Cdye23 Posted February 28, 2014 Share Posted February 28, 2014 Hey everyone. I've been interested in bulk vending for a while but never really pulled the trigger. I saw an ad for a machine in our local newspaper and it turns out the guy has an entire route to sell. Being a newbie I have no idea if his asking price is in the ballpark or not. When I met up with him he gave me the normal hot air "my accountant says the route should be priced 2-3 times gross sales so you're really getting a deal", "I only work about 2 hours a month" and my favorite, when I asked to see the bank statements he said "well what I report isn't what I really make". Enough of the back story. Here's the details: Equipment (age unknown but at least 6-7 years old based on revenue data): Placed 20 placed gumball machines that say "Big Rumble" on them but they look a lot like the spiral Wizard to me 9 placed U-Turn 4 1 placed U-Turn 8 Not Placed 5 spiral gumball machines 1 "Lil Rumble" machine 1 U-Turn 4 Revenue (on his excel sheet, not bank statements): Yearly Gross: $12,989 Yearly Net: $4,797 (in his terms basically based on 50% profit on most locations but only 25% profit on the most profitable locations) Misc Info: Asking price does not include any extra parts (of which he shows he has plenty) Locations are included in price Product currently in machines is included with sale Monies currently in machines is not included with sale Locations are not efficient - just three of them would take me 4-5 hours to service due to driving distance (but those are the most profitable (high schools) Seller's not too motivated but is getting bored with the business The route is currently commission based and are between 30%-40% gross He said he would finance the deal making me think the figures are more solid Asking Price: $6,175 My biggest hesitation is the time it will take to service all of the out-of-town machines. I have a full time job and a new baby at home. What are your thoughts? Thanks everyone, -chris Link to comment Share on other sites More sharing options...
FrCorey Posted February 28, 2014 Share Posted February 28, 2014 too much for spirals and u turns they seem to be selling on the route potetial. Link to comment Share on other sites More sharing options...
musser Posted February 28, 2014 Share Posted February 28, 2014 If he can't verify income with bank statements, commission checks, tax forms or some other reliable means its all hearsay. Link to comment Share on other sites More sharing options...
orsd Posted February 28, 2014 Share Posted February 28, 2014 Hey, I see you made it here from bvf This is a better forum, by the way Ditto on what frcorey and muster said Link to comment Share on other sites More sharing options...
Cdye23 Posted February 28, 2014 Author Share Posted February 28, 2014 Thanks all. I've posted to a couple bulk forums. But I agree, this is a better forum. Of the 30 machines placed, only a third are located in my town. One route (3 machines) would take me a total of 1.75 hours of drive time, second group (10 machines) would take 2.5 hours and the last 6 (3 locations) would take all of 4 hours. Those aren't including service time. He's stuck on $150 for the U-Turns and $175 for the spirals and says the locations are a "bonus". What should my next step be? Demand to see bank statements/tax returns or no dice? He actually just texted me asking if I was still interested after we met only a week ago. I assume that he's a little more eager to sell. Link to comment Share on other sites More sharing options...
treadmill Posted March 1, 2014 Share Posted March 1, 2014 Machines are worth no more than $100 a piece. Locations can not be sold because he doesn't own them and by the way somebody else could come in and take your location and then what, your out of money. Too much driving for very few machines to service. If route was like maybe 50-100 machines I would consider it. As some have said no bank statements or tax returns to verify income I would run away as fast as I could. Link to comment Share on other sites More sharing options...
musser Posted March 1, 2014 Share Posted March 1, 2014 I guess I take issue with calling 3 or 6 machines a route. They are not a route but a random mess. Walk away. Link to comment Share on other sites More sharing options...
TexasFreemason Posted March 1, 2014 Share Posted March 1, 2014 I see several red flags... 1. The distance involved. That would be okay if they were racks or amusement machines, but not for spirals and U-Turns. 2. Money in machine Not included. 3. Price 4 Commissions are too high. Again... okay for racks and amusement but not for candy and gum. 5. The fact that the bank statements and the "records" that he shows you do not match. He is either cheating the government or trying to cheat you. Either way he is a crook. My advice, buy machines and place them yourself. Link to comment Share on other sites More sharing options...
TWvend Posted March 1, 2014 Share Posted March 1, 2014 I'd offer 100.00 each cash for the placed machines which is 3000.00 and have him include the 7 which aren't placed. Go up an extra 500.00 if you really want it , but no higher. That's just my .02 Link to comment Share on other sites More sharing options...
redfleet32 Posted March 1, 2014 Share Posted March 1, 2014 Every "route" or few machines Ive bought always started with the owner thinking they are worth twice of what we end up settling on. The key is to not offend them in the process of educating them of what their machines are really worth. Link to comment Share on other sites More sharing options...
Rick Posted March 2, 2014 Share Posted March 2, 2014 Sometimes your gut knows before your brain does. I know you're itching to take the plunge, but after I read:"My biggest hesitation is the time it will take to service all of the out-of-town machines. I have a full time job and a new baby at home."...is there really anything else to consider? Sounds like you already know the answer, you're just looking for someone to talk you into it. Be patient, the right route FOR YOU will come along soon. Link to comment Share on other sites More sharing options...
Grazing Hippo Vending Posted March 2, 2014 Share Posted March 2, 2014 One of the things I learned during my post graduate studies at the University of Hard Knocks, is that just because something may be a good deal, it does not mean that it is necessarily a good deal for you. Not that I am convinced that this route would be a good deal for anyone. I think Rick hit it on the head. If you have serious reservations then you should probably step back and consider what it is you need for you and your growing family right now. Maybe start a little smaller? Place a couple of machines on your own? Buy a more condensed route? Good Luck! Link to comment Share on other sites More sharing options...
Cdye23 Posted March 3, 2014 Author Share Posted March 3, 2014 Thanks all for helping out. I this you're right Rick, I have answered my own questions. Update to the story: I was pressing to get bank statements and he sent me his full spreadsheet showing many more locations in our town that were much more lucrative. Looks like he was just trying to sell off his underperforming/long distance machines. However, he has offered me his non-placed machines for $900 (5 4' spirals and 1 2' spiral). I know harleyrider mentioned he wouldn't pay more than $100 for each but I've been looking around and I haven't been able to find any close to that price either for sale or sold. Where's the best place to buy used machines and/or should I offer him $600 for those and place them myself? Link to comment Share on other sites More sharing options...
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