Kit Machines

Like any business, vending machines have the potential to be extremely successful, to perform averagely, or even to fail. To ensure that a vending machine business is profitable, it is essential to put the proper support, strategies, and pricing structures in place.

How Much Do Vending Machines Make?

Due to the industry’s extreme variability, it can be challenging to separate out the information regarding specific vending machine profits. For instance, a single vending machine in a busy hotel without a restaurant could earn hundreds of dollars every day, whereas a machine hidden away in a dim, dusty apartment laundry room might only make a few dollars every month.

However, as a whole, the vending industry is worth many billions of dollars. Food and beverages on the go are always needed, and the market shows no signs of slowing down. It is actually growing. The amount of money a single vending machine generates depends on the type of machine, its location, the products it sells, and the cost of those products. However, a successful combination of products and machines can help a vending machine owner to make a sizable profit.

How Much Does It Cost to Start a Vending Machine Business?

Starting a vending machine business is not expensive, but startup costs do vary depending on the route you take to get started. While starting your own vending machine business can reduce startup costs, it may be difficult to succeed in the industry without help. It could take a solo vending machine owner months or even years to get a business up and running without contacts, a name brand that is recognized in the field, a track record, or mentors, which negates the savings on startup costs.

On the other hand, partnering with a well-known vending machine business as part of a franchise or franchise-like system might be slightly more expensive initially, but it will position a vending machine business for success from day one by offering support in site selection, contracts, marketing, product sourcing, and more.

There are several ways to finance a vending machine business to pay for those slightly higher startup costs. Cash, unsecured personal loans, secured personal loans, short-term business loans, SBA loans, home equity lines of credit (HELOCs), and special 401(k) rollovers created specifically for people starting businesses are some examples. Depending on your particular situation, you may choose a different financing option to start a vending machine business. To make the best choices for yourself, your family, and your future business, consult a financing expert as often as you can.

Average Profit Margin for Vending Machines

Vending machine businesses require capital to launch, as with any type of business. The machines, location space rent, inventory, maintenance, and other expenses are included in the startup costs. The type of vending machine(s) you choose to run and the number of machines you have running at any given time will determine the exact cost of doing business.

To be profitable, pricing must also be strategically planned. Let’s say you run a vending machine for cold drinks that charges $2 per item, but it only gets 10 sales a day because of its less-than-ideal location. A $20 daily profit is generated by that machine. Your profit is only 50 cents per item and only $5 per day if the sodas cost you $1.50 each. You would need to own hundreds, if not thousands, of soda machines in much better locations to make your profits worthwhile.

On the other hand, if you had a strategically placed vending machine full of snacks that, for instance, sold 50 items per day at a price of $4 each but cost you 50 cents per item, your profits would be about $175. Your profits would be well worth the effort if you had a number of well-positioned, well-liked machines.

The vending machine industry can, in fact, be very lucrative, but like any other industry, it requires effort to succeed.

What Are the Most Profitable Vending Machines?

Even though vending machine profit margins on average can be quite high, some machines are slightly more profitable than others. Here are some of the most profitable types of vending machines:

Coffee Vending Machines

With an annual spending of $35.8 billion, Americans consume over 77.4 billion cups of coffee. Although operating a profitable coffee machine takes some forethought, as with many other types of machines, coffee is a big business.

Simply put, some locations—like shopping malls and centers—have inoperable coffee machines. They are effective in settings such as office buildings, apartment buildings, car dealerships and maintenance facilities, medical facilities, schools, and other locations where you see people waiting a lot or going to and from work.

However, many owners of coffee vending machines report profit margins over 200%. Pricing coffee requires understanding what a particular market can bear.

Soda Vending Machines

One of the most well-liked products on the market are soda vending machines, and during warm months, demand for cold drinks increases significantly. People will purchase cold beverages all year long in warm climates. Demand may decline in the fall and winter in regions with seasonal climates.

Although soda and cold beverage machines do need refrigeration, which can add to their operating costs, they are the most straightforward to stock because the selection can be limited and the profit margins can be high if they are priced fairly.

In some places, sodas can cost as much as $3.00, but in most cases, cans are less expensive than bottles. A $1 target vend goal can be achieved by operators by purchasing in bulk and lowering costs.

Snack Vending Machines

Snack vending machines are extremely common vending machines that can be located almost anywhere with high foot traffic. Some snacks have a lower markup than other items, like candy, but overall, snacks have much wider profit margins. Vendors can easily charge $2 for a bag of nuts that cost them $1 to buy.

Snack vending machines also allow for more variety, which is great for customers but does require vendors to go to the machine more frequently to restock popular items.

Cold Food Vending Machines

Cold food vending machines offer items like salads, sandwiches, burritos, breakfast foods, and full meals that are ready to eat, frozen, or reheatable. Foods with a mix of a short shelf life and foods with a longer shelf life are necessary to make this type of machine profitable.

Cold food vending machines must be refrigerated, so like soda machines, their operating costs can be a little higher. A quick turn-around is also required for the food. Items, especially if a machine accepts credit or debit cards, can be marked up significantly, though, since people are essentially paying for meals.

Vending Machine Profit Statistics

Realistically, after a few months of operation, one vending machine won’t be enough for a proprietor to retire to paradise. But a few well-placed vending machines with high-quality goods can generate a sizable amount of income.

The average vending machine purchase in America costs about $1.75, and each person spends about $27 annually. The average vending machine brings in more than $75 per week and more than $300 per month. Some vending machines produce much less than this, while others produce a tremendous amount more. An owner makes more money and generates more revenue when they run more strategically placed, fully stocked machines.

It’s also important to note how much vending machine preferences are changing. There was a time when nearly every vending machine in the nation sold sodas, candy, chips, and other fatty, sugary snacks. Consumers today prefer much healthier options. Water, juices, nuts, meal replacement options, and foods they can feel good about giving their kids are what they want.

There will always be a place for “junk food” machines in our country, but now is an excellent time to break into healthier product lines, especially because the profits on those lines can be much greater than other foods and beverages. Industry data repeatedly demonstrates that the sale of healthy snack products exceeds that of junk food, and that the difference between the two is growing.

Are Vending Machines a Good Investment?

When you approach the vending machine business strategically, it can be a great investment. Similar to any other business, it pays to research a field before entering it and to have a supportive mentor who can teach you the ropes so that you can make money.

Additionally, it will take time to post a net profit, just like with any other type of business. You will invest money into the company up front, and it will take time and effort to reach break-even and then operate profitably. Vending machines are not a wise investment for those who are unwilling to do their homework, listen to industry professionals, or try to launch a business on their own with no help.

Vending machines, however, can be a great investment if you are prepared to learn about the sector, pay attention to advice, and put in the work required at the start to make the business work over the long term. They can serve as a second source of income, a family business, a full-time enterprise, or a passive income generator.

Vending machines are excellent investments if you have the backing of industry professionals because they provide cash flow; customers insert cash or swipe a credit card, and you immediately take the money. The company is adaptable enough that you could start it as a side hustle, a 9 to 5 job, a retirement business, or a stay-at-home parent business. Last but not least, the business model of vending machines makes them wise investments. Scaling up can be done at a comfortable rate once you start seeing dependable profits.

Benefits of Vending Machines Business

Profitability

We understand that you came for this, after all. Nobody, no matter how well-intentioned, can actually give you an accurate picture of the profit margin of a single vending machine. Between locations and machines, earnings can vary, sometimes significantly. We can say with certainty that: The annual volume of goods put into vending machines in the U.S. alone tops $7 billion. Additionally, healthier snack and beverage options are increasingly outpacing the usual fare from vending machines.

Like in any business, output is frequently correlated with input. That is to say, results are generally better when hard work and wise, unbiased decisions are made. This increases the likelihood of success along with careful recordkeeping, ethical business conduct, and attentive customer service.

Flexibility

Who wants to start a business only to become tethered to it all the time? The answer to that, we assume, is. . . nobody. It’s incredibly flexible to run a vending machine business. Yes, there is still a need for stocking and upkeep of the machines. But unlike many other businesses or side jobs, you can fit these tasks into your schedule rather than the other way around. During the day, night, and on weekends, stock and maintain your equipment. . . whatever works with your schedule. It just requires some coordination with the building’s or company’s owners. Keep your vending machines stocked, tidy, and functional at all times.

Of course, hiring staff is the alternative method of stocking and maintaining equipment. Alternatively, involve the family in smaller operations. After all, a vending machine business might be the ideal business venture to instruct children in entrepreneurship.

Ease of Entry

Starting a vending machine business doesn’t require any particularly specialized knowledge or skills, but it does require some hard work and business savvy. But there might be a learning curve, just like with any new endeavor. However, you have access to lifetime coaching when Healthy YOU Vending is your business partner. This implies that you can contact our knowledgeable coaches by phone or email whenever you need assistance with your vending business. Our coaches have first-hand knowledge of the healthy vending market and extensive practical experience.

How to Start Your Vending Machine Business

Step 1: Consider Your Possible Products

Vending machines that sell food are common and straightforward, but there are also options for vending machines that sell items in bulk or vending machines that sell specialized goods.

You can pick a theme for your vending machine if you’re starting a food vending business. Because schools want to give students a healthy diet, offering healthy snacks in schools may be a good course of action. Generally, you can modify your offerings to fit the market you want to enter.

Step 2: Find the Right Location

You can begin to locate space in commercial establishments and plan a route based on the types of machines you possess. You’ll probably want the machines to be close by to begin with since you or a staff member will be refilling and maintaining them. You can begin to cover more ground as your company grows and you hire more staff.

If you want to install vending machines in neighborhood businesses, you should get to know the proprietors of those establishments and promote your services to them. Contact a regional manager or whoever handles more significant location management projects if you’re looking for a contract with a school district or a company with multiple locations.

Step 3: Choose the Right Type of Machine for Your Business

Machines can be classified as mechanical, electronic, or bulky. Bulk dispensing machines hold one product in bulk and dispense a specific amount for a quarter or a dollar. The distribution of sanitary products is a common example of this in restrooms. These can start at $50 and go up to $200.

The traditional break room vending machines are mechanical. They have a range of products and start at about $2,000 each. They do, however, generate higher profits than bulk machines.

An electronic vending machine is the latest and most advanced version. These machines can easily accept credit card payments, cost at least $3,000 each, and frequently have touch screens. The cost of the machine rises with the amount of food and drink offered. As fewer people carry cash and coins, the ability to use a credit card often results in them receiving a lot of business. Just be sure to pick a payment gateway that doesn’t impose excessive fees.

Step 4: Find the Right Market

In order to best serve the types of customers you want to serve, your vending machine should be located in an ideal location. In places where people spend a lot of time and lack the means to prepare meals, such as offices, hospitals, and universities, vending machines with microwaveable foods and other meal-like options do well.

Offices benefit greatly from snack vending equipment. If you are interested in establishing those relationships, you can succeed with vending machines that offer novelty items or tiny candies.

Finally, airports, rest stops along the highway, and train stations are excellent locations for vending machines that sell electronics or medicine. Since these items are necessities for travelers, these devices might have a high profit margin.

Step 5: Stocking Products

Some states require a specific proportion of healthy options to be offered in food vending machines. If this is the case in your area, make sure you have access to sources for healthy snacks.

You should establish contacts with wholesale suppliers when considering food stocking in general to obtain the lowest cost per unit. You can increase your vending machine profits over time by saving money on the initial costs of food.

How to Purchase Vending Machines

The best way to start your business with the most flexibility is to purchase your own equipment and find your own locations. This is the best way to start if you’re prepared to capitalize on contacts in structures and commercial spaces for vending machines.

A fleet of already-operating vending machines can also be purchased. Get as much information as you can about the owner’s reasons for wanting to sell their vending machine route before taking this action. It’s great if they want to retire if that’s the reason. You’ll need to be aware of any problems with the locations they chose, though.

There will be fewer decisions to be made at the beginning if you invest in a franchise because it is already an established business. However, the franchisor does receive a portion of the franchisee’s sales.

Vending Machines Repairs and Maintenance

Vending machines are vulnerable to theft and vandalism because they are located in public areas. Despite how frustrating it is, you can incorporate this into your business plan.

Your vending machines still need regular spot checks even if you bought them brand-new rather than used. Your vending machine will lose money for every downtime that it experiences. Better profits overall will result from scheduling routine machine maintenance into your schedule.

Frequently Asked Questions