Kazakh street food industry has ample room for growth, says entrepreneur

ASTANA – Hungry and observant city residents may notice an increase in the number of ready-to-eat food and drink locales popping up on Kazakh streets, reported forbes.kz.

Photo credit: forbes.kz.

York Food, Butcher’s Street, Borough Cookhouse, Street Gourmet, The Bus Street, Vkusnyabus, Buter Bro, Hochu Ponchiki, Zhadina Govyadina, OM NOM NOM, ELIKS, THE BURGER and MANAKISH are just a few of the hot spots.

The global street food industry has boomed, with more than 2.5 billion people consuming ready-to-eat food and drink sold by street vendors every day, according to a 2007 Food and Agriculture Organisation study. Such sellers have even received the highly-coveted Michelin star, a feat attributable to their food innovation and ability to keep up with consumer demand.

Diners often opt for street food for convenience, to try ethnic cuisines or enjoy their food in a more social setting. In looking at those on the preparation side of the truck, street food industry insiders explain why Kazakh entrepreneurs have pursued these businesses and what challenges they face.

Upon first glance, a food truck business appears quite viable. Purchasing a vehicle is more affordable for the average entrepreneur than investing in a café or restaurant, with a truck costing approximately seven million tenge (US$19,273). With 60 mobile commerce businesses in Almaty, there are also relatively few competitors.

“The advantage of food trucks is their mobility. In this way, they are useful for an entrepreneur when working in seasonal places such as ski resorts, near bodies of water or wherever else the gathering of people is seasonal. There is no need to maintain the premises and crew all year round. The same applies to days of the week. On weekends, food trucks work in places of rest and, on weekdays, near office buildings,” said Andrey Shentsov, director of food truck production at Sputnik.

The company usually receives orders for ice cream trucks from Kyrgyzstan and Uzbekistan and, to a lesser extent, Kazakhstan.

“We either have a weak market or there is little interest among or major obstacles for entrepreneurs to develop this kind of business,” he noted.

He singled out several barriers to the industry’s development in Kazakhstan.

“There are no legal restrictions [on where you may park and trade] and this remains an unresolved issue,” he added. “Still, negotiating with the paid parking company Almaty Parking is an option and an existing practice, for example.”

Additional obstacles, common to many businesses, include funding and lack of experience among entrepreneurs. Having a good product is only half the battle in the street food industry.

“Designated food truck locations are required,” said Shentsov. “In deferring to experience overseas, food trucks are located exclusively on specified sites in Prague, Los Angeles and Miami, for example. In Abu Dhabi, an entire ‘bazaar of trucks’ has been established.”

Food truck owners also face questions about taxes.

“Every district has its own tax authorities,” said Vkusnyabus owner Artyom Orlyansky. “How do we pay taxes if we move across locations? Will documentation be multiplied? I don’t know how this is done on a legal basis for mobile commerce. The tax authorities themselves do not know. There is a need to solve this issue at the state level and to distinguish mobile commerce as a separate type of commercial activity.”

At the Atameken National Chamber of Entrepreneurs, a group now oversees mobile commerce development, instituting the Society for Standard Professionals’ requirements and a tax collection process. According to the Almaty Akimat Entrepreneurship Administration, businesspersons are also obliged to wield a trade permit and comply with the sanitary rules established by the Kazakh Ministry of Healthcare.

As entrepreneurs and state authorities overcome these hurdles together, enthusiasm for on-the-go morning coffee, quick and easy lunchtime sandwiches and flavourful burgers for dinner on a noisy street continues to grow, along with the industry’s potential in Kazakhstan.