New To It All

[PhilC]

Hi folks. Found the forum while looking around for reviews of vending machine "universities". Read a comment here that they're not really worth the time/money and most of what you'd like to know you can learn from others here. So, let's give this a shot!

My wife and I are nearing retirement age and we're looking for a source of "passive" income. Nothing to support us, but just a few hundred dollars a month, maybe, to supplement SS, 401Ks, part-time jobs and some rental property income we have. Trouble is, we have NO IDEA where or how to start.

My feeling is we need to know how to find locations before we start anything else. But, being a newbie, there's probably plenty we haven't thought of at all.

What advice would you give folks like us? Is this really something worth our time/effort? If so, where to even begin?

Any and all advice would certainly be welcome. Thank you! 

Edited July 26, 2022 by PhilC

[AngryChris]

5 hours ago, PhilC said:

Hi folks. Found the forum while looking around for reviews of vending machine "universities". Read a comment here that they're not really worth the time/money and most of what you'd like to know you can learn from others here. So, let's give this a shot!

My wife and I are nearing retirement age and we're looking for a source of "passive" income. Nothing to support us, but just a few hundred dollars a month, maybe, to supplement SS, 401Ks, part-time jobs and some rental property income we have. Trouble is, we have NO IDEA where or how to start.

My feeling is we need to know how to find locations before we start anything else. But, being a newbie, there's probably plenty we haven't thought of at all.

What advice would you give folks like us? Is this really something worth our time/effort? If so, where to even begin?

Any and all advice would certainly be welcome. Thank you! 

Welcome to the forum.  The first and most important thing I would like to tell you is that vending is NOT passive income.  It sounds like you don't want to go all-in on a vending business but you just want some simple income.  If that's the case, your best bet is likely to just stick with some decent used/refurbished machines and just sell cans.  Maybe 4-10 soda machines at decent locations could possibly be enough to make you happy with the profits but without needing much to run it.  Another very simple option is honor boxes at offices.  The good thing about honor boxes is that you need absolutely no one to help you.  You can buy the boxes very cheap, place them yourself and do everything else there is.  Vending machines require either a truck with a lift gate or some other means to deliver them to the location, and decent refurbished machines can easily be $2k/each.  The two big misconceptions people have about vending is 1) it's "passive" income.  It isn't by any means!!!!  No more passive than cutting lawns!  And 2) you make tons of money.  The reality is that a vending location can do anywhere from a few dollars each week to thousands, but those mega locations have a bank of machines that get filled daily.  Vending is a numbers game and the better locations require a better service.  To keep it simple, you want locations with less than maybe 35 employees in an area where they can't get any other vendor to provide them ANY vending machines.  Then you can just provide soda only and make a little money restocking them every other week.  Just a hand full of machines could generate you a few hundred dollars each month of profit but you will absolutely be working at least that one day each other week to restock them, and that doesn't count service calls.

[PhilC]

21 hours ago, AngryChris said:

Welcome to the forum.  The first and most important thing I would like to tell you is that vending is NOT passive income.  It sounds like you don't want to go all-in on a vending business but you just want some simple income.  If that's the case, your best bet is likely to just stick with some decent used/refurbished machines and just sell cans.  Maybe 4-10 soda machines at decent locations could possibly be enough to make you happy with the profits but without needing much to run it.  Another very simple option is honor boxes at offices.  The good thing about honor boxes is that you need absolutely no one to help you.  You can buy the boxes very cheap, place them yourself and do everything else there is.  Vending machines require either a truck with a lift gate or some other means to deliver them to the location, and decent refurbished machines can easily be $2k/each.  The two big misconceptions people have about vending is 1) it's "passive" income.  It isn't by any means!!!!  No more passive than cutting lawns!  And 2) you make tons of money.  The reality is that a vending location can do anywhere from a few dollars each week to thousands, but those mega locations have a bank of machines that get filled daily.  Vending is a numbers game and the better locations require a better service.  To keep it simple, you want locations with less than maybe 35 employees in an area where they can't get any other vendor to provide them ANY vending machines.  Then you can just provide soda only and make a little money restocking them every other week.  Just a hand full of machines could generate you a few hundred dollars each month of profit but you will absolutely be working at least that one day each other week to restock them, and that doesn't count service calls.

Thanks for the reply, Chris!

So, if we do decide to do a few of these soda machines, which sounds like the avenue we're looking for, how do you find decent locations that would turn a profit? Is it just a bunch of cold calling? What sort of venues am I looking for? And it would seem to me that any place worth the effort will probably already be occupied, right? How do you "break in" and make the effort worth it?

[AngryChris]

11 hours ago, PhilC said:

Thanks for the reply, Chris!

So, if we do decide to do a few of these soda machines, which sounds like the avenue we're looking for, how do you find decent locations that would turn a profit? Is it just a bunch of cold calling? What sort of venues am I looking for? And it would seem to me that any place worth the effort will probably already be occupied, right? How do you "break in" and make the effort worth it?

Well, the best locations are going to require the best service.  Sticking with something simple like only doing soda machines means you'll be limited to small locations.  You may be thinking that you could just add a snack machine too to make more but then you'll find yourself in this balancing act between wanting good locations (that require more committment) and wanting to have simple "passive" income.  In my opinion, your target should be places like automotive and tire shops, small businesses with less than 20 employees that can't get vending elsewhere, etc....  If a customer says they have to have snacks, you shouldn't do it.  Would I do it? Yes!  But I would also require that they have the employee count to make it worth my time because I know I will have to invest my time and money into them.  It's a business for me and it pays for ALL of my bills.  But for you?  Just keep it simple.  If they are okay with just a soda, take it.  If another small vendor gives them a snack, that's fine too.  And if they kick you out because another vendor offers both, just find a new location.  Again, the goal is to keep it simple.

How to get these locations?  Stopping by is the best option.  Simply tell them you're retired and looking to grow a small vending business and you just want to offer drinks to small locations with xx amount of employees or less.  If they don't have vending, they may be receptive.  Do good locations already have vending?  Yes, of course, but that's not what you're looking for.  You are looking for simple low-overhead easy money.  You could grow a small soda-only business into a large one if you had the right kind of area.  It wouldn't work in a really rural area but if there were a million people within a 30 minute radius of you, then there is plenty opportunity.  My point is that there's nothing wrong with keeping it simple.  The reason larger vendors don't do this is because we can make WAY more money with better locations and vending has growing pains.  You get so big and you need a truck, a warehouse, a driver for each additional route, office manager, repair guy, etc...  The more you make in a vending business, the more you have to invest for quite a while.  With a small 10-machine route of just soda, you can work out of your garage with just a minivan and you can make several hundred dollars each month.  You won't get rich, but you [hopefully] won't be devoting a whole lot of time to it either.

[AZVendor]

A few hundred dollars of profit each month will require more machines than you think, especially when you realize that out of 10 locations you might have, maybe only 2 will be decent stops - more likely only 1.  A decent stop will do 5 cases (24 count) of soda per week.  A good stop will do 7 and a great stop will do 10 cases per week.  You'll be lucky to get some decent stops.  Do your math: if cans cost you .37 and you sell for .75 or $1 and you give 10 or 15% commission to the location (not required but often demanded) and you have fuel costs, maintenance costs paying someone to fix or move them, capital costs, etc.  You'll figure out that a few hundred dollars of income per month takes a LOT of work.