6 replies to this topic

[cash flow]

I'm thinking about entering the business. I'm currently doing my research and trying to cover as many angles as possible. Of course I realize nothing can replace actual real life experience and doing the job myself.

Ideally, I'd like to buy an established route. Of course, the diligence process to do so would be extensive as I would want to drive the route a couple of times and actually audit the money collected. Nevertheless, I love the idea of a cash business with attractive margins. But, here's my delimma; as much as I would love to buy a route with 50-60 machines I don't see how it would be possible to provide sufficient service to customers and do this on a part-time basis. This would seem to require a full time commitment no?

I would be really interesting in hearing from the veteran vending owner/operators on (1) what type of commitment would be involved in managing an operation with some (albeit very, very minor) scale. (2) what is the path to a high level of prosperty in this industry - is an independent wealth a dream? If so, what are the biggest impediments? If not, what are the keys to growing a highly successful vending business. Has anyone built a $1,000,000 business?

[jblvending]

I'm thinking about entering the business. I'm currently doing my research and trying to cover as many angles as possible. Of course I realize nothing can replace actual real life experience and doing the job myself.

Ideally, I'd like to buy an established route. Of course, the diligence process to do so would be extensive as I would want to drive the route a couple of times and actually audit the money collected. Nevertheless, I love the idea of a cash business with attractive margins. But, here's my delimma; as much as I would love to buy a route with 50-60 machines I don't see how it would be possible to provide sufficient service to customers and do this on a part-time basis. This would seem to require a full time commitment no?

I would be really interesting in hearing from the veteran vending owner/operators on (1) what type of commitment would be involved in managing an operation with some (albeit very, very minor) scale. (2) what is the path to a high level of prosperty in this industry - is an independent wealth a dream? If so, what are the biggest impediments? If not, what are the keys to growing a highly successful vending business. Has anyone built a $1,000,000 business?

[jblvending]

I'm thinking about entering the business. I'm currently doing my research and trying to cover as many angles as possible. Of course I realize nothing can replace actual real life experience and doing the job myself.

Ideally, I'd like to buy an established route. Of course, the diligence process to do so would be extensive as I would want to drive the route a couple of times and actually audit the money collected. Nevertheless, I love the idea of a cash business with attractive margins. But, here's my delimma; as much as I would love to buy a route with 50-60 machines I don't see how it would be possible to provide sufficient service to customers and do this on a part-time basis. This would seem to require a full time commitment no?

I would be really interesting in hearing from the veteran vending owner/operators on (1) what type of commitment would be involved in managing an operation with some (albeit very, very minor) scale. (2) what is the path to a high level of prosperty in this industry - is an independent wealth a dream? If so, what are the biggest impediments? If not, what are the keys to growing a highly successful vending business. Has anyone built a $1,000,000 business?

Buying a Route has it's pit falls,I prefer that you build your own Vending Company.We started out building our own Company ,and after time bought smaller less profitable vending companies, more or less for there machines.It's one of the hardest business to own, because of all the problems that can and will happen.To do part time, I'd limit my machine count to 25 machines, anything over 50 would require you to run full time.The cash seems like a draw for many folks, but it can quickly turn into a money pit if you don't know how to toubleshoot, repair, and replace parts and machines.The 1,000,000 is a nice goal, to get to that amount you would need about 225 machines at an avg collection of $85.00 a machine a week, thats two route's made up of 112 per route.The deal with that million is that its not the amount you collect, it's the margins that you make,if you can't stay around 52% gross profit, it will be hard pressed to stay profitable.

[cash flow]

Buying a Route has it's pit falls,I prefer that you build your own Vending Company.We started out building our own Company ,and after time bought smaller less profitable vending companies, more or less for there machines.It's one of the hardest business to own, because of all the problems that can and will happen.To do part time, I'd limit my machine count to 25 machines, anything over 50 would require you to run full time.The cash seems like a draw for many folks, but it can quickly turn into a money pit if you don't know how to toubleshoot, repair, and replace parts and machines.The 1,000,000 is a nice goal, to get to that amount you would need about 225 machines at an avg collection of $85.00 a machine a week, thats two route's made up of 112 per route.The deal with that million is that its not the amount you collect, it's the margins that you make,if you can't stay around 52% gross profit, it will be hard pressed to stay profitable.

Thanks for the response!

Some questions though:
1. What makes the business so hard?
2. I'm not that handy in terms of repairs - is this a major problem?
3. How many machines do you own? How many workers do you employ?
4. What factors beyond inventory reduce the gross profit margins?
5. Is there any new technology that would change the industry?

Thanks in advance.

[marks_vending]

Thanks for the response!

Some questions though:
1. What makes the business so hard?
2. I'm not that handy in terms of repairs - is this a major problem?
3. How many machines do you own? How many workers do you employ?
4. What factors beyond inventory reduce the gross profit margins?
5. Is there any new technology that would change the industry?

Thanks in advance.

1. Finding location is the hardest I find
2. You will learn to get handy as you go along. You can't always afford a $50 or $75 an hour service call plus parts.
3. I own 30-40 machines and run the business myself. This way you know the work is done properly, and the profits are yours.
4. Gas mileage of your vehicle. Fresh product. Even though bagged items are still fresh past their expiry date, people see that date and think all items are stale and outdated, keeping them away.
5. The newest technology that I am aware of is the machine part that now hooks up for debit and credit cards. This is not profitable unless you are in a massive contract with tons of machines, because you have to pay a percentage on each transaction, which cuts into your sales

[cash flow]

Thanks!

Have you grown your route organically, or have you acquired some machines?

Do you work full-time on your route, or do you have a day job? Would you advise this as a full-time job? What are your goals in terms of growth?

You seem to be the kind of operator I want to be that's why I'm so interested in your views.

Thanks again.

[marks_vending]

Thanks!

Have you grown your route organically, or have you acquired some machines?

Do you work full-time on your route, or do you have a day job? Would you advise this as a full-time job? What are your goals in terms of growth?

You seem to be the kind of operator I want to be that's why I'm so interested in your views.

Thanks again.

I found my first machine/location on a website called kijiji. Then by fluke a business came available and I bought that. I place free ads on kijiji advertising my services and I also mail out flyers and a business card to businesses in my area (that works about 1 location for every 100 I have sent out, but that's pretty good considering it cost me a stamp)
I have around 30 machines and 20 locations.
I have a day job, I set aside 1 day a week for vending, and on a weekend 1 day I get supplies. The vending is fun, doesn't seem like work. To get supplies is like 2 hours tops, and that's every other month, I buy alot at one time. So it takes me about 4-5 hours a week all inclusive. In terms of growth my goal is to ad 1 machine per year if I can (it's a hard business to expand in) I also try to upgrade 1 machine per year (a smaller pop machine for a larger one) This allows me to show up every 2 weeks instead of every 1 week, becoming more efficient in terms of time actually spent on the route. Then I sell my no longer used machine on kijiji and that helps pay for the larger one. Every other week I spend about 2 hours on the route, as I have allready upgraded the machines for larger ones. My goal is to be able to only have to service the route 1 day every 2 weeks, that allows for great efficincy, saves gas money, and for the amount of time actually spent serviceing the route, it is a great return on the $$$. But it all starts with one machine right. All the best,