Beginner, and lost in numbers...

[lferrante]

To start this off with some self-deprecating humor- I have dyscalculia (really), maybe not my best decision to get into vending! hah.

 

I purchased my first combo machine about 3 weeks ago. I'm having trouble trying to understand what I'm supposed to be calculating.

 

I made a detailed Excel workbook with 2 tabs, one for products and another for inventory. If anyone wants to see it , PM and I can link. Problem is I don't know how to use it, jeesh.

 

The machine was stocked with about 75% product when I got it. I went out and bought some drinks and snacks and filled it up. But I didn't keep track of what I put in, and when I sporadically go fill it up through the week I'm lost with the numbers there too. There seems to be a snowball effect of not keeping numbers straight, now there's no way to tell what sold the first or second week. IF my inventory is supposed to say how many items were sold to count profit, I don't have that information.

 

I bought two low cost books on Amazon about vending, but neither covered managing inventory in detail.

 

I also tried Vendtrack but the high cost for just one machine doesn't make sense.

 

The machine has about $40 in sales a week. Honestly I don't know how much of that is profit! I'm stuck.

 

The machine can show the sales amount, what's in the coin return, number of vends.

 

If anyone is curious, travel time and distance is not an issue, less than 5 mins away.

[orsd]

read through the full line part of the forum

it will answer lots of questions

to figure out profit, simply subtract cost of one item at costco from the sale price

for example, a 32 case of coke is around 8 bucks at costco

divide 8 by 32 to get 25 per can cost

add tax, around 2 cents, and bottle deposit, if applicable in your state

if you vend for 75 cents, then .75 minus .30 (approx) =.45 in profit per vend

also, pay attention to expiration dates on snacks, especially

also, try to keep cost of product to one half of vend cost.

[Vendors Tech]

read through the full line part of the forum

it will answer lots of questions

to figure out profit, simply subtract cost of one item at costco from the sale price

for example, a 32 case of coke is around 8 bucks at costco

divide 8 by 32 to get 25 per can cost

add tax, around 2 cents, and bottle deposit, if applicable in your state

if you vend for 75 cents, then .75 minus .30 (approx) =.45 in profit per vend

also, pay attention to expiration dates on snacks, especially

also, try to keep cost of product to one half of vend cost.

He's right.  Also, unless some items sell too slow to fill them this full then have to worry about them expiring, fill all the rows to maximum capacity, count how many items each row or rack (for soda) will hold, then count how many are empty each time you service the machine.  That way, you know exactly how much of what sold, and you can track what you paid for what you sold, and what you profited.  Its a lot to do if you have a large route, but with one machine, its by far the easier way to go.  Don't get too flustered on losing track of what you sold out of just one machine though. 

[moondog]

To start this off with some self-deprecating humor- I have dyscalculia (really), maybe not my best decision to get into vending! hah.

 

I purchased my first combo machine about 3 weeks ago. I'm having trouble trying to understand what I'm supposed to be calculating.

 

I made a detailed Excel workbook with 2 tabs, one for products and another for inventory. If anyone wants to see it , PM and I can link. Problem is I don't know how to use it, jeesh.

 

The machine was stocked with about 75% product when I got it. I went out and bought some drinks and snacks and filled it up. But I didn't keep track of what I put in, and when I sporadically go fill it up through the week I'm lost with the numbers there too. There seems to be a snowball effect of not keeping numbers straight, now there's no way to tell what sold the first or second week. IF my inventory is supposed to say how many items were sold to count profit, I don't have that information.

 

I bought two low cost books on Amazon about vending, but neither covered managing inventory in detail.

 

I also tried Vendtrack but the high cost for just one machine doesn't make sense.

 

The machine has about $40 in sales a week. Honestly I don't know how much of that is profit! I'm stuck.

 

The machine can show the sales amount, what's in the coin return, number of vends.

 

If anyone is curious, travel time and distance is not an issue, less than 5 mins away.

For snacks, you should start with a chart or "plan-o-gram".  This will list each selection and the snack item assigned to that selection.  It's important to to be consistent with your product placement as some items vend better with certain coils depending on the coil "pitch" (spaces per coil).  Eg. Fritos will vend just fine in a 12 pitch coil where Doritos will fit a little tight and  vend better with a 10 pitch coil.  Once you have this set up, give each selection a par count which is the maximum amount you'd stock for each item - the par count is based on your past sales experience.  Extremely popular items may completely load the coil where less popular items may only have a par count of six.

 

For the sodas,  I keep track of how many sodas I load each service cycle for sales tax purposes.  Most combo machines will have a serpentine can section where you can't actually count  how many cans are in each column. 

 

You'll find that your profit (gross margin) will be half of your gross receipts in almost all cases.  It may never match to the penny but's it's really not worth doing a lot of in depth analysis over unless you're doing a million dollars a year or more in sales.

[AZVendor]

For the sodas,  I keep track of how many sodas I load each service cycle for sales tax purposes. 

Don't you pay sales tax on gross collections, not unit sold? 

[moondog]

Don't you pay sales tax on gross collections, not unit sold? 

We pay sales tax on sodas but not snacks so with a combo machine I record how many sodas go in and pay tax on the sales price as if they were already sold - usually they are by the time I file my taxes.

[Vendergy]

Sometimes you'll find 12 pack soda for less than $2.50..at east coast markets like waldbaums or stop and shop, almost .21 cents a can! Just start over now that your starting inventory is probably diminished. Just write down what you spent on the supply, and minus it from what you pull out say after two weeks. If you don't pay the proprietor any commissions, all the money is yours anyways! Thats why I don't mess with snacks..chips get stuck in the coils, expiration dates, stale, crumpled chips! Beverages are the way to go! JMO! Good luck!

[TKK]

There really isn't a hard problem here like everyone has stated. If you need to be ocd about it, write down the cost of each item you stocked ex. Sodas .25 cookies .25 etc. Fill up the machine and when you service check the spirals. If there is 10 chips missing write it down, 6 cookies write it down etc. With sodas you can use a permanent marker put a case or two of sodas in each selection and make a line next to them. Then same thing. When you service fill up to that line and count how many sodas you added, unless its empty then add more than before or double columns. At the end of the month check all the items you sold. Say knotts cookies 22, flaming hot mix 45,, etc. Then you can

multiply those products by cost x items sold minus total gross collected. Very simple. You do not want to be this detailed even in a bigger route. Just try to know what sells in each location and make sure you have that every time you service. Like me I just see my monthly purchases and subtract from total sales.

Az is right, you must pay taxes on total sales, well taxable sales.

Here in Texas no taxes on any vend under .50c if its bulk

No tax on water

No tax on food items like chips, crackers, pastries, cookies etc, IF there is not an eating facility there.if you have them in a break room you must pay sales tax on all sales except water.

You should at MINIMUM double your profit. I personally more than triple (im at 30% cogs)

[lferrante]

Thank you all your input.

 

Guys, I'm going to post my Excel workbook just so it's more clear to everyone. I have already accounted for all of the things above, even tax on CRV if applicable, but for example, here is a tough one:

 

If I buy a case of soda for $8.00 from Costco, then buy another in 2 weeks from Wal-Mart I pay a different price right? So what happens when I try to calculate historically to determine profit? All the original sales at the first price point get screwed up because the current price is different.

 

These are the little things I'm thinking about. Here is the Excel 2010 sheet.

https://docs.google.com/file/d/0BzloJ3FFlMb1ZVV5N2NuZ0ZrTnM/edit?usp=sharing

 

You can see all my initial costs in column I to fill it up, but like I said the machine was already about 75% full.

 

Also, the sold columns aren't filled in correctly because I don't know how to keep track of it, As mentioned there is about $40 a week in the box. The con holder keeps like $37 or so.

[orsd]

you did that?

thats a lot of patience needed

wow. im impressed

also, when you get a full size stacker style machine, make sure to get "vendable" waters

 otherwise, theyll jam

also, what combo do you have?

most combos are serpentine rack style, not stacker style, and you cant do water in them, only cans

one more thing

did you buy the 50 count case of chips from sam's?

if you did, unless this is a really good location, you'll want to avoid the 50 pack cases because chips expire in 2-3 months and you might have a hard time selling them before they expire.

[lferrante]

Thank you! Yes, my coworker gave me the idea to split the two tabs, but I figured out all the rest. I tend to get really detail oriented, sometimes over complicated. LOL

 

Yes, I bought 50 pack from Sams..next time I won't do that. I can tell already they aren't selling as I would like them to, probably will expire. Water is vendable, and plastic sturdy so they don't compress out of shape.

 

Machine made in China RC800 (6 drink/30 snacks or whatever). Perfect size for the location, people say the machine isn't that great, but it's the best fit and matches the decor.

[coinvestor]

Make sure that your pricing is right, buy variety packs, keep as little extra inventory as humanly possible and spend your time looking for another more accounts. Track your gross profit by taking total collections for the month and subtract your inventory cost for the month = gross profit. Your numbers will bounce around from month to month as your inventory fluctuates and carries over from month to month, but you will get good numbers over time (ie quarterly or annually). Im not sure how to say this without sounding flip, but you have one combo machine............. your profit is piled in the expired box in the corner of your kitchen Spend your time looking for more at least 3-4 more stops or finding a way to track profit and inventory is useless. I had the same issue getting started and I think most people did. Its easy to spend lots of energy and time thinking about stuff like this until your paralyzed when it really only comes down to the right pricing going into the account and not overbuying which you have to do with one combo.

 

JD

[endgame027]

Lferrante,

I bought my first machines this summer too. I have a 12 selection soda and a glassfront snack machine, but I'm wondering the same thing you are. I am keeping track of overall profit, but that will be negative for a while because I bought the machines and inventory. I think what I am hearing from other members on the forum is that it's most important to keep track of how many of each item we sell. Here is what I am thinking but can't seem to figure out how to get it on a spreadsheet. If we buy a 24pk of soda for like $.25 per can with expiry dates of Dec '13 and then later a 12pk for $.35 per can with an expiry date of March '14, I think we should keep track of this for two reasons. One is obviously profit per sale and the other is keeping track of expiry dates. Both could be tough to do with the 24pk and the 12pk mixed in together and the first soda's buried in the machine. So if we go back to the machine and we've sold 30 soda's for $1 each then we know we've made (24 x .75) + (6 x .65) = 21.90 profit on these sales and we have gotten rid of all 24 of our Dec '13 expirys. Then if we ever have to throw out expiry's, we would just count the number we throw out times the cost per can to find out our losses. These calculations would have to be separate from our overall cost/income calculations, but they still could be helpful. Not sure how I would put this into a spreadsheet.... 

[Vendergy]

Customers seldom check expiration dates, and if you buy a case of soda and are worried about the expiration dates, you're not selling very much of it! I'm refilling my machines every week!...soda cans are good for over a year!

[orsd]

Close to a year

Way less if its diet or bottled

[TKK]

Mm yeah idk why you guys would go that far seriously. I dont mean to burst bubbles but either A u have too much time in your hands or B you are treating a tiny business as a normal one. The expiration shouldnt matter ive never had a problem w stales except in the beginning. Cans last like 10 months.

[Vendergy]

Maybe we shouldn't criticize them too much, after all...the title of the thread does say he is a beginner!

[TKK]

Your right, I was a beginner last year and yes id check my first accounts like 3 timeS a week lol. But its sooo much waste of time. Even.with my excel sheet its super basic and to the point all I care about is gross and net etc.

[rmorris1953]

Wow..... Sure glad I only do service work :-). Pretty complicated tax rules in some states. Kansas 7.15% on everything sold. OK $75 Tax stamp.

[endgame027]

Okay. I understand it's easy to go overboard and all those numbers probably aren't worth it with one or two machines. I will keep track of gross and net, but wouldn't it be helpful to know how much of each product sold between services? I feel like if we can easily see how much product we have when we fill the machines and then how much less we have when we come back the next time, then it's almost no extra work other than writing it down. If you are refilling your machine once a week then you are selling enough that it might not matter. I don't think my account will be like that lol. 

[orsd]

if you have a new enough machine, then there will be a sales counter, as well as a money counter

it has to have a display

we can tell you how to access it if you can provide the make and model of your machine

[endgame027]

Thanks I reset the sales counter today.

[lferrante]

_{Ugh, guys sorry. I'm still stuck. Another month gone by and I can't figure out exactly how much money I made.}

 

_{Total sale amount in machine was $127. I don't khow how many of each sold.}

 

_{What are you guys doing on each trip to the machine? I don't know what to write down. I tried writing down the quantity of what I added each time I visited, but I got to the end of the month and that doesn't tell me how many I sold.}

[AZVendor]

If you really want to track this much detail, here is a basic formula to use:  (Beginning inventory - stales + adds - ending inventory) = units sold.  Units sold x selling price = gross sales.  Units sold x cost of product = COGS cost of good sold.  That will work for any single item you choose to track.  Then Gross sales - COGS = gross profit.  This is called gross profit because no costs other than operational costs are involved.  An even simpler way to figure this out is to take your sales for the month, subtract the money you spent on product, subtract how much product you still have in the machine and in storage and that leaves your profit. 

 

You truly are being too anal about this.  If you want this much detail, then the formulas above are the way to do it.  An easier method is to track you product purchases and simply subtract all of them from your machine sales and what's left is your profit.  You just have to realize that the math includes unsold product that you haven't realized a profit on yet. 

[TKK]

ORRRRRR.....

You can write down everything you stock in it. Then.go by when they open, sit down next to it, count what products were bought, write it down. Make sure you take a lunch but do NOT leave sight of the machine. Then when they close make sure everyone leaves to avoid getting a last minute sale not accounted for, then log Down and repeat the next day.

Just leave it alone buddy its a waste of time, just stock what sells and move product that doesnt. Subtract total sales minus product expenses. Sure u may have 10 cases of stuff left but over time youll see an average number as the next month you wont spend as much.