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Old 04-16-2017, 04:59 PM   #1
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I know someone who's thinking of getting into having some vending machines. They're talking to a company that seems to be more involved, you get the machines from them and they help find locations (included in the purchase price it seems). You get the product from them (it's not name brand candy it's more like that generic stuff you see in Staples in clear wrappers) and that's where they seem to make their money.

This seems to be an industry where there's lots of shady places or places that prey on ppl trying to make easy money.

But also seems like there's legit money to be made and this company doesn't seem like an outright scam. They claim to be established in BC for decades and are starting to expand into Alberta.

But it does sound like an easy way to buy into a business that doesn't make any money.

Anyone with experience in the industry? What kinds of questions to ask, pitfalls, etc?

Edit: it's these guys I think http://www.canadiansnacktower.com/
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Old 04-16-2017, 06:35 PM   #2
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My uncle did this for a while. Made some ok extra money but when he looked at the amount of time he was spending on it...it wasn't worth it. Lots of time spent servicing, fixing and stocking the machines
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Old 04-16-2017, 06:47 PM   #3
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I've heard the same kind of thing. The time and effort involved isn't worth it. I know two people that got into it. One was hot beverage machines and the other was candy. They both got out within a fairly short period of time. The reality of the work isn't very sexy.
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Old 04-16-2017, 07:05 PM   #4
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This business is all about location location location and 99% of the good one's are gone, never trust a company that claims they'll help you get locations because I'll guarantee they won't spend a dime on it. I'm not saying it isn't possible to make a living as I have done very well for 22 years but be prepared to starve for a while if you're getting into snack vending.

The real money is in vending "stuff" nobody else has thought of.
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Old 04-16-2017, 07:20 PM   #5
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One step up from Fairground Carney,
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Old 04-16-2017, 07:38 PM   #6
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My claw machine business has done well. 20 years, still have all the same stuffed animals I started with.
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Old 04-16-2017, 07:41 PM   #7
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The easiest way to make money in the vending business is to sell machines that are overpriced with the promise of putting them into good locations. Maybe this company is different, but...

If they had good locations lined up, why do they need your friend? Buying machines is easy, placing them in good locations is hard.
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Old 04-16-2017, 07:51 PM   #8
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Originally Posted by bizaro86 View Post
The easiest way to make money in the vending business is to sell machines that are overpriced with the promise of putting them into good locations. Maybe this company is different, but...

If they had good locations lined up, why do they need your friend? Buying machines is easy, placing them in good locations is hard.
Yeah that's my initial reaction too. The answer based on other posts would seem to be "cheap labour"
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Old 04-16-2017, 10:34 PM   #9
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To me one negative about this business is (and maybe this is just me) that I think less and less people carry money on them these days so perhaps there maybe less people that can buy snacks with cash.
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Old 04-16-2017, 10:37 PM   #10
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To me one negative about this business is (and maybe this is just me) that I think less and less people carry money on them these days so perhaps there maybe less people that can buy snacks with cash.
Vending machines with card readers are becoming very prevalent, though

Apple Pay, Android Pay, a typical credit/debit card... you name it.
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Old 04-16-2017, 11:33 PM   #11
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On a serious note my foster kid bought a vending machine that vends pop and snacks for about 800, bought a location from some dude that scouts locations seperatly for about the same, he now has a machine in a disabled employment programs office, it does around 150 bucks business a month, I assumed he was getting ripped off but it is moderately legitimate, not worth the effort he has to put into it, on the other hand I get to boast to the social workers I have a kid with his own business that doesn't involve selling crack out of a stolen car!!
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Old 04-17-2017, 12:11 AM   #12
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One of my closest friends owns the #2 vending machine company in Calgary and area. His operation is fairly large with multiple drivers running around collecting and changing merchandise, he has a few large bays as storage and buys his product direct from the Coke's, Pepsi's, Lay's Potatoes Chip's etc.

Financially you can do quite well but I have also inquired about the type of machines your friend is thinking about, he has always sided away from it. A lot of the good locations are currently taken but its the little things that people don't think about.

The issues with maintenance of the machines for breaking down, jamming etc
The need and experience for moving machines from different locations for reasons such as office moves, renovations to the business etc. If your going to be paying a company several hundred dollars every time you need a move, it can get expensive quickly.

Some of the premier locations that can make good money also want a cut of the action is well. This is one of the biggest things I never thought about when it came to this business. Paying commission for specific locations in order to get the business, sometimes its worth it and sometimes its not.

In any event, my friend is currently looking at selling off some of his specific routes as a downsize as he may be going into another business. If your interested, let me know and send me a PM for details.
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Old 04-17-2017, 07:28 AM   #13
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Vending machines with card readers are becoming very prevalent, though

Apple Pay, Android Pay, a typical credit/debit card... you name it.
don't disagree with that (although I have yet to see a vending machine that takes apple pay), but the machine in question did not seem to have that option, and I'd also guess that there is an extra data cost to set up a machine to take non-cash payments.
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Old 04-17-2017, 08:00 AM   #14
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These machines seem smaller than the typical vending machine, they're closer to the ones where you'd put in money and get a handful of candy. They're not powered. So they wouldn't be able to accept cards, they take $2, but on the flip side they're easier to move (and steal by the same token I guess) and mechanically simpler. Seems there'd be more locations that these could go in than a large vending machine, which might be an advantage.

Who repairs them is something to find out.

EDIT: This is what they look like I think, they can go on a stand or sit on a counter/table:

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Old 04-17-2017, 08:42 AM   #15
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Originally Posted by afc wimbledon View Post
On a serious note my foster kid bought a vending machine that vends pop and snacks for about 800, bought a location from some dude that scouts locations seperatly for about the same, he now has a machine in a disabled employment programs office, it does around 150 bucks business a month, I assumed he was getting ripped off but it is moderately legitimate, not worth the effort he has to put into it, on the other hand I get to boast to the social workers I have a kid with his own business that doesn't involve selling crack out of a stolen car!!
That's actually a wicked return. He nets maybe $50 a month? If you could replicate that you'd have a dream retail business.
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Old 04-17-2017, 08:49 AM   #16
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I feel like the windfall is offices and professional centers and institutions (schools, hospitals, etc.) that are a bit cut off from other sources of snacks (convenience stores, +15 shops, grocery, etc.) where people waiting around or working all day will give in to the hunger and hit up the machine.

Otherwise, I can't think of a situation where I would willingly buy an overpriced vended product. It's always when I have no choice.
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Old 04-17-2017, 10:09 AM   #17
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I feel like the windfall is offices and professional centers and institutions (schools, hospitals, etc.) that are a bit cut off from other sources of snacks (convenience stores, +15 shops, grocery, etc.) where people waiting around or working all day will give in to the hunger and hit up the machine.

Otherwise, I can't think of a situation where I would willingly buy an overpriced vended product. It's always when I have no choice.
The Captive Market principle.
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Old 04-17-2017, 10:15 AM   #18
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My uncle did this for a while. Made some ok extra money but when he looked at the amount of time he was spending on it...it wasn't worth it. Lots of time spent servicing, fixing and stocking the machines
This.

I've done tax work for a few of them and this is basically it in a nutshell.

Its a ton of work. A ton.

Now, you can make some decent cash doing it. I would say that out of 3 businesses that I did taxes for over the years none of them made a profit after considering the sheer amount of money they sunk into their vehicle and none of them stuck it out.

Its an entry level business. You dont need any expertise to do it, you just have to be willing to put in the hours and do the work.

You're on the road 10 hours a day depending on where your machines and suppliers are located and if your vehicle is anything 'less-than-stellar' mechanically you are not making money.
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Old 04-17-2017, 10:45 AM   #19
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The people are older, so they're not looking at it as a replacement for a full time job or have to live off the income just something to earn some money and stay busy. They want to start out with a modest number of machines.

But the feedback is good, it sounds like a serious factor in their decision should be that the amount of work it is is high for the compensation.

I told them to also ask if their contract is transferable.. i.e. say they decide to get out, can they sell their machines and the new owner can take over without any penalties or whatever.
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Old 04-17-2017, 10:50 AM   #20
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The people are older, so they're not looking at it as a replacement for a full time job or have to live off the income just something to earn some money and stay busy. They want to start out with a modest number of machines.

But the feedback is good, it sounds like a serious factor in their decision should be that the amount of work it is is high for the compensation.

I told them to also ask if their contract is transferable.. i.e. say they decide to get out, can they sell their machines and the new owner can take over without any penalties or whatever.
Honestly man, if I had to buy the machines that would be a non-starter right off the bat.

Stock them, sure, but vending machines are the most unreliable pieces of machinery on the face of the earth I would not want to be responsible for having to fix and maintain them.

I'd lease them.

Much easier to walk away from them.
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