Whats the value of a route?

[vendy]

I saw a bulk candy machine at a location and I called the owner and asked if they or anybody they new was selling a route. I talked to this person for a while and he said that he was interested in selling. He said that he had 31 Dual head machines placed and 2 in his basement. He said he would collect 300 to 400 a month. I don't know what the gross on that would be. He also said that someone had recently called and asked how much he was asking for the route and the price was $8000 That person never called back and I can see why, Seems like alot. It would take way to long to get any return on investment. What would be a realistic number to put on this type of route? I also asked if he would sell individual locations that were doing good. Any thoughts!

[Alan Sampson]

Hi Vendy

Considerable has already been posted about the value of a established route. I understand that what a route will gross each year is a good starting point. $300 each month is $3,600 a years. That is a good offer.

Alan   

[vendy]

So you are saying that this route is overpriced at 8K?

[candyman007]

Hell yes it's overpriced at 8k.  The route is worth 4k.  I would not go above that number personally.  You do not want to spend more than a years income paying for the route.

Rob

[KPower]

I have read several posts about this on other forums and the general consesus seems to be 70% of a years gross returns. which would be 2520 to 3360 based on the general estimate he gave you of 3 to 400 a month. You have to remember you are buying used machines and the locations may not be great. You can buy 60 oaks and 30 chrome ashland stands and mounting plates for 115 per double head set up.....before shipping. That would be 3450 before shipping for brand new machines that you could place yourself for free. So basically with his deal you are paying over twice what new machines would cost just for the locations. even if you add locator fees in you could probably get them all new, shipped and located for 4500 or less. a

I'm just trying to offer you something to think about. If he wants to sell he will sell and I would not offer over 4k myself.

[vendy]

Thanks to everyone for your comments. I thought it was a bit pricey. You all have put it into perspective for me.

Thanks

[pusherman]

no more than $3100 for me, if he could show me some numbers

[cogbuddy]

Dude i think that by his reply you must have come to know something about it by yourself. From my point of view anything between 300 to 350$ would be the fitting price. Else it is overvalued.

[dutchboy]

I have heard others say that a reasonable amount would be 70% of the annual gross sales.

[pusherman]

yes 70% of the gross if they can prove the sales, i want to see the money coming out of the cash box. not what they right on paper for sales. other wise you are just buying machines that need to be relocated.

[schmedspub]

Ask for 2 years tax returns aqnd ask to meet with thier Accountant. If they Balk then Walk

[joehop]

VENDY I AGREE WITH SCHMEDSPUB

[fastcat8]

I live in a rural area so I will pay a higher price to keep others from getting in the business. I bought a guy out who claimed he had 75 vendstars. When I looked at the machines he had in storage they were all in pieces and looked 10 years old. He did have 30 on location but to this day I have no clue how many machines I actually bought. He wasn't making enough money to make payments on his bank loan which he took out to buy them. I paid off what he owed (over $5,200), and after making some changes in the locations it turned out to be one of the best moves I ever made. He wasn't a good vendor at all.

I can't help those who pay $12k for 20 machines, because they always want most of their money back, but I will always try my best to help others get out of the business. To me the locations are worth more than the machines.