First snack machine. Advice?

[Honda man]

A friend of mine is looking into placing a snack machine (electric machine that vends chips, candy bars, etc.) at the nursing home where his wife works. Machine would be used mainly by the employees. He's looking at this as a way to supplement his income since things are slow at work. What are the  pros & cons that he should be aware of? What's a good machine and about what should he expect to pay? Maintenance & repairs? I want him to see the whole picture, not just the income potential.

Ernie

[bcron]

My first thought has to do with shelf life of product. If he is going to buy the product at Sam's or Costco, which is where I think a lot of smaller operators go, many products have relatively short shelf lives. By relatively, I refer to items like chips which tend to have an expiration of about 1 1/2 to 2 months from the time I purchase them if I seek out the longest expiration I can on the shelf. I would be concerned that a single location may not go through product quickly enough that you end up with a lot of expired product and leaving you little profit.

[ageevending]

number of employees x ($4 for blue collar) x target gross profit (I use 50%)

So if there are 20 employees @ this place he should expect to generate $80 a week gross and $40 net.

However his net will be smaller if this is his only location, since his waste will be higher... so say he makes $100 a month net.

A decent snack machine will cost $500-800, so he'll break even in 8-10 months.

[Honda man]

Agee & bcron

Thanks for the insight. I'll pass this on to him.

Ernie

[andyinchville]

HI,

Just curious but is 10 months to break even considered good?

Thanks!

Andrew