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Vending to stores....$1800 / wk pay.......


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HI All,

While most of the vending work I do is machine vend (and even 1 soda machine....;-)) , I also so a little bit of food vending to stores (Hostess / some Lance....mainly small mom and pop places (convenience stores) since all the big ones are on contract already).

I recently ran across this ad on CL and it really intrigued me because of the high weekly pay....They NET about what I GROSS and they do it with only 10 stops.

What do you think about this opportunity?...Any other store vendors out there (by store vending I mean stocking shelves in large stores not necessarily machine vending).

CL ad Below _______________________________________________________________________________

I am selling my Grupo Bimbo Bread Business, the territory I own and deliver to is all of Louisa and Fluvana Counties. The labels I carry are as follows Arnold Branded Bread, Thomas' Muffins and Bagels and their complete breakfast line. Maiers Italion Rolls, Entennmanns Cakes and donuts and Stroehmann Potato Rolls.

Currently in the territoy are three Food Lions 1 at Lake Monticello, 1 in Louisa and 1at Lake Anna with a fourth propossed in the Zions Crossroads area. There is the Wal Mart Supercenter at Zions also along with 6 independant grocers I deliver to in the two counties. There are a few more that I choose not to deliver to but you can build your business by serving them.

The business averages 8965.00 a week in sales that is a 52 week average. You are paid 20% on those weekly sales around 1800.00 weekly. It is much busier in the summer ( say the average is 11,000 than the winter months say they average 7,000 ) but it at equalls to about 9000.00 You are paid weekly thru automatic deposit if you wish.

I am asking roughly 162,000.00 for the purchase of this business. Up to roughly 110,000.00 can possibly be financed thru the lendor who handles are route purchases asuming you have good credit. That means you will need roughly 52,000.00 to put down on the business. I am becoming a District Sales Manager for Grupo Bimbo and this is the ONLY reason I am selling my business. This territory is a high dollar money making territory. The growth potential is no where near the top. I suspect it will someday average between 11-12K a week.

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My take is I would LOVE the weekly $$ BUT 162 K for nothing but stops is for me a little hard to swallow (no machines or hard assets (truck etc...is NOT included....just the stops...when I got my machine vending route at least I got LOTS of hard assets so that if all the stores / stops threw me out at one time, I would still have a substantial value in machines, supplies, truck etc....here you get just the stops(on the flip side no machines means no breakdowns etc...))......

Also, besides the difficulty in getting the 52K down (I wish I had that much!) I would hate to know what the payments are on the balance....

What do you all think?

Andrew

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I have a friend that used to own 4 routes from this company. I know he did well with it but it also wore him out. The 10 stops to grocery stores will be 1-2 hours each. You will need to have appointments in some cases to deliver.

The relationship you have with the bakery is something that could be best described as a hybrid between a franchisee and a independent contractor.

I have no idea about the valuation.

If you do look into this further be sure that you know and understand the contract very clearly because if it does not work out for you the financed amount still has to be paid, just like a mortgage unless you BK it. I would think the finance terms would be for 5-7 years and with reasonable interest rates would put your payments around 1500-2000 a month.

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you generally dont get any hard assets when buying a route (fedex, bread route, etc..)

its more like being an employee than a business owner, even though you own the route, you arent going to be kicked out for another driver the routes are exclusive but there are a lot of rules you have to follow

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you generally dont get any hard assets when buying a route (fedex, bread route, etc..)

its more like being an employee than a business owner, even though you own the route, you arent going to be kicked out for another driver the routes are exclusive but there are a lot of rules you have to follow

The routes are exclusive but a location(s) can be taken away and sold to another owner for nonperformance issues to protect the brand. I have no idea what the process entails or how much you can fight it.

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HI All,

Thanks for the replies so far...

I spoke w/ the owner of the business briefly over the phone and he seems like a nice guy....We didn't get to talk long because he was with his wife and was about to eat dinner at a restaurant. He and I will talk more on Monday.

I would imagine that bread (and possibly some of his other products as well) would be somewhat more perishable than even Hostess Cakes so I guess the stops may have to be worked more than once every week or two? (typically my small convenience stores get serviced every week along with my busier machine vending stops).

I don't really have the $$ to get the route from him BUT I figure maybe we could negotiate ( That is how I got my snack route that I run now...I didn't have the $$ for that either BUT I did manage to trade a property for the business....Also, I figure in this economy how many people are going to have $52K sitting around plus the fact that vending work may not be every persons "cup of tea" because it can and often does take lots of time to do vending route....Of course he may be a little under the gun too since he is to get a "regular" job with the company.

IT was a good point about how it is possible to lose a location for poor performance or whatever other reason that my pop up....While I don't think I would ever offer poor performance things can and do happen that are often beyond your own control....Example...The owner of my route 2 owners ago, told me he had invested time and $$ getting shelf space at a couple larger independent stores...He stocked them w/ Tom's Chips (he was an independent Tom's vendor) ....Later, for whatever reason, the Company decided THEY wanted the stores for their own employees so they refused to sell him the chips (larger bags) he needed for the stores.....effectively they took his business because he could no longer get product (Something along those lines would really suck if you put in about $160K into something and get screwed up somehow....esp w/ no hard assets to even fall back on).

Another horror story the previous owner (2 owners ago) of my route told me was that he invested $5000 (now this was probably about 15 to 20 years ago I am guessing since he had the route 15 years, then the previous owner had the route for about 4 years or so, then I've had the route for about 2 years now) in handheld computers from Tom's then (very shortly after), the company decided, they didn't want to support the computers anymore so he essentially ended up with expensive "paper weights" (they were had held units and relied on the company computer to work).

I guess a route purchase like this would really involve a lot of thorough reading of the terms and conditions of everything since you have no real hard assets to fall back on.

To me tho, this opportunity almost seems too good to be true....As a side note , Lance in our area was trying to phase out employees and make everybody independent contractors....A man about 5 units down from my storage unit was a driver for Lance and told me about their opportunity....route for sale about $60 K , included stops and truck (at least here you got a truck for your $$)....He told me what his route was grossing and that the commission was 10% of that....After I back figured everything, that deal didn't seem so great after all since at that point it would be just paying 60K for what I was already making!....

Hmmm now that I just thought about it, this Bimbo route, where the owner is asking $160K and makes $1800 / week costs WAY more than double of the Lance route (60 K for about 900/ week income) or mine (I traded land for the business that the owner wanted $36K for (makes about $900 / week also) so I ended up w/ the business and some $$ since the land was valued more than the business)....Of course being already set up and making the $$ is good too!

Thinking about the routes in terms of costs VS weekly incomes, the Bimbo route doesn't sound like a real good investment after all?....Of course the INCOME per week is REALLY GOOD! (the current owner claims about 45 - 50 hours a week to do)....Of course the previous route owner of my route worked it in 3 days BUT when I got it (in order to do it right) it takes me about 55 hours or so....wow so much to think about.....

Truthfully, Unless he is willing to barter / trade for non cash things I don't think I can realistically get the business.....Of course if he is open to trades the real problem starts....I would have to have a real good person do this route or mine because I definitely cannot do both!

WOW, life would be so much easier just hitting a lottery ticket! ;-)

Andrew

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i never thought of a route as a very good deal my barber used to own one and told me some about it. it seems basically like a job that you have to buy into the biggest advantage is you can get some cash out when you want to move on. The pay can be decent but when you factor in insurance and stuff it looks less impressive. its a lot of early hours though. he got started about 4am he mentioned quitting because of the hours

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HI,

I guess I never thought of it that way....I guess you are buying a job...Although in this case with the money being so good I guess you could probably hire it out to somebody and still make good $$ just owning it....even if you paid out $700 or $800 as salary you would still be left with $1000 to $1100 per week (of course things like gas etc would have to be taken out BUT that's good $$ for basically doing nothing if you can find the good help (I would imagine it would not be too hard to find a good person to run the route for that kind of weekly pay!).

You are right about the early hours tho....Personally that would be a big drawback for me but maybe I could get used to the early AM.

The Hostess guy that delivers my product to me starts a 1 AM and finished by noon....THAT is some kind of crazy...Me, I'm more like a 8 AM to 8 PM (or so) kind of person.

The driver that helps / does my route sometimes likes to be in the truck by 6 AM.....That may be OK in the summer but in the winter....that's just too cold! ;-)

Andrew

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