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Value of a route


BluePlate
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I'm sure this has been discussed before, what is the best way to determine the value of a route?  If I was to use a fictional route like 30 machines placed within a 20 mile radius.  The machines are doing an average of $14 per location a month.  The route comes with product and the machines are Vendstar 3000's.  How would you value? How much value difference if they were Beaver machines or 1800 vend machines?

Thanks

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I don't remember the formula on how someone figured this out but it did make sense.  I read it in a post sometime this past week.  I think I have now read every single thing on the board.  I am sure someone will post the link to that thread, I don't know how to do that if I did find the thread.

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I recall reading it also. Maybe the poster can fill in the blanks. IIRC it was basically that the value of a route was the money the route made in a year. I don't recall if that was gross or net. I don't think it took into account machine type, age of machines or product in the machines.

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70% of the 1 year gross is what has been posted in other threads on this subject.

I come from a business (Credit Card Processing) where people build portfolios solely with the intention of selling the portfolio.  So at 70% of one years gross, it does not seem like this would be a good "plan", just building to sell - unless you plan on dumping your dog locations or locations not in your target area.
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I am new at this vending business...but I have to ask...If you value the "route at 70% of the 1 year gross...What value do you give the machines???....or do you figure that in the "route" cost....

In my Real Estate business...any commercial business venture is considered a good to better move if you can get your cost back in a two year period...Obviously the shorter the better...

Jay

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Jay,

I'm new to this whole thing myself, but that is one of the things that excites me about this business, you can make a return on your investment within 5 to 8 months.  As a new comer, it seems the key is locating the machines where you don't have to drive out of your way for a handfull of quarters.  I'm really going to try to place my machines in a few mile radius.

I'm finding there are enough people who have a garage or a storage shed full of machines, that supply of used machines are much greater then demand - driving costs the costs down. I would love a perspective of a veteran on this......

T

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Here are some threads that address this topic. All these have come from the "Vending 101" section at the top of the board.

Steve

Whats the value of a route? - http://www.vendiscuss.com/forums/view_topic.php?id=53&forum_id=1

Purchase Existing Routes - http://www.vendiscuss.com/forums/view_topic.php?id=33&forum_id=1

Buying existing route - http://www.vendiscuss.com/forums/view_topic.php?id=104&forum_id=1

Valuing a Route - http://www.vendiscuss.com/forums/view_topic.php?id=291&forum_id=1

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