Getting into the business

[jbradley3313]

Good morning everyone,  my wife and I are looking to get into the vending machine business for a side hustle since it fits perfectly with our schedule.  I have about 20k to invest if needed but want to start between 10-15k to prepare for any unforseen issues rising up.

I am talking to someone selling two locations with a combo machine at both for 10k.  I haven't visited them yet but is claiming each one makes 350.00 net a month.  This would put the return on invest around 14 months which seems step to me.  Is this normal range for the business or should I stay away from the route purchasing since there is a premium being payed for the route.  Ty for your tine

[Gizmo Vending]

Vending will not be a side hustle, I don’t know why people think that it can be.   This is a concept of purchasing expensive equipment just to be able to make money by selling inventory you as well have to buy.  The question you need to ask yourself is how can you succeed?  This is an extremely saturated industry, meaning everyone is doing it and all businesses pretty much have vending equipment in there.   The only thing left to you will be the 2 and 3 man shops next to convenience stores.   I would never recommend a noob buy an existing business, route or location simply because you don’t know enough about the business.   What if you get kicked out?  What brand of machines are these?   How are you going to fix the machines if there is an issue?    The only way you will succeed is persistence.  When you do a sales pitch to a business and they tell you they don’t need your equipment is that the last time you contact said business?  If you say yes then be prepared to hear all no’s.  
At best you will create something of value just so you’ll sale it later to someone else.  Do not be prepared to make any money for a long time.  At best - no debt, work from home and no employees for 5 every dollars you make you could pay yourself a dollar.  That’s 20 percent.  Add vehicles, warehousing paying taxes, employees, etc. it’s more of you keeping 5 percent.  

Edited March 3 by Gizmo Vending

[tblake05]

Gizmo, I got my feet wet in vending buying our first 9 machines across 4 locations from a retired gentleman who was selling off his route to fully retire. I took a risk, knowing nothing about vending, probably overpaid, but have grown, upgraded, and are now in the black with 28 machines. It was very much a side hustle that took majority of my time for four years after working 40hrs a week until my wife left her job and took over. So to the OP, yes it can be done. It took us 5 years, but here we are.

combo machines are not the best to start with especially if they are seaga (btdt). So just keep that in mine. Plus you can ask for sales data. If he has credit card readers on the machines, sales data won’t be hard to show. If he doesn’t have credit card readers, the machines prob aren’t as busy as he says.

which poses another question, is the equipment leased or owned?

[jbradley3313]

I called off on meeting both people because they were combo machines and two were much further away from me then we thought and the other from the picture looks like it is tucked away in a break room next to a fridge so that's a no go for me.  

We would like to build this business up and hopefully replace our current income but know there is going to be some growing pains along the way.  Thank you for the information.  I have a price point in mind now for a route or machine I purchase and how long to expect a profit from it.

[AZVendor]

You need to post the models of the machines you are interested in and their prices and we can tell you whether they are good machines and a good value.  Stay away from combo machines.  Those do not make you a profit due their low capacity and how often you might need to service them.