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Advice on buying a vending route and a lot of extra machines


soldout

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Im looking for advice on purchasing an established route from someone I found on CL.  I am new to bulk vending with only 1 machine on location and thought this would be a great opportunity to get my foot in the door.   Back story - He is a realtor, operates a bar and has about 11 apartment buildings that he manages and with the money I buy the route with he wants to begin building a new house behind his current home.  That is the reason for him selling the route.  When I contacted him I was interested in some 1800 vending bulk candy/gumball machines and as we got to talking and I found out he had a route I asked him if he would consider selling it to me.  He says he not in a position where he needs to sell it but at the same time he would sell it for the quick cash so he can purse other investments.

He is not very organized which I completely understand with having 2 children, wife, a home and all the other things he is running and managing but he has 19 locations with bulk candy, gumballs, stickers, tattoos, 1" and 2" capsule machines.  The machines are all Beaver, Northwestern and 1800 Vend machines.  All but maybe 1 or 2 of the 1800 Vend machines  are removed from their stands and mounted on racks creating a 6 head gumball or candy machine rack.  

I have a list with the number of locations and the amount of machines at each location.

Location 1

3 - 2" cap, 1 - 1" cap, 1 - 3 head candy and 1 tall 2" cap Im guessing this is a stand alone machine and not part of the rack.

Location 2

3 - 3 head candy, 6 slot All Star, 2 - 2" cap, 1 - 1" cap

Location 3 

2 - 2" cap, 1 tall 1" cap (again possibly a stand alone machine), 4 - 1" cap and it says 8 candy machine rack big(guessing 8 single heads on a rack)

Location 4

2 - 2" cap, 3 1" cap and 1 - 3 head candy

Location 5

1 - 3 head candy

Location 6

3 - 2" cap, 3 slot sticker, 2 - 1" cap, 1 - 3 head candy

Location 7 

4 - 2" cap, 4 or 5 - 1" cap, 6 slot sticker, 3 - 1" cap

Location 8

1 - 3 head candy

Location 9

3 - 2" cap, 4 - 1" cap, 8 slot sticker (I thinks notes read 2 - 4 slot machines)

Location 10

6 slot sticker, 3 -1" cap, 2 - 3 head candy

Location 11

5 - 1" cap, 2 or 3 sot sticker, 2 - 1" cap, 3 - 1" cap

Location 12

1 - 3 head candy

Location 13

6 slot sticker, 2 - 3 head candy, 4 or 6 - 1" cap

Location 14

2 - 3 head candy

Location 15

1 - 4 slot sticker, 2 head candy 3 slot?, 2 or 3 - 1" cap

Location 16

3 - 2" cap, 3 - 1" cap

Location 17

2 - 2" cap, 3 - 1" cap

Location 18

6 slot sticker, 3 - 1" cap, 2 - 3 head candy

Location 19

2- 3 head candy, 2 - 2" cap, 3 - 1" cap

Today he said he was able to get 4 more locations due to the fact he is very well known throughout the city and has a lot of connections through family, businesses and friends.  1 of the locations is a barber shop that is moving to a new location and already has a rack with a mixture of 1" and 2" caps and maybe a sticker machine and he is supposed to place a 6 head candy rack once the barber shop opens.  There are 2 other locations that said they would start off with a 2 - 3 head candy and other location will take a 3 head candy.  Another location that is listed doesnt not have machine type or number of machine listed so that is unknown.

Included in the route is all product in the machines as well as a lot of extra machines he has split between his garage and basement of his families restaurant.  Between both locations we estimated about 150 individual head and sticker machines on racks or on storage shelves in his garage.  I would say about 75% of the machines are complete and mounted on racks ready to be placed.  Other need coin mechs, lids or locks all of which he has in his garage  I saw a modified 12 head U Turn using small canisters, a shooting hoops gumball machine, 2 pinball bouncy ball machines, 1 Tomy Gacha Japanese toy vending machine, 1 spiral gumball machine with a broken base, about 5 - 6 head 1800vending machines racks, tons of spare parts like locks, keys, coin mechs, bodies, stands, etc.  He also estimates about 1 years worth of 1" and 2" filled caps, empty caps, about 40 boxes of stickers and tattoos.

What is the going rate per bulk vending head in a working location?  I count 145 working heads in all 19 locations counting the sticker/tattoo machines as 1 head.  The seller is asking $20,000 cash in full for everything he has.  Today I went to his house and saw all his extra machines, inventory and parts and went to his restaurant to see the other machines in the basement.  He took me to one of the locations on the list that is right next door to his restaurant.  Ive asked to see his other machines on location and also for any financial statements and he says he cant share those with me for personal reasons.  Ive watched a few videos on youtube of venders buying routes sight unseen, is this wise?  He said once I gave him the cash he would take me to all the locations and introduce me to the owners and let them know I am taking over his route.  He has even offered to take me out 1 or 2 times per month and help me locate machines which I dont think will happen given everything he is involved with in his other ventures.  

The thing I am most uncomfortable with is sorting and organizing all of his extra machines, inventory, keys, locks, etc and moving and storing them until they are placed or sold off.  I will need to break down and condense them so they dont take up as much space as they are now.

Sorry for such a long read but I wanted to provide as much information that I have gathered up to this point in hopes of getting the best advice from the bulk vending pros on this site.  I have pictures of the extra machines and parts if you would think that might be helpful.  Any and all advice is greatly appreciated, thank you.

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15 hours ago, soldout said:

Im looking for advice on purchasing an established route from someone I found on CL.  I am new to bulk vending with only 1 machine on location and thought this would be a great opportunity to get my foot in the door.   Back story - He is a realtor, operates a bar and has about 11 apartment buildings that he manages and with the money I buy the route with he wants to begin building a new house behind his current home.  That is the reason for him selling the route.  When I contacted him I was interested in some 1800 vending bulk candy/gumball machines and as we got to talking and I found out he had a route I asked him if he would consider selling it to me.  He says he not in a position where he needs to sell it but at the same time he would sell it for the quick cash so he can purse other investments.

He is not very organized which I completely understand with having 2 children, wife, a home and all the other things he is running and managing but he has 19 locations with bulk candy, gumballs, stickers, tattoos, 1" and 2" capsule machines.  The machines are all Beaver, Northwestern and 1800 Vend machines.  All but maybe 1 or 2 of the 1800 Vend machines  are removed from their stands and mounted on racks creating a 6 head gumball or candy machine rack.  

I have a list with the number of locations and the amount of machines at each location.

Location 1

3 - 2" cap, 1 - 1" cap, 1 - 3 head candy and 1 tall 2" cap Im guessing this is a stand alone machine and not part of the rack.

Location 2

3 - 3 head candy, 6 slot All Star, 2 - 2" cap, 1 - 1" cap

Location 3 

2 - 2" cap, 1 tall 1" cap (again possibly a stand alone machine), 4 - 1" cap and it says 8 candy machine rack big(guessing 8 single heads on a rack)

Location 4

2 - 2" cap, 3 1" cap and 1 - 3 head candy

Location 5

1 - 3 head candy

Location 6

3 - 2" cap, 3 slot sticker, 2 - 1" cap, 1 - 3 head candy

Location 7 

4 - 2" cap, 4 or 5 - 1" cap, 6 slot sticker, 3 - 1" cap

Location 8

1 - 3 head candy

Location 9

3 - 2" cap, 4 - 1" cap, 8 slot sticker (I thinks notes read 2 - 4 slot machines)

Location 10

6 slot sticker, 3 -1" cap, 2 - 3 head candy

Location 11

5 - 1" cap, 2 or 3 sot sticker, 2 - 1" cap, 3 - 1" cap

Location 12

1 - 3 head candy

Location 13

6 slot sticker, 2 - 3 head candy, 4 or 6 - 1" cap

Location 14

2 - 3 head candy

Location 15

1 - 4 slot sticker, 2 head candy 3 slot?, 2 or 3 - 1" cap

Location 16

3 - 2" cap, 3 - 1" cap

Location 17

2 - 2" cap, 3 - 1" cap

Location 18

6 slot sticker, 3 - 1" cap, 2 - 3 head candy

Location 19

2- 3 head candy, 2 - 2" cap, 3 - 1" cap

Today he said he was able to get 4 more locations due to the fact he is very well known throughout the city and has a lot of connections through family, businesses and friends.  1 of the locations is a barber shop that is moving to a new location and already has a rack with a mixture of 1" and 2" caps and maybe a sticker machine and he is supposed to place a 6 head candy rack once the barber shop opens.  There are 2 other locations that said they would start off with a 2 - 3 head candy and other location will take a 3 head candy.  Another location that is listed doesnt not have machine type or number of machine listed so that is unknown.

Included in the route is all product in the machines as well as a lot of extra machines he has split between his garage and basement of his families restaurant.  Between both locations we estimated about 150 individual head and sticker machines on racks or on storage shelves in his garage.  I would say about 75% of the machines are complete and mounted on racks ready to be placed.  Other need coin mechs, lids or locks all of which he has in his garage  I saw a modified 12 head U Turn using small canisters, a shooting hoops gumball machine, 2 pinball bouncy ball machines, 1 Tomy Gacha Japanese toy vending machine, 1 spiral gumball machine with a broken base, about 5 - 6 head 1800vending machines racks, tons of spare parts like locks, keys, coin mechs, bodies, stands, etc.  He also estimates about 1 years worth of 1" and 2" filled caps, empty caps, about 40 boxes of stickers and tattoos.

What is the going rate per bulk vending head in a working location?  I count 145 working heads in all 19 locations counting the sticker/tattoo machines as 1 head.  The seller is asking $20,000 cash in full for everything he has.  Today I went to his house and saw all his extra machines, inventory and parts and went to his restaurant to see the other machines in the basement.  He took me to one of the locations on the list that is right next door to his restaurant.  Ive asked to see his other machines on location and also for any financial statements and he says he cant share those with me for personal reasons.  Ive watched a few videos on youtube of venders buying routes sight unseen, is this wise?  He said once I gave him the cash he would take me to all the locations and introduce me to the owners and let them know I am taking over his route.  He has even offered to take me out 1 or 2 times per month and help me locate machines which I dont think will happen given everything he is involved with in his other ventures.  

The thing I am most uncomfortable with is sorting and organizing all of his extra machines, inventory, keys, locks, etc and moving and storing them until they are placed or sold off.  I will need to break down and condense them so they dont take up as much space as they are now.

Sorry for such a long read but I wanted to provide as much information that I have gathered up to this point in hopes of getting the best advice from the bulk vending pros on this site.  I have pictures of the extra machines and parts if you would think that might be helpful.  Any and all advice is greatly appreciated, thank you.

My short answer is don't buy it right now. You are new to this business so you may decide in short order it isn't for you and you don't want to be stuck with a truck load of vending equipment that will be hard to sell. I am assuming you are working full or part time at the moment so you really need to try to build your business in measured steps or you could become overwhelmed and frustrated. This guy is telling you that he is no hurry to sell it so it will probably be there down the road if you decide you want to make a go at it.

     Some other points......

Never buy a route or equipment sight unseen for obvious reasons. This guy is wanting 20k upfront (ridiculously high price) but not willing to give you any info is a huge red flag. If he is not willing to share sales or location information how in the world does he expect you to buy it? Even if you were buying for asset value only you would still need to see the condition of the equipment on location and if he is selling it based on sales then he needs to back up his numbers with tax returns or bank records. There are non disclosure agreements and other contracts that he can use to protect himself if he was afraid you were going to share info or steal his accounts.

He needs to disclose how much he is paying in commission to each location.

Sticker, 2" capsules and racks are tough to place and it sounds like he wants to unload a bunch on you for an exorbitant price. He said he is willing to help you locate equipment but why hasn't he located it for himself? 1.1 inch capsules and gumballs are much easier to locate. Personally I would encourage you to stick to gumballs and candy (singles, doubles & triples) to start then down the road possibly add toys/stickers/tats.

This guy sounds like he has too many irons in the fire and my next concern would be if he has serviced the locations consistently. What happens if you walk in and the location goes "I have been trying to get a hold of that guy for months and he never came out to service the machine......get it out pf here!" Another one for the garage.

Start small with good equipment (Eagle, Oak, Beaver or Northwestern). I encourage you to buy used but Eagle does selling new machines at reasonable prices. Teach yourself how to locate and put your own equipment out because in this business you are always pulling and moving equipment. This will give you a taste of the business and if you decide you hate it it's easier to sell small 1-3 head candy machines then racks.  Good luck.

 

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I've only purchased a couple of small routes. And they we're semi organized, and even they were a headache. All sorts of keys, product to figure out and machine parts everywhere. So what you're talking about would be a huge undertaking. 

Also, why does he have so  many machines and only 19 locations? I think i would pass, and ask yourself how much would it costs to just buy brand new eagle machines and place them yourself. 19 locations sound good, but depends on how they're doing, and even after I've taken over locations, just naturally you have to pull some anyway. Places close, change ownership, remodel, you name it, all of which i've experienced. 

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