5 Questions to Ask Before Buying a Vending Machine


Whether you’re looking to add an additional revenue stream to an existing business, or if you’re looking to build a new business from the ground up, vending machines have traditionally provided a steady source of income; believe us, we at Vend-Co know a thing or two about them. If you’re thinking of trying out a vending machine, however, make sure that you ask the right questions before committing to a rental or purchase contract. These questions need to be answered before signing any agreements, but make sure that you fully understand the risks of what you’re agreeing to.

  1. How much income can I realistically make?

There are plenty of advertisements for vending machine businesses that promise enough income to quit a full-time job. While there are vending machine businesses that provide this type of income, they typically involve over 50 machines located in established, high-foot traffic locations. For many vending machine owners, the income provided from a single machine is less than $100 a month. That means that several machines may only provide enough money to pay a few bills, not nearly enough to allow you to quit working full-time.

If you’re taking over a vending machine business from another business owner, be sure to look at the profit and loss statements from the business. Pay close attention to costs versus gross income; many vending machines lose a lot of money to facility rental fees and other expenses.

  1. What type of machines are right for my venues?

Take the time to really consider what types of machines are right for the venues you’re placing them at. Consider what other food and drink options are available nearby, the mindset of the typical customer, and even the right price point for the clientele and location of your machine.

For example, a machine that is located in an amusement park will likely need to have higher prices to pay for the high facility rental fees. Fortunately, theme park customers expect high prices, and will likely be willing to spend a lot of sodas and water that come in bottles that can be refilled throughout the day at free water fountains. Machines located on college campuses may do well with snack sales, unless the machines are located in buildings where food isn’t allowed. Machines located at gyms will likely do better if they are stocked with low-calorie snacks and drinks, and business owners might even consider stocking items such as towels or skincare products.

  1. What are my start-up costs? What are my ongoing costs?

Vending machines are just like any other business in that it is absolutely critical to understand your costs. Make sure that you understand everything that is being charged upfront for the machines. In particular, pay attention to the cost of renting space at various venues. The vast majority of locations will not allow you to place machines for free; many of them will demand a percentage of sales and/or a minimum monthly fee to pay for costs such as electricity.

In addition, consider ongoing costs such as machine maintenance and restocking. Contracts for vending machines are all set up differently, there is no “standard” form. That means that it is entirely possible to rent the machines from a supplier, purchase them on a payment plan, or in some cases receive them for free as long as you agree to only stock them with products from a certain supplier. All too often, business owners find out too late that they were renting machines when they thought they were on a purchase plan, or that the machines they own can only be stocked with products from one company. Read your contract carefully, and don’t take the word of sales people who themselves may not know the details of what they are selling.

  1. What happens if the machines are damaged?

Make sure that you have a clear understanding of what happens if the machines becomes damaged. Vending machines are often left unattended for days at a time, and it is next to impossible to determine who may have damaged a machine and get them to pay for damages. If the machines are being rented, it is not uncommon for the company that owns them to handle maintenance. If you own the machines, you will likely be on your own. While plenty of business owners have successfully learned to do repairs themselves, they still have to order replacement parts. While a machine is broken, it is not producing income.

If you choose to have a maintenance contract on your machines, be sure to ask about what guarantees are in place for the quality of the work and the wait time for repairs. Also ask about the company’s policy in regard to “excessive” repairs; some maintenance agreements only allow for a set number of repairs every month, and some rental companies reserve the right to repossess machines if they are experiencing very high rates of vandalism or breakage.

  1. How will customers pay for items?

Finally, it’s important to put some time into determining how customers will pay for items from the vending machine. Today, most machines contain items of high enough value that a dollar bill reader is practically a requirement. These machines have some issues, however, and are swiftly becoming more problematic for customers who tend to carry very little cash on them. Credit card readers and wireless payment options such as Apple Pay are becoming increasingly popular as a result.

For a vending machine owner, however, credit card readers introduce a new host of problems. These readers often charge high processing fees that come directly out of a company’s profits. Some machines will put a “hold” of several dollars on a customer’s card, then charge the correct amount once the consumer makes a selection. This results in customers becoming upset that funds are being blocked in their account. Make sure that customers are aware of the terms of use of these machines.

Contact Us to Take Charge of Your Earning Potential!

Vending machines are the ultimate source of passive income and are super easy to install and maintain. Plus, once you start one, adding more to your inventory is much easier. Browse our selection at Vend-Co today and contact us if you have any questions!

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