shacks Posted February 6, 2011 Share Posted February 6, 2011 Hello, We are in the process of trying to place our first 5 soda/snack machines in locations. If a commission is required to get the location we are willing to do so but have no idea what industry standard is. We do not want to shoot ourselves in the foot by offering too high a commission and also do not want to offer too low. Please any advice is appreciated on what any of you are comfortable with. Thanks, Link to comment Share on other sites More sharing options...
andyinchville Posted February 6, 2011 Share Posted February 6, 2011 HI, We typically offer 10% but we have gone as high as 40% on a bid (of course the prices were raised a bit to offer the higher payouts)....Comm is based on gross sales. Andrew Link to comment Share on other sites More sharing options...
shacks Posted February 6, 2011 Author Share Posted February 6, 2011 Hello, Thanks for responding so quickly. We are trying to use the commission as a way to get our foot in the door of some places but definitely don't want to start out too high. We thought that 10% sounded low since we will be using the clients electricity but if that is standard then I feel better about it. We have 6 Sega Mechanical combo machines so we are not looking for huge accounts but definitely want to make sure we place them in profitable locations and don't kill ourselves with the commission. Where would you suggest placing machines like these? Again we are very new to food/beverage vending, started out in bulk and are now trying to move forward. The previous owner of the machines said he did very well in larger hair salons and Barber shops. I am just curious if these are good locations. Thanks, Link to comment Share on other sites More sharing options...
andyinchville Posted February 6, 2011 Share Posted February 6, 2011 HI, Actually for us, 0% is standard....we only do commission as a last resort....try to sell them on quality of service, convenience (both for employeees and customers if applicable), reasonable prices, quality selections (example we use Hostess products rather than Bluebird etc...). If they had gotten poor service before you may be able to get in with the promise of good service.... On the flip side if the issue of electricity gets brought up it may be cheaper to buy a "kill o watt" meter and offer to pay for the actual electricity used....on a good site this will more often than not be cheaper than paying out a 10% commission. Hope this helps you. Andrew Link to comment Share on other sites More sharing options...
andyinchville Posted February 6, 2011 Share Posted February 6, 2011 oops I forgot to answer your other questions.....any stop can theoretically be good...just depends on who is there...assuming it is a machine in the back room of an employee lounge (a small shop with junk food junkies can be better than a large workplace shop with thrifty people)....Generally speaking the larger the employee base and visibility from the public the better off you will be....I think I read somewhere on this site, person for person, blue collar workers eat more than white collar workers....At the current time I do not have any beauty salons or barber shops so I cannot comment on them from experience....maybe others can chime in? Andrew Link to comment Share on other sites More sharing options...
shacks Posted February 6, 2011 Author Share Posted February 6, 2011 That does help. I think you are right that we should try to sell our services first and use the commission as a last resort. I am sure we will have to approach each account differently but it is much better not to come out of the gate offering a commission. We were planning on going in way too high to start so you have helped alot. Thanks, Link to comment Share on other sites More sharing options...
andyinchville Posted February 6, 2011 Share Posted February 6, 2011 HI, Glad to be able to help you...I was once new on this site and really appreciated all the help I got from the more experienced members so I felt like its only right to give back and help others on this great site....there is a lot of good info here....it'll take awhile but it does help a lot to read and ask questions as needed. Good luck on your first machines...let us know how it turns out. Andrew Link to comment Share on other sites More sharing options...
dogcow Posted February 6, 2011 Share Posted February 6, 2011 Hello, Thanks for responding so quickly. We are trying to use the commission as a way to get our foot in the door of some places but definitely don't want to start out too high. We thought that 10% sounded low since we will be using the clients electricity but if that is standard then I feel better about it. We have 6 Sega Mechanical combo machines so we are not looking for huge accounts but definitely want to make sure we place them in profitable locations and don't kill ourselves with the commission. Where would you suggest placing machines like these? Again we are very new to food/beverage vending, started out in bulk and are now trying to move forward. The previous owner of the machines said he did very well in larger hair salons and Barber shops. I am just curious if these are good locations. Thanks, basically dont pay commission on these machines. the places you can put them are honor box type locations (barber shop, beauty shop, small mechanics shops,etc...) likely you wont even have any competition so theres not much reason to offer commission. furthermore you probably aren't going to have a high volume so commission will cut into your margin. i would recommend just saying that it is a service to the employees and customers. These machines don't use much electricity. Link to comment Share on other sites More sharing options...
EddieMac Posted February 6, 2011 Share Posted February 6, 2011 We had a barber shop last year that didn't do very well. We removed it, the barber bought their own machine (exactly like ours) put it in, then after a few short months, took it out. Our standard commission is 0%. We will do 10% for schools (Snack and drink). If the school does a lot of business then we will do 15% for the drink machine, but that's only if they nearly empty the drink machine each week. The only two regular businesses we pay a commission to are two that we bought from other companies where they were already getting a commission from the company we bought the locations from. Otherwise, we just can't afford a commission unless we raise the prices in those machines, and most places would rather have lower prices. Have a great day, Link to comment Share on other sites More sharing options...
mission vending Posted February 6, 2011 Share Posted February 6, 2011 basically dont pay commission on these machines. the places you can put them are honor box type locations (barber shop, beauty shop, small mechanics shops,etc...) likely you wont even have any competition so theres not much reason to offer commission. furthermore you probably aren't going to have a high volume so commission will cut into your margin. i would recommend just saying that it is a service to the employees and customers. These machines don't use much electricity. I would concur with this sentiment. These machines will go into what is considered a low volume location and the location should be happy to get any kind of vending equipment. I have started running into what would be considered a low volume location for full size machines and the vending company in there is charging the location a fee to leave the machines in the location. If you do go the commission route, no more than 10%. Link to comment Share on other sites More sharing options...
shacks Posted February 7, 2011 Author Share Posted February 7, 2011 Thanks. This is very good to know and it will helps us to approach these type of clients with a little bit more confidence about our services. The worst thing would be to actually lose money. I will let you all know how it all works out after we place these first few machines. This forum is great. Link to comment Share on other sites More sharing options...
dogcow Posted February 7, 2011 Share Posted February 7, 2011 I have started running into what would be considered a low volume location for full size machines and the vending company in there is charging the location a fee to leave the machines in the location. LOL wow id love to meet the guy who cut that deal, must be the king of the fast talkers. after that kind of pitch you'd have to check and make sure you still have your wallet. Link to comment Share on other sites More sharing options...
mission vending Posted February 7, 2011 Share Posted February 7, 2011 LOL wow id love to meet the guy who cut that deal, must be the king of the fast talkers. after that kind of pitch you'd have to check and make sure you still have your wallet. Actually I've run into this twice now. The first being last year with an OCS provider charging 5 -10 bucks a month for the brewer rental. Then last month, an account I solicited that had a 4 wide and 8 select can in it by a local operator with a number of routes, they were charging the location $50.00 per month to keep the machines in there and only serviced it 1X a month. I can see why they are charging the location, with that little volume I would pull out as well without something else going on to make it more worthwhile. With 1X a month service I did not pursue their business. Some deals are just not worth doing. Link to comment Share on other sites More sharing options...
Poplady1 Posted February 8, 2011 Share Posted February 8, 2011 Welcome to the vending business. I agree with all of the comments already made and just wanted to add a couple additional thoughts. I have found one of the best types of spots for these Seaga machines would be in a office with 50 to 60 employees. Those spots are right on the line between requiring full size machines or a good combo. Plus they rarely ask for commission. I helped a Texas vendor put one out a couple of months ago and he reports it is doing $75 a week. Which is good for a combo. He visits twice a week. He also reports that the popular items are often sold out even visiting twice a week (which is one of the problems with these machines). They don't carry much stock. So try to keep your combos close to your home. Hope it goes well for you. Poplady Link to comment Share on other sites More sharing options...
dogcow Posted February 9, 2011 Share Posted February 9, 2011 Welcome to the vending business. I agree with all of the comments already made and just wanted to add a couple additional thoughts. I have found one of the best types of spots for these Seaga machines would be in a office with 50 to 60 employees. Those spots are right on the line between requiring full size machines or a good combo. Plus they rarely ask for commission. I helped a Texas vendor put one out a couple of months ago and he reports it is doing $75 a week. Which is good for a combo. He visits twice a week. He also reports that the popular items are often sold out even visiting twice a week (which is one of the problems with these machines). They don't carry much stock. So try to keep your combos close to your home. Hope it goes well for you. Poplady hes doing $75 a week from a mechanical combo? Link to comment Share on other sites More sharing options...
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