, pub-6262331124919164, DIRECT, f08c47fec0942fa0 Jump to content

Do you Sell, Lease or just Supply high end Bean-to-Cup machines to your big accounts?


Recommended Posts

The regular business model for OCS is that you supply (≈$500 U.S. cost) brewers to accounts at no charge and covered costs and made decent profit selling coffee & related items. Now with the $5,000 - $6,000 Bean-to-Cup machines in the mix with large high volume accounts, how are you monetizing them?

1)  One model is outright selling the equipment to the account for your cost or even with some markup, then having a service agreement with them that is valid for 'x' years so long as they buy all coffee and related products from you.  A BIG advantage to this method is that the machine is theirs. If they decide down the road  they want a different machine or different vendor, you are not stuck with expensive, specialized and used equipment you need to find a new home for. If you use this model, do you sell at cost or how much do you mark it up?

2)   Another model is retaining ownership, but charging a monthly lease or service fee to help offset some of the large investment. If you use this model, what amount of monthly 'fee' have you been able to charge? How many years ROI do you shoot for to amortize the sizeable initial investment.

3)  Old school model of just supplying  machine(s) with no upfront or monthly costs. This is the riskiest as you need to be sure you'll sell a LOT of product to cover the large initial investment, the account has zero investment in the equipment so you better have a solid three year + agreement/ contract so you are guaranteed at least that long to make a good profit and ROI. But whenever a contract ends, if they decide to change vendors, you have used specialized equipment that you have to try to find a new home for.

4) Long ago when automated espresso was relatively new, I used to have Colibri LX & Saeco DA7P's out invoicing/billing per cup to the account. That was very lucrative, but I don't know that that would fly these days. Anyone still have units billing by the cup count?

Link to comment
Share on other sites


This topic is now archived and is closed to further replies.

  • Create New...