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Proceed with caution or RUN?


Rick

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Hoping to get an opinion from you experienced Full Line guys, specifically regarding how you would respond to this Craigslist ad (if at all!)  I'm strictly bulk but, never one to leave a revenue stone unturned, this caught my eye:

http://fortcollins.craigslist.org/bfs/4505651438.html

 

Cliff's Notes:  Three crappy (but new) Seaga Combos on location grossing $1,200/month.  From reading the ad, this guy is obviously in Combo hell - having to service this place "twice a week" and I'm guessing that's conservative.  What's interesting to note is that only a few weeks ago his asking price was $24k and is dropping like a rock.  He sounds all out desperate.  Obviously I'd be immediately flipping the combos and buying standalone snack and soda.  

 

Thoughts?  Is this one of those situations you simply say BETTER YOU THAN ME! and move along, or do you think there's any way to structure this that gives him an out and me a great location?

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Proceed with the knowledge that you MUST replace the three combo machines with at least two full-sized machines. It could be a once a week account and that would be a good account. The other two are throw away accounts...then you are stuck with 5 pos machines.

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Proceed with the knowledge that you MUST replace the three combo machines with at least two full-sized machines. It could be a once a week account and that would be a good account. The other two are throw away accounts...then you are stuck with 5 pos machines.

 

The other two locations are $75 each a week (at least his ad says they do $600/month combined).  Are those truly throwaways?  I know it's close.

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The other two locations are $75 each a week (at least his ad says they do $600/month combined). Are those truly throwaways? I know it's close.

I'd truly be surprised if they were $75/wk accounts. A sellers revenue estimates are generally overinflated. I'd bet if they truly were doing $75/wk they would need to be serviced every week.
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Do not believe his revenue estimates.

 

I would be interested in seeing his 2012 and 2013 tax returns.

 

Also you could read the non resettable meter and devide by the number of weeks the machines have been on location.

 

Generally most combo machines will require service before they have 150.00 in the cash box.

 

Walta 

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The other two locations are $75 each a week (at least his ad says they do $600/month combined).  Are those truly throwaways?  I know it's close.

Maybe it's just my perverse nature but I don't believe him.  Allen Watson was recently crowing about his Genesis combo (same crappy ilk) that did a record $258 in two weeks and he's been in the business for years (you'd think he'd know better than to run combos  ;D )  If you're new to full line vending, this would be a bad place to start.

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The big location looks good but you're going to lose as he will still want over $3000 per machine.  He's trying to sell the machines, not just the locations so you will need to buy the machines just to get the locations so you can spend more money to install real machines in the big location.  Unless you know where you can turn 3 Seaga combos into a full size multiprice soda and snack machine you are going to lose money on the large location.  If you do this deal and sell the 3 Seagas then I would not upgrade the small locations unless they truly warrant it, but rather run the Seagas until they cost too much money to operate or sell those two locations with the machines.

 

Regardless, this is like a one year old car that isn't worth what is owed on it.

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I've been in the business 2 years. Since then I have run into a number of hard luck cases where someone buys multiple accounts for more than $15k. It always ends up being a very bad deal. I have nearly made this mistake twice.

 

I have yet to hear one success story. Start off small, and buy one account at a time. Do not put all your eggs in one basket. IMO.

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I've been in the business 2 years. Since then I have run into a number of hard luck cases where someone buys multiple accounts for more than $15k. It always ends up being a very bad deal. I have nearly made this mistake twice.

 

I have yet to hear one success story. Start off small, and buy one account at a time. Do not put all your eggs in one basket. IMO.

The best way is to buy good used equipment and then find a location........ Just saying....

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