Looking for a new way to make some extra money every week? A vending machine business might be perfect for you! With an average earning of $715 per month, vending machines are an easy way to have a consistent income when placed in the right location. This Business Kitz article will tell you all you need to know about owning a vending machine business.
How do I choose a good location for my vending machine business?
Location plays a significant role in the success of any vending machine business. Important factors to consider are weather, accessibility, and relevant demographics as they’ll greatly affect the business. It’s important to choose an area that gets sufficient foot traffic and where quality food is difficult to find. An ideal location has 30+ regular people on the premises every day.
Examples of ideal places could include:
- Construction sites;
- Office buildings;
- Apartment buildings;
- Retail stores;
- Schools and universities; or
Do I need permission for my vending machine business?
It’s also important that before you choose a location for your vending machine business, you have permission from the property owners and there is a contract agreement. A contract agreement is important as it’s likely the property owners will require a percentage of the income in order to cover utility fees whilst also making passive income for themselves. Some owners may be more likely than others to grant permission, so be prepared to either do some convincing or get rejected. Contracts are also important in preventing disputes and conflict between yourself and the lessor, as they are a collection of terms that both parties have agreed to.
Are vending machine businesses a good return on investment?
Vending machines are a great investment as most vending machine businesses make their initial investment back after operating for 12-18 months; depending on the location and foot traffic of the area it’s located. As it’s also a low-maintenance business, it’s a perfect opportunity for passive income. The average earnings per period are below.
|Period||Average income per machine|
Offering all different types of payment methods will maximise your earnings. A successful vending machine business should offer:
- Coin slot;
- Credit card; and
How do I analyse the market?
It’s important to consider what products you intend to sell and at what price point. It’s also necessary to evaluate the vending machine’s competition within the area it’s going to operate. This is going to dictate what products you are going to sell and at what price points you’re going to sell them. If there is a lolly store close to the vending machine, it may be best to avoid selling lollies and perhaps sell chips and soft drinks instead. It’s also crucial to examine your target market and customers to decide what they may have an appetite for. Depending on the demographic, it may be better to sell healthy snacks such as juices or veggie chips but at a higher price point, or if the vending machine is located at a university, selling energy drinks, chips and lollies at a lower price point would be better. It’s also best to get in contact with a wholesaler of your products to be able to purchase them in bulk at a discounted price to ensure maximum profit for your vending machine business.
Now that you have all the necessary information regarding starting up a vending machine business, go out there and start making easy money! However, if you do need extra legal advice around starting a vending machine business, our sister company Legal Kitz can assist. They offer a FREE 30-minute consultation to assist you with your legal needs. Additionally, our Business Kitz business specialists can help you with your business needs, book a FREE consult now.