Need assistance in valuing a route that is on sale

[bluevendiscuss]

I'm looking for help on what to offer for a route and machines that this person has for sale...

- This person is looking to sell 25 Vendstar machines, bought new 2 years ago. 

- 6 machines are on location, 7 has been opened but is sitting around. The remaining 12 are still boxed up.

- Does not have any financial statement/report on earning that the 6 machines is making. This person put it this way..."all has been done in a disorganized fashion as far as keeping track goes"

- Is asking $2,500 for everything

I do not think it is worth $2,500 for everything, but want to counteroffer that is more reasonable (for me at least) and I'm thinking of offering no more than $1250. I'd like to try get $50 for each machine and not even try assigning a value on what the 6 machines that are on locations since no financial report has been done. Granted...income statement on machines are not close to being reliable but does give me an impression of the type of business this person is running.

So, what do you think? What value will you place on this transaction?

[T BIRD]

This person is an unhappy position it seems which works well for you.  Sounds like he/she was 'taken' by the Vendstar rap.  I like the amount of your counter offer.

Just so you know, the way to value a route that is up and working and giving commissions is a value is placed on each machine times the number of machines out on location.

[bluevendiscuss]

Just so you know, the way to value a route that is up and working and giving commissions is a value is placed on each machine times the number of machines out on location.

Just to make sure I understand you right, the amount of "coins" that a machine generate in one month is the number I should use to place a value on a machine that is out on a location?

[Profits]

Just to make sure I understand you right, the amount of "coins" that a machine generate in one month is the number I should use to place a value on a machine that is out on a location?

Route valuation is typically 6-12 months gross.  Some consider the majority of a route's worth to be the machine itself.  A route with machines that need to be replaced would be worth nothing.

Personally I would not bid on a route with Vendstar machines.  The cost involved in replacing Vendstar machines with proper machines would likely double the price of the route.  But why go that direction when you can just buy the right machines from the outset and avoid acquiring someone else's poor investment?

[NinnJinn]

The way I used to look at it if there were no income reports is,  Offer what I thought was fair for the machines.  The machines that were on location, throw in an extra $20-30 for each located machine.

You would still get the placed machines cheaper than buying the machine and hiring a locator.  But I also wanted to see the locations that the machines were in.

Now if there were income statements and they were reasonable statements,  Then I would offer the seller the amount that the machines would gross in 9-12 months.

[bluevendiscuss]

What is the market value for a brand new vendstar machine? $30-50

I offered $800 (around $30/ machine) for everything. The seller declined, asking for more. I explained the valuation I used is based on current market value, which is around $30-50 based on what I see on Craigslist and eBay.

What do you (anyone) say is the value of a new Vendstar machine?

[NinnJinn]

I believe vendstar sells them brand new for around $2-300 EACH!

[royalforest]

The one thing I did right in this business is I never purchased and still will not purchase a new or used 3 headed candy machine for more then $50.00 each. Even if it is on route and the route averages 20.00 per month per machine times 12 months gives you 240.00 income for each machine per year times 50% would put a value of 120.00 per machine on route. So if the machine is not on route and you pay $50.00 per machine you figure it will cost another $70.00 per machine for locating and filling with candy which still puts you at the $120.00 mark per machine on location. So I would pay $50.00 or less off route and 120.00 or less on route if it averages 20.00 per month. I hope this helps.

[bluevendiscuss]

I know the company Vendstar themselves sell machines at around $300 each. And I refuse to buy direct from Vendstar.

I prefer to get it from Craigslist or eBay and they are much much cheaper.  

I may have stated my questions incorrectly, what prices you typically see on Craigslist or eBay for a new vendstar machine?

[bluevendiscuss]

The one thing I did right in this business is I never purchased and still will not purchase a new or used 3 headed candy machine for more then $50.00 each. Even if it is on route and the route averages 20.00 per month per machine times 12 months gives you 240.00 income for each machine per year times 50% would put a value of 120.00 per machine on route. So if the machine is not on route and you pay $50.00 per machine you figure it will cost another $70.00 per machine for locating and filling with candy which still puts you at the $120.00 mark per machine on location. So I would pay $50.00 or less off route and 120.00 or less on route if it averages 20.00 per month. I hope that helps.

RoyalForest,  that is a big help!  That forumla gives me some direction on how to place value on machines that are just sitting around and those that are on route.

Thanks!

[fronk327]

New Vendstars usually go for $50-$100. That is brand new, never used, scatch free, complete with a set of keys. Used $10-$65 depending on condition.

[havending]

Route valuation is typically 6-12 months gross.  Some consider the majority of a route's worth to be the machine itself.  A route with machines that need to be replaced would be worth nothing.

Personally I would not bid on a route with Vendstar machines.  The cost involved in replacing Vendstar machines with proper machines would likely double the price of the route.  But why go that direction when you can just buy the right machines from the outset and avoid acquiring someone else's poor investment?

Vendstar is a proper machine for a person wanting to place tripples.  There is no real problems with a vendstar. the only problem is the new price vs the resale price. 

[NinnJinn]

I may have stated my questions incorrectly, what prices you typically see on Craigslist or eBay for a new vendstar machine?

Sorry about that! yeah, I read it wrong..  It really all depends on how deep in debt or how bad the seller wants to get rid of them.

Deep in debt due to vendstar's BS....  about 100-150 still in box.

"I got screwed, I just want to get rid of them" .....  about 50-75 still in the box.

But all the ones that I have seen on craigslist that are new, they are wanting to sell in a lot and will not separate usually has a  $1200 price tag on them or higher for about 20-25 machines.  I was always afraid of purchasing that many machines at one time without have a location for at least half of them.

[Jax Snacks]

Vendstar is a proper machine for a person wanting to place tripples.  There is no real problems with a vendstar. the only problem is the new price vs the resale price. 

Why own a machine that can not vend gumballs, superballs or capsule toys?  Candy is usually one of the slower sellers out there.

[will.vend]

Why own a machine that can not vend gumballs, superballs or capsule toys?  Candy is usually one of the slower sellers out there.

the problems with vendstars are numerous...and at the top of the list is anytime you talk about them you are gonna hurt someone's feelings, newbies buy these machines not knowing how cheaply built they are, then after spending there hard earned money they feel compelled to defend them and their decision to buy them. I know there are forum members that use these and my comments arent directed at them, my comments are directed at the next person considering buying these machines, there are no justfiable reasons to buy a vendstar, you will regret it and if you stick to vending for any length of time you will have to replace these machines and in the long run you have not saved any money. Other threads have talked about triples vs singles or doubles, I have said and will always say buy singles and make up doubles or triples as you need them...and when you are sick and tired of those crappy vendstars trash them do not resell them.

[NinnJinn]

when you are sick and tired of those crappy vendstars trash them do not resell them.

But, but, but what about all that money we got screwed out of for buying them in the first place? 

[royalforest]

I don't but vendstars because of the fact you can't vend gumballs. For the same price you can but metal machines that have better color, last longer, have more value, and most of all can vend gumballs. I would never buy a single head machine when you can buy a triple and have the chance to capture more quarters because of more selection.

[lak20019]

If you can find proof that Vendstar is going out of business (just a rumor now?), maybe you could use that angle to lower the price of the route. It would be a pain to find replacement parts, etc. once the ebay market dries up.

[havending]

Why own a machine that can not vend gumballs, superballs or capsule toys?  Candy is usually one of the slower sellers out there.

I agree but the statment was that for some one wanting to operate tripples the machine are just fine.  i asume that someone wanting tripples would vend candy and not gumballs or toys.  But for the record i would not use them on a location because i vend very little candy.  I do own around 50 vend stars and they are all on loan to non profit groups to allow them operate them and raise their own money.  I got them brand new for 26 ea,

[dperry]

Why own a machine that can not vend gumballs, superballs or capsule toys?  Candy is usually one of the slower sellers out there.

There is a triple in the break room in my office at work.  It sells out of boston baked beans every 2 weeks.  The M&M's on either side start to go down shortly after the beans are gone.

I went to a major chain grocery store today and peeked at the rack on my way in/out.  It has 2 2in, 3 flats and 4 1in.  The 2in were selling sour candy in caps and goop.  The 1in was selling bok choy boy for 50c and the rest was candy.  Sours, cotton candy and something else, that I can't remember.

[will.vend]

There is a triple in the break room in my office at work.  It sells out of boston baked beans every 2 weeks.  The M&M's on either side start to go down shortly after the beans are gone.

I went to a major chain grocery store today and peeked at the rack on my way in/out.  It has 2 2in, 3 flats and 4 1in.  The 2in were selling sour candy in caps and goop.  The 1in was selling bok choy boy for 50c and the rest was candy.  Sours, cotton candy and something else, that I can't remember.

I personally prefer sticking to 90% toys and 10% gumballs or something close to that formula, the more line items you carry the higher your expenses are, there is a def need and market for candy but I choose not to offer it.