6 Tips For Making Your Vending Machine Business Shine
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I remember my summer roadtrips as a kid. We would stop off at a rest stop and I would get to pick out a drink from the vending machine. I would pull out some coins and go for the grape Fanta. Yeah, I’m old.
Back then vending machines were high maintenance beasts that required you to go out and collect your money, refill the change drawers and hope and pray that no mechanical issues had occurred.
Today it’s a different game. Most machines accept digital payments and allow you to monitor their health and stock remotely, making them even closer to a true passive income stream. And even better, if you find the right market, you can go beyond piddly drinks and snacks to higher profit items like phone chargers, disposable cameras, gift cards, and vapes. I’ll share some top tips for securing your vending business below:
Identify Your Market
Think about making a venn diagram when choosing your product. Pick something that excites you or you want to take the time to do some research on. For example, pokemon cards have been an amazing seller lately, so you could try to ride that trend. You can also do a survey of your community to figure out what people in your area purchase the most especially on impulse.
Do you live near a bunch of bars and nightclubs? Or are you realy into CBD products and know them well. Remember though if you are selling age restricted products you will need to look at all local, state, and federal laws, and license requirements.
If you are in a vacation destination, you may want to focus on vacation items like phone chargers, sunscreen, beach towels and the like. These are impulse buys, and people are more likely to pay a bit more for them.
Identify Your Product
Once you know what people want to buy and what you at least have some interest in, do a comparison of vending machines and products. Vendo, Crane, AMS, and Wittern offer reliable machines with card readers, which is great for modern setups.
Ask questions of the vending machine salesperson like:
What is the typical profit on your machines? What sells the best in which regions?
What happens if the product is discontinued or runs out of stock?
What guarantees do you have for the operation of the machine?
Do you offer used machines?
Do you offer placement services or do I need to provide my own transportation?
Identify Your Location and Traffic
Now that you have an idea of what you want to sell, it’s time to hit the streets. Create a flyer showcasing what products you want to sell and the types of vending machines you are looking at.
Approach business owners and managers to ask about their openness to placement and whether they already have any agreements in place. Also ask if they have previously tried to sell these products and how that went.
This may not be the time to negotiate profit sharing or commission, but most businesses will expect to receive a cut of the profit and may ask you to include some part of the utility costs. Come with a range of numbers that would work for you so you can at least start the conversation. Once you have a couple of locations secured, use that in your marketing.
Get Your Business Setup
You'll need a business license, vendor’s license, and insurance for your machines. You will need an LLC to do all of this, which are relatively easy to setup and provide you some protection.
Figure Out Maintenance
You’ll need to come up with a system for how often you need to restock and this will likely require a few visits. You’ll want to visit anyways to see how folks are responding and make sure it’s functioning. This is a good time to checkin with the manager as well.
Vending machine maintenance is crucial for ensuring reliable operation, customer satisfaction, and profitability. It involves regular cleaning, inspections, and addressing issues promptly to prevent more significant problems.
Develop a schedule that includes daily, weekly, monthly, and quarterly tasks, customizing it based on machine usage and manufacturer recommendations. Monthly maintenance costs can range from $5 to $10, while major repairs can range from $50 to $150.
Evaluate Product Success and Failure
You can rinse and repeat the above steps, but take a look at how you are doing first. Are there any spots that are doing really well? Try to figure out why and replicate this.
Are there any sites not doing well? As around and see why. You might just need to move those to a new site.
