Need advice structuring a deal for a location

[mission vending]

OK, I'm a little confused because I thought having it under contract would be a good thing. So, if I understand you correctly, having a year left is bad because I will have spent $$$ on a better soda machine, and will not have a positive ROI at the end of the contract term.

Anything I'm missing here?

The only thing you are missing is my poor conveyance of thoughts. Please let me clarify.

Anytime you have anything in writing it is a good thing. From my perspective, many people use "agreement" and "contract" interchangeably. Again, IMO, they are two very separate and distinct things. The difference to me is that a true "contract" is that a contract is very difficult for the location to cancel and includes some sort of penalty for the termination of the agreement, usually a prorata buyout of the remaining term. These are pretty rare to find.

So I am thinking you are looking at, by my definition, some sort of "agreement" which certainly adds value but, again my opinion, does not add significant value to the deal. An agreement, again IMO, specifies the terms under which you will operate at the location (commissions etc.) and the terms under which you will be fired. I've said it before, this is a service industry and , again IMO, you will eventually lose every location that you have. You might mess up somehow, location closes, new management, new ownership and any number of things beyond your control. The key to long term survival is to continually hone your customer service skills and build those relationships. In doing so your location longevity will far exceed the industry average of three years. It is much harder for someone to fire a friend than it is to fire "the vending guy".

If you do your job correctly extending the agreement should not be an issue, especially if you do upgrade the equipment.

Hope this straightens things out for you.

[brendamca]

OK, I think I understand better now. I need to get a copy of the agreement to be sure.