Sgolembiewski0903 Posted May 6, 2017 Share Posted May 6, 2017 HI all! I may be moving a little too fast for a beiginner ... but I am trying to look into credit card readers - or at least understand them for future reference.... I do have a couple accounts who would like CC readers - and I think I might consider it... BUT - My question(s) is/are: 1) Good companies - I have seen Nayax, USA Technologies (eport), and Air-Vend mentioned a lot on the forums... *note** I inherited two eport readers/setups from a route purchase, so am interested in hearing about USA tech! 2) What am I to expect as far as budgeting goes?.... these companies don't make late night 10pm research easy - they require I call or submit an inquiry..... I understand that most companies charge for unit/monthly fee/processing %'age fee.... Link to comment Share on other sites More sharing options...
AZVendor Posted May 6, 2017 Share Posted May 6, 2017 Don't do card readers in low volume locations or on machines that don't have prices averaging $1.00 or above. The fees will just eat away at the profit margins of lower prices. Don't even broach the subject of card readers until you fully understand them. Link to comment Share on other sites More sharing options...
Southeast Treats Posted May 6, 2017 Share Posted May 6, 2017 Never to early to think about it, but the cost is high for vending.... My attitude in this has always been that I want to accept any type of Yankee dollar the customer wants to spend (within reason)! I am using several different readers, and they are all OK in that they get the job done. There is also PayRange, which is a smartphone app for vending, and the hardware and costs are much cheaper if you have locations where steady customers will adopt the app. Also, your machines must be MDB and older machines might need upgraded firmware or entirely new control boards to make any of this work. Here's about what to expect cost wise: Hardware - $275 to $300 per machine to buy the hardware; it can also be leased or rented but with a minimum order of 10 units usually. With most plans you own the leased hardware after a few years so the monthly costs drop. Monthly service - $6 to $12 per machine per month, depending on using leased or owned hardware and the company you use. Swipe Fees - about 6% of each CASHLESS sale (they do not take any fees from your cash sales) Two Tier pricing - Your option to add an amount (usually .10) to each cashless purchase to help cover costs; most operators on here are in favor of that, some of us just eat the cost (and usually do a small across the board price increase). DEX data - Being able to use you DEX data effectively is part of the attraction of cashless telemetry, but starting out you will probably be better off just using route cards for records. You need a good back end software service to get the most out of your data, and it won't make enough of a difference until you have grown some. If you want to use the hardware you have, I can provide you with a contact at USAT who does inside sales to small market operators. He can set you up with an account and tell you the cost to get units online. I would advise getting the basics started first; good equipment at good accounts for cash. Hold onto the existing hardware until you figure out where it will give you the best return before trying it out. After that, when you have 8 or 10 more good machines then think about leasing equipment for them. For me, a good machine for cashless is already doing at least $60 a week in cash sales.... Link to comment Share on other sites More sharing options...
Randymire Posted May 7, 2017 Share Posted May 7, 2017 PayRange is a good alternative for smaller vendors or smaller locations because it's not as costly to install and it's easy to install. Sent from my iPhone using Tapatalk Link to comment Share on other sites More sharing options...
AngryChris Posted May 7, 2017 Share Posted May 7, 2017 I think Southeast Treats nailed it except I disagree on needing $60/week minimum sales... I think a machine should do at least $100/week before you consider adding a reader. However, at $60/week, depending on the demographics of the account, a reader could add a substantial boost. It really depends on the account. Younger people use their card more and cash less so a boost is very likely in colleges and places that typically recruit young workers straight out of high school or college. Older people don't trust readers, especially from vending machines, and prefer to use cash wherever they go. So, a manufacturing facility with a lot of 45+ year old people doing $200/week combined probably won't warrant card readers. However, something like a small college or a maybe a tool shop/large automotive shop with a lot of young workers might do very well with card readers. I really have a hard time thinking about locations with a lot of younger people to be honest. You usually find a good mixture of people or a lot of older people. The obvious reason for this is because the younger people are either still in college or working retail/fast food/any other entry level job that doesn't warrant vending machines whereas older people are supporting families and have been in their careers for a while. There's only one thing I really want to add about card readers... when you add one to a machine and notice that you INSTANTLY start getting card sales, that is not a guarantee that the card reader is paying for itself. Depending on the location, many of your card sales may simply be from people who decided to use their card INSTEAD of cash, rather than people paying with a card that wouldn't have paid with cash. In other words, if your machine would have made $65 with cash one week.. then you added a card reader and the machine did $50 in cash and $25 in card sales... that's not really a $25 gain but a $10 gain. When you factor in the costs of the transaction fees to the entire $25 and the wireless fees, you might have possibly made LESS money with the card reader than before you installed it, unless you use 2-tier pricing (or a price increase across the board) and those extra $10/week exceeded the wireless costs (which they probably would in this example). I have a location where I added a reader and the sales didn't really change. I have another location where I expect the sales to go up a pretty good percentage when you finally get the new reader connected. Link to comment Share on other sites More sharing options...
Poplady1 Posted May 7, 2017 Share Posted May 7, 2017 Just did a Hilton Hotel in Texas with 14 floors. They wanted a vendor willing to put drink machines on each floor with CC readers. They also wanted some Pepsi and Coke in each machine. My vendor went with 7up because they allowed 3 buttons for additional flavors. Payrange was the only way to go. We worked with the hotel to allow our vendor to reduce the commission by the processing fees. The occupancy rate was really good on this one because it was next to a major attraction. So only a few snack machines were necessary which helped. When we get these multi-floor hotels we only charge for the first 4 floors. Vendors would go broke paying for machines on all those floors. Link to comment Share on other sites More sharing options...
AZVendor Posted May 7, 2017 Share Posted May 7, 2017 Why would you use Payrange in a transient location that would barely have any adoption? Was it to placate the hotel even though the devices would hardly be used? Link to comment Share on other sites More sharing options...
Southeast Treats Posted May 7, 2017 Share Posted May 7, 2017 Every location is different, and Chris makes some very good points. I started out using $100 a week as a benchmark for readers, but that has been changing with time. I believe that over the next 5 to 7 years card readers will become as important as validators on machines. If you talk to old time vendors who saw the evolution of validators you will see how similar card readers are evolving; and the overall trend in this country is towards more use of cards and less cash. The age demographics for cashless are evolving as well. I started out being worried about losing cash sales to more expensive cashless, and of course that could occur depending on the location. My experience so far has been that people who have been using cash in a vending machine will continue to use cash, and cashless purchases will be additional sales. I have seen sales increases average 20% when a card reader is added to an existing account, some much higher and only one that so far has been lower. Some of my new locations that I have started with card readers can run as high as 70% cashless (younger demographic locations). Since I also use the telemetry data to prekit, my operation is more efficient with online machines and that is a cost savings as well. If cashless evolves as I think it will, there will be a time when cash sales drop, but because of changes in the number of our customers who carry cash; we will need card readers to retain that business. The take away from all my rambling should not be to run out and spend tons of money adding card readers right away, but to have a good long term plan to phase them in to your operation if you plan to be in the business for a while. Link to comment Share on other sites More sharing options...
AngryChris Posted May 7, 2017 Share Posted May 7, 2017 It is hard to transition when you're already deep in. If you can start off with good locations and newer equipment, adding cc readers is a good idea. Link to comment Share on other sites More sharing options...
Southeast Treats Posted May 7, 2017 Share Posted May 7, 2017 2 hours ago, Poplady1 said: The occupancy rate was really good on this one because it was next to a major attraction. So only a few snack machines were necessary which helped. When we get these multi-floor hotels we only charge for the first 4 floors. Vendors would go broke paying for machines on all those floors. Bev, my question is this - does having that many machines in one property ever really pay off? I know some of the hotel flags push for that kind of coverage, but is it in any vendor's best interest profit wise to provide the service? Link to comment Share on other sites More sharing options...
Poplady1 Posted May 8, 2017 Share Posted May 8, 2017 It only works if you have a 3rd party contract with a bottler and they can provide most of the machines or if you happen to have a large inventory. You would be surprised how much these big hotels can make but the upper floors are always the slowest. You have to keep and eye on the expiration date so you can move product to lower floors. Be sure you know the occupancy rate on those big ones. Most hotels range between 70 to 85. That's normal for the big ones. The best spot for machines are the employee breakroom. Often times the hotels provide a hot lunch or dinner if they have access to fresh food but the vending remains strong. Sometimes new vendors won't put machines in a hotel/motel if there is a grocery/convenient store nearby but this is a myth. Once folks are in their rooms believe me they only go to the vending machines then the pool. Link to comment Share on other sites More sharing options...
flintflash Posted May 8, 2017 Share Posted May 8, 2017 Southeast and AngryChris summarized the whole "card reader" issue really well. I started implementing USA Tech in our machines. We actually started with Crane Streamware (which has a much better reporting website in my opinion) but switched to USA because installing the units in our machines was very easy. As the others have stated, the younger generation customers are more prone to go cashless, since they are more attracted to technology and tend NOT to carry cash. The older generations tend to still carry cash and have a "distrust" of the readers for security (even though they are more secure than the common card processor in a store). Cashless will become more predominant in the upcoming years, more so than bill validators did when they emerged, because they are so convenient AND are not prone to the problems that bill validators have (jamming, bad belts, etc.). ALSO...as we've added card readers, one aspect we HAVE noticed at accounts is that card readers encourage Multi-Vends...customers purchasing more than one item. We have shops where the employees will purchase several bags of chips or two drinks, and so on. And higher ticket products (like sandwich machines or $2.00 candy items) are more appealing when swiping a card. People tend to NOT think about the purchase when buying with a credit or debit card. Link to comment Share on other sites More sharing options...
Poplady1 Posted May 13, 2017 Share Posted May 13, 2017 On 5/7/2017 at 2:14 PM, Southeast Treats said: Bev, my question is this - does having that many machines in one property ever really pay off? I know some of the hotel flags push for that kind of coverage, but is it in any vendor's best interest profit wise to provide the service? I just noticed you are in Florida, the major tourist destination in the country. You must do some hotels, how do they pan out in your State? Link to comment Share on other sites More sharing options...
Southeast Treats Posted May 13, 2017 Share Posted May 13, 2017 I only have a few, but they do well during the season. I'm in the Daytona area and our tourism is event driven (Daytona 500, Bike Week, Spring Break, etc) vs the Orlando area where it's pretty much game on all year. I have avoided the "every floor" situation so far. Link to comment Share on other sites More sharing options...
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