loach33 Posted April 24, 2014 Share Posted April 24, 2014 I think I know the answer to this question and I know where I'm leaning but I thought I would put this out there for any comments. Even for you fulltimers - think back to when you were here.... If you were a part-timer but looking to go full time one year from now - and you knew that to do that you would have to triple your sales from here, (add over $100,000 in sales), then would you consider your the first start on that road to be a large 200 person account that will require 10 machines because they have multiple buildings. Coffee included. It is a blue collar environment with breakrooms and three shifts running 6 days a week. (They currently have 17 machines but it looks to be overkill). They would look to change vendors if they can get newer equipment and credit card readers. So, the machines won't be cheap. It's hard to project but if you figure just $1/day per employee for five days a week that's $48,000/year. I'm going to be conservative and say that it's more like a $30,000/year account. I do know the commission on just pop they get is, they say $30/month, which is 5%. That means $600 in pop. So, if that's true then this account isn't that good. If they're getting hosed on the commission and it's really twice that then it's still just a $30K account. (They would not require a commission going forward by the way) You may want more info, but that's the gist of it. If you say no, stay away, then what other direction would you go to get to those sales figures? Link to comment Share on other sites More sharing options...
moondog Posted April 24, 2014 Share Posted April 24, 2014 I think I know the answer to this question and I know where I'm leaning but I thought I would put this out there for any comments. Even for you fulltimers - think back to when you were here.... If you were a part-timer but looking to go full time one year from now - and you knew that to do that you would have to triple your sales from here, (add over $100,000 in sales), then would you consider your the first start on that road to be a large 200 person account that will require 10 machines because they have multiple buildings. Coffee included. It is a blue collar environment with breakrooms and three shifts running 6 days a week. (They currently have 17 machines but it looks to be overkill). They would look to change vendors if they can get newer equipment and credit card readers. So, the machines won't be cheap. It's hard to project but if you figure just $1/day per employee for five days a week that's $48,000/year. I'm going to be conservative and say that it's more like a $30,000/year account. I do know the commission on just pop they get is, they say $30/month, which is 5%. That means $600 in pop. So, if that's true then this account isn't that good. If they're getting hosed on the commission and it's really twice that then it's still just a $30K account. (They would not require a commission going forward by the way) You may want more info, but that's the gist of it. If you say no, stay away, then what other direction would you go to get to those sales figures? Anytime you can land a 200 person blue collar account you should jump on it. It doesn't get much better than that. Just tripling your sales doesn't necessarily mean you'll be tripling your profits. Build slowly with good solid accounts and you'll make more in the end. Link to comment Share on other sites More sharing options...
allen watson Posted April 24, 2014 Share Posted April 24, 2014 I would look to buy an existing route with owner financing. Link to comment Share on other sites More sharing options...
AZVendor Posted April 24, 2014 Share Posted April 24, 2014 This could be a great account for you. I might not put your bottom line where you want it right away, but after the machines are paid off then your bottom line will improve dramatically. A smart investment now will benefit you greatly down the road. As Moondog says, jump on it but do it with your eyes wide open. This sounds like an office location with multiple buildings which will dilute your sales per machine. If it's manufacturing you could do better. You definitely want to estimate conservatively. No commission sounds great until they expect prices lower than market pricing. Don't give the farm away. Maintain prices that you can live with and, over time, gradually work your prices up on some of the items to incrementally grow your bottom line. Provide the card readers, but don't feel that you must leave them on every machine in every building. Be honest with them beforehand that if the sales don't support the card reader then some might be removed as they are expensive to run. Remember that card readers are most useful on high priced products. Definitely get good, quality machines that you are familiar with so you can keep them running easier. My big break came when a gigantic quasi-government contract fell into my lap. I bought $100,000 worth of equipment on 3 year financing (the location contract was 3 years), lined up machines from Coke and Pepsi (I was already a Pepsi 3rd party and this brought Coke along), bought my first Isuzu truck, hired my first driver and installed 100 machines in one week. I jumped head first into the deep end after having worked from 5 machines to about 60 machines in the prior 5 years. It worked out but we struggled the first couple of years. Nowadays you can buy good refurbed machines including the soda machines for much less than that price. The only account I had that might equate to this was a local city here that I won the contract on and installed 27 machines in various buildings. I could never get the monthly gross sales from those 27 machines to exceed the sales I had from 3 machines in a junior high school account I had. I think that says more about the junior high school account than it says about the city account, but it still amazed me. Your only options to grow that much in one year is by in-house growth like this new account or by purchasing other locations or someone's route. The quickest way to do it is with a route, but then you'll be cleaning up someone's messy machines and finding a variety of machines you might not be familiar with. Internal growth like this new account will be your baby with no messes to clean up. And then you can still go buy some locations or a route or use this new account as a referral when you sell other new accounts. The sky's the limit. Link to comment Share on other sites More sharing options...
AngryChris Posted April 24, 2014 Share Posted April 24, 2014 Unless you sell food, coffee, snacks, and soda at the same place, $5 per person seems a bit high. I would go with $2.5 for snack and soda and about $5 for the whole kitten kaboodle Link to comment Share on other sites More sharing options...
Rick Posted April 24, 2014 Share Posted April 24, 2014 AZVendor, your posts make me believe I can do anything. Thank you. Link to comment Share on other sites More sharing options...
tc vending Posted April 24, 2014 Share Posted April 24, 2014 I think buying a route would help you grow fastest I like steady growth myself wouldn't mind a buyout if the terms were right. Buying out other vendors is popular in my area right now. Link to comment Share on other sites More sharing options...
SchligVend Posted April 25, 2014 Share Posted April 25, 2014 AZVendor, your posts make me believe I can do anything. Thank you. That is why I keep Randy (AZvendor) on call for my repairs and parts around Az. Link to comment Share on other sites More sharing options...
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