Is this realistic?

Question

My Uncle, in his endles efforts to motivate me into entrepreneurial adventures (by the way, I'm 16), always suggests various ideas for small businesses that I could do. Some of them aren't bad, but alot seem a bit farfetched.

A few days ago, he came up with puting vending machines in apartment buildings, and letting them make money for you.

Here's the part where I ask that anyone with busines knowedge correct me at every wrong.

The way I understand that, is that I would get in contact with Coke, or some other company that leases/sells vending machines. I obtain one, and then speak with apartment building landlords to see who will allow me to install the machine in their building. Supposing I find someone who agrees, I would likely have to pay the landlord some fee for using his space. After that, the cash would roll in, I would pay to restock the machine, rinse and repeat.

So first of all, is my understanding of how that would work correct? Second how much do vending machines cost?

How much would I have to pay the landlord? How much does it cost to restock?

Would there really end up being profit in this? I'm really not sure that there would be.

Answer 1

I can't do the financials for you, but a few ways to start into expanding into a new vending business:
1) Lease the equipment whether the machines are new or used. Add one or two vending machines at a time and build slowly with good high traffic locations.
2) Purchase established routes (from someone retiring or getting out of the business). The existing vending business would be currently set up with machines on locations, suppliers of products, along with the procedure of filling each type of machine and pricing of the products.
3) Purchase used equipment from other vending operators or distributors. Try it first and see if vending is for you. Research trade magazines, classified ads, or call local distributors for new and used equipment for sale.
**Choose machines that are: reliable, easy to service, easy to locate, caters to the people on location (products that they want), and gives you an outstanding return on your investment.**

How much you'd have to pay the business owner where the machine(s) are located is commonly know as commissions paid to the location. The business owner allows the machine in their establishment because it is a convenience to their employees and customers. Offering a great vending service for free could be just what they need. Otherwise, 0 to 20% of the NET profit can be negotiable to achieve the location, depending on amount of employees and traffic. A signed contract of agreement is advisable.

There are various types of vending machine opportunities so CONSIDER THESE MOST POPULAR VENDING MACHINE OPTIONS: Bulk Candy Vending, Gumballs, Capsules, Soda Vending, Snack Vending, Office Coffee Service or Coffee Vending Machines, Small Combo Machines, Hot Dog Carts, Concession stands, Crane Game Machines, Deli Vending, DVD Vending, Family Fun Centers, Food vending, Full Line Vending, Healthy Vending, Honor Snack Boxes, Juke Boxes, Laundry Coin Op, Personal Products, Stickers, Tattoos, Toys, Video Games, Bottled Water Vending, Amusement Entertainment Machines, Arcades, Coin op Car Washes, ATM machines. Check out The Vending Yellow Pages Directory. http://www.vendingconnection.com/yellowpgs.html

Check out the vending business company that you'd want to buy from. IF IN DOUBT OF THE COMPANY YOU ARE ABOUT TO BUY FROM - Contact:
Federal Trade Commission Web site - www.ftc.gov 1-877-382-4357
National Fraud Information Center Web Site - www.fraud.org 1-800-876-7060
Better Business Bureau - www.bbb.org
Small Business Association - www.sba.gov 1-800-U-ASK-SBA

To contact persons to find locations for my vending machines or
for company listings of vending machine locators for you to contact go to: www.vendingconnection.com/yplocators.html

There are various types of vending suppliers.MANUFACTURERS are the companies that actually manufacture the products or machines, usually selling through distributors or brokers, occasionally selling directly to the vending operator at discount prices. DISTRIBUTORS sell machines and/or products directly to you in your area. Some distributors may have products and vending equipment in stock with warehouse space, assisting you with vending equipment, product, parts, and financing. RETAIL WHOLESALERS are a specific kind of retail distributor. Often a retail wholesaler has a large, easily accessible inventory that they will resell to the public at wholesale prices. Well known retail wholesalers such as Sam's Club or Costco Wholesale which require a membership to purchase products. BROKERS act as middlemen between manufacturing companies, retailers or distributors, often buying a product and selling it to the smaller local vending business vendor.

To look for a vending machine company to place and service machines go to this link: Vending Service Operators- USA http://www.vendingconnection.com/ypoperatorsusa.html

To advertise the vending business for local businesses to contact you to place machines you could start advertising in a local printed yellow pages and newspaper classifieds section, or also place an online internet ad on The Vending Yellow Pages Directory - to List your company contact information - Go to this link: http://www.vendingconnection.com/ypoperatorsusa.html

Answer 2

It's not a far-fetched idea, but I don't think you can do it for 2 reasons: If you are self-employed you have to obtain a federal tax ID # and the vending machine company will require it. At 16 you can't obtain one yet. Also, I think most apartment buildings are not zoned for vending machines, so most landlords won't be able to put them in. You would make more money if you put it in work or school buildings than in residential anyway.

Answer 3

Do the grunt work:

1) Find out how to rent/vending machines first.
2) Find out how much landlords would charge you.
3) Figure out the price of the drinks (figure out how much you would pay for the convenience of having a drink right there than going to a store.)
4) Figure out how many drinks people will buy. (how many people are there in the building?

It must be profitable because there are machines in hotels...

Answer 4

Just wanted to commend you on how well you wrote your answer. It is very refreshing to see one so young and be so articulate. Sorry, I don't have an answer for you but good luck and I hope you take over Canada!!!!