How to Start a Vending Business

by | Nov 12, 2010 | Start A Vending Machine Business

How to Start a Vending BusinessSo you think you’d like to start a vending business. Do some soul searching and make sure you are the right type of person. Ask:

  • Are you an entrepreneur? This is someone who must assume all the risks of a business, but can also guarantee the benefits.
  • Are you self-motivated? There is no 8-to-5 in the vending business; you work until everything is done. On the other hand, there are days when the hours just fly. The really great thing about vending machines is they conform to your schedule: They can be installed just about anywhere, generate sales 24/7 and can be serviced most any time. But it’s up to you to make it happen.

How to Start a Vending Business  Best ways to get started
The more information you can get about vending, the better off you will be.

  1. Contact NAMA, the National Automatic Merchandising Association, the trade association that handles issues involving the food and beverage vending industry. They have information on all aspects of the business, including education, health and safety, government affairs, NAMA-certified vending machines, publications, expos and careers. You can reach them at (312) 346-0370 or www.vending.org.
  2. Work for a vending company. You’ll find out if you like the business, and learn valuable shortcuts to installing and loading vending machines, buying product, inventory and accountability. Of course, you can learn all that on your own after starting a vending company, but it takes time.
  3. Check with (or find) appropriate business counsel:
  • Accountant – How best to run the paperwork for the best return – on profits, as well as taxes. Also ask if you should set up your company as a sole proprietorship, corporation or LLC.
  • Attorney – To set up your corporation and advise on any legal implications
  • Banker – Open new accounts solely for the business (don’t use your personal accounts)
  • State, county and federal governments – Any licenses, permits and other paperwork

How to Start a Vending Business Some people avoid all this; they just jump in, set up a couple locations, find out they like the business. . . and then have to go through all this. What a hassle. Do it right from the start and you’ll be able to focus your newfound excitement and energies on building your vending business.

A few words of wisdom
Buy the right brand of vending machine – this can make or break your company. Look under NAMA-certified vending machines and buy one of these. Call a vending company in your town and ask what brand of vending machines they use. If you have decided to buy a particular brand of machine, ask the vendor if he has heard of it or has any experience with it. There are only 5-7 brands that I would buy, personally. See my article: “What types of vending machines should I buy?”

Look at what Coke and Pepsi buy when you’re considering drink machines. They have more machines out than any vendors. Brand names are located on the left side of the door, on a manufacturer’s plate with brand name and model number. Make sure there is more than one company distributing the parts. If there is only one source and it goes out of business, the machine will no longer be useful to you when replacement parts aren’t available.

Watch out for “biz op” guys. These are the unscrupulous companies that try to rip you off by selling a vending franchise with substandard vending machines, bad accounts, and a franchise that is little more than name only. These companies last only a short period of time. They steal your money, bankrupt out and laugh all the way to the bank.

The people who stay in this business stay in it for life. Every day is different; you have new challenges and new ways of making money. I seldom see vendors retire, but if they do, they’re back to work in just a few weeks. Compared to running a vending business, golfing and fishing just aren’t enough. Do your homework that is How to Start a Vending Business

Some great vending blogs How to Get Started In the Vending Business

How Does the Vending Machine Business Work

by | Sep 16, 2010 | Start A Vending Machine Business

How Does the Vending Machine Business  Work   This business isn’t very complex. You solicit different businesses with sites on which to put your vending machines.

How Does the Vending Business Work  The best locations that bring in the most money are hospitals, truck terminals, manufacturing plants, schools, and any place where large numbers of people pass through. Blue collar locations are better because these folks work hard, make good money and don’t normally have time to go out to lunch. A general rule of thumb is that you’ll secure one location for every 100 locations you solicit. It isn’t as hard as it seems because the larger vending companies – the ones you think would gobble up all the business – often lose sites simply because they are so large, and aren’t able to provide the level of service many businesses want.

How Does the Vending Business Work  If I were starting a vending business from scratch today, I would decide – and promise – to give prompt, personalized service; in many instances, that’s all a business owner needs to hear. Your job, of course, is then to follow-through on your pledge.

Once you secure a location, you then buy and install the machines into the new account. Never buy machines before you secure a location, and always buy the least number of machines that you can get by with. You can always add machines if needed. Just remember your goal is the highest possible return on your investment (the vending machines) that you can get. The more profit that you make, the faster you can pay off your machines.

Next, fill the machines. I always put a note on the front of the machines that says, “Please tell me what you want placed in the machines” on installation day, with room for people to write comments. During the first week, go by the machines every day to make sure all machines are working well and are stocked. After the first week you will be able to work out a schedule in order to restock the machines, based on the volume of product sold from the vending machines. When restocking the vending machines, listen for (or even ask about) things like “We’re working overtime this week.” Of course, then it’s your job to be sure you step up the schedule to keep pace with what folks are buying.

Some locations will want commissions from their machines. Commissions are a percentage of sales that you give to higher volume locations – usually between 5-20% of gross sales. Personally, I would not pay a commission to any location with fewer than 40 employees. Set up a commission that you can live with or raise the prices of the items in the machine to cover your costs.

If the account does not bring in the amount of money that you feel satisfied with, move the machines to a new account. Every account has to pay for itself. Having friends in an account that’s not making money isn’t a good business reason for keeping the account there; your friends don’t help you pay the bills.

The key to a successful vending business is working hard, and providing prompt, courteous customer service. If you don’t mind working, a lot of people make a fine living in this business. It’s up to you to find the motivation to seek out locations for your machines, to follow-up with your customers and restock machines regularly, and to respond professionally when problems arise.It is not rocket science in knowing How Does the Vending Machine Business Work just mostly common sense.  More videos from the Vending Business Show  How to Start a Snack Machine Business

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