Crusez09 Posted March 23, 2015 Share Posted March 23, 2015 HEy everyone. This is one for everyone but i was wondering about people in california espically. im startin out and only have one machine placed at the moment. i was wondering how much of every dollar is the average or the percent most of you are spliting with the locations. or how everyone is dealing with spliting the profits. thanks in advacnce. Link to comment Share on other sites More sharing options...
Rick Posted March 23, 2015 Share Posted March 23, 2015 Typical standard in the industry is 25-40% of gross with many vendors offering a sliding % based on monthly sales. I doubt you'll have much luck getting your direct competitors in CA to give you anything more specific than that. CA is a competitive market so I wouldn't be surprised to hear people paying as high as 45-50 for the very best spots. Or more often I'd guess is saying they pay 50 and shaving 5-10%. Link to comment Share on other sites More sharing options...
TexasFreemason Posted March 23, 2015 Share Posted March 23, 2015 I am glad I don't live in California. I only give 10 percent on candy and 20 percent to a couple of gum only locations. Link to comment Share on other sites More sharing options...
Rick Posted March 23, 2015 Share Posted March 23, 2015 I think 15-20% is reasonable in more rural areas. Competition has a big impact. Link to comment Share on other sites More sharing options...
Crusez09 Posted March 23, 2015 Author Share Posted March 23, 2015 When you say % is that of every dollar in machine or after all merchandise expense to fill machines. do you give the location that percent every visit? monthly? yearly? Link to comment Share on other sites More sharing options...
Rick Posted March 23, 2015 Share Posted March 23, 2015 Well, there's been many debates on these forums about the very question you're asking but my numbers above are for gross sales (every dollar in the machine). Personally, I like to pay commission quarterly. Time flies in a busy restaurant and, in my experience, owners are more likely to consider me a serious revenue stream if I'm cutting them $75-$150 every three months instead of $25-$50 every month even though we're talking about the exact same amount of money. If they want commission every collection I can do that too. Link to comment Share on other sites More sharing options...
Crusez09 Posted March 23, 2015 Author Share Posted March 23, 2015 thanks rick, so in your post you said 15-20%. so that would be 15-20 cents out of every dollar that comes out of the machine. i have tried a few places and it seems when i say the locations cut they seems discontent with only getting 15-20 cents of evry dollar. the location i have is forty cents every dollar but im expecting alot of sales. do you think thats too much? i may let this location slide but my future ones i want to be around 20cents per dollar. Link to comment Share on other sites More sharing options...
Rick Posted March 23, 2015 Share Posted March 23, 2015 40% is the highest I would go. Think of it in these terms, you have three entities that need to be paid every collection cycle - the location, your business and you. If your costs of doing business run 40% (for product, gas, insurance, CPA, licenses, service supplies, etc) and you pay 40% commission to the location then that only leaves 20% for you. Sad face. That better be one helluva location to justify a 20% net (and those locations DO exist). You can do things to manipulate the first two numbers to increase the % to you. Me personally, I've had better success manipulating business costs to increase my net than I have decreasing my commission. If you're in a densely populated area of CA I fear you'll be laughed out of any quality spot pitching 20% and even if they say yes you're always exposed to competitors kicking you out because they're offering more. For me, I'd rather come with 30% commission and find ways of decreasing costs like 50 cent bouncy balls in a sportsblaster (13%cog) and 2 heads of 25 cent junk mix 1" in a really busy place will shrink costs without sacrificing sell through in a hurry. The goal I'm always striving for (and usually fall a little short) is 40% for me (30% commission and 30% costs). Hope that's starting to make sense. Another great way to increase your cut is charity and commission doubles in places most of the big bulk guys don't bother to look. Link to comment Share on other sites More sharing options...
Crusez09 Posted March 23, 2015 Author Share Posted March 23, 2015 wow thanks for the info. the clouds are starting to clear. im gonna try goin low on my next commision see how it goes. are any locations up for graps ie: corporations like walmart, target? i alwasy see these are already taken and i imagine they probally only deal with major vendors. i was thinking hitting up some thrift stores gas stations, ill see how it goes. im lovin this forum ill have to repost what i find out. Link to comment Share on other sites More sharing options...
orsd Posted March 23, 2015 Share Posted March 23, 2015 Those chains have nen machine in em Get mom and pop places restaurants grocers etc Try smaller ones first, you lose less if you muck it up Link to comment Share on other sites More sharing options...
Crusez09 Posted March 24, 2015 Author Share Posted March 24, 2015 haha thanks ya that is my plan Link to comment Share on other sites More sharing options...
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