started the cart, they were already setting their sights on expansion. They plan to open their first store in Brooklyn by the end of the year, and set up a third cart by spring. But far from claiming success, Dave said the margins for the business aren’t “crazy,” and any extra money is ploughed back into the fund for opening the store. Don’t expect their carts to go away anytime soon, however. “We intend to stay on the streets. We like street carts and what they represent,” Dave said.
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