The vending machine business can be a competitive one, but the first step to success is the same with vending as it is with anything else: you have to show up.
The problem with that comes when your vehicle breaks down, gets a flat, has a fender bender, or is incapacitated in some other way. Without a way to move machines, or get to where you need to service them, losing out on contracts is a guaranteed outcome.
Success and growth are the goals for every business, and a vending business is no different. One of the best ways to ensure success is to be prepared and being prepared means having a backup in case of an emergency.
Buying a second vehicle can seem financially daunting, but it doesn’t have to be. Consider adding a “beater car” to your business to use in case of emergencies. What’s a beater car? A beater car is an older car (usually more than 10 years old, and with a low market value.) Remember, it doesn’t have to look great. It just has to be reliable. Since the car is older, you can likely pay for it outright; this would mean a minimum to no monthly payment at all and a very low insurance rate. If you insure it under your business, the rate will be even lower.
Doing an extensive online search can ensure that you get the lowest price in your area. Sites like carfax.com, truer.com, and carsdirect.com can help you get an idea of what the car you’re looking for will cost in your area. You can also look for private sales through places like craigslist.org, eBay.com, and more.
Another thing you may want to do before you actually buy the car is to discuss the tax ramifications of your purchase with your accountant. You’ll want to ask important questions such as:
Does the vehicle need to be in the business’ name in order to write it off?
What vehicle-related expenses should be accounted for so they can also be deducted? (Items such as gas, oil changes, maintenance, and others may be tax deductible.) Normally, you should be able to deduct the finance charges on the loan as well as fuel and maintenance costs for the vehicle, but it’s important to ask because tax laws change regularly!
Can I deduct the interest I pay on my auto loan from my taxes?
How do I maintain mileage records separately for personal and business use?
What specifically counts as “business use?”
What type of vehicles do you recommend I consider?
What type of vehicles do you recommend I avoid?
There are many other questions you may want to ask, but these are a great start to ensure that you are in the best possible position, tax wise, with regard to your second vehicle.
When having a backup vehicle, make sure that you don’t make the mistake of neglecting the first just because you have a backup. Maintaining your vehicles, personal and business, is just as important as maintaining the machines on your route.
Remember that if you don’t show up to maintain a route, there is always someone else who is willing to do so. Losing contracts because you don’t show up can cost a lot more than whatever payments are required to maintain a second vehicle.
What you are really buying with your second vehicle is peace of mind. If your car has to be in the shop for repairs, you’ll still be able to service your route. This peace of mind isn’t only valuable to you, it’s valuable to your staff, the people on your route, and your family as well. When you can depend on your vehicles, people can depend on you, and that’s the most important thing to sell in a business such as yours.