HVendTrends Posted March 27, 2012 Share Posted March 27, 2012 I am looking to buy an existing snack vending route in DC metro region, either in Maryland suburbs/Montgomery County or Northern Virginia suburbs (not both areas in one route) and would prefer a vending route that has a healthy snacks emphasis. I would not be interested in a size larger than I can service myself of no more than 20 to 30 machines and would need seller financing after I make a down payment on the business. I am also seeking advice on how to price such a vending route. I welcome feedback on views/experience for buying an existing snack vending route and suggestions about how this should be priced (an equitable formula for pricing on net annual revenue) with seller financing as part of the transaction. Should it be priced just on the annual net revenue or should current value of the used machines be taken into account for the price of the route? Thank you for your input! Link to comment Share on other sites More sharing options...
sbishop Posted March 27, 2012 Share Posted March 27, 2012 Seeing that you are looking for a "healthy snack emphisis" I am guessing that you do not have much if any experience in full line vending. I would suggest that you buy a machine or location and test the waters before buying a route! Link to comment Share on other sites More sharing options...
RJT Posted March 27, 2012 Share Posted March 27, 2012 Your "story" sounds a bit familiar but let me give you my 2 cents. (whatever that is worth) Get off the healthy kick and concentrate on "regular" vending. Offer some healthy selections in your line up and even call it your "healthy options" program or whatever you want to call it. Then you will have a better chance of making it. Like your name implies HV "Trends". Trends are just that trends and trends come and go like bobby socks, wire rim glasses, mullets, and parachute pants, stick with the tried and true which is regular vending. Regular vending is like wing tips it just dosent go out of style. Like I said offer some healthy selections which is a smart way to handle the trend of healthy vending, but dont put your entire bank roll on that "trend". Yes, in short one time net plus any added value nice, newer machines may add to the value, is a starrting point. No hard fast rules about how to price a vending company or route. A general rule is to go by net which is in general 1/2 of gross. However, that may not be accurate if they have low prices. I have seen top dollar paid and I have seen fire sales happen, it really depends on the entire situation. One sure way to make sure someone is telling the truth on revenue is to ask for any and all receipts for goods purchased to back up any such claims. It is easy to make up sales numbers it is much harder to make up receipts from suppliers showing goods purchased. Again, all this can vary. Have a route doing 100k gross but has top notch newer equipment or have the same route with old junk equipment can make the price of the route/company vary greatly. Link to comment Share on other sites More sharing options...
Vendors Tech Posted March 27, 2012 Share Posted March 27, 2012 Asking if an unknown route with unkown types of equipement in unkown location types for an unknown amount of money doesn't give anyone anything to go off of. Just use common sense. 1. Don't borrow money, especially not in this economy. 2. Stop going against the expert advice from seasoned vendors on this forum, like RJT and others, and get off the healthy snack issue, and get into real vending. 3. Look at stats. Does true all healthy vending succeed anywhere? Are there any "big" vending companies doing it? 4. If it was profitable, wouldn't everyone be doing it? Or least more people than almost nobody? 5. If you consistently ignore the advice of the members of this forum, as you are repeatably doing, why are you continuing to ask questions? Link to comment Share on other sites More sharing options...
mission vending Posted March 27, 2012 Share Posted March 27, 2012 I am looking to buy an existing snack vending route in DC metro region, either in Maryland suburbs/Montgomery County or Northern Virginia suburbs (not both areas in one route) and would prefer a vending route that has a healthy snacks emphasis. I would not be interested in a size larger than I can service myself of no more than 20 to 30 machines and would need seller financing after I make a down payment on the business. I am also seeking advice on how to price such a vending route. I welcome feedback on views/experience for buying an existing snack vending route and suggestions about how this should be priced (an equitable formula for pricing on net annual revenue) with seller financing as part of the transaction. Should it be priced just on the annual net revenue or should current value of the used machines be taken into account for the price of the route? Thank you for your input! I think you will be searching for a long time for a snack only route for sale, there just are not that many to begin with. Virtually all vendors do snack and drink together to maximize revenue. Link to comment Share on other sites More sharing options...
HVendTrends Posted March 28, 2012 Author Share Posted March 28, 2012 Good advice above from RJT - thank you! While I initially considered an exclusive healthy snack vending business, I have been receiving some constructive advice including yours to reassess my approach to a vending business, which is why I am now more inclined to acquire an established general snack and beverage vending route that I can grow from what I acquire. I would like to follow-up with you as I look at an actual general snack and beverage vending route that I may purchase in my area, so please feel free to message me with your contact information if you are inclined to have some direct follow-up. Thanks! While I appreciate some of the comments above from H4UV, I don't particularly appreciate the question #5. Firstly, it seems to me that the purpose of this kind of forum is to post questions, comments and advice to further understanding about this industry and issues about vending. So, when I have been contemplating a particular business opportunity for healthy snack vending, it seems entirely appropriate to post a question and request for feedback. Some of the feedback has been quite helpful and constructive and I as I am further evaluating what direction to take, the constructive comments are appreciated and I am taking a second look at healthy versus general snack vending as reflected with my post above. Second, my posting above clearly invites interest and conversation about my new interest in buying an existing GENERAL snack vending route, which if you cared to look at the posting, is expressing an interest in general as opposed to exclusively healthy snack vending. Constructive advice on my posting above and two questions posed are welcome. Thank you! Link to comment Share on other sites More sharing options...
dogcow Posted March 28, 2012 Share Posted March 28, 2012 I am looking to buy an existing snack vending route in DC metro region, either in Maryland suburbs/Montgomery County or Northern Virginia suburbs (not both areas in one route) and would prefer a vending route that has a healthy snacks emphasis. I would not be interested in a size larger than I can service myself of no more than 20 to 30 machines and would need seller financing after I make a down payment on the business. i'd like a winning lottery ticket does anyone know where i can find one and how much i should make an offer? Link to comment Share on other sites More sharing options...
Vendors Tech Posted March 28, 2012 Share Posted March 28, 2012 What I meant by that question, is that you have aleady posted a question on healthy vending, and we answered it. You are still bringing it up. I just can't believe that there is 20-30 machine route in your area, that offers healthy snacks, has good quality machines, and will be available at a price anyone could afford. Most people who have those kinds of route think that they are "it", and their route is extremely valuable. Or, they spent so much money on junk Genesis, Seaga, and whatever that Jofemar brand is, that they have to ask an outrageous price just to keep from getting out of the business bankrupt. You need to start looking at realistic numbers here. Everything so far has been hypothetical. Bring an established route to us with the stats and machine and account info, and we can help you. We can't work with non-existent numbers or facts. Link to comment Share on other sites More sharing options...
mission vending Posted March 28, 2012 Share Posted March 28, 2012 Things to look for in evaluating any route: 1. DOCUMENTED REVENUE, not what they say it makes, tax returns or bank deposits 2. DOCUMENTED REVENUE, self explanatory lol 3. age and type of equipment, is it MDB, is it DEX ready to accommodate new technology you might want to deploy in the future 4. any contracts in place 5. commission structures 6. assets other than machines on location 7. warehousing and delivery situation If you find a route that interests you the above information will go a long way in helping you with determining a fair value. Link to comment Share on other sites More sharing options...
dogcow Posted March 28, 2012 Share Posted March 28, 2012 forget owner financing ... i would never finance a route that small first of all and second of all the owner would have to be very desperate to sell. you have no experience in the biz what if you totally screw up the route and get booted from everywhere then how does he get his money. maybe if i could get a lein on someones house i might consider doing that but i think you are basically dreaming if u think ur gonna get owner financing, either that or you are paying a huge premium or getting junk. Link to comment Share on other sites More sharing options...
Vendors Tech Posted March 29, 2012 Share Posted March 29, 2012 Its a risk the owner would have to take, yes. I am targetting routes that REALLY want to sell with that statement. I wouldn't recommend that someone jump into the business any other way, they will pay too much money. An inexperienced person should start out small and buy a route that is a good route, but let's say an elderly person owns it and needs to sell fast because of health problems. That is the way to go,not spending tons of money, or borrowing it, when getting into a business you know very little about, working machines you have never seen before, and learning a trade that takes a good 3-5 years to master. Even with my experience, I would never borrow money to buy a route. If I had enough cash on hand, then I would out right buy it. But otherwise, the only way I would consider it is to do owner financing. If I couldn't pay, then I would be out the time I put into it, but wouldn't have a $1500 a month bank payment on top of it. Link to comment Share on other sites More sharing options...
dogcow Posted March 29, 2012 Share Posted March 29, 2012 Its a risk the owner would have to take, yes. I am targetting routes that REALLY want to sell with that statement. I wouldn't recommend that someone jump into the business any other way, they will pay too much money. An inexperienced person should start out small and buy a route that is a good route, but let's say an elderly person owns it and needs to sell fast because of health problems. That is the way to go,not spending tons of money, or borrowing it, when getting into a business you know very little about, working machines you have never seen before, and learning a trade that takes a good 3-5 years to master. Even with my experience, I would never borrow money to buy a route. If I had enough cash on hand, then I would out right buy it. But otherwise, the only way I would consider it is to do owner financing. If I couldn't pay, then I would be out the time I put into it, but wouldn't have a $1500 a month bank payment on top of it. owner financing is borrowing money they hold a note you are still obligated to pay if the route falls apart, its just harder to collect if theres no hard assets its against but it is still a collectable debt afaik Link to comment Share on other sites More sharing options...
sbishop Posted March 29, 2012 Share Posted March 29, 2012 I have found 5-6 routes for sale. Most of them wanted WAY too much money and I have passed. I did start my vending venture with the purchase of a route that was priced right, the guy was in his 60's and had health issues and it was more of the pain for him to have to continue serviceing it, so he sold it cheap to get out from under the responcibility. BTY, it was and is called sensible snacks. He named it that over 12 yrs ago and almost went broke trying to offer healthy snacks. I do have healthy selections, but they are the ones that sell. Good luck in you vending biz. I hope you take my advice from my earlier post and start small. I started with 3 machines 8 yrs ago and I liked it. I ended up moving from NC to TX (love will do that to you) and came across the route I now own Link to comment Share on other sites More sharing options...
HVendTrends Posted March 30, 2012 Author Share Posted March 30, 2012 Great comments above - thanks very much for the helpful guidance. I'll keep ya'll updated as I continue my search and review of a particular vending route I am considering. Link to comment Share on other sites More sharing options...
VFVending Posted February 27, 2013 Share Posted February 27, 2013 Hvendtrends, Did you find a route that met your needs? Link to comment Share on other sites More sharing options...
treadmill Posted February 27, 2013 Share Posted February 27, 2013 Obviously not since he has not gotten back with us since last year. I think he is still looking for pie in the sky healthy vending route in DC. Link to comment Share on other sites More sharing options...
VFVending Posted March 4, 2013 Share Posted March 4, 2013 Obviously not since he has not gotten back with us since last year. I think he is still looking for pie in the sky healthy vending route in DC. He might have found that pie in the shy but it definately wasn't a healthy vending route. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.