contracts & agreements

[Ktdeady]

hey guys, 

how do you guys draft up a contract for your machine locations? does anyone have a sample model I can look at? 

In a world where you have to CYOA (cover your own golpher), I'd like to have my location host sign something so there won't be any discrepancies later.

Also... what's the average commission you guys are giving (if any)? 

thanks!

[Southeast Treats]

no one rushing to answer this, because for most of us our contracts are not something we want our competition to see... for small accounts you would probably be OK with a one page agreement stating such things as you will supply the equipment and the machines and contents remain your property, what the location will be responsible for (reasonable care towards the equipment, etc) and not responsible for; and what commission you are paying to whom and how often.  For larger accounts you probably want to work with a consultant to develop something professional. 

As for the actual commission rates, again, we don't really want our competitors to be able to come on here and see the numbers.  You should have a fair idea of how much you make yourself so compute a fraction of that.  I tell locations that want commission they can have what they want but the prices will be adjusted accordingly to cover their share.  Often that ends the discussion and there is no commission required.  If they want too much it's not going to work for either of us because we will have no sales.   I usually compute commissions as a percentage of collections (sales minus sales tax and card swipe fees).  There are other ways to do it but I think this is the easiest for all. 

[orsd]

On 10/8/2019 at 8:21 PM, Ktdeady said:

hey guys, 

how do you guys draft up a contract for your machine locations? does anyone have a sample model I can look at? 

In a world where you have to CYOA (cover your own golpher), I'd like to have my location host sign something so there won't be any discrepancies later.

Also... what's the average commission you guys are giving (if any)? 

thanks!

I will answer your commission question simply because the answer is already out there on this board.

Typically it’s no more than 10%. For certain types of locations or really good ones it can be up to 20%. However I will increase prices to compensate. Typically I want to see COGS plus sales tax plus commissions to be no more than 60% of gross. Typically this breaks down to just over 40% cogs, 7% sales tax, and 10-15% commission.