How To Start Vending Machine Business 2024

Starting Vending Machine Business not only generates income but also allows you to reap the benefits of a small business owner. All of this without the drawbacks of opening a store, franchise, or a restaurant. The vending machine business is ripe with opportunity. Here’s what you need to know to get started on How To Start A Vending Machine Business 2024

Starting a vending machine business is the perfect side hustle. But there’s so much more to this business than simply buying vending machines and placing them anywhere.

You have to evaluate vending product options, scout for appropriate locations, decide on investment and profit margins, and more. There are a lot of in-between steps to ensure your vending machine venture’s success.

How to Start a Vending Machine Business 2024 in 6 steps

Consider all of your Vending Machine Options: This includes Food and Drink Machines, Bulk Vending, and Specialty Vending.
Find the Right Location for your Vending Machines: Consider locations where you feel motivated to use a vending machine. Then work out an agreement with the proprietor.
Find your Vending Machine: Vending machine sellers include manufacturers and wholesalers, secondary market retailers, and online resellers.
Stock your Vending Machine with inventory: Consider site-specific needs when purchasing inventory for your machine. Also, don’t over-order stock in the beginning.
Explore your Vending Machine Business Financing Options: The best financing options include a short-term loan, equipment financing, and inventory financing.
Make the right investments in vending machine tools: A successful operation requires you to invest in tools that will help you run your business more efficiently, as well as prioritizing customer service.

Determine the Vending Machine features you want

After you’ve decided what you want to sell, decide what features you’ll need and want in your vending machines. Some of the special features and capabilities available include:

Functionality to accept credit and debit card payments
Interactive touch or voice-activated screens
LED lighting
Graphic and branded wraps that go around the machine to make it more visually interesting and attractive
Combination food and drink dispensing
Software for remotely monitoring stock levels in the machine

Cost of Starting a Vending Machine Business 2024

The majority of the costs to start a vending machine Business comes from the vending machines and the stock items.

With as little as a $2,000 investment, you can generally get a basic vending machine business up and running.

Many vending machine operators recommend buying used or refurbished machines. Which you can find between $1,200 and $3,000.

How To Start A Vending Machine Business 2024: A Step-By-Step Guide

Any advantage or insight you have on vending machines is a great way to get in on this niche business.

For example, if you’ve already identified a need for a snack machine near you. Reach out to property owners you know and gauge their interest in placing vending machines at their locations.

But even without personal connections, you can Start a Vending Machine Business and make money doing it. Here’s how to Start a Vending Machine Business in six steps.

Consider your vending machine options

While most people may think vending machines only come in the standard snack-and-soda variety. If you’ve thought about How To Start a Vending Machine Business 2024, you likely know there are more options.

In general, there are Four Different Categories of Vending Machines (which we’ll outline below).

Consider all four types when choosing the machine whose products would be the biggest hit with your target market.

A). Specialty Vending Machine Business

You’re not just limited to Food and Drinks when Starting a Vending Machine Business.

Large public places like arenas, airports, and malls often have machines offering goods like tech accessories, beauty products, or other specialty items.

Some of these vending machines use the same technology as standard vending equipment, and some are differentiated as Automated Retail Machines.

Some Specialty Vending Items Include:

Retail:

Essential travel items like phone chargers, headphones, and neck pillows can be lucrative vending products if you’re able to negotiate a contract with a local transit station, or even an airport. Upscale vending machines in malls and airports often contain luxury skincare products or electronics.

Tobacco:

Tobacco vending is legal in many states, and can be lucrative depending on the state taxes. Even cannabis vending machines are also becoming available, but with a much more limited market.

B). Bulk Vending Machine Business

Starting a Vending Machine Business with machines that stock gumballs, stickers, or rubber balls. Also known as bulk vending requires very little capital and low maintenance costs.

These typically low-maintenance vending machines might not be glamorous, but the quarters do add up.

A refurbished vending machine could cost you less than $50, and bring in as much as $30 per month. The products you’re offering have incredibly low overhead.

C). Food and Beverage Vending Machine Business 2024

According to Vending Market Watch’s 2022 annual report. Food and beverage vending machines with snacks, soda, and candy make up the majority of the vending market share in the U.S. With beverages alone accounting for nearly a third of vending sales.

If you’re wondering how to start a vending machine business, you can’t go wrong with this old standard.

Of course, there are variations on this standard. You can get a machine that just offers drinks, snacks, or snack-and-drink combinations.

Some vending machine entrepreneurs choose to purchase different types of machines for one location. Or place one kind of machine in multiple locations.

Franchising Options: How To Start A Vending Machine Business 2024

If you don’t want to Build Your Vending Machine Business from scratch. You may want to consider buying a franchise to start your vending machine business.

As a franchisee, you will be able to work within a proven business framework and receive extra support and training to get your vending business set up.

You’ll also be able to decide how many or how few machines you want to invest in. However, keep in mind that as a franchisee, you will be responsible for paying a portion of your profits to the franchisor.

Find the right location for your Vending Machine Business

The type of vending machine you choose is crucial. But where you decide to put that machine is the most important factor in earning a profit from your vending machine business.

For instance, an upscale Food and Beverage Vending Machine Business might fail in a strip mall full of restaurants. But that same machine might flourish in an office park.

When starting a Vending Machine Business, think about the locations where you have personally purchased something from a vending machine. As well as the times when people are most likely to purchase a beverage, snack, or other items.

There’s a good chance your restaurant selection was limited. You were in a hurry, or you were waiting somewhere like the airport or DMV.

Some other location ideas for your Vending Machine Business 2024 include:

Schools
Laundromats
Grocery stores
Manufacturing plants
Apartment complexes
Hospitals or medical centers
Airports and shopping malls

The next step is securing your location. A good salesperson might feel comfortable cold-calling a property or business owner, or soliciting them in person.

This approach can work for smaller locations, especially if you’re a frequent patron or already know the owner.

You can also try visiting your local Chamber of Commerce.

They can give you information about major businesses in your area, which might give you some ideas for potential locations.

Ideally, try to place your vending machine at companies with at least 100 employees or considerable foot traffic, like a multi-business office park.

If you already have locations in mind, reach out to proprietors, or work on getting contact information for the relevant manager.

Talking to prospective partners about location needs can help you get a better understanding of local demand and inform your vending machine and product selection.

Understand State-Specific Vending Laws, Regulations, and Compliance

Different rules apply to various Types of Vending Machines Business, and vending regulations vary by state.

Before starting a Vending Machine Business and reaching out to prospective location proprietors. Find out how your state governs vendors.

By contacting your local Chamber of Commerce. Or looking up your state’s small business regulations online.

Find your Vending Machine

You can’t start a Vending Machine Business 2024 without first obtaining a machine. Check Them Here on Amazon

Luckily, finding your vending machine can be as simple as an online search.

To get an idea of the different vending machine offerings and price points out there, search both locally and from national suppliers.

You should also consider the cost of inventory when looking at vending machine prices. To find the vending machine of your dreams, start your search with these three types of sellers:

Manufacturers or wholesale vending suppliers have the widest selection of vending machines for sale, the newest technology, and the most end-to-end services for delivery, repairs, and training. This is the most expensive option, though equipment through vending franchises might require a minimum order of multiple machines or other fees that go toward machine servicing and entrepreneur development programs.

Secondary market sellers or specialty online retailers allow you to browse multiple brands and models of vending machines and often have helpful resources for business owners.

Consumer-to-consumer platforms like Craigslist and eBay have thousands of vending machines for sale. Save time by filtering by merchant or owner location, so you don’t have to worry about major shipping costs. This may be the best option for first-time vending entrepreneurs who don’t want to spend thousands on a new or refurbished machine.

As you’ll quickly find once you start your search, vending machines come with a range of features and capabilities, all at different price points.

Some of those special features include:

Interactive screens
Touch or voice accessibility
Snack/drink combination machines
Credit card and large bill functionality
Branded “wraps” for the front of your machine
Remote monitoring software and low-stock alerts

Try not to be too tempted by these special features, though, since they can become costly. Choose the vending machine that best fits the products you want to offer, and what you can afford at the moment.

Stock your Vending Machine Business with inventory

Once you’ve landed on a vending machine, you’re well on your way to starting a vending machine business. Next, you have to stock it with inventory.

Product selection is an excellent opportunity to boost sales.

Rather than choosing to stock items based on wider food and beverage trends, pay attention to local, site-specific needs.

To stay on the safe side, don’t over-order stock in the beginning, and adjust your offerings based on demand.

If you choose to provide combined food and beverage services in your vending machine business, drinks will make up most of your sales.

As the growing refreshments market expands from soda to coffee, flavored water, and healthier beverages like coconut water. It’s worth considering what your location can support in terms of pricier specialty foods and drinks.

Drink size and shapes will affect your range of machine choices. So if you feel strongly about selling cartons or irregularly shaped products, try to find a machine with adjustable product sizing.

Financing Vending Machine Business 2024

Starting a vending machine business doesn’t require nearly as much startup capital as most other small businesses do. Some businesses can cost hundreds of thousands of dollars to start.

Still, a few thousand dollars isn’t exactly pocket change. If you need a loan to purchase your vending machine, consider these two options:

Short-term loan

If you’re already a business owner, and you have the business financial history to prove it, securing a short-term loan to finance your vending machine might be your best course of action.

Like traditional term loans, short-term lenders deposit a lump sum of cash directly into your business bank account, and you’ll repay your loan, plus interest, over a predetermined amount of time.

As you can guess based on their name, repayment terms for short-term loans are considerably shorter than their long-term counterparts—usually 18 months or fewer.

And interest rates are a bit higher than longer-term loans. For those reasons, though, short-term loans are generally easier to qualify for than long-term loans.

But this is a small business loan, so short-term lenders need to review and approve your business’s financials before agreeing to extend you a loan.

If possible, you’ll want to bring a good business revenue history and good personal creditworthiness to prove your candidacy.

Equipment Financing

You don’t necessarily need tons of capital on hand to start a vending machine business that makes money.

But if you need a little help, you can shoot for an equipment financing loan. The terms of these loans depend on the value of your equipment, which also acts as collateral in case you default on your loan payments.

Cared for properly, vending machines can last upwards of 10 years, which might help assure lenders.

In addition to your own financial information and business plan, you will need equipment quotes for the machine(s) you plan to purchase if you choose to apply for an equipment loan.

Additionally, if you need capital to purchase inventory, you may want to consider inventory financing.

Advantages and Disadvantages of Starting a Vending Machine Business 2024

With just a few thousand dollars to invest. A vehicle, and determination, you’re completely capable of starting a vending machine business and turning a profit.

But starting a vending machine business isn’t all fun and games (though you can vend fun and games in your machine).

Like any new venture, there are advantages and disadvantages to consider.

Vending Machine Business Advantages

Little to no Overhead Costs:

There are little to no overhead costs of running a vending machine business, especially if you’re running the business on your own.

Since vending machine businesses don’t require many employees or office space, you don’t have to worry about making payroll, benefits, or spending thousands on rent.

Easy to Scale:

Scaling your vending machine business is incredibly easy. You can start off with a few vending machines, and as you become more successful, expand locations.

Variety of Choices:

These days, there are all types of vending machines. Vending machines now serve healthy foods, gourmet options, and sometimes options completely unrelated to food.

The Vending machine business disadvantages

Theft and vandalism:

Vending machines are an easy target when it comes to theft and vandalism. Ensure that your machine locations are located in secure and safe areas to avoid a loss in profits.

Time commitment:

Operating a vending machine business will require you to commit some time and energy into stocking, servicing, and collecting money from your machines on a regular basis.

Frequently asked questions: How To Start A Vending Machine Business 2024

Where can you Place Vending Machines?

You can place vending machines in most commercial spaces such as offices, retail shops, bowling alleys, and more. But you’ll need to sign a contract with the property owner first.

Are Vending Machines Businesses Subjected to Taxation?

Yes, vending machines are charged Sales Tax on the revenue they generate. The amount of sales tax varies depending on your state.

Do Vending Machine Business Owners Pay Rent?

Yes, vending machine business owners pay rent or commission to the owner of the building. Vending machine owners generally pay between 5% to 20% of their vending machine sales.

Is Vending Machines Business 2024 Profitable?

Yes, Vending Machines Business can be profitable. The average vending machine earns $35 a week, but vending machines that are well-stocked and placed in safe, high-traffic locations can generate over $400 a month.

Skills, Experience, and Education Useful in Running a Vending Machine Business

Starting a vending machine business doesn’t require a business degree, but certain skills and experiences can increase the chances of your business being a success.

Technology Repair Background

Vending equipment will only bring income while it’s functional, so if a machine breaks, being able to promptly repair, it is important.

A business owner who can do at least some of their own repair work can save on the expense of calling in a professional repair person and can also get the machine up and running quickly to continue to bring in money.

Customer Service

Even though a business with vending machines rarely sees their customers, it’s important that vending machine operators have good customer service to secure and keep prime locations.

Vending machines in key locations will make far more sales than those that don’t receive much foot traffic.

Retail Trend Knowledge

Being able to keep up with vending machine retail trends is key to stocking machines with inventory that will sell.

A business owner needs to stay aware of what products are becoming popular and constantly adjust their inventory to reflect those most popular products.

Networking Skills

Networking is a particularly important skill in this industry.

Business owners will need to establish relationships with store and property owners and then negotiate an agreement that allows them to place their vending machines on the property.

Purchasing skills

Owners will need to keep on top of knowing what products sell in their various locations to stock products people are willing to pay for.

Organizational skills

When a business is responsible for multiple vending machines, keeping each machine stocked and service will require an organized approach. These organizational skills are also important in managing inventory.

Attention to detail

A business owner needs to focus on the details of their business, from product pricing to monitoring the expiration dates of inventory.

Conclusion

The Vending Machine Business drives billions of dollars globally each year.

You may be able to break into this lucrative market with less than $1,000, the right market research, informed decision-making, and entrepreneurial energy.

Invest incrementally as you learn about your vending machine’s demand patterns, and start generating a passive income without taking out a massive loan or going into debt.

Depending on whether or not you’ll continue to work another job, increasing the scope of your vending machine business gradually will allow you to take on more when you’re ready, or scale back if necessary.

No matter where you are financially, the vending industry offers an opportunity to operate your own business, while only risking as much as you’re comfortable investing. That is how to start a vending machine business 2024.