Vending Machine Business Idea
The vending machine business is an important industry for increasingly active people who need this convenient option for foods and drinks.
This is a wonderful opportunity for generating “passive income” for continual cash flow.
Annually, more than 5 billion drinks and 8 billion snacks are sold through American vending machines. A Department of Commerce study showed that fewer than 5% of new vending businesses fail – compared to a 65% average for other small businesses.
The Economic Stimulus Act of 2008 has provided new tax deductions for the self-employed.
The vending machine business offers flexibility and independence to its owners. Other companies advertise the popular products sold in these machines, so there’s no need to worry about that.
All you need is to be physically fit and be able to meet three basic parameters: location, product and machines.
Vending offers a flexible schedule. Many start part-time and gradually build up their routes.
Available options include franchising or the purchasing of established routes. It should also be noted that this is a 100% cash business, which should make it appeal to many new entrepreneurs.
Developing A Business Plan
Develop a business plan for your forecasted expenses and revenue. According to experts, approximately 78% of your gross revenues will go to expenses, so after accounting for vehicle maintenance and repairs, be sure to factor this in to your plan’s calculations.
When you first start out, you should focus yourself on finding locations, acquiring equipment, and determining good product mixes. Later you can look into finding new locations and centering yourself on filling every one of your clients’ needs.
Also be sure to monitor the owners of current machine locations to see if there’s any way your company could improve the service they receive.
Expansion options include movie rental kiosks and medical device and candy machines amongst many others.
Your Vending Machine Business – Locations
The most basic sales task for the vending machine business is attracting good vending locations. Find a high traffic location or company with many employees. Bulk targets should include schools, hospitals and factories though the competition here is high and service expectations high.
Tailor your product mix to the specific business or venue you’re serving, and compare the pricing structures of your competition so as to be able to offer more competitive services.
Finding Good Vending Machines
Be sure to always seek out good-quality vending machines and vending supplies, and don’t ever buy what people aren’t looking for. With this in mind, also be sure to select attractive machines capable of drawing in customer interest.
Good machines are small, efficient, provide good product mixes, offer change and can display the newest products. Only buy used vending machines if absolutely necessary.
In dealing with your clients, small things such as providing a “Vending Company Service Form” and an efficient method of dealing with coin returns make you look professional. To reinforce this image, look at joining the Better Business Bureau.
If your vending machine business provides high-quality products and services, it can establish a good reputation, then use word of mouth advertising to generate long-term profitability for you.