Commercial machines give great returns!
We have sold all types of vending equipment starting in 1968 (including mechanical, bulk machines and other lightweight units). Please take the time to read this page completely and you will see why we now only sell refurbished commercial grade equipment. We have many successful customers, large and small that have bought from us year after year. Our refurbished vendors give you the best return on investment and allow you to be able to build a business that you can operate for many years. In an uncertain economy where a traditional savings account earns almost non existent interest, we have many new customers that have gone into the vending business. The vending business is the largest (legal) cash business in the world today, where you receive your profits in cash every time you fill your machines. Your rate of return is obviously dependant on how good your locations are. With a little work and investment in equipment very good returns are possible compared to traditional savings which doesn't even keep up with cost of living increases today. Vending is after all the largest (legal) cash business in the world. You never have to worry about people owing you money and taking 'bad checks' as in a traditional business. As soon as you place your machines you start earning money. Every hour that your location is open customers have the ability to buy from your machines!
Combo vending versus 'Commercial Grade' Vending Machines
Many sellers that used to hype 'bulk' vending are now
starting to push lightweight Combo vending machines. They do this because most
of these machines are made in China for very little cost, and their profit
margins on these units are huge. The latest trend in these
combo machines is to call them 'Healthy machines' We just had a customer call us
that bought these combo machines off of one of the new 'Healthy websites' and
said he paid about $8500 each, yes hard to believe that people would pay that
much for these machines. What they fail to realize is that you can vend 'Healthy
items' in any vending machine and usually a machine filled with only 'Healthy
items' will not sell enough products to the general public. Like it or not
people want a choice in vending products and will not always make the healthy
choice when buying vending products.
Another issue with these Combo vending machines is the lack of capacity. Combo vending machines have a limited capacity, compared to full size commercial grade machines.
Customers will not allow you to wait until the entire machine empties out of products, so you usually end up servicing the machines when they need about 70-90 drinks and about 70-90 snacks. Some customers that own these have told us that by filling them before they look empty, their gross profit is as low as $50-$70 (based on a 50% gross profit) after buying product. With the high price of fuel and the current state of the economy, it is very difficult to make a profit on these machines, not to mention a very slow return on investment.
Compare this to a full size soda and a full size snack machine that you can empty and refill up to 300 sodas and up to 275 snacks without the machines looking empty. The difference translates to a gross profit of up to $285 (based on a 50% gross profit and selling a few energy drinks, for soda and snack) on an investment that is usually much less than the cost of one new combo machine. Many customers have had bad luck with these imported Combo vending machines that they call us all the time to try and get us to buy them. This is how we found out about the customer that paid $8500 each
Cashless vending, credit card readers
Another item the combo sellers will try and talk you into is cashless vending. While this sounds good on the surface, the processor charges a per transaction charge, as well as a monthly fee. Many smaller accounts don't warrant such an expense or the customers resent paying higher prices for the products to cover this cost. All of our 'late' model soda machines (MDB type) can accept cashless vending but before investing in this system make sure the volume is in the account. These 'low cost' credit card readers can always be installed on location in usually less than an hour with proper tools or by a service tech. In our opinion, a wiser investment would be to upgrade the bill validator system to a $5 upgrade at the time of purchase. This allows customers to use higher value bills to make purchases without the per transaction cost of accepting credit cards.
Bulk vendors versus 'Commercial Grade' Vending Machines
I have been asked on many occasions about all the 'hype' on 'bulk' vending units that people see all over the internet. The 'bulk' machine sellers will tell you that their machines are the best, have the highest profit and empty rate. The 'bulk' machine sellers like to sell these machines because most of them are manufactured in other countries like China, for very low prices and their sales markup is huge. These sellers pay incredible amounts of money every month in pay per click fees to be in the top pay spots on the most popular search engines. They will tell you how their machines empty at about $300, believe me, it is not that easy. These might do quite well if they are located in a bowling alley, a bus station or a shopping mall, but in the real world many people locate these units in small, out of the way places. Unless you are operating 'capsules' the food or gum in the vendor will probably get 'stale' before it is sold. The sellers of these tell you about the 'vast amount' of locations available, but in fact, many commercial or industrial locations do not like these type of units because they cause a mess, or vend gum that people drop or discard when they are done chewing it. We have been selling vending equipment for over thirty years. Years ago we used to sell 'bulk machines' as well as 'mechanical full size units'. We no longer sell either of those items due to the fact that when our customers would buy them, they would become unhappy with operating them very quickly. Usually within about 90 days from their purchase, most customers would ask to 'trade' these units back to us towards full size commercial grade equipment. By being around for over 30 years we have learned from these lessons, and that is why we now only sell refurbished commercial grade equipment. We still get customers to this day that buy these 'bulk' machines from online sellers and find they are not making enough money to earn a living. Many of our customers have small routes with 50 to 100 machines and are able to make a nice living, and we have part time customers with as little as a few machines that earn enough to supplement their paychecks from their full time jobs. How many pieces located you need to earn a living depends on how good your locations are, but that is also true of bulk machines as well. A full size can soda and snack machine has the potential to empty out at $800 to $1,000 for the pair, and a lot more people drink soda, eat snacks and candy every day than chew gum or buy capsule toys for their children. According to a survey in a vending industry related magazine, sales of vending products in a recent year were over 20 billion dollars for soft drinks, almost 9 billion dollars for snacks, and confections, but less than 1/2 billion dollars for all bulk vending combined. The 'bulk' sellers tell you that it is hard to compete with the national soda makers, such as, Coke, Pepsi, etc. This is not quite true, since these large companies do not operate snack vendors, and they only carry their own brands. By owning your own equipment you can 'cross brand' and operate multiple brands in your machines as well as providing snack machines that these soda makers do not operate. These huge soda companies also have huge overhead due to the high wages they pay their route drivers etc. I have seen small vendors take over some of the locations that the bottlers basically didn't want and make them into good locations for a small vendor without the large overhead.
(1) These 'bulk' machines 'Do Not' make change for dollar bills like commercial machines.
(2) These 'bulk' machines and lightweight combos can be easily stolen from a location due to their light weight versus commercial grade machines that weigh from 700 to 895 pounds each.
(3) When people are hungry they want more than a 'gumball' or a few nuts. They want a 'full size' candy bar or bag of chips, etc.
The benefits of having an all cash vending business.
Vending is the perfect cash business. There are no bad checks, credit risks, accounts receivables or other collection problems. Vending is the largest cash business in the world. When your machines are placed correctly they are paid for in a matter of months, not several years like most businesses. The vending industry is a growing industry that is developing at a very high speed. The vending industry is now considered as one of the most lucrative business opportunities in America.
Your new venture has immediate cash flow without lean years. Bulk machines versus 'Real Commercial Grade' Vending Machines for a small vendor without the large overhead.
Your income starts as soon as you place your machines on location. People have used vending machines day in and day out through times of recession, as well as times of inflation. According to surveys from national trade magazines vending continues to grow at the rate of over 10% per year and with no end in sight. The business can be started with a small investment and can gradually be expanded to almost any income you desire. While other businesses have failed due to the poor condition of the economy, higher interest rates, a slower real estate market, vending has continued to thrive. People in the industry say they expect 2010 and 2011 to be the best years yet for the vending business and small route operators due to the expected economic recovery that is long overdue.
Having a year-round business.
People drink beverages, eat candy and snacks every day of the year, in every city in the United States.
Vending machines do not cater to one type of person, everyone consumes food on a daily basis.
Vending is virtually recession-proof and nationally advertised products are always in demand.
Vending makes the ideal family run business.
Vending allows you to involve members of your family in a business with some major advantages. You can work with your children in an environment that lets you teach them good business practices and work ethics. If you have teenagers with a drivers license they can restock machines and the younger children can help count the money.
Having a business gives you flexible hours with lots of time off.
Once you have your vending machines are on location, they do most of your work. They are always on the job, displaying and offering your products for sale 24 hours a day, 365 days a year. Once you drive to the location it takes an average of 20 minutes, twice a month to restock products and collect money from the average full size vending machine.
Vending machines do not demand higher wages and require only re-stocking of fresh supplies on a regular basis.
You have a business with no personal selling required.
Vending machines do the selling for you, allowing you to work smarter not harder. Vending machines are always on the job, they are never late for work, they never take coffee breaks or call in sick. Vending machines do not insult your customers or give away your profits. Vending machines do not take bad checks, expired credit cards. They collect cash at the time of sale and then deliver the product immediately.
You have a business with no rent, utilities, etc. to pay.
With a small route you can work out of your home, instead of an expensive office. Your machines are placed in business locations that already have customers and they pay the overhead. You are your own boss and can work at your own pace.
Having a business with no employees to pay.
By filling the machines yourself there are no employee wages to pay along with all the other employee based taxes or employee insurance.
New machines versus refurbished
We used to sell new machines as well as reconditioned. We no longer sell new for the following reason: According to a recent survey of vending operators about 93 out of 100 potential vending accounts do not make enough revenue to warrant the cost of new equipment. New machines are great if you have high volume accounts, but most people do not have these accounts. Typical cost on new 'commercial grade' machines run as much as: Can drink $3400-$4800, Snack $3600-$4500, Cold food $7200-$8500, as you can see quite high compared to used or refurbished. Priced with mech and validator, typical options, vendor pricing, not including sales tax or shipping in some cases. Please remember 'anyone and everyone' can call their machines refurbished but what does that really mean? Please see our machine ratings page for what we actually do to our machines. Many of our competitors don't even 'clean or paint the inside' of the machines.
If you set up a new account with a 'NEW' can drink, snack and cold food machine it you would have to gross almost $600 per week to pay for the equipment is 1 year or less. Based on 50% gross profit on item vended.
By comparison if you purchased a B or C-rated can drink machine you would only have to gross $30 per week to pay for it in one year. If you set up a new account with a reconditioned can drink, snack and cold food machine it you would only have to gross about $190 per week to pay for the equipment is 1 year or less. Based on 50% gross profit on items vended.
It hot climate areas of the country we have heard of vending operators paying for their can drink machines in as little as one summer in the right location. Remember the key to success is to make your money stretch as far as it can. This is why you should only buy what you need for the location. If it is a small account do not buy an expensive machine. In many factory or industrial warehouses you can use a B-rated model machines.
Start small and grow as you can afford it
Many people start in the vending business without much knowledge. This can hurt you financially if you are not careful. All of the machines that we sell are full size, commercial machines. There are many machines that are made that are small, countertop or mechanical coin acceptance. These machines are fine if you are a housewife looking to make a little extra money on the side. We used to sell those type of machines and no longer do. The main reason is that people who were serious about vending would out grow these type of machines in several months. There are two main problems with the small mechanical machines. One problem is the machine does not make change or take dollar bills. The second problem is that the machine will 'work you to death'. Most of these machines hold under 100 products and can only gross $40 to $50 at a time, if the entire machine empties out. This is only the gross, the profit is less than 1/2 of that amount. A full size commercial machine on the other hand usually holds 350 to 600 products and empties out at $250 to $500. Remember you spend the most time driving to the location so you might as well fill 500 products as soon as 50.
If you are just starting you might want to start withCAN VENDING machines. These are the easiest, most trouble free machines to start with. Basically you just load cans in the machine with most machines holding between 6 and up to 10 flavors of drinks. We offer 'B' rated, refurbished can drink machines starting at$795 each (sometimes with rolling sale items we have these machines as low as $695 each). Click on link to see some of these machines. If the locations that you have secured are small or industrial type these$795 machines should do the job for you in many cases.
SNACK machines are the next best item to operate. They require a little more work because you are filling 30 to 40 different products. If merchandised properly these machines can have high returns.
FOOD machines would be my last choice for new vendors. They require almost daily filling due to spoilage of food items. You should only consider operating FOOD machines if you have an extremely large account.
Many people use cold food machines turned to a lower temperature instead of frozen machines due to the fact that cold food machines are usually more reliable and do not require a microwave to heat the food.
Industrial locations-These are nice because the machines are considered a courtesy for their employees. Because of this fact many industrial do not ask for or require a commission. Usually 10 people or more is good for a lower cost machine. Many of these machines can be located in warehouses so a$795 or less machine is usually sufficient.
*Car dealerships-Most always are good locations but require refurbished equipment to be competitive. Usually you would need an 'A' rated, probably a$1495 machine in a large high image dealership. These type of locations usually request commission of at least 10%. *In today's economy make sure you are dealing with a strong dealership that has a good lineup of vehicles. Many domestic dealerships are suffering these days due to poor sales. Survey the dealership prior to placement and make sure you actually see customers on the lot.
Misc. Retail-Usually good locations but require refurbished equipment to be competitive. Could maybe get by with a$795 machine or$995 if location is a little upscale or in their waiting area. These type of locations usually request commission of at least 10%. These may include: Lube and tune, tire stores, auto parts, brake shops, etc. try to make sure that they have a waiting room and people waiting for their cars, etc.
Apartment Buildings-Are almost always are good locations but require refurbished equipment to be competitive. Make sure that machines are secure in these type of locations to prevent break ins. These type of locations usually request commission of at least 10%.
Mobile Home Parks-Are almost always are good locations but require refurbished equipment to be competitive. Make sure that machines are secure in these type of locations to prevent break ins. These type of locations usually request commission of at least 10%.
Suggestions for possible vending machine locations:
• Car dealership* (see above)
• Telephone answering service
• Apartment complex
• Youth center
• School teachers lounge
• Tire store
• Hardware store
• Lumber yard
• Nail store
• Hair salon
• Feed, grain store
• Brake shop
• Brake shop
• Trade technical school
• Job placement center
• Glass store
• Pet store
• Dog kennel• Lube, tune up center
• Industrial building
• Factory, production facility
• Machine shop
• Distribution center
• Barber shop
• Muffler shop
• Vocational training center
• Amusement arcade
• Thrift store
Possible financing source for small vendors:
Any customer that wishes to acquire your equipment and inventory can obtain 100%
financing. Our business loan program is available to any business that is a year
or older, credit score of 500 or higher and gross revenue of $15,000 per month
or more. Fast credit decisions and funding within a week. Please contact us for
FINANCE SOLUTIONS OF AMERICA LLC
Are you a startup or new to vending? If so please click on link below to go to out general financing page for other options
We used to operate vending routes so we have quite a bit of experience in this field. We eventually had to stop and focus on sales of machines. Vending can be a very profitable and long term business. Many people like vending enough to make it a lifetime career. We hope that information on this page has been of help to you in your decision to start in the business of vending. If you do not have luck with the locating companies listed below you can try placing your machines yourself:
(1) If you currently work at a job try there first, many times an employer would rather have an employee do the vending service.
(2) Make up a proposal of your business with brochures etc, and then presenting them to new or existing locations.
(3) Go to your friends or relatives and offer them an incentive payment to get you into location where they work or know someone.
(4) Get a list of new businesses that have applied for a business license from your local city of county. Many cities and counties sell these lists at a reasonable fee. Once you have the list solicit in person or mail a proposal to the location prior to opening. Emphasize that you are a smaller company and that you can provide better service than the national vending companies. This is true in most cases and large vending companies lose accounts to smaller companies all the time due to poor service and the fact that they only offer their brands.
(5) Try targeting a certain type of business (such as motels) and send mailers with your brochure and stress the smaller vendor approach.
(6) Watch for 'out of order' vending machines, talk to the store owner, if this is a chronic condition they may give you a try.
(7) Thinking a little larger? Try a bulk mailing service that will insert you ad or brochure with many others from different types of businesses.
This page was updated 5/19/13