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How long does a bulk vending account last...


Abbadox
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Most everyone looking to get into bulk vending focuses on how much they can make per location and how much does it cost to start but I think another major factor to consider is the length of time you can expect to actually keep the account.

I would like to hear from everyone what is the average length of time you keep a bulk vending account?...

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There is no easy or one-size-fits-all answer to that question as there are many factors and variables.  I have some spots that have been around for 5 to 7 years and others don't last even a year.  However, every location seems to have a life cycle.  Owner and management turnover is a big factor.  So is corporate policy decisions.  Charity locations have a tendency to more volatile than commission locations since there is no real financial benefit to the owner.  There is no silver bullet, you can lose any location at any time for any stupid reason.  Rest assured, you will lose locations and that is the number one problem in bulk vending, IMHO.  If I still had all of the locations that I lost, I would be raking in some serious cash.  Every business tends to have a serious pitfall and losing locations is ours.

And you thought that finding locations was the only hard part!  No new vendor that enters the business, including myself, appreciates how many locations that will eventually be lost.  I talk to other vendors and they all say, "I can't believe how many locations I have lost".  That is why we must always be on the offensive looking for new accounts since that phone is going to ring someday and it will not be good news.  I have stopped counting (too depressing), but I have easily lost 150+ accounts over the last 9 years!  Annually, about 10 percent lost due to business closings or theft and 20 percent lost due to evictions.  And that does NOT include the locations that I voluntarily removed due to poor performance!  Just remember to include replacing lost locations in your business plan and budget.

Jax

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I to believe we should always be proactive to keep and maintain our locations. to both grow our business and keep the vending industry at a high standard.

loosing a location would have to be the worst part of this business. doing all the work and having it pulled from you shortly down the road.  :(

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Anyone who's done vending long enough can tell you that the account will last as long as the location allows the machine there. Sometimes it is 1 day sometimes it is years. At my childhood barbershop, there was a Ford Charity machine there from the earliest I remember and was still there the last time I went there for a haircut about 10 years ago.

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With the correct placement and doing the right thing and taking care of the accounts you should be there as long as the business is in business. Do a super job at taking care of the business and they will in most cases keep the competition out as well.

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  • 2 weeks later...

Sorry guys maybe I was not very clear in my point, I was trying to get across to all the people thinking of starting a bulk vending business to think about turnover. It is a huge part of the business and most people new to the business skip over this part. I was thinking it would be good to post some details on the average length of time an account lasts.  I know many on here say just do a great job and you will keep the account for years but in my experience it is a crap-shot at best. Turnover often involves change of manger/owner, change of mind, location closing, theft.  I have tried to find concrete numbers but no luck and most people just say it varies. 

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LOL, most people say it varies because it does :)

Averages, in general, are a pretty poor way to measure things. For example, if I told you my average pull from my 4 accounts was $25/mo, what would that tell you?

I might have 4 $25 accounts, or 1 account that does $85/mo and 3 that do $5/mo.

So, if someone said the avg time an account lasts is 6mo...what does that mean?

The reality is that it really does *depend*. The people I sold my full line route to lost my 2nd largest customer after a month because of something *really* stupid they did. They left the door open and people took candy. They threatened to call the cops unless the account reimbused them for the money. The account gave them their money and then gave them their walking papers.

How much did the account have to pay them? $9.

So they lost an account that pulled in about $150/wk over $9.

If you asked them what the avg time an account lasts they would give you a low number :)

Seriously, tho, I've had some corp accounts that lasted a week because the DM came in and said the machine had to go. But I have accounts that I've serviced since day one.

It really does all depend :)

Kevin

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I agree with you totally Kevin, but my point still stands.  The issue is not that accounts come and go or even how much revenue they make. My goal in this thread is to ask bulk vending operators what the average length of time they keep an account and the reason for wanting this info is that if we get enough input it should give the people looking to get into the biz a starting # to factor into their business plan and help guide them to a successful operation instead of just thinking that if they do a great job that the account will last forever.

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To me, Abbadox, it is too depressing and really not productive to keep track of the failure locations. Yes, you should learn from each loc you lose but move on. To the new people just know it will happen too much and you will take some big hits from lost locs. Also understand you will lose every type of location and you should have the capital backing to weather these losses. Good news, you will learn over time what works for you and your odds of losing a loc will drop significantly.

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Determining the average life span of your locations is almost impossible since there are so many variables.  It would be more reasonable to plan for a turnover rate on a yearly basis.  My experience is to plan on losing 15% to 20% of your locations (especially charity) due to evictions and 5% of the locations due to theft or vandalism and 5% due to business closings.  Note that this does NOT include the locations that I voluntarily remove due to bad performance and that number can vary greatly depending on the quality of your locator or personal locating skills.  The numbers will probably vary by geographic area, but here in central Florida there is a large transient population and business owners and regional managers turn over at a high rate.  I would recommend that you track lost location on a monthly basis in a spread sheet and tally up the totals after a year.  The numbers may astound (or depress) you!

Jax

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The numbers may astound (or depress) you!

You hit the nail on the head Jax,  this is exactly the point I wished to make.  I agree tracking the numbers per month and then average it out over a period of at least a year and then combine this info along with other members on here and we may be able to get a real average to work with.  Every industry has averages... They are not perfect but they are helpful.

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