I have a background in the vending industry, perhaps I can add some insight.
In terms of the machine price, figure something in the $150 - $250
range, depending on the quality of the unit and how hard you are
willing to look to find a good deal. I've seen new machines for sale
by private sellers who want out of the business in the $50 range... if
you can find them. My customers have had good luck with the
four-compartment swivel units for a location like you are describing,
something like the Quad Revolution made by Seaga. You can Froogle
"seaga quad revolution" and find them for around $215 fom a variety of
distributors. I'd also recommend buying a bicycle cable lock to
secure the machine. You also need your initial candy stock. All
told, your student will need to invest $200 - $300 per machine to do
it right, possibly less if they can get a great deal on the machine
from a private seller.
The profit margins should be very good. If your student buys candy in
bulk fom a warehouse club, expect the product cost-per-vend to be
about 5 cents. Most of the bulk machines are quarter operated, so
you're making a vey good gross margin percentage. You may also have
to pay a commission to the location, which is typically a percentage
of the gross sales. I wouldn't recommend paying more than 10% for
what you are describing.
The million dollar question is: how many vends can you generate a
month? I can't answer that question for you, but I can give you some
things to look for:
1) Machine location. Is it visable? How many people pass by the
machine per day? Do they just walk by the machine on the way to
something else, or are they forced to wait near the machine. The more
time they are exposed to the machine without inturrupting their
routine, the more people will buy.
2) What kind of people are exposed to the machine? You probably
won't do well in the lobby of a investment bank. You can make a
killing in a college lounge. Get the idea?
3) What are the alternatives? Vending machines are all about
offering convenience to your customer. Are there resturants nearby?
Do businesses in the building offer snacks to their employees?
Most people figure that it takes 1-2 years to pay off the equipment if
you value your time at zero and have a reasonable location. I've also
heard numbers of $15-20 profit/month/machine for bulk units.
Understand that these are averages, and that the standard deviation is
very high. I have one customer that consistantly makes $150 per week
from a particular bulk machine ... and others who made less than
$5/month. The people who do this for a living have very large numbers
of machines. They don't plan on a high amount of profit per machine,
but they make it up in volume.
To sum it up, the key to success in vending is having great locations.
If you and your student really believe that it is a good location for
a bulk vending machine, then it's not an unreasonable business risk to
buy a machine and give it a go.
Good luck! |
