Singod Posted September 13, 2022 Share Posted September 13, 2022 I am looking at a couple routes near me and an wondering like one of the said he has about 400 locations with 1000 machines but he only brings in 30k a year and has 25% COGs. 30k seems really low on 1000 machines and 25% seems pretty low on COGs. It is all candy route. Do these numbers seem really off? Obviously I'm not getting it just wondering is this normal numbers because I have a small route now and it is more like 38% COGs and much better sales per machine. Link to comment Share on other sites More sharing options...
orsd Posted September 13, 2022 Share Posted September 13, 2022 A large route that’s focused on quantity and not quality can be like that. Throw in COVID and the long slow agonizing death of bulk, especially candy vending and this is what you end up with. Link to comment Share on other sites More sharing options...
AngryChris Posted September 15, 2022 Share Posted September 15, 2022 I am not a bulk guy but this sounds like a bulk candy route that's a bit upside down. The good part is that, if you are outgoing and business savvy, you could turn this thing around and milk it for years to come. The bad part is that bulk is on its way out the door. I hear the biggest killer of bulk sales is the lack of credit card acceptance since so many people don't carry cash anymore, especially kids or young adults who want to buy things for their kids. The second biggest killer, from my understanding, is that inflation has made it super tough for operators. Increasing prices may cause a reduction in sales, especially if people only have ONE quarter and not two or more. And I understand that it can be expensive (if not impossible) to change the coin mechanisms to accept multiple quarters. What I have read by just lurking the bulk forums is that a lot of people are just riding it out and driving bulk vending into the ground rather than make changes. You COULD turn a big bulk route into something far more profitable, possibly doubling or even tripling the profit, but you could also run it completely into the ground depending on what you do. With full-line vending, it's "dying" but nothing like bulk vending. Micro markets are the future but they aren't practical at every location, which is why vending machines are still being manufactured. Personally, I wouldn't even consider buying a bulk route because it's not what I do or what I am good at and I already know what I can do with what I have. I think 30k may be accurate and the purchase prices should be based off of the profit or the value of the equipment but not both. And I have no idea how to value bulk vending but I would imagine 30-60k would be the price range. Just keep in mind that it seems like your options are A) invest into this business knowing you'll have to put a lot more money/time into these routes to turn them around and make them POSSIBLY more profitable, b) ride it out for years until you can recoup your initial investment and start making money in the long run and maybe sell out later, or C) just pass on it. I can see bulk vending being around in another 10-20 years but I can't see it even having 10% of the footprint it has today. Link to comment Share on other sites More sharing options...
gumball guy Posted September 15, 2022 Share Posted September 15, 2022 On 9/13/2022 at 5:28 PM, Singod said: I am looking at a couple routes near me and an wondering like one of the said he has about 400 locations with 1000 machines but he only brings in 30k a year and has 25% COGs. 30k seems really low on 1000 machines and 25% seems pretty low on COGs. It is all candy route. Do these numbers seem really off? Obviously I'm not getting it just wondering is this normal numbers because I have a small route now and it is more like 38% COGs and much better sales per machine. So many variables so it's hard to tell exactly what's happening with that route but I think orsd hits the nail on the head when he says quantity over quality. Who knows how often the guy is servicing the route or what he's putting in the machine? 30k is low but believable if he is neglecting the route. I'm betting that he has a ton of dog locations that need to be pulled and the machines re-located but he's just not acting on it. Also his cogs are a reflection on what he is selling. Tons of gum will bring the cogs percentage down but it will also hurt your sales if gum isn't moving in a location. Link to comment Share on other sites More sharing options...
Singod Posted September 17, 2022 Author Share Posted September 17, 2022 Thx for the replies guys i havent been on much since i posted. i guess i was just kind of amazed my worst location was at about $4 a month and i pulled it after 4 months i just dont see why someone would let this big of a route get the average machine down that low and if this was any kind of normal. so it seems they have just let this route go most likely and just threw a machine anywhere that would let them. maybe i should just try mini cranes they seem to do well from what i have seen. Link to comment Share on other sites More sharing options...
zjtaylor Posted October 20, 2022 Share Posted October 20, 2022 On 9/17/2022 at 12:02 AM, Singod said: Thx for the replies guys i havent been on much since i posted. i guess i was just kind of amazed my worst location was at about $4 a month and i pulled it after 4 months i just dont see why someone would let this big of a route get the average machine down that low and if this was any kind of normal. so it seems they have just let this route go most likely and just threw a machine anywhere that would let them. maybe i should just try mini cranes they seem to do well from what i have seen. My first route I purchased was like this but it was only 100 machines and I pulled or resold 75% of them. I learned that you can profit off a route like this but from reselling locations. My worst location was a scuba shop that moved $1 a month! I would not buy a route today unless the operator did racks and/or toys. I think that's a sign of a potentially decent route. Hard to trust people's numbers. Link to comment Share on other sites More sharing options...
dkochan Posted October 26, 2022 Share Posted October 26, 2022 I would only buy this route if there is potential to upgrade at least half of the locations to gumballs, toys and tattoos. You also need to find out if the seller is paying commission to some or all of his locations. Link to comment Share on other sites More sharing options...
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