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I need your experience!


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Hi all:

I received a response to my CL ad looking to buy routes. Someone wrote to me with 20  2-yr-old 1-800 Triple Heads. Fifteen are placed, but the average monthly pull is only $13, which I believe is low, particularly for a triple head machine. And even at that, the numbers are highly inflated by 3 high-producing locations. The bulk of them are bringing in $2-$6 per month.

I've read plenty of discussions on this forum in the past, and my understanding is that the value of a route is EITHER in the equipment or the location, but NEVER both. His asking price for this route is $16,000. I was expecting to pay something more like $1,600. I can't see a used machine and the location being worth $800 each, and that's if all 20 were in solid locations. I would only keep the 3 high-producing locations long-term and start looking for better spots for the dogs as soon as I get the ones that aren't placed at all into locations.

His argument justifying his asking price is that if I invested $16,000 at the bank, the roughly $200/month take would be a better ROI than I'd get at the bank. However, that seems to be flawed thinking to me. If I invested money in the bank and received the interest, I'd still have the original investment as well. Whereas, here I'd be giving away $16,000 and while I might be bringing in $200/month, not only would I no longer have my $16,000 but the assets I did have (the machines) won't last forever. For that matter, neither will the locations.

So I'm asking for feedback from those of you that have been in the business and bought or sold routes. Am I way off base or is he? Perhaps we both are. As always, your input is appreciated!



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I'd let this one go..

That goes without saying. At $16,000, even if it's a good deal, I'm just not prepared for that kind of investment at this time. What I want to know is how to evaluate a reasonable purchase price.

I believe I had also seen something along the line of the purchase price should be in the same ballpark as 1 year's take...

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Jarola, I hope the sellers name wasn't John Seah. I contacted someone from CL claiming to sell a route (on the east coast) and, long story short, he gave me that same bank crap. If that is his name, you might want to RUN away (and change your email address!) ;D


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