Vending machines have been around for a long time and today they are more advanced than ever. Starting off as simple coin operated machines requiring not electricity they have now advanced into highly sophisticated machines. Today it is not uncommon to stumble across vending machines offering all sorts of products from cans of drink to freshly made popcorn or coffee. And have moved from simple coin operated machines to accepting all forms of payment from coins, bank notes, eftpos and paywave, However these machines are highly priced and can sell for up to $12,000 brand new and are mainly used by confectionery companies as a form of advertisement rather than sale generating machines. Luckily for us the old machines are still available and you can easily pick up a used vending machine for around $300. On this page I will Show you how to take advantage of this old technology and turn it into profits.
The idea is simple enough to understand however I will fully outline each step to help you get started as well as show you a few number to help you work out how much revenue you should expect to produce.
THE 7 EASY STEPS
Step 1 - Save $500, Self Explanatory
Step 2 - Source Your First Vending Machine
Finding your first vending machine is a lot easier than you might think. I recommend sourcing your first vending machine using channels like eBay, local newspapers etc. You will most likely want more vending machines in the future so be sure to start creating a list of contacts. Their are a lot of different types of vending machines on the market to begin with I suggest choosing Bulk Vending Machines, these are the ones you see outside newsagents, video stores and fish and chip shops. They usually sell small capsules with toys, gumballs, bounce balls etc. They can usually be picked up for around $150 used.
Step 3 - Sourcing Stock
For drink machines go straight to large department stores, they usually sell slabs or cans at a loss to get people in their store. Once you have acquired more machines go straight to the sales reps for the drink companies they will usually do a good deal on bulk quantities. If your going for bulk vending machines go straight to eBay you can pick up 1000 bounce balls for around $50 the capsule toys are about the same price and gumballs are around $30 for 1000. Remember to keep a list of contacts as your vending machines numbers increase you can send a message directly to the seller and ask for bulk quantities and will usually receive around a 15% discount.
Step 4 - Finding The Right Location
Chose the right location, their is not much I can help you with here as you really need local knowledge, choose high foot traffic areas where their seems to be an under supply of vending machines. National companies and shopping centres are usually out of bounds as they want new vending machines and usually have the money to finance them themselves, try small business like video hire store, locally owned take away stores etc.
Step 5 - Dealing With The Business Owner
When approaching the owner of the business you need to remember they don't want their customers spending money outside their store as they would rather have the customers spend the money in their store. Try to avoid offering to place a drink vending machine outside of take away stores for example. You will usually have to offer a commission on sales to the store owner or a percentage of sales donated to charity with a sticker on the machine saying "We Support The Cancer Council" for example as this gives their customers a reason to shop their.
Step 6 - Maintaining Your Machine
Maintaining you machines is a lot easier than you would think, basic coin operated machines as I have suggested have proven track records for performance, occasionally a coin may jam or a member of the public might try and place some foreign objects in the coin slot. This is about the worst that can happen and is a simple fix. Show they shop owner how to clear the jam and you should have nothing else to worry about the refilling the machine and collecting the cash.
Step 7 - Automation - Create Income Passive
Their are several ways to automate the process of Refilling the Machines and Collecting the Cash, however I am going to show you how I have achieved this. I spent a lot of time deciding how to achieve this and I believe I have chosen the easiest and most cost effective method. My Method works by allowing the business owner to see the extra revenue for a few weeks while the machines where maintained by my staff after the initial breaking in period you can then offer the business owner a larger commission for him to maintain it. I offered 10% initially then waited for the income to cover the cost of the machine. After this I offer them 25% for him to preform the maintenance duty's, they are normally happy to do this. If they decline offer to rent the machine to them for approximately half the average income the machine generated each week. This option produces a little less money however by now the machine has paid for itself and free money is still free money in my book.
Crunching The Numbers
Below is a list of the two vending machines I reccommend to beguin with as well as a few stats
Bulk Vending Machine
Cost $200 - Expected Reveune $25 per week = 8 Weeks to pay for itself
Drink Vending Machines
Cost $700 - Expected Revenue $70 per week = 10 Weeks to pay off