THE 4 PILLARS OF THE VENDING MACHINE BUSINESS
It’s possible to spend your whole life stuck on a train called corporate America, or a train called blue collar, or maybe one called American dream.
You keep thinking about how you’ll escape one day, how amazing it will be to break free from some preconceived notion of “who you’re supposed to be…” You think about what it would feel like to take back control of your life, gain financial independence, create a future for your family, and make a positive impact on the world.
It’s a nice fantasy
Think for a moment…does this sound familiar? If not, what is your fantasy? Who do you want to be? What do you want to do? And, when are you planning on making it a reality? You’re reading this, so it’s fair to assume that you’re at least considering the possibility of franchising, or starting your own business. “Perhaps you realized [it was time for a change] after another long commute home or maybe when you missed yet another of your child’s music recitals or hockey games because of a late business meeting. Did you reach your fork in the road when you woke up this morning, looked in the mirror and said, “Is this it? Do I have to go to work today?”
Has something happened that was not of your own choosing but occurred through a corporate downsizing, demotion or some other restructuring? Suddenly you’ve been thrust out of your career and are now wondering, “What now?”
Stephen Hogan, a highly regarded business consultant, describes it beautifully – the quintessential moment in the life of every business owner. The point when we realize that not everything is as it should be. When we think: “If only I had more control over my life, more flexibility, and a higher income potential. Then I’d be happy. If only I owned my own business I’d be happy. That’s it…I’ll start my own business, but what kind?”
Your internal monologue may have sounded a bit different, but nevertheless here we are. Perhaps you’ve done a little homework, and you think the $42 billiondollar vending industry might be the right fit for you. Maybe vending sparked your interest because you heard it has less overhead, no rent or electricity bills, or more flexibility than other industries. Perhaps you like the idea of a permanent escape from the office where you can interact with your neighbors, and make an impact on your community.
Before you can make a decision you need to know more about the business to see if it aligns with who you are, and what you want. You need an answer to this question: what is the vending machine business exactly?
The 4 Pillars of the Vending Machine Business:
Pillar 1: Equipment
There are almost unlimited options available when it comes to choosing vending machine equipment, Some of the most popular vending options to date include: credit card readers, LCD screens, healthier options, and micro markets. This leads us to one of the biggest questions in the vending world. What comes first, the vending machine or the location?
It’s a controversial question. But, when it comes down to it, the ultimate goal of your business is to maximize profits. The truth: locations are interested in finding full service solutions. That will almost always be the big picture goal for them – and by extension, this should also be your big picture goal. By securing a location prior to buying a machine, you might have a better chance of being able to fill that location’s needs and desires.
Pillar 2: Location
Too often, new entrepreneurs don’t quite understand what it takes to start a business. The vending business is no exception. If you don’t have a comprehensive strategy or support system, your ability to land the best places to put your vending machines, with high foot traffic and exclusive contracts, can be nearly impossible. If you’re looking to secure the highest quality locations that will maximize your ROI, you will need to become proficient in the art of lead generation, engagement, and nurture, and you will also have to provide top-notch ongoing support.
Pillar 3: Products
As previously mentioned, many locations choose a vending supplier that offers the right options for their students, employees or patrons. Vending machines with just candy bars and chips are quickly becoming a thing of the past. Vending companies now offer a larger variety of food options, from breakfast to dessert. Without the right products at competitive prices, a machine in a great location can be an absolute dud.
There are a lot of product sourcing options, but when it comes down to it, what you choose to vend should depend on what the location needs. It’s important to consider demographic, foot traffic, and consumer age. Make sure you’re constantly analyzing the product movement inside your machines so you can see which products do well, and which ones don’t. When in doubt, do a tasting event, or ask the location to do a survey. Your customers will thank you, and so will your bank account.
Pillar 4: Ongoing Service
If you think stocking your machines is your only job, think again. You’re in the relationship business, and the best vending relationships are full service. This includes repairs, technical service, automatic reorders and customer specific product options.
One of the most important things you can do is set expectation with a location before signing the deal. This builds trust between you and the location. In all social/ professional scenarios, people relax when they understand what to expect.Once you’ve set this expectation, you need to exceed it – follow-through and do it better than they could have even imagined. This, of course, builds trust, and continues the cycle. In other words, this will help you to make a lifelong relationship with your location, and it can also help you get location referrals too.
You should now have a better understanding of the four main aspects of the vending machine business. That being said, it’s important to note that launching and operating a successful vending business isn’t easy, by any means. Before you order any machines on Ebay, or sign any franchise documents, take some time to weigh all of the options. More importantly, make sure all of the options line up with your specific business goals.
* This article was adapted from ‘How to Start a Vending Machine Business: The Complete Guide.’
Jessica wrote her first novel, a historical fiction romance, at age 10. However she soon discovered that she had a lot more to learn about the subject before she could be considered an authority. Since then, her flirting abilities haven’t improved, but she thinks her writing ability has considerably. After earning an undergraduate degree from the University of Southern California, she found herself in a franchise sales role at H.U.M.A.N. Healthy Vending in Culver City CA. Long story short, she fell in love with the franchise world, and she feels honored to be able to help prospective business owners discover if the vending business is right for them.