4 replies to this topic

[Three Kids]

I am looking at an opportunity to get into snack and soda vending by purchasing an existing business in the town I live in. There are 50 machines total, split just about equally between third party vendor machines and those owned by the business. Machines are in good condition with some in really good locations, some in good only locations and some in OK locations. Gross Sales for the past three years have averaged $80,000. Machine and other assets total $30,000 in value. Asking price is $46,000 but I can get it for less, how much less I don't know yet, as seller is motivated due to moving out of area.

Any thoughts, suggestions, questions, etc. by those with experience will be greatly appreciated.

[RJT]

I am looking at an opportunity to get into snack and soda vending by purchasing an existing business in the town I live in. There are 50 machines total, split just about equally between third party vendor machines and those owned by the business. Machines are in good condition with some in really good locations, some in good only locations and some in OK locations. Gross Sales for the past three years have averaged $80,000. Machine and other assets total $30,000 in value. Asking price is $46,000 but I can get it for less, how much less I don't know yet, as seller is motivated due to moving out of area.

Any thoughts, suggestions, questions, etc. by those with experience will be greatly appreciated.

Based on those numbers you are only looking at a $31.00 a week gross revenue per machine, that is not good.

How are you determining the value of the assets?

Are you getting 25 total machines that you will own?

Do you have a complete asset list with make and model of each machine?

Age of equipment?

What is the pricing of product like?

How is the gross revenue being proved?

Deposits?

Receipts of purchased products for the past three years?


Even being able to answer all the questions I asked I would pass on the deal myself. The revenue is just not high enough and not enough assets in the deal. With 50 machines I would want to see closer to 160k plus in gross revenue.

[RJT]

Dbl post...sorry

[Three Kids]

Based on those numbers you are only looking at a $31.00 a week gross revenue per machine, that is not good.

How are you determining the value of the assets? Right going off of what seller has provided and stated that they used what they bought the machines for four years ago in addition to asking prices off internet sites-not sure which ones.

Are you getting 25 total machines that you will own? Yes

Do you have a complete asset list with make and model of each machine? No. What other than make and model can you get from a machine, i.e. year?

Age of equipment? See above.

What is the pricing of product like? Average price seems to be around 1.00.

How is the gross revenue being proved? I have three years T/R and three and a half years of bank statements. Sales per T/R had reached $122 one year. They have lost some accounts due to businesses closing and 2-3 to competition.

Deposits?

Receipts of purchased products for the past three years? Is this just to determine product costs??


Even being able to answer all the questions I asked I would pass on the deal myself. The revenue is just not high enough and not enough assets in the deal. With 50 machines I would want to see closer to 160k plus in gross revenue.

This business is located in a town with a population of 7,000 with just a few businesses/plants, etc. with more than 30 employees so I think reaching weekly gross revenue per machine of $60-$75 is probably unrealistic. One of these machines is in building where I work and we have noticed for months that it has not stayed stocked, which has what got me interested in inquiring about a possible sale. Business was bought four years ago with idea that it would be sole income for family. It was not so the husband took job and wife has worked the business. I do not think it has been worked like it could be. This would be a second income for my family with my wife working the business. She has marketing degree with experience running routes for Pepsi and brother 25 years with Coke running routes. No doubts that we could improve the business. We're just trying to figure out how much we can profit out of it monthly. Still in the process of gathering informatin such as talking to current customers and to Coke and Pepsi contacts about their relationship with this business.

Your thoughts and questions are appreciated.

Thanks

[Three Kids]

This business is located in a town with a population of 7,000 with just a few businesses/plants, etc. with more than 30 employees so I think reaching weekly gross revenue per machine of $60-$75 is probably unrealistic. One of these machines is in building where I work and we have noticed for months that it has not stayed stocked, which has what got me interested in inquiring about a possible sale. Business was bought four years ago with idea that it would be sole income for family. It was not so the husband took job and wife has worked the business. I do not think it has been worked like it could be. This would be a second income for my family with my wife working the business. She has marketing degree with experience running routes for Pepsi and brother 25 years with Coke running routes. No doubts that we could improve the business. We're just trying to figure out how much we can profit out of it monthly. Still in the process of gathering informatin such as talking to current customers and to Coke and Pepsi contacts about their relationship with this business.

Your thoughts and questions are appreciated.

Thanks