PitbillSox Posted December 9, 2009 Share Posted December 9, 2009 So I made a post outlining what I'd like to do and some people suggested maybe buying a route and altering it from there. So I looked on CL and I found something I wanted your opinion on: 32 machines (95 1800 Vending machines, with few Vendstar ones) 2 year route Averages $600 a month with an admittingly non-committed manager 10,000? That's $312 a machine. I told her it was a bit much and she said she'd work with me. Thoughts? Link to comment Share on other sites More sharing options...
alyssamma Posted December 9, 2009 Share Posted December 9, 2009 I'm going to take some guesses here... 32 machines, 95 *percent* are 1800's with the rest Vendstars. The route has been in service for 2yrs. He pulls in $600/mo now, but is saying he isn't "trying". If he "tried", he could make more. The selling price is $10K. If the above is correct...run, don't walk, to the nearest exit. This is a horrible deal. First, you have to assume the avg is high...it *always* is. And, he is admitting he is lazy, so he is also probably lazy about the income. But, even if that was true, $600/mo = $7200/yr. There are many ways to value a route, but I don't think anyone would say that paying > 70% or so of the gross is worth it. That would mean about $5K - 1/2 of what he is asking. Others would only pay for the machines or locations and would arrive at a much lower figure - $3-$4K. But I would say that $5K is fair. Regardless, $10K is at *least* 2x what the route is worth. Kevin Link to comment Share on other sites More sharing options...
PitbillSox Posted December 9, 2009 Author Share Posted December 9, 2009 32 machines I don't know what she meant about the 95 1800 vendstars? I'll ask....... Link to comment Share on other sites More sharing options...
alyssamma Posted December 9, 2009 Share Posted December 9, 2009 NDame, I think we posted at the same time...see my post above... Link to comment Share on other sites More sharing options...
JPVendCo. Posted December 9, 2009 Share Posted December 9, 2009 there is no way i would pay 10k for 32 machines! I have never paid over $100 for any machine, ever. (any bulk machine that is) value in my opinion: if you are paying cash I would start at $50 a machine, which is 1600. 2400-3200. would be a reasonable amount. if you wanna be generous, and the TERMS are right 4000 for the high end... 600 gross is an 18.75 avg. with a 35% COG, thats 12.19 avg, or 390 for the whole she-bang. Link to comment Share on other sites More sharing options...
PitbillSox Posted December 9, 2009 Author Share Posted December 9, 2009 Thanks guys. Anymore thoughts? Link to comment Share on other sites More sharing options...
alyssamma Posted December 9, 2009 Share Posted December 9, 2009 LOL, are you waiting for someone to tell you it is a good idea? Link to comment Share on other sites More sharing options...
PitbillSox Posted December 9, 2009 Author Share Posted December 9, 2009 ......no? Just maybe some more insight as to how to value the route so I can negotiate the price a bit? Link to comment Share on other sites More sharing options...
JPVendCo. Posted December 9, 2009 Share Posted December 9, 2009 I gave you a whole range there.......what else needs said? what insight are you looking for? Link to comment Share on other sites More sharing options...
PitbillSox Posted December 9, 2009 Author Share Posted December 9, 2009 I appreciate your imput and I emailed those guidelines to the potential seller. I didn't know if anyone else had any guides for valuing routes for when she comes back at a different price.... Link to comment Share on other sites More sharing options...
jayhawk22 Posted December 9, 2009 Share Posted December 9, 2009 I don't know about candy routes but when I have bought routes in the past I stayed around 1 years sales. In this economy though I wouldn't even pay that. It helps if you are dealing with a desperate seller! Then you can offer even less! I am considering buying a small flat/toy capsule route that the seller wants $58,000 for. I will probably offer $45,000. Link to comment Share on other sites More sharing options...
jb5580 Posted December 9, 2009 Share Posted December 9, 2009 A small route for $58,000 ?? Link to comment Share on other sites More sharing options...
alyssamma Posted December 9, 2009 Share Posted December 9, 2009 ND, I told you 70% of 1yrs gross. I told you others pay for machine or location. JP is one of those and he said $50/machine and gave you a range. Also, if you do a search here, you can find dozens of posts on the subject Kevin Link to comment Share on other sites More sharing options...
JPVendCo. Posted December 9, 2009 Share Posted December 9, 2009 I don't know about candy routes but when I have bought routes in the past I stayed around 1 years sales. In this economy though I wouldn't even pay that. It helps if you are dealing with a desperate seller! Then you can offer even less! I am considering buying a small flat/toy capsule route that the seller wants $58,000 for. I will probably offer $45,000. WTF do you consider small??? Link to comment Share on other sites More sharing options...
lurtsman Posted December 11, 2009 Share Posted December 11, 2009 WTF do you consider small??? I wondered this also. Link to comment Share on other sites More sharing options...
jayhawk22 Posted December 11, 2009 Share Posted December 11, 2009 I've been doing this for over 10 years. It is how I make my living & I have no other job. The 30 location route I am going to buy is a small route. It will be a nice little addition to my company. I like building from within but sometimes it is easier to fill in holes in your route by acquisition. To show an example of my scale I will use our local movie theatre as an example. It is a 10 screen cinema in a mall. I have 17 vending pieces in it including arcade games, redemption games, chicken machines, sticker machines, toy capsule racks & more. I am in over 20 of this companies theatres. Link to comment Share on other sites More sharing options...
jb5580 Posted December 11, 2009 Share Posted December 11, 2009 I just thought a small route was like the ones I've been negotiating for lately: 20 to 30 locations for$2500 to $3000. $58,000 in my world would be a huge route. Link to comment Share on other sites More sharing options...
jayhawk22 Posted December 11, 2009 Share Posted December 11, 2009 I hear ya. I started out with 8 candy machines & never looked back! After candy I got into gumball machines then stickers then toy caps then cranes then arcade games, boxers, redemption, chickens etc. If it makes money I will try it! My business motto is grow or die! Link to comment Share on other sites More sharing options...
PitbillSox Posted December 11, 2009 Author Share Posted December 11, 2009 So the truth comes out....... In my back and forth e-mails with her, it comes out she paid $300 for each machine and a locator (prolly $50 a pop) so she paid about $10,500 for the 30 machines to be placed. I tried telling her I can buy 30 machines new, and a locator for probably about $125 each, meaning I can pay $3750 to place 30 new machines. And I asked her why would I pay ~2.5X that for 2 year old machines. I tried explaining to her she paid 3X the machines value up front, and she's trying to make that back now. Link to comment Share on other sites More sharing options...
sherlock Posted December 11, 2009 Share Posted December 11, 2009 So the truth comes out....... In my back and forth e-mails with her, it comes out she paid $300 for each machine and a locator (prolly $50 a pop) so she paid about $10,500 for the 30 machines to be placed. I tried telling her I can buy 30 machines new, and a locator for probably about $125 each, meaning I can pay $3750 to place 30 new machines. And I asked her why would I pay ~2.5X that for 2 year old machines. I tried explaining to her she paid 3X the machines value up front, and she's trying to make that back now. Interesting....and what was HER response to your explanation? Link to comment Share on other sites More sharing options...
PitbillSox Posted December 11, 2009 Author Share Posted December 11, 2009 Hasn't come up with one. I'm literally just asking: "I can buy new ones and hire a locator and pay about $125 each for a total of $3750 for 30 machines. You want $10,000 for located machines that are 2 years old. Why should I do that?" Link to comment Share on other sites More sharing options...
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