huynhhh Posted October 7, 2014 Share Posted October 7, 2014 So I have about five or six stands left to place (and a whole lot of heads with no stands) should I place them all and wait until I get full return on my initial investment? Or should I keep investing and expanding my empire?? How do you guys do it Link to comment Share on other sites More sharing options...
Makes Cents Posted October 7, 2014 Share Posted October 7, 2014 I place everything then list each location and machine on my route sheet either in red for ROI not met or in black for ROI met. When you first start theres alot of red but it changes fairly quick. Its good to reinvest as much as you can when you start to grow fast BUT make sure you keep enough cash reserves for operating costs. There is a good form in the download section that shows if your location is in + or -. You can plug in sales, cogs, machine costs, locator fees etc. http://vendiscuss.net/index.php?/files/file/63-bulk-vend-profit-tracking/ Link to comment Share on other sites More sharing options...
rodney69 Posted October 7, 2014 Share Posted October 7, 2014 I consider all of it an investment. If you get the machines low enough that you can resell them for the same cost or close, then to me it's just a savings account. As long as your not throwing product away, your money is growing. How much do you make in interest with money in your pocket? How much in a savings account? How much if you empty one head of candy? Return on investment is what I look at. I keep a LITTLE set a side for emergency and then the rest I keep buying more equipment and putting it out! What I look for though, is locations that I don't have stale candy our product in. that's why a lot of vendors use gumballs to stay a location. It takes about 5-10.00 to pay for the product in the machine depending on which one you have. Empty a head and you just paid for the machine, and product. I know that it makes a profit and more than banks. So reinvest! Link to comment Share on other sites More sharing options...
GagesVending Posted October 7, 2014 Share Posted October 7, 2014 Why would you purposely keep them at home? You bought them to make money; so get them out of the house and into locations in order to obtain your goal! Link to comment Share on other sites More sharing options...
huynhhh Posted October 7, 2014 Author Share Posted October 7, 2014 Why would you purposely keep them at home? You bought them to make money; so get them out of the house and into locations in order to obtain your goal! I'm saying after I place them all, should I wait until I get full return on my initial investment, or should I continue to buy more machines (get in more debt ) Link to comment Share on other sites More sharing options...
garys vending Posted October 7, 2014 Share Posted October 7, 2014 I say go more in debt. I'm going to keep buying machines so when I make my collections instead of having 5 to collect from I'll have 20 to collect from. Ect Link to comment Share on other sites More sharing options...
AngryChris Posted October 7, 2014 Share Posted October 7, 2014 I'm not a bulk vendor but I do full-line and honor boxes. Regardless, I think my opinion might make a difference here. Whether to reinvest your money, go into debt, or drain the profits to pay yourself is entirely up to you. Do you want to get paid a little NOW? Do you want to slowly grow so you can get paid more LATER? Or do you want to do both -- borrow money so you can grow your business faster and make more money and start making money faster? Again, it is preference. My preference depends on the cost of the investment and the potential return on the investment. If you find a good location (ie. restaurant), then it is probably worth it to borrow money and get something in there faster. You don't want to miss out on potential opportunities that can make lots of profits. On the other hand, if there are no potential good customers or you aren't looking, you may be better off simply saving your profits so that you will be ready to buy more equipment as soon as you find a new customer. If you want to make money in your pocket right now, then do neither of those two options (save for an expansion or borrow money) and simply take your profits and enjoy. If it were me, and I were just starting with bulk vending, I would go about it one of two ways. Either I would save up EVERY profit that the bulk business made and use it to buy more equipment, or I would borrow money to grow the business faster. I am an investor at heart with a business mind. I want to make money.. we all do... but I know that I can make a lot more money in the long run if I reinvest quickly. I also know that saving up profits doesn't always allow you to expand as fast as borrowing money. I chose to borrow money for my vending business and it took me all of 4 years to get to where I am now, and I am full-time vending and living off of my profits. I don't make a lot right now but that's changing quickly. The most important factor is that I make enough money to actually have some flexibility. In the near future, I am simply going to buy machines with cash in order to avoid debt, but if the right account comes along and it looks like a big money maker, I will definitely be considering going into debt to make those big profits. Please note that the only real drawback to borrowing money is that, if you are not responsible about paying off your debt, it can completely cripple you and your business. I don't recommend borrowing money for anyone who cannot responsibly pay for what they owe. Link to comment Share on other sites More sharing options...
orsd Posted October 8, 2014 Share Posted October 8, 2014 Get equip if its a good deal and you can locate it all Link to comment Share on other sites More sharing options...
garys vending Posted October 8, 2014 Share Posted October 8, 2014 I say go more in debt. I'm going to keep buying machines so when I make my collections instead of having 5 to collect from I'll have 20 to collect from. Ect Link to comment Share on other sites More sharing options...
FrCorey Posted October 8, 2014 Share Posted October 8, 2014 go have a beer and some lunch Link to comment Share on other sites More sharing options...
musser Posted October 8, 2014 Share Posted October 8, 2014 Don't go into debt until you actually know what you are doing. When you learn how to make a profit then use someone else's money to grow. Link to comment Share on other sites More sharing options...
TexasFreemason Posted October 8, 2014 Share Posted October 8, 2014 Place the ones that you have then reinvest the profits to buy stands for the ones you have no stand for. It is slow at first but it gets faster and faster, Link to comment Share on other sites More sharing options...
rodney69 Posted October 8, 2014 Share Posted October 8, 2014 Don't go into debt until you actually know what you are doing. When you learn how to make a profit then use someone else's money to grow. Robert kyosaki talks about that exactly! It's best to know, or have an idea about how much your going too make before you borrow. Especially if your using the profit to pay the loan off! Link to comment Share on other sites More sharing options...
shepherdsflock Posted October 8, 2014 Share Posted October 8, 2014 Use your profits to buy stands and place extra machines. It sounds like an excruciatingly slow way to grow, but it's the safest way to grow. It's not just safe because you're avoiding debt risk, but also because you will learn valuable lessons along the way that you would otherwise not learn if you simply borrowed money and hoped for a payback. Bulk can be a tricky industry, with businesses closing, kickouts, etc., you need to be very sure that every piece of equipment you place with borrowed money will consistently return revenue for the duration of the debt. It's hard to be sure of that in bulk; unless you're getting REALLY good deals on equipment (pennies on the dollar). Link to comment Share on other sites More sharing options...
shepherdsflock Posted October 8, 2014 Share Posted October 8, 2014 Don't go into debt until you actually know what you are doing. When you learn how to make a profit then use someone else's money to grow. Be careful not to think of borrowed money as "someone else's money". This can lead you to take foolish risks because you don't feel like it's your money at stake. Think of borrowed money as your money that you are paying fees to use.This will do two things. It will help you control impulsive risk taking because you feel more like it's your money. And, it will cause you to hate debt, because who wants to pay money to use their own money? That's essentially what debt is. You are paying interest to spend money you haven't earned yet (but will earn and then give to the bank). Link to comment Share on other sites More sharing options...
RikaKazak Posted October 8, 2014 Share Posted October 8, 2014 I'm saying after I place them all, should I wait until I get full return on my initial investment, or should I continue to buy more machines (get in more debt ) I would grow as quick as you can, without going into debt or going into a TINY amount of debt. Real estate is my main investment, and I saw what happens to people when they get in over their head with debt. It's not pretty, it can ruin marriages, it can stress people out so much they go nutty. I'm not saying never use debt (i have debt on my rentals) but I am saying be very careful, it's like playing with fire. edited to add: I guess what I'm trying to say is, lots of people in the real estate bubble capped out how much they borrowed, based on how much they "could" borrow (basically the lender capped the ceiling) I would highly recommend sitting down, thinking of what you feel comfortable borrowing, assume your business went to zero overnight, and see what that world would look like. If that world isn't that big of a deal (say you borrow $20K and make $80K a year) and you're fine with that world, then go for it. If you make $80K a year but are living pay check to paycheck and even losing $3K would be devastating, then don't borrow that much. Basically if it would be a HUGE drama/headache/big deal, then just simply lower the amount you'll borrow until you're comfortable. Just be careful, remember, it's easy to go "borrow more"...it's hard to turn the corner once you've "borrowed too much." Link to comment Share on other sites More sharing options...
Lake Cities Vending Posted October 8, 2014 Share Posted October 8, 2014 Have a cold beer. lol Link to comment Share on other sites More sharing options...
huynhhh Posted October 9, 2014 Author Share Posted October 9, 2014 I would grow as quick as you can, without going into debt or going into a TINY amount of debt. Real estate is my main investment, and I saw what happens to people when they get in over their head with debt. It's not pretty, it can ruin marriages, it can stress people out so much they go nutty. I'm not saying never use debt (i have debt on my rentals) but I am saying be very careful, it's like playing with fire. edited to add: I guess what I'm trying to say is, lots of people in the real estate bubble capped out how much they borrowed, based on how much they "could" borrow (basically the lender capped the ceiling) I would highly recommend sitting down, thinking of what you feel comfortable borrowing, assume your business went to zero overnight, and see what that world would look like. If that world isn't that big of a deal (say you borrow $20K and make $80K a year) and you're fine with that world, then go for it. If you make $80K a year but are living pay check to paycheck and even losing $3K would be devastating, then don't borrow that much. Basically if it would be a HUGE drama/headache/big deal, then just simply lower the amount you'll borrow until you're comfortable. Just be careful, remember, it's easy to go "borrow more"...it's hard to turn the corner once you've "borrowed too much." All the money being borrowed is from emergency money I have set aside that me and my siblings make monthly payments to, so there isn't interest or anything.. I think after placing machines I'll expand a little bit slower and pull lower performers.. Thanks guys for all of your input appreciate it Link to comment Share on other sites More sharing options...
musser Posted October 9, 2014 Share Posted October 9, 2014 Let me rephrase, do not borrow money to buy furniture, appliances, electronics, shoes, cars, or any other consumer good. Borrow to buy a house if you have a good down payment ( most people have to). Wisely borrow to grow your business. As long as the money you are borrowing enables you to produce enough profit to service the debt, run the business and create a profit you are okay. This is the way it really works: when you borrow money in a business you create a liability, as you pay off the debt on the equipment you bought the liability is turned into an asset. Furthermore the asset you bought can be depreciated and the loan interest is deductible. So if you buy wisely you are paying off your note with TAX FREE money. I have done this for years and it is an absolute gift. This is what I think and I am not interested in a debate but another observation that those that think will "get". All the whining about taxes and the tax code is from people that don't understand it or from those that don't want YOU to understand it. The tax code is written by elected officials that are bought and paid for, thus the tax code is written by business Link to comment Share on other sites More sharing options...
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