A vending machine is a coin-operated automatic machine, it provides items like chocolates, coffee or soft drinks, etc. Nowadays vending machine business is considered a good option for starting a business. In 2021 everybody is busy and doesn’t want to waste their time going to snack shops etc and wait in the queue. For this reason, everybody prefers vending machines to buy their favorite snacks on the way. On considering this it is preferable to say that vending machine business is a great option to start.
Vending machine business is cash-based, but now due to the cashless trend, many vending machines now accept credit cards, etc.
Sodas, chocolates, coffee, or snack vending machines are a lot popular from when they came into the business. But if you say that these are the only popular vending machine preferable foods, then we say you are wrong.
Now people are going for healthier options too than chocolates or soft drinks etc. So, you can place healthy food in vending machines.
- Advantages of vending machine business:
- Disadvantages of Vending machine business:
- How to start a vending machine business:
Advantages of vending machine business:
There is a number of factors that make it an attractive business to start. The advantages of vending machine business are:
The vending machine business can be started on a small scale. Starting your vending machine business on small scale can reduce your financial risk. For e.g., you own one vending machine. With this, you can experiment in the field of vending machine business, its profit and loss. You can experiment either this business is for you or not because it does not make you lose a huge amount of capital.
2.Easy to start:
Vending machine business is easy to start as you don’t need a huge amount of investment. All you need is vending machine, a great location, and items you want to sell. But you do need is a business license, insurance, and routine inspections, etc.
3.Flexibility of your work hours:
you don’t need to monitor your vending machine business growth from office work hours. You only need to do your administrative duties such as managing financial data, taxes, etc.
Like other business which have a fixed schedule of the working hour, vending machine business does not have a specified working time. Depending on customers, the vending machines can earn money 24/7 for you.
5.Variety to choose:
In vending machine business, you have a variety of items to sell. You can choose the items to sell in the vending machine according to the market demand.
6.Be your own boss:
When you own a vending machine business even a small one, you are the boss of your own. You don’t need to have to listen to someone else. You only have to listen to yourself and make good decisions for your business.
Disadvantages of Vending machine business:
There are many disadvantages to starting a vending machine business. These are:
When having a vending machine, you need security too. Even with CCTV cameras, your vending machine is not that safe. Nowadays owners place their vending machines behind the gates so that money slot and choosing options can be accessed by customers.
2.High capital costs:
Vending machines of high quality are of great cost. Even low costing vending machines cost a lot. So, for you to start vending machine business you need to first invest a little higher amount of money. If you want to have a dream location then you need to invest more money which results in high capital costs.
3.Long working hours:
You get the flexibility of time, but if you increase your business from one then you need to invest more hours than working for a traditional job. You have to invest your time in inspecting, filling, and servicing the machines. Thus, you have less free time because success requires commitment and more time investment in the business.
4.Competition for profitable locations:
Some streets or place which are crowded or has blue-collar workers have a high scope of profits. For these locations, you have to pay a higher amount. You don’t want your wending machine in a place full of vending machines. That is why there is a high amount of competition for profitable locations.
As more people tend to do cashless transactions but a large number of the population purchases goods from vending machines with cash. For this, you need to have a pocket change in the vending machine first and if you gain a lot of pocket change, to deposit it in the bank you gain a surcharge.
6.No human touch:
As the vending machine is an automatic machine, you don’t have much space for human touch. As lack of human touch, the customers can’t do even a little bargaining for items which is not healthy for customers neither owner.
How to start a vending machine business:
After watching the advantages and disadvantages of having a vending machine business, if you want to start a vending machine business you need to make strategies and do the market search.
1.Do your homework:
When you want to do something, you first do research on it. Just like it, for starting a vending machine business you need to do the market search. To start a vending machine business, you don’t need to have training or be an expert, but it does not mean that you can start right off without any research. You need to analyze the amount you want to invest, your growth, your investment of time, and how much time you can wait for returns.
2.Having Vending machine:
There is a lot of ways to start a vending machine business. But it solely depends on you and your budget to own what type and which kind of vending machine. These types are:
1.Buying a vending machine franchise:
The easiest way for starting a vending machine business is to buy a vending machine franchise. Vending machine franchise provides you already established business model providing you with operational infrastructure with the agreement. But for these benefits, the franchiser charges start-up cost and percentage from your income or charges some monthly fee.
You should read the agreement carefully to check whether the agreement is friendly to your business or not or they have some conditions that restrain you to extend your business to a new level.
2.Buying an existing vending machine:
Buying an existing vending machine can provide you little push-up if the decision is taken carefully. You need to analyze the deal carefully and the reason that why the current wants to sell. You should examine all of the aspects so as to bring find any issues regarding the deal. You should examine these aspects:
- Inspects the machines to make sure they function properly.
- Review the reason why he is selling it in the first place.
- Analyze financial reports of the business.
3.Your own vending machine business:
If you want to have more freedom in your business then you should purchase your own vending machine. This involves most of the work because you have to do everything from scratch. You can gain more excess to your business in this option and can do experiments with your business.
3.Decide what you want to sell:
When you have decided your plan of purchasing what kind of vending machine you want and how you want to expand your business, you need to decide what you want to sell in your vending machine. You can either place high-cost selling items or cheap vending machines according to your budget and your plan of making a profit. You can sell drinking items like soda, soft drinks, or beer; or eating items like pizza, snacks, candies, chocolates. But you can also sell non-eating or drinking items like stationary, makeup, shampoo, soap, or other items which do not get rotten with time and have high demand value too.
You can decide the name of your business, however, you want. But you have to consider the fact that in the near future your business will be known by its name that’s why it should be chosen carefully according to your hope from business and its future goals. You have to consider the fact that your name of the business should be unique and register it.
5.Decide vending features:
If you want to highlight your vending machine from others you can decide to add extra features you want. Your vending machine having new features attracts customers. The features can be either decorative or something else. But you should be careful that these features should be easy to use for customers. They may not be hindering customer’s experience. Except for traditional methods, you can install easy payment methods like a card or online payment. This will give you preference over other vending machine owners.
6.Select your location:
After thinking about all of this, you need to decide the location where you want your vending machine to sell. You would want your vending machine to be in a location where you will get a lot of customers. Your vending machine should be in the locality where the people buy that item. You don’t want to place your vending machine containing candy or an unhealthy snack bar in front of the gym. This will affect your range of customers and ultimately affect your profits. So, you will need to select your vending machine location very carefully because your business is based on it.
If you are placing your vending machine business on someone else’s premises you need to have a proper contract with them at what cost they will provide you the premises. You should consider the contract carefully or even get a piece of legal advice from a lawyer or your attorney so as to not get any difficulty in the future.
7.Business Licenses, Permits, Tax:
When you have decided about the above points explained, you need to research your vending machine business meeting the laws and regulations of local and federal. You should search about what kind of licenses you need. You should have a business account so as to manage your future transaction and if a difficult situation occurred your personal assets will not be at risk.
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