Author Topic: Side hustle vending machines  (Read 22615 times)

VolcanicArts

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Side hustle vending machines
« on: April 05, 2017, 10:51:30 PM »
I've been considering buying about ten vending machines by next year and creating a small route for them. I've read some on them and they appear promising. These would most likely start off as smaller quarter machines that vend candy, gum etc. I currently have a great job I like and my profits from investments have been very good over the years. I figure I could easily just keep doing what I'm doing with no change ( currently save 50% of take home) and retire in five years assuming no drastic complications. However a part of me says you only live once and I would like to say later on that I created my own business at some point. I'm realistic in knowing at a small level these machines will not make me rich, but can provide monthly income and allow me to scale up later. At my starting point I'm looking at about 3500 for 10 machines, maybe 500 for location fees, and then having to pay for gas, inventory, and potential time lost. Does anyone have any experience with this kind of business or thoughts on it. Even if I lost everything I would not care that much, but that outcome seems unlikely. I have also been observing some machines placed around town and comparing levels over time. I have also started to find businesses that have waiting areas without vending machines and keeping track of them, also trying to think of non-competing products. Please let me know if you think this is a worthwhile endeavor.

DocMcStuffins

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Re: Side hustle vending machines
« Reply #1 on: April 06, 2017, 08:01:05 PM »
Have a friend who started this in is small town and does it with his little boys. It is their company and he makes them take inventory and keep a record / book keeping to teach them about business. Different than what you are doing but was cool. You may want to look into a company that does bendy machines at schools. There was won that did stickers and things. Rent is free as you promise the school a certain percent. They like it because it is all their schools mascots. A good pitch would be at the PTA presidents. Just FYI.

BlueHouse

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Re: Side hustle vending machines
« Reply #2 on: April 06, 2017, 08:14:53 PM »
I also think it would be cool if you looked in to new modern machines in other countries.  Half the fun of vending machines is watching the food drop, and kids love it.  It would also be cool if they could provide things you don't normally see in vending machines in America.

I LOVE the vending machines they have in Japan. So much, so cool!  I would love a ramen vending machine!

DocMcStuffins

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Re: Side hustle vending machines
« Reply #3 on: April 06, 2017, 08:18:08 PM »
Saw one before that made a pizza from stratch.

solon

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Re: Side hustle vending machines
« Reply #4 on: April 06, 2017, 08:56:03 PM »
If you had a vending machine that dispensed side hustles, I'd put a quarter in that.

k-vette

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Re: Side hustle vending machines
« Reply #5 on: April 06, 2017, 09:30:16 PM »
My first business was vending machines.  I used both snack and soda machines.  It's all about location and the number of machines.  More machines means lower overhead when you're running to grab products, etc.  Just some thoughts:

Soda machines and snack machines are HEAVY and require muscle and good equipment to move.  Smaller candy machines obviously less.  High margins on the small candy machines, but not a lot of actual dollars unless it's a really high traffic spot.

If it's a business with 20 employees and no customer foot traffic, don't bother.  50-100 employees, certainly.  Those that make a full-time job out of it typically have 100+ machines running.   

VolcanicArts

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Re: Side hustle vending machines
« Reply #6 on: April 06, 2017, 10:40:34 PM »
My first business was vending machines.  I used both snack and soda machines.  It's all about location and the number of machines.  More machines means lower overhead when you're running to grab products, etc.  Just some thoughts:

Soda machines and snack machines are HEAVY and require muscle and good equipment to move.  Smaller candy machines obviously less.  High margins on the small candy machines, but not a lot of actual dollars unless it's a really high traffic spot.

If it's a business with 20 employees and no customer foot traffic, don't bother.  50-100 employees, certainly.  Those that make a full-time job out of it typically have 100+ machines running.


Sounds good thanks for the tip. I found a barber shop near me recently that has a waiting area about 15 chairs and no vending machines. I marked the location as a possibility for later. I see a lot of parents bring their kids in and wait so maybe candy and sodas would work well there.

BlueHouse

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Re: Side hustle vending machines
« Reply #7 on: April 07, 2017, 05:29:35 PM »
I like the machines that are more like the impulse-buy sections at department stores, not candy or soda. 

Check this link out:  http://unionmarketdc.com/retailer/guerilla-vending/

This particular location has things like T-Shirts, artisan salt, mugs, and other very un-mustachian things, but things that people will spend serious money on.  Think gift-shop, without the overhead of a store.  It was fascinating.

texxan1

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Re: Side hustle vending machines
« Reply #8 on: April 19, 2017, 10:49:29 PM »
Its quite a large investment, but I have one of the twice the Ice,  Ice and water vending machine... for those living in the south... It can be a very large money maker.... and really only needs minor time per week.. I work it with my ex/partner and we probably spend 4 hours a week at the machine, the rest is counting the money.

If anyone has ever looked at these and want some true numbers let me know

Tex

SC93

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Re: Side hustle vending machines
« Reply #9 on: May 16, 2017, 10:51:13 PM »
My good buddy owns a very large vending business and makes a few million a year. My other buddy (recently passed away) owned a smaller vending business and did quite well. There must be money in it if done correctly.

Goldielocks

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Re: Side hustle vending machines
« Reply #10 on: June 05, 2017, 10:57:00 AM »
I used to manage the vending contract for a national grocery chain.  (230 stores, maybe 800-900 machines).

Some things to consider:

1)  Kids and parents like the ones that dispense a small toy instead of candy all the time.   Many sales were due to the kids, so items that kids find fun are good.  ... toys, gumballs, jawbreakers, etc.   The game / toy machines (that always dispense a small prize) are also fun, even the ones with a crazy coin drop for a gumball.

2)  For some reason nut / peanut machines sell well, especially small ones in maintenance waiting rooms where men work (I was told) BUT peanut allergies and sanitary condition must be considered, and these were banned from our stores unless nuts were packaged.

3)  Half of our sales seemed to be from employees.!   Machines for offices and school areas  (think a tutoring center or music lesson area) were good sellers.  So not just waiting areas, but places where someone wants a snack, but the employee size is too small for a full size vending machine... and a $1 coin machine works.   -- car repair shops, truck driver areas, Lordco auto parts, etc.

4)  We required machines to have a complete refurbishment (new paint, condition, etc) every 5 years, which can be expensive.  The machines must look great to be placed easily.

5)  Other than small candy / coin machines, the larger vending styles here need to covert to card systems.. this is a huge trend, that people don't carry cash.   Also, I went through the transition where the government brought out new money formats, so the dollar readers all had to be upgraded to work, or coin slots changed to allow for coin sizes, etc.

6)My predecessor was so aggressive in negotiation the placement contract and terms, and the vendors were outbidding each other, to the point that one went broke within 18 months of getting the 3 year contract, and I had to go out to get new vendors after.   Looking at the original contract, I don't think any business could have made money on it.   

trollwithamustache

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Re: Side hustle vending machines
« Reply #11 on: June 05, 2017, 11:56:03 AM »
Do you have a place to store the machines? A long time ago we had an operator at a plant do this as a side gig. I think he made a lot of money. But the problem was he needed space to store the machines/inventory for them. (and I think work on them periodically?) Anyways, he was the only guy at his facility so he used the company warehouse. Which was fine until it wasn't fine. 

I love a good side hustle and my study of his business seemed to be that he really need like 20x20 ft of good shop/warehouse space for the business.

VolcanicArts

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Re: Side hustle vending machines
« Reply #12 on: June 25, 2017, 01:02:31 PM »
Do you have a place to store the machines? A long time ago we had an operator at a plant do this as a side gig. I think he made a lot of money. But the problem was he needed space to store the machines/inventory for them. (and I think work on them periodically?) Anyways, he was the only guy at his facility so he used the company warehouse. Which was fine until it wasn't fine. 

I love a good side hustle and my study of his business seemed to be that he really need like 20x20 ft of good shop/warehouse space for the business.

Storage is something I considered, but I will be operating on a small scale 20 machines max, and will be placing them quickly. I can use my garage if I needed to store them temporarily. I've done a little more research, but I've gotten distracted on a woodworking startup, so that is my first priority now. Hopefully I can have enough time to have both the woodworking shop and the vending machines up and running by January.

Guide2003

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Re: Side hustle vending machines
« Reply #13 on: June 25, 2017, 01:23:12 PM »
My rich lawyer uncle gave a soda machine to his 14 yo son for Christmas. I think my cousin even requested it! Pretty neat idea to get him into hustling.

Would it be worth starting with a single machine and refining items, location, and process first before you commit to 10 machines?

VolcanicArts

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Re: Side hustle vending machines
« Reply #14 on: June 25, 2017, 11:37:22 PM »
My rich lawyer uncle gave a soda machine to his 14 yo son for Christmas. I think my cousin even requested it! Pretty neat idea to get him into hustling.

Would it be worth starting with a single machine and refining items, location, and process first before you commit to 10 machines?

I will be starting with 3 machines and scale up from there. The max I plan to have is 20 operational, as I figure once I get past 20 it will start taking too much time per weeks for restocking and maintenance that it could cut into time I need for my job or other things. I will be vending some woodwork at a traders village a few days a month soon, so just to get an idea about profit margins etc. I may bring one or two small machines and place them at the table I work at. Even though it will only cover 30 to 40 hrs out of the month, I can estimate profit potential over a long period of time, and there's a ton of foot traffic at this trade show. I can also buy used machines on the cheap for this to try out, and if the profit is reasonable, then I'll commit to 3 of the machines and secure the locations around January.

anonymouscow

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Re: Side hustle vending machines
« Reply #15 on: June 26, 2017, 10:01:13 AM »
I just bought a route last week, 12 snack and soda machines.

For me this is a large investment, I am hoping after about 2 years I will have made my money back and then can do it full time.

Right now I am just trying to get the hang of things.


Mgmny

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Re: Side hustle vending machines
« Reply #16 on: June 26, 2017, 03:59:14 PM »
I just bought a route last week, 12 snack and soda machines.

For me this is a large investment, I am hoping after about 2 years I will have made my money back and then can do it full time.

Right now I am just trying to get the hang of things.

How did you find it for sale?

SC93

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Re: Side hustle vending machines
« Reply #17 on: June 26, 2017, 04:21:30 PM »
Valcanic Arts, You better check to see if you can sell that type of thing at your Traders Village. The traders Village in the DFW area will not let any other vendors bring in food or drink to sell.

2 years to break even? Ouch. I wish you the best and hopefully you don't tire of it. It can be tough work if you do it yourself.

As for storage, my one buddy did it all from his carport for years and years until he passed way. My friend that has a large company is building a new building to work out of and it's not very big at all. There is a guy down the street from me in another neighborhood that I see with mostly drink machines such as Pepsi and he lives in a duplex and runs it out of his garage. So storage isn't really a problem if you really want to do something......

anonymouscow

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Re: Side hustle vending machines
« Reply #18 on: June 27, 2017, 06:38:48 AM »
I just bought a route last week, 12 snack and soda machines.

For me this is a large investment, I am hoping after about 2 years I will have made my money back and then can do it full time.

Right now I am just trying to get the hang of things.

How did you find it for sale?

https://www.bizbuysell.com

anonymouscow

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Re: Side hustle vending machines
« Reply #19 on: June 27, 2017, 06:47:57 AM »
Valcanic Arts, You better check to see if you can sell that type of thing at your Traders Village. The traders Village in the DFW area will not let any other vendors bring in food or drink to sell.

2 years to break even? Ouch. I wish you the best and hopefully you don't tire of it. It can be tough work if you do it yourself.

As for storage, my one buddy did it all from his carport for years and years until he passed way. My friend that has a large company is building a new building to work out of and it's not very big at all. There is a guy down the street from me in another neighborhood that I see with mostly drink machines such as Pepsi and he lives in a duplex and runs it out of his garage. So storage isn't really a problem if you really want to do something......

Thanks, I agree 2 years is a long time.

Theoretically, this should just be 10-15 hours a week.

I am hoping after two years I will be able to replace enough of my income to quit my day job or go part time.

Mgmny

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Re: Side hustle vending machines
« Reply #20 on: June 27, 2017, 07:33:02 AM »
I just bought a route last week, 12 snack and soda machines.

For me this is a large investment, I am hoping after about 2 years I will have made my money back and then can do it full time.

Right now I am just trying to get the hang of things.

How did you find it for sale?

https://www.bizbuysell.com

Cool, thanks!

VolcanicArts

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Re: Side hustle vending machines
« Reply #21 on: June 28, 2017, 12:26:56 AM »
I just bought a route last week, 12 snack and soda machines.

For me this is a large investment, I am hoping after about 2 years I will have made my money back and then can do it full time.

Right now I am just trying to get the hang of things.

Good job keep us updated on your progress.

Northern gal

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Re: Side hustle vending machines
« Reply #22 on: June 28, 2017, 10:47:23 PM »
We tried and failed.

We thought we had bought an established route of three businesses and six machines to place.

We did our due diligence as best we could but it turns out the sales figures had been heavily fudged. Food started to go off. Out of three, one was doing ok.

The machines were second hand and things kept breaking. One Caught fire.

We were unable to secure locations for the additional machines ( we would have been happy to pay a fee).

It was worth a try.


felixbf

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Re: Side hustle vending machines
« Reply #23 on: June 28, 2017, 11:39:02 PM »
Back when i worked in a call centre (opened 24/7) in 2006-2008 vending machines would need to be re-filled every 2-3 days.Those guys made a killing marking up prices by 1-2 dollars.
So if you gonna do this ,aim for business that run 24/7 !

VolcanicArts

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Re: Side hustle vending machines
« Reply #24 on: June 29, 2017, 02:48:33 PM »
We tried and failed.

We thought we had bought an established route of three businesses and six machines to place.

We did our due diligence as best we could but it turns out the sales figures had been heavily fudged. Food started to go off. Out of three, one was doing ok.

The machines were second hand and things kept breaking. One Caught fire.

We were unable to secure locations for the additional machines ( we would have been happy to pay a fee).

It was worth a try.

That sounds rough. One thing I've learned in business is you need to start with solid wares, I.e. new machines, and paid for locations. When starting off we are not knowledgeable enough with the ins and outs enough of maintenance for used machines, or how to establish routes etc. I would rather pay more upfront initially to prevent headaches, then later on I might tinker with the idea of used machines or finding my own locations.

anonymouscow

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Re: Side hustle vending machines
« Reply #25 on: July 07, 2017, 08:51:46 AM »
We tried and failed.

We thought we had bought an established route of three businesses and six machines to place.

We did our due diligence as best we could but it turns out the sales figures had been heavily fudged. Food started to go off. Out of three, one was doing ok.

The machines were second hand and things kept breaking. One Caught fire.

We were unable to secure locations for the additional machines ( we would have been happy to pay a fee).

It was worth a try.

Yikes, that is terrible, sorry it did not work out for you.

Were you selling sandwiches and such? I hear that is really tough because of the short shelf life.

If I do lose a location I am hoping I will be able to move the machines to one of the other locations. It is one of my biggest fears going into this, there is really no guarantee that a location will not want to change vendors. I really want to at least make my initial investment back.

I am still waiting on some things to be switched over on the machines I bought. They have the ability to be set up so the inventory and sales can be tracked online. If they work as advertised they should make my life so much easier.

BlueHouse

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Re: Side hustle vending machines
« Reply #26 on: November 06, 2017, 09:04:16 AM »
Sorry your side hustle didn't work out.  At my job, some people decided to take it upon themselves to go to Costco, buy enormous amounts of junk food, water, etc, and create a "kitchen mess" that is paid on the honor system.  There are vending machines one floor down that we must pass on our way in and out of the building.  It kind of pisses me off that the Costco contingent is putting a small business owner out of business.  But I don't want to be the asshat who forces it to stop, so I say nothing and buy nothing. 

SC93

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Re: Side hustle vending machines
« Reply #27 on: November 06, 2017, 10:44:29 AM »
Wood work you say? Wow is there a lot of money to be in the wood working business. My friend in Kansas City sells his stuff quick. He has a very professional wood working set-up in his garage. He makes larger things such as tables, benches, chairs, adirondack chairs... sells the hell out of them. He doesn't make fancy high priced items, he makes regular things and sells at a good price. You wouldn't need 2 freaking years to break :)

LovinPSDs

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Re: Side hustle vending machines
« Reply #28 on: November 28, 2017, 08:39:27 PM »
So I think I have located a prime spot for machines, I'm just wondering if I should look at taking the next step.

The location is my daughter's gymnastics place.  In short, they have a counter with a teenage girl selling water, gatorade and 5 or 6 tiny items like ring pops and laffy taffy.  On the night we are there I would estimate atleast 75 kids come through the place (in a 2 hr window, i have no idea what happens when we're not there) and most parents wait the 30mins to 1hr while the kids practice.  It's usually before dinner but after school so I see lots of people snacking... Honestly, looks like a PRIME location.  Seems like (1) large capacity drink and (1) large capacity snack machine would really crush it.  I haven't approached the owner yet but it looks like a gold mine from the outside looking in. 

What do ya'll think? I would have one stipulation that the machines be able to hook up for Credit Card use as I feel that's a game changer in the vending industry.  Off the hip start up costs seem to be around 10-15k on 2 NICE machines.

SC93

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Re: Side hustle vending machines
« Reply #29 on: November 28, 2017, 10:06:37 PM »
Credit cards are a MUST. What amount of time do you think it would take to re-coop your investment?

LovinPSDs

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Re: Side hustle vending machines
« Reply #30 on: November 28, 2017, 10:24:15 PM »
Credit cards are a MUST. What amount of time do you think it would take to re-coop your investment?

The more thought I'm putting into this the more I think it would make sense to go with a cheaper used machine.  Even a single machine with drink/snack combo is more than they currently offer. Get my feet wet and see what I can learn about the business model. To answer your question, I haven't really run the numbers yet just found what I think could be a prime spot.

How does one calculate that without really know what it would generate? Doesn't seem unreasonable to sell 50+ items a day, lots of snack hungry traffic with set waiting times.
« Last Edit: November 28, 2017, 10:26:02 PM by LovinPSDs »

LovinPSDs

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Re: Side hustle vending machines
« Reply #31 on: November 29, 2017, 06:38:40 AM »
A follow up question for those who have been in the business...

Do people ever run just a machine or two for some extra pocket change, or does this business only really make sense with scale?

SC93

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Re: Side hustle vending machines
« Reply #32 on: November 29, 2017, 08:14:05 AM »
craiglepaige had my original thoughts exactly. I know if I run a business and sold food, there is no way I'd let you put a machine in there. What would be the advantage for me, the business owner?

I think there might be a little profit from a few machines but it's not all rainbows. That 1 location might last 20 years but more than likely you will have to find another location and another location and so-on. What seems great on the outside usually isn't when it comes down to the calculator.

Speaking of my friend the calculator..... let's say you find machines for 1/2 that price @ $5000. If you make a profit of $ .50 from each sale (can that be done??) it would pay for itself within 1 year. That is IF 50 items a day are sold 7 days a week. Most people don't mind that. I'm more of a 'want my profit to start now' type of guy. When I started this last business I bought a washer and dryer for $150 and sold it within a couple of days for $350. Those are the types of businesses I like.... instant money.

I kind off see the vending business as a pain in the ass, especially with just a machine or 3.
« Last Edit: November 29, 2017, 08:15:45 AM by SC93 »

LovinPSDs

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Re: Side hustle vending machines
« Reply #33 on: November 29, 2017, 01:30:42 PM »
So I think I have located a prime spot for machines, I'm just wondering if I should look at taking the next step.

The location is my daughter's gymnastics place.  In short, they have a counter with a teenage girl selling water, gatorade and 5 or 6 tiny items like ring pops and laffy taffy.  On the night we are there I would estimate atleast 75 kids come through the place (in a 2 hr window, i have no idea what happens when we're not there) and most parents wait the 30mins to 1hr while the kids practice.  It's usually before dinner but after school so I see lots of people snacking... Honestly, looks like a PRIME location.  Seems like (1) large capacity drink and (1) large capacity snack machine would really crush it.  I haven't approached the owner yet but it looks like a gold mine from the outside looking in. 




Why would the locale be okay with you coming in and taking away their business?

They are paying someone to sit there and man the register and honestly they don't hardly sell anything at all (product selection wise).  I am assuming a wider selection of product would bring more customers, plus they could reduce either the workload or staff size (cost).  I'd be surprised if they are making much with the current setup.

Need to do some more research on what a decent single machine (1/2 snacks & 1/2 drinks) would cost to have fully up an running.


SC93, I get the idea of "want my profit now" I'm just struggling to come up with something at the moment.  I've been very motivated by a friend who started his business by purchasing car header wrap in bulk and selling it on Amazon/Ebay for a mark up but haven't jumped off into that world yet either.  My wife runs a small MLM business form home so we have everything needed to ship directly from the house, still pondering on a product.

SC93

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Re: Side hustle vending machines
« Reply #34 on: November 29, 2017, 05:26:08 PM »
Send me a private message.

KarefulKactus15

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Re: Side hustle vending machines
« Reply #35 on: November 30, 2017, 01:01:44 PM »
Sorry your side hustle didn't work out.  At my job, some people decided to take it upon themselves to go to Costco, buy enormous amounts of junk food, water, etc, and create a "kitchen mess" that is paid on the honor system.  There are vending machines one floor down that we must pass on our way in and out of the building.  It kind of pisses me off that the Costco contingent is putting a small business owner out of business.  But I don't want to be the asshat who forces it to stop, so I say nothing and buy nothing.

I dont see this being a problem to be honest.     Obviously the vending markups are high.   Need to find a more efficient market to operate in.   


+ it would require a company policy that associates can only consume food from the vending machine and not provide discount food to coworkers.


In general a company should* do what is best for their employees.  Obviously its not the vending machine or someone wouldnt risk losing their personal $ on the honor system.

bookguy

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Re: Side hustle vending machines
« Reply #36 on: June 08, 2019, 10:02:46 AM »
So, Volcanic Arts, did this work out for you? I'm thinking of buying some 3-head .25 cents candy machines, so I'm looking for any input or results.

Dicey

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Re: Side hustle vending machines
« Reply #37 on: June 08, 2019, 10:09:42 AM »
So, Volcanic Arts, did this work out for you? I'm thinking of buying some 3-head .25 cents candy machines, so I'm looking for any input or results.
@VolcanicArts hasn't been seen in these parts since May 12, 2018, but maybe a bat signal will reach them.

Michael in ABQ

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Re: Side hustle vending machines
« Reply #38 on: June 19, 2019, 03:39:01 AM »
I working in an office of ~40 people for almost a decade. We had two vending machines in the break room most of that time. The person who owned them sold their business about halfway through my time there. Eventually the new owner pulled the machines as they weren't making enough.

The machines were older and I recall they had to be repaired multiple times. I'm sure professional maintenance runs $50-100/hour. The arrangement was they paid some percentage to the office (20%?, I don't really know). Seems like it would get restocked about once a week.

anonymouscow

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Re: Side hustle vending machines
« Reply #39 on: December 01, 2019, 11:26:45 AM »
I just bought a route last week, 12 snack and soda machines.

For me this is a large investment, I am hoping after about 2 years I will have made my money back and then can do it full time.

Right now I am just trying to get the hang of things.

Good job keep us updated on your progress.

Update, after a little over 2 years of owning vending machines, I sold off the route.

Lessons
-  I overpaid for the machines / route when I purchased them.
- I should have started smaller, I purchased 5 locations, which was too many with a full time job.
- I should have gone with different machines, I kept running into maintenance issues that couldn’t be solved with just replacing a part. Mostly drinks kept jamming and I couldn’t figure out why.
- It took a lot more time than I thought, lots of planning,  difficult to keep everything organized, machines needing filled on specific days / times.

I still think it can be a good job / side job, I should have taken the advise to start with one reliable drink machine. Most of the time I was buying soda for 33 cents and selling it for a dollar.

The other advise was to only pay for the value of the machines. One industry valuation for routes is that they sell based on 100 - 75% of annual sales. It might be a better business strategy to service a vending machine location for a year, keep really good records, then list it for sale based on annual sales (assuming it did well for the year).

There is a vending machine forum out there  that is really helpful, anyone with questions about vending routes I would recommend asking there.