Tales from the Locator

[joshbrooksflorida]

Hey folks,

 

I'm a new guy in the business, and was hoping that you could tell me if this locator is shooting me straight or not.  Thanks very much.

 

I bought twenty tri-vends (ten from amerivend and ten from vending on demand), and have those on the street.  I have since ordered 43 Northwestern super 60s, which I hope to spot next weekend.  I paid a locator to help me spot the tri-vends, and spent most of the day picking her brain about the business.

 

She said that you can make five figures a month vending bulk candy, with 500 machines.  Is this realistic?  That claim implies that you can NET $20.00 per month per machine, and that you can get to 500 machines each month (she said she could service 50 machines each day).  Any thoughts or experience on this is greatly appreciated.

 

She also mentioned that she would visit her machines every 45 days.  That way, she could have more 50-machine routes, and more days free to do other things.  Is this realistic?  I estimate that, even with a high level of activity, the machines that I'm using/going to use have two months' worth of product.

 

Thanks very much for your input.

[25cent_smile]

Hey Josh, Five figures a month, holy crap!!!!!    I'm new to the business too, however, I've done 300+ hours of research on this business. I'll tell you the truth. If you have good locations, I believe $20 per machine is possible especally for triples. That is only 3 vends per day. Unfortunately, servicing 50 machines a day in not reasonable. Time yourself at home then multiply by 50 plus driving time. You also need to know the hours of your locations. I think servicing 25 machines a day would be tops.

Make sure you do the math.

Bryan

[leo7068]

From my limited experience I think it is possible, but not common. To have all 500 locations netting 20$ average is good, and means you have done some relocating for poor performers. Servicing 50 a day means they have to be VERY close together. I don't think this scenario is possible unless you are in a big city.

[caserri]

Getting to 50 machines a day is a stretch unless they are close together or you have some racks. Servicing 500 in a month is very do-able. I'm not sure why she would want to service 50 machines a day. That would complete her route in 10 days. With 500 machines I would service 25 a day for 20 days a month. That covers your entire fleet and gives you weekends off!

As for the figures, well they are a bit less believable. If she is netting $20 per machine over all 500 machines then that means she is grossing about $26 per machine (assuming 30% COGs) While that is a very achievable number, it won't come easy or quickly. It would be the result of a finely tuned fleet that has been tweaked over years. Keep in mind that for an average of $26 you would need to have a significant portion of your fleet making close to $50 per month.

Josh, take a peek at the revenue section of member PLUS and see what operators are actually averaging per month with their own fleets. I think there are 1 or 2 vendors there that report numbers anywhere close to a $26 average. One of them is a rack runner too.

Impossible - no,

Improbable - yes.

Steve

[tedk]

Josh:

You are at the gate to the garden path!

Read Steve's advice and go to the revenue section. It is a lot more realistic than the locators fairy tale.

Ted

[chuck]

The NBVA average is 9-12 dollars a month per head. You will be hard pressed to beat that if you are not a major operator in a large metro area.

Anyone can average 20-30 or even more in a small vending business. But as you grow your average will drop.

Most locators are full of BS, that is why they are salespeople. Just take anything they say with a grain of salt. And don't trust a locator farther than you can throw them.

chuck

[joshbrooksflorida]

Thanks Chuck,

So to understand, if I have 23 triple-vends, and 43 Northwestern super 60s, for planning purposes I have 112 heads?  Looking at the averages that you mentioned, 112 x $9-12 = $1,008-1,344 Gross per month?  That seems much more down to earth.

Also, what about vending 'higher quality' items, such as gourmet jelly beans or pistachios?  If I can get them at a price that is still profitable, would the volume of my sales be notably higher?

Thank you very much to all for your help and insight.

[25cent_smile]

Hey Josh, It's all about the money. #1 profit is Gumballs of all types. Ex. I was at K-Mart last week and saw a very large rack, vending that is. It had10 large single head machines. Eight of them had gum the other two had toys.  The vendor is getting 71% profit minus the machine cost. You are lucky to make 5cent per vend on fancy nuts. Gumballs last longer too. Less waste.

Just a thought.

Bryan

[chuck]

joshbrooksflorida wrote:

Thanks Chuck,

So to understand, if I have 23 triple-vends, and 43 Northwestern super 60s, for planning purposes I have 112 heads?  Looking at the averages that you mentioned, 112 x $9-12 = $1,008-1,344 Gross per month?  That seems much more down to earth.

Also, what about vending 'higher quality' items, such as gourmet jelly beans or pistachios?  If I can get them at a price that is still profitable, would the volume of my sales be notably higher?

Thank you very much to all for your help and insight.

You will probably have to relocate several times to get a decent average. Triples are especially tough because most locations won't support a triple. Product selection is a trial and error process. What sells well in one location might not move at all in another. If you hit the right product in the right spot your sales could go thru the roof...or you might just generate a lot of stale at your expense. There is no magic bullet.

I usually figure out of 100 placements 20% will do very well, 20% will be terrible and the rest will fall in the middle.

A lot of people get into this business because they hear pie in the sky numbers from machine sellers. There is no magic bullet and the quarters won't just roll in. It takes a lot of hard work to build, tweak and maintain a profitable vending route. Good luck to you!

chuck

[joshbrooksflorida]

I am beginning to see what you mean.  I just got done checking my 19 triple vends.  I put six out last Saturday, and checked them today, so they have sat six days.

-  8 had $1.25 or less (less than one vend per day)

-  6 had between $1.50 and $2.50 (with an average of 1.3 vends per day)

-  The other five (all at one OUTSTANDING location) had $8.50, $11.25, $12.25, $10.00, and $13.25 in them.

Total collected for six days was $75.25, or an average Gross of $19.80 per machine per month, if things keep going as they are.  But, if I take the five superstar performers out, it looks much more bleak:  $20.00 collected between 14 machines, or an average Gross of $7.14 per machine per month.  Also, I imagine that it will become more difficult to have such a high ratio of superstar machines as my total machine count grows.

Those that did poorly were in break rooms;  those that did well were accessible to the general public, and near the exits (downstream of the cash registers, where people have change still in their hands, and mom's purse is still open).

I am scheduled to receive three more tri-vends, and 43 Northwestern super 60s next week, and am pretty convinced that I can do as good if not a better job than the locator did.

We'll see, and I'll let you folks know how it goes.  Either way, I did make some money today, spent my time toward a useful, productive endeavor, and HAD A GREAT TIME.  Good luck to you all;  may our routes be filled with stellar locations.

Josh