Vending Machine Business
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Thread: Vending Machine Business

  1. #1
    Senior Member KaeJS's Avatar
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    Vending Machine Business

    What do you guys think of owning a vending machine?

    It looks like it takes (realistically) one year to break even.

    Assume you spend $1,500 and can earn $25/week. It would take 60 weeks before you actually cover your costs.

    However, after those 60 weeks, you've got $100/month. Double your money in just over 2 years?

    I can see how they make money. I can also see how they'd fail. Ideally, I look at it as a buy and hold investment. Your only real problem will be if your machine breaks or is vandalized.

    Stupid Idea? Smart Idea? Takes a long time but definitely makes money idea?

    In particular, looking at this:

    http://www.vending4less.ca/page4.php...=37&category=0


  2. #2
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    I thought about it myself and asked a few people who used to have machines. They said the hard part is getting locations and keeping them. The location usually wants a cut and other vendors want your spot.

    If I could by an existing route I would consider it. I'm not much of a cold caller so I'd probably have a hard time securing locations.

  3. #3
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    Seems like the margin is really low(id almost think delievering news papers are better than vending machines)also do have to stock it(im guessing yes?dealing with a all coins business might be a huge pita,do you have to get insurance in case some teenager decides to tip it over and injury someone?what about maintence cost?if the electrical button stick/dye?,theft-is there tricks of getting the product without putting coins in?(those old school coil ones,where you can shake it)doesn't seem worth it.....also it would seem like your not really realizing profit because the profits would be constantly be back re-investing in your orders.

    Having said that i know a guy who works at pepsi-if you ever do get into it-the energy drinks line is apparently the product that sells the best(ie monster)he told me they sell a crap load because of the popularity and there is a good spread between supplier acct to retail.

  4. #4
    Senior Member leoc2's Avatar
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    I new a guy who had several ATMs. He seemed to be wealthy.Nice house and car. He unfortunately passed away a couple of years ago.

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    As jcgd mentioned the hardest part is getting locations and keeping them. I had some machines in the 90's and you had to out bid other companies to get the location to start with. Then of course you have to clean and maintain them and show up every other day to stock them and make sure none of the chips and candy hang up on the coils. Saying all that it is not hard work, but after paying for the location and such it will take longer to get your money back and make a profit.

  6. #6
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    Another big problem is the theft... I knew people who had vending machines at universities and the like and they were always getting broken into or stolen... especially the cashbox.

    They still made money but by the time you pay for expenses, time, hassles (the #1 favorite item is sold out but the rest isn't, but they still expect you to come fill it), it's not the greatest margin according to them.

  7. #7
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    My parents use to own a vending machine company. I think they lasted about 2 years. It was a lot of work, we had about 10 machines and were constantly restocking them. I don't think it is worth the hassle unless you have a ton of machines and do it full time.

  8. #8
    Senior Member KaeJS's Avatar
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    Yeah, I think the greatest hassle is going to be restocking.

    I'm starting to think its too much of a long road....

    You have the cost of stocking, then the cost of gas to drive there and stock it.

    I think if I could get a location close by, or a location that I go to or pass by once a week, I would do it.

    However, I can't see myself driving a different way to restock and collect money. I want this to be an "on the way" thing.

    I don't want it to eat up any extra time or any extra costs.

    All about the location

    Thanks for all your input, CMF'ers.

  9. #9
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    I think the biggest problem is location.
    Where do you think you are going to put it? on a street corner?

    reminds me of a 30 Rock episode:
    Dennis: One word. Coffee. One problem. Where do you get it?
    Liz: Anywhere. You get it anywhere.
    Dennis: Wrong. You get it at my coffee vending machine. 38th and 6th in the basement of the Kmart.


    I suspect it's one of those deals where you would be shocked at how little your competition is willing to work for to put you out of business.
    Last edited by hystat; 2012-02-12 at 11:42 AM.

  10. #10
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    Talking

    Quote Originally Posted by KaeJS View Post
    Assume you spend $1,500 and can earn $25/week. It would take 60 weeks before you actually cover your costs.

    However, after those 60 weeks, you've got $100/month. Double your money in just over 2 years?
    You haven't factored in the cost of product (50% of sales ?), gas and other costs to service the machine, repairs and maintenance costs, spoilage and shrinkage, bank fees (possibly credit card and internet fees), inventory, return on investment, rent/electricity, moving costs to relocate/deliver machine.

    As well, I have heard that later this year, the CDN Mint is rolling out new $1 and $2 coins, and the that many vending machines will need to be upgraded to be able to recognize the new coins.

    http://www.vending-cama.com/NEWTOVEN...ancing-Act.pdf


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