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Like any business that takes time, effort and money to scale, a vending machine business is perfect to start as a side hustle. And if you’re looking for a side hustle opportunity, you’re not alone. A LendingTree survey conducted in October 2020 found that 45% of Americans have considered starting a side hustle during the pandemic — and those who have depended on that income.
Start My Own Vending Machine Business
However, starting this type of business involves more than just buying a vending machine and setting it up. In order for your vending machine business to be successful, you need to complete many steps in between. And while you may not become a millionaire, you may be able to grow the business to the point where you can replace your full-time job income. Here’s what you need to know in this guide to starting a vending machine business, including startup costs and what you can expect to earn.
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Vending machines can vary in price depending on the type of machine you choose. Below is a breakdown of the different types of vending machines and their estimated costs. Please note that the estimated cost is for a new machine. If you buy a used or refurbished machine, your costs may be lower.
Bulk vending machines are often located outside retail stores or in shopping malls, in waiting rooms of offices and transport stations, and inside restaurants or arcades with a children’s theme. These machines offer toys and small sweets such as stickers, candies and chewing gum, and usually require hostels to sell their goods. Bulk vending machines are the most affordable of all vending machines, but they also provide a lower profit per item than machines that sell more expensive products. The advantage of large volume vending machines is that they do not require electricity or batteries to operate, which makes their maintenance easy.
Food and beverage vending machines are found inside retail stores, shopping malls, hospitals, hotels, airports, office buildings, event centers and schools. They offer a variety of food and drinks, including candy, chips, cookies, water, energy drinks, tea, and soda, and the price is higher than bulk vending machines, which can make them more profitable-especially if they’re located in a. high traffic area. There are also more specialized food and drink machines, including those that dispense coffee, deli sandwiches or ice cream. Remember that this type of machine requires electricity to operate and requires ongoing maintenance.
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Dedicated vending machines are most often found in places where the target group travels, such as airports, hotels, resorts, restaurants, gyms, event venues and bars. These machines dispense specialty items such as personal protective equipment, beauty products, detergents and electronics. These machines often contain special technology that requires more maintenance. Plus, they often have customized holes to fit specific products, making it difficult to change the product that the seller is selling.
Now that you know what types of vending machines are available and their estimated costs, here are the steps to start a vending machine business.
Find out how many customers you need each day or week to make your vending machine business profitable. Drive around to find available, high-traffic locations for your vending machine. Good locations include hotels, motels, gyms, office buildings, laundromats, schools, and shopping centers. Note all other vending machines in the area to avoid competition.
Check with your local government about required business registration and licensing. According to the Small Business Administration, if you’re running a business under your own name, you don’t need to register anywhere. However, you may not be able to take advantage of the legal protection, personal liability protection and potential tax benefits that a registered business can offer. Depending on the structure of your business, you may need to apply for an employer identification number to help identify your business when filing taxes.
How Much Do Vending Machines Make
Now that you’ve done your market research for the area you want to serve and registered your business, choose the type of vending machine you want to offer. You can choose from bulk vending machines that do not require electricity and usually take coins. Or you can choose a snack machine, a drink machine, or a special type of machine.
Tip If you are interested in a new engine, check the warranty before buying and note the cost of common parts you will need to repair the engine. If you decide to buy a used or refurbished machine, look for the model number to help you determine if the spare parts are available. If the machine is no longer in production, replacement parts may be difficult to find when needed. 4. Determine operating costs
Create a spreadsheet that details all your expenses – whether they are one-off or recurring. Operating costs include inventory, maintenance, fuel, rental costs, sales tax and loan payments, just like when financing your vending machine. Find out how much it costs to run your vending machine business in the short term, such as weekly or monthly, and in the long term, such as annually.
If you cannot start your slot machine business with the funds you have, you can apply for a loan or slot machine financing. You are more likely to get a loan or financing with a good credit score. Additionally, be prepared to submit a business plan and budget if you are applying for a small business loan.
How To Start Your Own Vending Machine Business
Return to the locations you explored for each of your vending machines and work to secure each one. You will need to contact the business owner or property manager in the location where you want to place each machine. To get the contact information of the right person, you can visit the place or call and ask.
To secure a spot, you should bid first to see if there is interest. Consider having your particular vending machine in place, for example, as it can provide variety or replace outdated and unattractive vending machines. Once you find that an owner or manager is interested in your machine, here are a few steps to secure placement:
Once you have secured a location for your vending machine, you need to install it. Don’t forget to take your inventory so your machine can start earning money as soon as possible. Choose to install machines and inventory that match the type of operation at the location. For example, in a hotel or hospital lobby, you may want to install PPE. You may want to install an ice cream machine at your event venue. If the machine will be installed in the gym, consider energy drinks and protein snacks such as bars.
Every time you visit your machine to refill, notice the items that are selling well and the items that aren’t moving. Maintain inventory of top sellers and replace stagnant items with items that you predict will sell well based on top sellers.
Vending Machines The Way Forward
Schedule an inspection of your engines to make sure they are clean, running properly and full. While you’re there, you should wipe down the machine and keyboard and make sure all buttons, lights, money slots, and credit card readers are working.
Just like any business you start, a vending machine business has its pros and cons. Here’s a quick look at some of the pros and cons to expect.
The lease agreement is the norm; you will have to pay a flat fee or part of the sale to place your machine in a certain location.
How much you can earn with a vending machine depends on various factors, such as the type of product each vending machine offers and the traffic in each location. For example, a vending machine in one location can make as little as $5 per week, while the same machine offering the same product in another location can make $100 (or more) per week. It also depends on how many machines you operate at the same time. To make $1,000 or more per day, you need at least 75-100 vending machines running at all times, according to VendSoft.
How To Start A Vending Machine Business By Jake Olaez
The minimum startup cost to operate a vending machine is about $1,592, according to information from Starter Story. This startup cost is added to all vending machines and inventory. This can include advertising and marketing costs, software costs, business incorporation costs and any equipment you need to operate the machine.
No. Although you don’t need to designate your vending machine business as an LLC, you can protect your personal and financial assets in the event.
