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Buying 2 combos in a good location?

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So I was wondering what you guys think about buying 2 combo machines at a location that's supposedly doing at least $500-600/month?


They are RS-850 machines side by side in a retail store 20 minutes from my house.  Each machines can hold 200 snacks and 175 drinks for a total of 400 snacks with a total of 40 selections and 350 drinks of 12 selections.  The store takes a 5% commission but is also open on Saturdays which is a big plus for me since I have a regular M-F job 8am-5pm.   The seller says there's 50-60 employees.  Additionally he said the combo machines are also available to lots of customers as well with around 100-120 transactions done per day.


Now I normally don't care for combo machines but I feel like it's a good location.

I will be looking at the location tomorrow around 5 so I will let you guys know what other info I can find such as the drink and snack prices.

Without looking at the location yet I said I can do at least $3500 and he said he was trying to get $5000 for it.  He said he can probably do $4000.  Do you guys think it's worth it?  I normally buy routes anyways at 8 months gross sales.


My plan is to service it as is for a year and put in a big separate refurbished drink machine for around $1800 (Royal 650)+ a good condition big separate snack(ex AMS 39 select or HR 40) maybe around $2000.  I would be investing around $4000 in a year but I can also get some money from selling the machines.


How much can I get for these machines each?  He said he bought them brand new in 2010.


Also he said the machines have to be serviced once/week.  They also have the USA Technologies credit card machines with remote control monitoring.  I have never had machines with these before so I am kind of excited about trying it out.  He said there's only a 2.55% commission/vend transaction.  Also he said only 17-18% of the sales are from the credit card readers so looks like I wont be paying much commission.  I would also have to pay $10/month to USA T for using their equipment.


Should I go for this?

Normally I buy separate drink and separate snack accounts but I don't think the combos should be all that bad I'm thinking?


By the way I have tried to buy just the location and he said he'll see what he can do.  How much should I offer for just the location?  I am thinking $800?


Is there a good chance of getting kicked out since other vendors can offer separate drink and snack.  I just want to make at least some money back before I start investing again on equipment.

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First of all, retail is not a typical good account.  They are low volume most of the time.  This one does less than $200/wk and that doesn't warrant spending what he wants for the account regardless what he spent on the machines himself.  If you are prepared to put real machines in right away because you can recoup most of your upfront cost by selling these machines then it's worth a look.  If you can get just the location then that would probably be best but now you have a location that wants card readers.  The machines aren't worth much to anyone who knows vending so I wouldn't spend much for them.  However, if you're comfortable with what he's telling you and your money won't get you an account that does this well elsewhere then maybe it's a good fit for you.


Why would he consider selling just the location?  Is he staying in vending?  Is he in the business of placing machines and selling them?  That part doesn't add up.  By the way, the card rate is probably closer to 6%.  I don't know if someone is subsidizing his rate or not.  I don't know what the "2.55% commission/vend transaction" is.  Is that straight commission or is it paid to a management company?  Lots of questions here.

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My largest account does $482/month which I just got last month.  So this would be a another big account for me if it really is doing $500-$600/month.  Dou think the sales numbers add up correctly even though even if it is a retail location?  Another words with 50-60 employees and customer traffic.


I am thinking if I can get $2000 for both the machines then that would be good enough for me.  If I leave the machines in for at least 6 months to service, then at least I can make around $1500 net profit to invest into the separate machines.


Interesting that you said even if I pull the machines out they will want card readers again.  Would putting in machines with out card readers be a big no no then?  I haven't even thought about that.  Do you think card readers are worth it?  I am actually more looking forward to the remote monitoring.  By the way how much are credit card readers each.  Do people also buy these used as well?


The seller said he has a guy maybe interested in buying just the machines so if that goes through that's good for me so I can get just the location but if it doesn't go through then I will just have to buy the whole account.


How much would you pay for just the location?  How about $800-1000.


Can you explain to me the card rate of 6%.

What I meant by the 2.55% commission/vend transaction is that every item that some one buys from the machine, 2.55% of it goes to the credit card company.  I guess your talking about the same thing with the 6% but just your saying it should be much higher then 2.55%.


Thanks for your response by the way.  I really appreciate it.

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Generally, I have found retail locations to be slow.  IMO, those machines are mediocre and do not have a very high resell value.  I would say both machines are valued at $750-$1,000.  I feel comfortable paying about 40% of yearly gross sales with decent equipment.  I would offer $2,400-$2,800.   

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