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5 Myths About Buying A Vending Franchise Business by Candice Clem
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Pros & Cons of Buying a Vending Machine Business | edegawiwajy.web.fc2.com
Please don't post asking users if they would be interested in a guide to something - just post the guide! Post it in series Part 1, Part 2, etc. Are vending machines profitable? I was thinking that vending machines might be a nice investment for someone who doesn't have a lot of free time.
You just have to refill them and collect the money every 1 or 2 weeks it seems, but I don't know much about the business. Here is a few of my questions:. It's profitable, but unlikely with just one machine. Some credit unions that I've belonged to in the past even had a coinstar type machine, and they still didn't charge fees. Call your local banks and ask. You will more than likely have to rent the space, and might also need to sign a long term lease. Or can vending machines only be placed in certain spots decided by the city.
From what I have seen even if you put it in a private business it may require a license from the local jurisdiction. Depends on your city. Go to your local code book good chance it's online in this day and age. I think in most jurisdictions, vending machines would be along the lines of "peddling" or "transient merchant". I know Bank of America has a loose change pouch and they will even count it and deposit it for you.
If you want to see if it's a business that suits you I would recommend buying a couple of used candy machines off craigslist and try and set them up in local barber shops or other mom and pop high traffic businesses. I own five 3-head machines I have in similar locations. They don't make a lot of money, but they make money every single month.
I have been trying to add a couple more locations for awhile. That's the toughest thing is finding quality locations, and making sure you keep them restocked. Always restock, and clean your machines every chance you get.
A clean, full machine will far outsell a dingy, half full machine. Bulk candy and nuts can be bought at costco or sams club to start yourself out. I have an ATM that is located inside a restaurant. I charge a 3. It cost 3, for the machine, and I would say the ROI will take about years based on my volume which is about 50 transactions every 3 weeks.
The main problem is stocking it with enough cash so you don't have to constantly refill it.
The only time consuming thing is refiling it which takes only 20 minutes honestly including going to the bank, so if you can start out with a lot cash you can just let machine make money for you. I would think there would be some extensive controls in place. I live in California and the person who handles the transaction is called Columbus Data Services Had to fill out some paperwork about myself, but they handle the transactions and ACH ect.
So I guess that I am not acting as any sort of financial institution, Columbus is, I am only a simple guy who fills a machine with money and charges a fee. Depending entirely on where you put them, yes they can be a cash cow. Schools for example would drum up a shit load more interest than putting one outside a library, For example. I'd say Schools, Swimming Pools, Parks? In the UK you can take small change to a bank, you may have to talk with them if you're bringing hundreds of pounds in coins in every few weeks as it would take the cashier ages.
Maintenance is a weird one and is almost impossible to gauge, it could be none it could get smashed up every week. I am also very interested and planned on making a thread for this. The machines are expensive and I don't know if they are justifiably expensive. You need to have a place to put them. My uncle bought a few places and machines off another vendor, then the other vendor had the owners of the locations throw my uncle out so the original guy could put his new machines in their place.
My uncle didn't have a non complete clause in the contract so he lost thousands. They break down, you will need to learn how to repair them. It's a full time job if you have enough machines to make a decent living. I would start with some gumball machines in a few local stores so you get the hang of filling and emptying, and you learn how to talk to potential places for a full snack machine. I'm a little late to the party here, but I'm a good source. I worked in our family vending machine business my entire life.
Yes it's very profitable. But you also have to put in a ton of work and if you hire people you have to trust them completely. It being a cash business it's very easy to get ripped off. The best places are factories. The next best is office buildings.
If you're in an industrial area this is a big win. To get in just walk in the door and ask! Don't call, you have a much lower success rate calling. We've gotten most of our accounts this way.
It's basically free money for the company so most managers jump at the chance. Roll the coins yourself and banks will take them straight up. The local bank actually calls my father when they're low on singles and quarters. Mechanical maintenance is a big part of the job. If there's a major problem it's usually a bad motor or bad circuit board. Manufacturers are usually eager to help.
You get a feel for each account. Some need to be filled 3 times a week, some once a month. Go often right after you get an account and you can usually tell how often they need to be filled.
I can't stress this enough! Companies consider vending machine people interchangeable. The best way to make yourself non interchangeable is to make friends. Talk to everyone who walks by when filling the machine. Introduce yourself to everybody. Try to learn when factory workers go on break at each factory. Be there at break time as much as possible. You want to be the local guy that everyone knows. If you have a family, stop by to check the machine with your little kid in tow.
Nobody kicks out the guy with an adorable little child to support. This also has the added bonus of getting suggestions for products. If possible fill these requests. You'll not only make more sales, but you'll make people like you making you less dispensable. Don't deal with unreasonable customers. If someone want's you to buy all brand new machines simply walk away. Lot's of places like this will kick you out in a year when someone else offers to buy newer machines and now you're stuck with the bill.
Price things to the nearest quarter if possible. If you sell soda for 70 cents your exact change light will go on quickly when the machine runs out of nickels. Better to go For some reason the new fad is health conscious food in vending machines.
Don't fall victim to this. Put a couple rows of peanuts and trail mix in, but have mostly Doritos and Oreos. People are fat and want fatty things. Product, fuel, and labor costs are rising, eating into already thin margins. Vending has typically been successful serving the blue collar demographic, but with the decline of manufacturing here in the US, the industry has seen a decline over the past few years.
It's a really serious issue in the industry. Get controls in place as early as possible, so once you start hiring people you'll know where every candy bar and dollar bill went. Utilize tools to help you run your business. This industry is very old school, mostly family owned and operated for decades.
Their owners are typically middle aged or close to retirement, and are either looking at selling Canteen, the lb gorilla in the industry is going around swallowing up companies left and right or handing down to the next generation.
Check out Vendors Exchange for used equipment, they're a bunch of good guys. The industry trade association is NAMA, the National Automatic Merchandising Association, they have a big show once a year in the sping time.
I agree it's a problem, but you have to go about it right. We've been trying to push higher profit margin products of late. The best decision we made was switching out large E's for Subaru hatchbacks. It takes a little more planning when you fill the truck in the morning, but the gas savings are nice. We've done a lot of switching towards office buildings, especially since I live in a state where manufacturing is in free fall. They don't pound the chocolate stuff as hard, but they do a fair job of it.
In regards to commission we just try to stay honest. I've seen a few guys who want to watch us count out the money, but most just trust us. We've been outbid like that before but it hasn't been a major problem. I honestly know very little about bringing people in.
Except for a few guys here and there we've been family operated my entire life, like you said it's very common. It's basically my father's business but he worked his sons during the summers and breaks from school, and now that we're adults I just cover him for vacation every once in awhile. As a one man operation you can make a good living off it, but it's long hours and little vacation. My father has done pretty well doing it. I forgot that little pro-tip! We've been doing that for years too.
It's a good gig. The only problem with it is you can only put their products in the machine. If the account is fine with that then it's the best way to go, and most accounts don't really care. We've gotten more than a few accounts by owning the machine and offering pepsi and coke products though. Best way to start is to find a route for sale on craigslist. Typically the machines will be cheaper used and you get placements ready to go.
Ask to see the books.
Personally I think they contribute to Obesity, so if you consider everyone around you eating more junk profitable. For instance, some school districts ban vending machine in the cafeteria. It can be argued that kids are more "vulnerable".
I don't personally smoke, but would not object to someone else choosing to as long as I'm not affected e. If someone chooses to eat bad food, I wouldn't object either. Does the US have an obesity problem?
Healthy You Vending Truth About Healthy You Vending Complaints
No doubt we do, but I wonder if we can fix the problem by making people conscientiously choose to eat healthy, rather than by artificially restricting their choices of unhealthy food.
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Finally completed and launched our free app Whatsinit? Have any of you tried influencer marketing on Instagram to sell your product? If so, how did it go? A quick list of main technological trends these days - is anything missing? This is an archived post. You won't be able to vote or comment. Entrepreneur submitted 3 years ago by x I was thinking that vending machines might be a nice investment for someone who doesn't have a lot of free time. Here is a few of my questions: Is it actually profitable?
Where is a good place to put them? How do you go about getting approved to put them there? How much maintenance is involved? Any information is appreciated! If you have any more questions PM me. I assume they take their cut by charging the banks because I keep my full 3.
Certain banks have coin machines that have no processing fees. Buy used vending machines. It's totally not worth it to buy new if possible. Any other questions feel free to ask me! You also sound like you've worked in the industry.
Pepsi and Coke bottlers will loan you machines in exchange for buying product from them I forgot that little pro-tip! Note-I've looked into it, but I haven't done it. Posts are automatically archived after 6 months.