27 replies to this topic

[Rocksolid]

Hi Guys,

Happy, health, and wealthy new year to all!!!

I found a route for sale. The route consists of 4 different stops. 3 are large and 1 is small. One of the large stops is just snacks and the other 2 large ones are snacks and soda. All 3 large routes net about 300.00 a month. The smaller stop is soda and gumballs and nets about 75.00 a month. The guy tells me he bought the machines brand new about a year ago and they are all mint. He said it takes one day to service the machines about 4.5 hrs from door to door. He is asking 3100.00 for each of the big stops and 500.00 for the small one. I told him I was interested in 2 of the big stops and he said he does not have much flexability in price then since he would still have to sell the other 2 stops and one of those are small, mabe a couple of hundred dollars. He said if I wanted all 3 big routes then he would throw in the small stop and I can have it all for 9000.00. It sounds good to me, but I wanted everybody's input.

[jblvending]

Hi Guys,

Happy, health, and wealthy new year to all!!!

I found a route for sale. The route consists of 4 different stops. 3 are large and 1 is small. One of the large stops is just snacks and the other 2 large ones are snacks and soda. All 3 large routes net about 300.00 a month. The smaller stop is soda and gumballs and nets about 75.00 a month. The guy tells me he bought the machines brand new about a year ago and they are all mint. He said it takes one day to service the machines about 4.5 hrs from door to door. He is asking 3100.00 for each of the big stops and 500.00 for the small one. I told him I was interested in 2 of the big stops and he said he does not have much flexability in price then since he would still have to sell the other 2 stops and one of those are small, mabe a couple of hundred dollars. He said if I wanted all 3 big routes then he would throw in the small stop and I can have it all for 9000.00. It sounds good to me, but I wanted everybody's input.

Help me understand, when you say $300 a month, is that per account, or $300 a mth total for those 3 large routes,and when you say net, is the gross around $600 a mth for these accounts?

[Rocksolid]

He told me that each large account is 300.00 net per month. I do not know what they gross, how important is that?

[BVI]

He told me that each large account is 300.00 net per month. I do not know what they gross, how important is that?

I would consider $300 per month per account to be very small and barely worthwhile, whether you're referring to gross sales or net. Net would be probably be your sales less sales tax and maybe commission... either way, it's not going to make that much difference unless your sales tax is sky high. I have a couple of snack and soda accounts that do $150 per week ($600 per month) and if they didn't do at least that much I'd be looking for better locations to replace them with.

If the location that does just snacks is grossing $300 per month, that's $75 per week. Assuming there is only one snack machine, then in my opinion those numbers are acceptable, not great, but acceptable. If there are two snack machines and that's all they do, I'd probably take a pass.

[Rocksolid]

I know it's not a lot of money, but I am just looking for a supplment to my regular job. I figure one day a week would be pretty easy to handle and it's better then taking a part time job after my real job. I would also try to grow the route a littel, but I am not looking for a large route, just something to bring in some extra money and not take up a lot of my time. We really could use the extra 600 or 900 a month depending if I take 2 or all 3 routes. Thanks for the comments, keep them coming

[Rocksolid]

Ok, I found out that the machines have a computer which records how much money has been put in the since the machine has been in use. He also told me he can show me some statements which will show how much money he has made, but not fully since he take some bucks off the top before the dept to the bank is made. He said he has a business license and recommends I get one. He said it is hard to say what his gross numbers are since he make 3X's on the chips and 2X's on the candy, but he took .30% and that is how he got to 300.00 a month net. I would really love more feedback. I relize that these machines are not making a ton of money and his asking price is also not a ton of money but to me and my wife, it's a lot and I want to make a good decision. Is his asking price too much or correct?

[coinvestor]

Ok, I found out that the machines have a computer which records how much money has been put in the since the machine has been in use. He also told me he can show me some statements which will show how much money he has made, but not fully since he take some bucks off the top before the dept to the bank is made. He said he has a business license and recommends I get one. He said it is hard to say what his gross numbers are since he make 3X's on the chips and 2X's on the candy, but he took .30% and that is how he got to 300.00 a month net. I would really love more feedback. I relize that these machines are not making a ton of money and his asking price is also not a ton of money but to me and my wife, it's a lot and I want to make a good decision. Is his asking price too much or correct?

What kind of machines are they. I would verify the age of the machines before you believe the dollar amounts on the non-ressetable counters. If you get serial numbers you can call the manufacturer and they will tell you the year model. If its a USI or Wittern machine the last five digits of the serial number is the date code (ie XXXXXXXX97XXX serial was manufacturered in 1997) assuming that its not a refurb. Check the year model to the date he said that he installed the machines. If this checks out then figure out the months on location and divide it into the total on the non-ressetable counter.

In general I try to gross 10% of my total investment (at a minimum) when I consider buying a location or selecting equipment for a new location. I also use this to figure out if the location will support new machines. So if I was looking to put machines in a location that I knew or suspected did $1000 a month then I could spend $10,000. Of course I always try to maximize my return and don't always spend that much, I just use this as a sanity check. I also know that this is lower than some vendors are willing to accept.

If I were looking at buy these locations, I would probably do it if everything checked out and the machines are really only 1 year old.

Just my.02

JD

[Rocksolid]

We took a look at one fo the machines last night. It looked really clean and he showed us how it works. I did not think to look at the serial #. The machine is a GF12 Snack machine drink combo. He showed us the notes he has been keeping and it showed that this location is doing about 400.00 a month and he usually nets about 300.00 so I guess he is putting about 100.00 a month of product into the machine. I asked if there was room to grow at this site and he said they have asked him about coffee, so at least if I buy it I know I might be able to get more business out of this location, but I hear coffee machines can be a pain. I need to walk before I run and worry about buying this route first, then coffee and other dtuff later. Does anybody kknow anything about this type of machine good or bad?

[alberta canada]

We took a look at one fo the machines last night. It looked really clean and he showed us how it works. I did not think to look at the serial #. The machine is a GF12 Snack machine drink combo. He showed us the notes he has been keeping and it showed that this location is doing about 400.00 a month and he usually nets about 300.00 so I guess he is putting about 100.00 a month of product into the machine. I asked if there was room to grow at this site and he said they have asked him about coffee, so at least if I buy it I know I might be able to get more business out of this location, but I hear coffee machines can be a pain. I need to walk before I run and worry about buying this route first, then coffee and other dtuff later. Does anybody kknow anything about this type of machine good or bad?

I'm not too familier with that type of machine, but the part that interests me is the margins... I operate in Canada, and have 50 combination pop/snack machines. I sell everything for a $1.00 and my chips cost me (after all taxes) about $.45, my chocolate bars $.65 and my pop (Coke/Pepsi) $.40. Averaging everything out, without my fuel and time spent to do the runs, I average about 45%-50% profit out of every dollar sold. Maybe the inventory is much cheeper in the states, but I cant see him making 75% from every dollar.

If the money he claims to make is $1000 every month, I would look at purchasing these machines but I would also ask about any contracts with the businesses as well. Some places want a cut of the profits. I try to stay away from those locations personally, but if they brought that kind of return I could see working out a deal.

Good luck with your decision

[alberta canada]

PS: If he is making $12,000 a year off of 4 machines that maybe cost him $12000 brand new, why would he sell them? I sure as heck wouldn't! This sounds like a case of too good to be true to me.

[BVI]

We took a look at one fo the machines last night. It looked really clean and he showed us how it works. I did not think to look at the serial #. The machine is a GF12 Snack machine drink combo. He showed us the notes he has been keeping and it showed that this location is doing about 400.00 a month and he usually nets about 300.00 so I guess he is putting about 100.00 a month of product into the machine. I asked if there was room to grow at this site and he said they have asked him about coffee, so at least if I buy it I know I might be able to get more business out of this location, but I hear coffee machines can be a pain. I need to walk before I run and worry about buying this route first, then coffee and other dtuff later. Does anybody kknow anything about this type of machine good or bad?

Rocksolid, the GF12 is an American Machine Corp machine, which is part of the Wittern Group, but everyone here refers to all machines put out by Wittern as "USI" machines. It is their cheaper line. I know because I have two GF35 snack machines, and though they are good machines, they lack some basic conveniences found in USI's better line (the HR-series snack machines). Because of this, I decided 2 of those machines would be enough for me. However, they ARE good machines.

With snacks, you generally have an average profit margin of 50%. That's what everyone typically makes, overall, if you keep your prices commensurate with other vendors. Some products make you a lot more money (like chips), others less (like candy). Same with soda. Cans make you about 50% to 55% margin, bottles are a lot less if you sell at $1.00. If a machine is producing $400 in revenue each month, then in your example, roughly $200 of it is product cost and $200 is gross profit. To arrive at your net profit, you need to back out your gas cost, bad product, refunds, machine cost, SALES TAX, etc... Now, if this guy is taking money off the top before he makes his bank deposit, then you really almost have to take his word for it in terms of what he is actually grossing (refer to his notebook). You might also accompany him on his next collection day and observe for yourself.

By the way, are you a Petra fan? I'm curious because I think I might know you.

[alberta canada]

I would consider $300 per month per account to be very small and barely worthwhile, whether you're referring to gross sales or net. Net would be probably be your sales less sales tax and maybe commission... either way, it's not going to make that much difference unless your sales tax is sky high. I have a couple of snack and soda accounts that do $150 per week ($600 per month) and if they didn't do at least that much I'd be looking for better locations to replace them with.

If the location that does just snacks is grossing $300 per month, that's $75 per week. Assuming there is only one snack machine, then in my opinion those numbers are acceptable, not great, but acceptable. If there are two snack machines and that's all they do, I'd probably take a pass.

Where in the world do you find locations that minimum make $150 a week? I bought a route with 50 combo machines a couple months ago and i was impressed that he had 7 that did over $200 a month. I don't have any with contracts, so I don't have to worry about commissions, but still the average of all my machines is probably in the area of $100.00 a month. What kind of locations are you using? I rely primarily on mechanical machines, so I use lunchrooms and showrooms of car dealerships, but there is no damage to the machines and less than 2% theft on average. I would be very interested to know more about your locations and numbers.

Thanks.

[Rocksolid]

Hi PVI,

Thanks for the input. I think I am going to buy at least 2 of these stops, maybe 3 and take a chance. I'd still like to hear opinions from other people about this though.
Petra - Is that the lost city or the model? Either way I'm not sure we know one another but it's always good to make a new friend

[BVI]

Where in the world do you find locations that minimum make $150 a week? I bought a route with 50 combo machines a couple months ago and i was impressed that he had 7 that did over $200 a month. I don't have any with contracts, so I don't have to worry about commissions, but still the average of all my machines is probably in the area of $100.00 a month. What kind of locations are you using? I rely primarily on mechanical machines, so I use lunchrooms and showrooms of car dealerships, but there is no damage to the machines and less than 2% theft on average. I would be very interested to know more about your locations and numbers.

Thanks.

Primarily blue-collar locations, such as manufacturing (factories), machine shops, distribution centers, etc... Minimum of 50 employees, and preferably 100 or more. In these locations, $150 per week between a soda and a snack machine is not all that great, just average in my opinion. Ideally, you want to generate $100 per week per machine. I have 3 combos, and 2 of them usually hit around $100 per week.

[BVI]

Hi PVI,

Thanks for the input. I think I am going to buy at least 2 of these stops, maybe 3 and take a chance. I'd still like to hear opinions from other people about this though.
Petra - Is that the lost city or the model? Either way I'm not sure we know one another but it's always good to make a new friend

That answers my question. We don't know each other. I know someone from another online community that goes by the name, "Rocksolid", and I thought you might be him. Petra is a Christian Rock band that spans over 30 years, and this other Rocksolid is from that messageboard.

Good luck with your purchase.

[Rocksolid]

After last nights visit to one of his stops it turns out he does about 400.00 a month and spends about 100.00 per month on product, so that is were the other 300.00 net is coming from. He is selling the route because he is moving out of state. Does anybody buy their product from anyplace other then a BJ's or Costco?

[jblvending]

After last nights visit to one of his stops it turns out he does about 400.00 a month and spends about 100.00 per month on product, so that is were the other 300.00 net is coming from. He is selling the route because he is moving out of state. Does anybody buy their product from anyplace other then a BJ's or Costco?

My advice is do not buy this route.Take that $9000 an invest in a CD, your ruturn is guranteed at leat 4.5%, and all you have to do is make the deposit. What some people don't realize, and BVI has eluded too, is that your net profit margin is really around 10 to 20%after you back out all of your expenses, thats it.We get hung up on these numbers and they sound great, but until you actually go out and do it, it's amazing that those numbers never match up to what the seller stated, so Rocksolid, you may have made up your mind to buy it, but if you havent, Don't, the GF12 will never produce the kind of money you will need to make, and be happy in the long run.

[coinvestor]

After last nights visit to one of his stops it turns out he does about 400.00 a month and spends about 100.00 per month on product, so that is were the other 300.00 net is coming from. He is selling the route because he is moving out of state. Does anybody buy their product from anyplace other then a BJ's or Costco?

Something doesn't sound right with his numbers. Either he is making half of what he says he is, or spending twice as much on product.


JD

[BVI]

Something doesn't sound right with his numbers. Either he is making half of what he says he is, or spending twice as much on product.
JD

I totally agree with that. Those numbers don't make sense at all. If a machine does $400 per month and only $100 is spent on product, then the seller must be getting another $100 per month in product for FREE from somewhere, or the seller is inflating what he nets in order to motivate a potential buyer.

Unless your prices are jacked up out of proportion, if you have $400 in sales, you're going to spend about $200 on product. That's just the way it works.

[BbAaSsSs]

After last nights visit to one of his stops it turns out he does about 400.00 a month and spends about 100.00 per month on product, so that is were the other 300.00 net is coming from. He is selling the route because he is moving out of state. Does anybody buy their product from anyplace other then a BJ's or Costco?

I will be buying some from GFS Marketplace

Bass Vending Services

[Rocksolid]

I have our money in a CD now, but I want to do something with it. My thought was to buy the route and try and build it up. I need extra money now and hate to have money sitting in a CD making a little money, but I'm not even able to take it out, what good is that when you need the money now. I thought I would buy the route, try and add on a few more stops or a few more machines at the excisting stops. Use the extra money coming in and when the time comes for me to sell the route, hopefully I will be able to get the same money that I paid for it or more. Does that not make sense?? I hate to think of getting a 2nd job where I will be very unhappy and never seeing my family and making 10 bucks an hr. As far as what he says, I will try to get more info regarding the age of the machine and what the machines says has been put in it. Maybe he is not counting what he is taking off the top. The first machine I looked at was in a club house of a very wealth community and is a very nice location. I am going to see one fo the other locations next week.

[BVI]

I have our money in a CD now, but I want to do something with it. My thought was to buy the route and try and build it up. I need extra money now and hate to have money sitting in a CD making a little money, but I'm not even able to take it out, what good is that when you need the money now. I thought I would buy the route, try and add on a few more stops or a few more machines at the excisting stops. Use the extra money coming in and when the time comes for me to sell the route, hopefully I will be able to get the same money that I paid for it or more. Does that not make sense?? I hate to think of getting a 2nd job where I will be very unhappy and never seeing my family and making 10 bucks an hr. As far as what he says, I will try to get more info regarding the age of the machine and what the machines says has been put in it. Maybe he is not counting what he is taking off the top. The first machine I looked at was in a club house of a very wealth community and is a very nice location. I am going to see one fo the other locations next week.

I'm beginning to think the locations may be bad. A subdivision club house is not a good location. I just turned down my own subdivision today. Too seasonal. If the other locations are like this one, don't just walk away from this route, RUN.

JBL is right... even if the locations are good, the GF12 will never ever make you enough money to be worthwhile. Despite the fact that mechanically it is a good machine, it just doesn't hold enough product to make its presence worthwhile. To make any money in vending, you MUST turn product. That machine is just too small... combo machines by their nature tend to be small (although there are some larger ones out there), but that one is definitely not big enough to be anything other than a waste of time, in my opinion, if it is being used as the primary machine for a location.

[Rocksolid]

Thank you in advance again for everybody's replys. I hope I am not driving you crazy. About the first stop, the club house. It has a fitness room and card rooms where people have poker tournaments. Also they are still building the houses on this site, they have about 100 built and about 100 -150 more to build, so all the workers go there for snacks. At this point he is mostly refilling this machine everyweek, at least that is what he told me. The other 2 sites are busineses where there are about 30-40 blue collar workers. Would I be paying too much for this route if I buy? Now I don't know what to do. I feel in my gut that this would be decent part time money, but you guys know the business and that is making me 2nd think it.

[coinvestor]

Rock,
You look like your still considering buying this, so let me add this.

Make this guy prove the gross income to you. Don't hesitate to tell him this. I am sure he didn't think twice about telling you the price he was asking and you should not thing twice about asking him to prove the income. You want the gross income not some "nets about" number. Write down the prices he has set in the machine for each item and you can figure out the margins on your own when you go to BJ's. Although I would consider buying a route where the owner was skimming from the top, I would buy based on verifiable income only.

The way I see it (and I told this to a man that was trying to sell me his route) you can screw the IRS while you own your route or you can get top dollar for your route when you sell, but you can't get both. Don't worry about feeling embarrassed or hurting his feelings. This is your money he is asking for. Keep in mind the more insulted he is about you asking these questions, the bigger the lies are that his is telling you.

Sorry for the rant!


JD

[jblvending]

I have our money in a CD now, but I want to do something with it. My thought was to buy the route and try and build it up. I need extra money now and hate to have money sitting in a CD making a little money, but I'm not even able to take it out, what good is that when you need the money now. I thought I would buy the route, try and add on a few more stops or a few more machines at the excisting stops. Use the extra money coming in and when the time comes for me to sell the route, hopefully I will be able to get the same money that I paid for it or more. Does that not make sense?? I hate to think of getting a 2nd job where I will be very unhappy and never seeing my family and making 10 bucks an hr. As far as what he says, I will try to get more info regarding the age of the machine and what the machines says has been put in it. Maybe he is not counting what he is taking off the top. The first machine I looked at was in a club house of a very wealth community and is a very nice location. I am going to see one fo the other locations next week.

Do more research, learn more about differrent types of machines, maybe look for part time or full time work in vending to see if it's something you will like.Define your goal's, do you want to work for yourself, or do you want extra money on the side?These are 2 total different things,Vending can be a good business, but I never recommend it as a part time job because of the time and monies you have to invest before you realize any real profit, seen to many folks , like you, buy into it, only to later sell it for pennies on the dollar, trust me we buy a ton of machines because of folks not know what there getting into.Now having said that, if you still want to buy these machines,offer him a lot less than what he is asking, and if he agrees to take the lower price without barking, then there is a problem, because if it's making the kind of monies he says, he will not have a problem standing firm on his selling price,good luck.Tim LeBlanc