How To Become a Street Vendor

If you're looking to start your own business, you might consider becoming a street vendor. A street vendor is a business owner who operates out of a stall by the street or out of a moving vehicle such as a van. While there are some similarities to stationary brick-and-mortar businesses, a street vendor has special considerations they should keep in mind when planning their business.

With the right market research, permits, equipment, and marketing strategy, you can find your target market and thrive as a street vendor.

We make business formation EASY. Learn about our DIY business formation services here.

Market Research

Market research is necessary to obtain information about your consumer's needs and how you can fulfill those needs. A brick-and-mortar store would focus on a specific location. How would your business fit into the neighborhood that exists around it? But with a street vendor, market research is a bit different.

The mobile nature of a street vendor allows for greater flexibility. For example, you may choose to research different festivals and markets where you could set up shop, neighborhoods that are popular with your target demographics, and parts of town with few restrictions on mobile businesses. Your market research may also focus heavily on tools like social media, which can be used to let your customers know where you are setting up shop each day.

Your market research is a key part of starting your business and developing your business plan. This research also helps when you are looking to secure loans, partner with investors, or obtain credit to grow your business.

Licenses and Permits

To operate a business, you first need to obtain any required licenses and permits. Licenses and permits allow you to operate a business within your town and your state.

Keep in mind that, depending on the laws in your area, you may need a special street vendor permit or license. Not every town allows street vendors to operate, so it's important to stay up-to-date on the requirements in your area.

Licenses

The two main licenses you'll need to get are a state business license and a local business license. Your local business license may specifically be a street vendor license. These licenses allow you to operate your business on the state and local levels.

You will also need to acquire a federal employer identification number (EIN) to conduct business and pay taxes for your business at a federal level.

Permits

Street vendors that sell food will always be required to have a permit issued by the health department before they are allowed to serve customers. If you are selling crafts or other products, the rules will change from place to place.

If you are wondering whether you need additional permits beyond your business license, talk with the people at your local city hall or the Chamber of Commerce.

Insurance

You'll need to have an understanding of business liability and insurance before you officially open up shop. Liability and insurance are all about protection. For example, you'll need to protect your business in case your and your customer's information is hacked. You'll also need to protect your business against lawsuits that might arise out of injuries at your shop site, the food you may sell, or through the use of your products.

If your business is based out of a vehicle, make sure that you have the appropriate insurance to protect you and your employees in the event of an accident on the road.

Equipment

One benefit to operating as a street vendor is that your shop is typically smaller and you can set it up more quickly than a brick-and-mortar location. You might have minimal start-up costs from your equipment, and you are less likely to have to worry about certain business operations, such as commercial zoning and lease negotiation

If you have a mobile business, then you'll need to find a vehicle accessible to customers. A food truck might need a window with a serving counter on the side for customers to order and receive their food, while a clothing business might need storage space for inventory.

If you work at festivals and markets, you'll need a tent, shelving, and product display options that are easy to set up and break down every day as you move from location to location. Whatever equipment you buy, make sure you understand how to set it up before using it for your business to avoid accidents and injuries.

Marketing

Once you've done your research, received your licenses and permits, and bought and set up your equipment, it is time to market your business. Being a street vendor gives you a competitive edge. You are mobile, you are unconventional, and you are small. With tools such as social media, you can create content that highlights the uniqueness of your business and helps to draw customers to your shop.

When you are working on target marketing (marketing to your very specific customer profile), you cannot rely on geographical segmentation the same way a brick-and-mortar store can. You cannot just focus on customers within a small area around your store. If your business is mobile, focusing on such an area may not be quite as effective as if you were stationary.

Instead, you will need to rely on customer segmentation and identify the people most likely to buy your product. Once you have identified them, you can create marketing materials (both online and in-person) that appeal to those groups. For example, if you sell crafts that appeal to an older demographic, you may want to join Facebook groups in your city, put up flyers near senior centers and recreation centers, and set up shop near farmers' markets and other morning events. You are in a unique position to find your customer and physically move your store to where they are.

Ready To Start Your Business? Get Legal Help

As you can see, street vendors have even more laws and regulations to worry about than the typical business owner. Consider reaching out to a local business organizations attorney to ensure that you understand the legal requirements before you start your street vendor business.

And when you are ready to start your business, use our simple DIY business formation process to ensure you meet all the legal requirements in your state.