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Starting or Buying a Vending Business

1,827 Views | 5 Replies | Last: 6 yr ago by rlb28
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InMyOpinion
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Been doing bulk candy, gumball and toy machines for years. Did snack and soda for a couple years. Never tried video, cranes or redemption style games

How do you build up a portfolio of locations? Pay a locator or hit the streets and be a salesperson. I do a little of both. Occasionally the locator gets a good one but I have better results when I secure
Locations.

How do you value the business where so much of it is cash? No sure what your asking here

What is typical for "rent" or a landlord cut? I typically pay 25% of sales to owner. However I do have a number of locations that don't charge anything

Would love to learn more from anyone with experience.

I enjoy it most of the time. Like anything it has its good days and bad. You deal with theft and vandalism from time to time. If starting now I would stay away from candy/food/drink unless you plan on going all in. Food costs are way too high for a "part time" gig. Everything sounds good at first but once everyone gets there hands in the pot for commission, taxes, fees etc you have to have some pretty high traffic locations to make it worth it.

Be careful about the equipment you purchase. A broken machine doesn't generate income and nothing sucks more than having a machine break right after you service it, no one lets you know and you show up 30/60/90 days later with very little in the cash box.

I'll try to answer any other questions you have any.

RogerEnright
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Quote:

How do you value the business where so much of it is cash?
If you are considering an "exit", I dont' think you get much value from it.
tamutaylor12
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InMyOpinion said:

Been doing bulk candy, gumball and toy machines for years. Did snack and soda for a couple years. Never tried video, cranes or redemption style games

How do you build up a portfolio of locations? Pay a locator or hit the streets and be a salesperson. I do a little of both. Occasionally the locator gets a good one but I have better results when I secure
Locations.

How do you value the business where so much of it is cash? No sure what your asking here

What is typical for "rent" or a landlord cut? I typically pay 25% of sales to owner. However I do have a number of locations that don't charge anything

Would love to learn more from anyone with experience.

I enjoy it most of the time. Like anything it has its good days and bad. You deal with theft and vandalism from time to time. If starting now I would stay away from candy/food/drink unless you plan on going all in. Food costs are way too high for a "part time" gig. Everything sounds good at first but once everyone gets there hands in the pot for commission, taxes, fees etc you have to have some pretty high traffic locations to make it worth it.

Be careful about the equipment you purchase. A broken machine doesn't generate income and nothing sucks more than having a machine break right after you service it, no one lets you know and you show up 30/60/90 days later with very little in the cash box.

I'll try to answer any other questions you have any.




Awesome info. I literally have zero knowledge of this business. A few general questions. How much does a typical machine cost? How often do you check it? How much money on average is there each time you go by?
InMyOpinion
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These answers are for bulk vending - capsule toys, candy, stickers, tattoos etc. so they will be different than machine your looking at but can still give you an idea.

How much does a typical machine cost?

The range varies for new equipment. I have singles, doubles, and triples which can range from $75-$250 and toy/sticker racks which have 5-9 selections and run $400 and up. I'm always on the lookout for used bargains. Lots of still "new in the box" machines collecting dust in garages everywhere. I built most of my 100+/- location route this way

How often do you check it?

Each location is checked every 30-90 days. I have a spreadsheet that estimates what is in each machine based on past collections and how long it has been since the last service. In general high producing locations get checked every month the rest get serviced when there is at least $30 or they get to 90 days.

How much money on average is there each time you go by?

My monthly average per location ranges from $5 per month to $150 per month. Things can change quickly by loosing a great location, adding a new high producing location or just a change in employees. Had an office break room with 8 employees that was doing $35 per month for 2 years, 1 employee left and it dropped to $15. This one employee was worth $20 per month.

It can be a lucrative cash business but honestly requires a lot of work. I can also say from experience loosing your top location is like a punch in the gut. 99% of the locations I loose are completely out of my control.
Dr. Doctor
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AG
A guy I work with buys about 2-3 items per day (M&Ms, chips, etc.)


I can totally see losing $20 or more a month with one employee. He said on a project one time, M&M's would be gone in a week; they only restocked once a month. Everyone wanted products, but they never filled them up.

~egon
rlb28
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AG
I ran a small vending business in the late 1990s. There was no licenses, fees, etc... I had snack and drink machines in a newspaper (24-hour operation), police station (24-hour operation), courthouse, car dealership and a huge setup in a regional 20-acre plant nursery that supplied to Walmart. I'll be honest, it's an all cash business, so.... you figure that part out about the taxes.

It was a lot of work and it was my side job, but I made a lot of money.

At that time I was buying the machines from Sam's Club for about $2,500 and financing them and paying like $85/month until they were paid off.

I would talk to the people in charge at the locations and most of the time I found out they weren't happy with their current vendor and I'd swoop in and get the location. I never paid a set amount to the person in charge, but I'd slip them cash once a week to keep them happy.

I moved my family after about four years of doing vending and sold the machines and route for about $30,000.
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