new2this Posted June 1, 2009 Posted June 1, 2009 Hello, I have one non commission rack on loc now. I know that is not the norm. I want to go locating with an idea how much to give the loc site. I am a bottom line person. Does anybody do a flat fee(that way all is fair). All locs are great during the honeymoon period(3 mos) then reality sets in and the next couple of months lets you know how much money a loc will bring in. Any thoughts and advice will be GREATLY appreciated. Thanks Coop
Beer980 Posted June 1, 2009 Posted June 1, 2009 Well a flat fee may be good or bad. The problem is you may pay out more then it brings in. The % seems to be the way to go to avoid that.
new2this Posted June 1, 2009 Author Posted June 1, 2009 Hello, What is the % most of the pros offer? Thanks
dperry Posted June 1, 2009 Posted June 1, 2009 I pay 25%. I've not had one location owner balk at that rate.
Quarter Master Posted June 1, 2009 Posted June 1, 2009 I do have one 4 head rack where I more or less "rent" the floor space for $24 monthly. It comes out to $6 per sq.ft. The rack takes 4 sq.ft. I figured the going rate of business space at the time last year X how much space I would use.It's been working out just fine for both parties for about a year so far.
lurtsman Posted June 2, 2009 Posted June 2, 2009 I pay 25%. I've not had one location owner balk at that rate. Gross or net?
Beer980 Posted June 2, 2009 Posted June 2, 2009 I only have one rack out and I pay 10% off the gross.
dperry Posted June 2, 2009 Posted June 2, 2009 I always pay off the gross. I count my money at the site and I give them their 25% right then.
nam Posted June 2, 2009 Posted June 2, 2009 Coop, I thought what you were asking was about paying a flat fee to the location for the space and not what percentage we pay, right? In other words, Islander has the correct answer you were looking for - paying a fee for the floor space not if we are paying 25% or 40%? I have thought about offering a location a flat fee like $50 a month for a smaller location and up to several hundred a month for a good location. This might be cheaper than paying the location a percentage on commission and not have to fool with counting quarters. The idea seems great but I found I guess wrong alot. Which is why I have never done it. lol It would be very hard to look at a location that I think will do great and I'd come out better just paying a flat fee of $100 a month because I'm sure that's gonna be cheaper than paying 30% commission. What would scare me in that senario is coming back a month later expecting to pull $400 to $600 and only have $50 in the bucket. No matter how many times I've placed a machine I still get fooled alot by the locations. Some I didn't think I should ever put a machine in do really really well. Others I've thought many times I've just got my new best location only to end up having to pull the machine for poor performance. I like the idea of paying a flat fee but I'm just gonna have to get a better crystal ball first.
new2this Posted June 2, 2009 Author Posted June 2, 2009 Yes, Nam I thought paying 40.00 to 50.00 to a small loc would be a lot easier than counting coins on site and paying the loc a percentage. If the loc is poor I would pull the machine I figured after 3 to 6 mos. However, like you said I do not have a crystal ball and the gamble would be great if I guess wrong. Thanks everyone for their comments. TCoop
shvend Posted June 4, 2009 Posted June 4, 2009 I myself would stay away from the paying a flat fee for a commission. The reason being is just like you and nam had already said you don't have a crystal ball. You are a lot better off to offer a commission at 20 to 30% just in case you run across one of those deciving locations.
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