Try Not To Overthink In The Vending Business

When you are doing this vending business on a daily basis, you need a lot of strength and stamina to maintain all you machines and keep them in good working order. Somehow you will keep on looking at the schedule on a daily basis and keep on calculating how much money you will be earning and thinking if everything will be done properly including the shopping time.

When you are free and not doing any vending, you have to condition you mind to do other things that you enjoy because if you overthink and think about the 10 or 15 locations that you will be doing the next day it will be very stressful, try not to overthink.

To keep you mind busy and detach yourself from other things, you need to do something that is entertaining or maybe you can think if a few steps ahead like future hiring on certain days that you do not like to work. Since all of us whether as a self-employed or as a person working for a job cannot physically do the daily routine forever on home-office-home, you have to actually think of learning new skills as an entrepreneur, such as : Online Business because this is the only business that doesn’t require physical stamina and human interaction and more time to do what you passionate about.

I have learnt


and I will be on my way to learning :

Making an online store
Maybe this is for you as well

Loosing And Gaining Vending Business Locations


This will be a revealing article that I will be writing about. My vending business started in the year of 2012 when I brought some money from the Philippines. The money was from the sale of my successfull ink and toner refilling services in the Philippines with 12 brick and mortar shops. I sold it because I already foresaw what will be happening, I was ranked in Google way back and I observed that every year there are shops copying me, so I took a step ahead.

I was with limited capital resources to begin with and started out with 20 machines on about 7 or 8 locations. I was concurrently running a Grocery Store which I bought for $55,000 in Kitsilano Alma corner store in which I later resold it at $30,000, I was tricked into buying the grocery store from the previous owners and they are renting me a small stall inside the grocery store for $1,000 per month and 3 months advance downpayment doing the ink and toner refilling prior to purchasing the grocery business. They were running it very well and their expertise is plants and flowers.

When i got the store I tried to run everything at the same time : refilling ink and toner, flowers, costco items, fixing laptops and boy I was burned out and drained of energy and the rent increased to $3,000 per month which I cannot afford and just barely netting around $800 to $1,000 per month with 9am to 6pm everyday luckily there was a buyer but I sold it at a loss.

So what I did was I was doing the vending business 2X a week because when I visit 3 or 4 locations im completely drained of energy and have to run back to the grocery store and do some shopping and entertain customers. The profit margins in the grocery store is like $1 per pack of cigarette and sometimes I was too busy and sold to police baits posing as people pretending to be 19 years old which I was caught unaware and forgot to ask for ID before selling, its good that I got out of that business.

So how did I loose locations

I was a complete newbie in the vending businss way back and was trying to please everyone when I visited the locations and I was driving a Nissan Sentra, I got lot of comments on the car that it can load so much stuff and the space is very small and lots of people suggesting to buy a used cargo van.  The previous owner told me that you can drive any vehicle you want and just do a good job in refilling the locations.

1st location

that I lost was in richmond, bc the manager of the hotel didn`t tell me that the hotel is being bought by a big property developer for a high rise, I serve the location well and everyhing was smooth and had my first break-in on the snack vending machine. Maybe the previous owner who sold me the location didn`t mention this to me, I was naive and as a new comer to Vancouver, BC I wanted to make a living to pay for rent and food, so I was desperate.

Note : this is not due to bad service that I lost this 1st location

2nd location

that I lost was upon obtaining a large vending route again by another vendor was when I was servicing a location in a government call center near granville island, after 2 years for servicing it, the manager just happened to call me and say to remove the machines out of the building. At that time I only have a handful of locations and had a part time job at a gasoline station since I was fired at Staples for fixing laptops at my grocery strore prior to being sold. I felt bad, the people inside the call center had rapport with me, it was just the facilities manager who maybe doesn`t like the way I conduct the business wanted me out. I told her that I`m going to schedule it for removal by next week and every other day she calls me to have it removed.

Note : There might be some miscommunication and I believe that I didn`t try my best to have a good relationship with the manager.

3rd location

that I lost was when I had a vending machine at an engineering company at virtual way, they requested me to put some certain snacks they like and which I did, the facilities manager was from the philppines and after running it for a couple of years there was a new facilities manager who is trying to stir the pot and trying to make some changes, she talked to me and say that they needed a reader on the machine. That was nearing the holidays in december as far as I remember, so in january I changed to into a brand new combo vending machine which cost me around $5,000 and had to arrange leasing company with installments for 36 months. Whenever I visit the location there are people in the company mentioning that the machine is not designed properly and the way the snacks is not to their liking and so many hundreds of reasons. The next week I got an email saying that the machine has to be removed in a month`s time. It`s like $5,000 down the toilet owing the leasing company.

Note : Reason is the manager and the people in the company doesn`t like the way I conduct my business with them

4th location

that I lost was I newly bought a location from a young vendor who is studying in college and earning some income on the side and sold it to me at a good price of $1,500. This was a car dealership in kingsway burnaby and suddenly the girl in the office just told me that they need the vending machine to be removed and I asked why, and she replied that they don`t need it anymore, so the $1,500 down the toilet again.

Note : People in the location doesn`t have any wavelength with me

5th location

that I lost was a math learning school in richmond westminster, I got this location from a vendor and there are 2 machines inside the building and I only have to go there on certain hours because they don`t want a vendor to disturb the kids in the afternoon when they are going to attend some kumon classes. The incident which happened was when the owner asked for some change , I just told her that im very tired and will come back tomorrow for some change loonies as float, when I was driving home to steveston on my rented house I was called on phone and had to go to the school immediately and when I met the owner they told me that the location was only 1 month contract and it already expired and I have to remove the machines immediately, I called the seller and was able to get a 50% of my investment so another $2,500 down the toilet.

Note : I didn`t have a gearing on building a relationship with the owner and just ignored their requests on refund slips and float which I sometimes I didn`t leave and also I`m always late of paying $60 monthly commission charges. It was the day that I forgot to pay the $60 and the owner had me disconnected from the location saying contract agreement expired the last time I visited them, they have a new professional vendor

6th location

that I lost was a education college I believe in downtown that have to move locations and they don`t need any machine on the new building because there was another vendor.

7th location

that I lost was a nursing school in richmond that I lost because the seller which was a filipino countryman didn`t tell me the problem on the coffee to bean machine that the machine is causing some intermittent problems and the staff at the nursing college keeps on calling me to fix it that I eventually pulled it out and loss around $2,500 because the filipino countryman was not honest and didn`t help me fix the coffee machine, it happens that the guy is a vending locator too.

Recently I sold a hotel vending location to him via Craigslist and he cloaked his name to an alias in craigslist and I was hesitating to sell it because it got it for $20,000 but he only came up with $17,000. I was surpirsed when he showed up at the hotel and sensed why he cloaked his name at Craigslist inquiry, so i showed him the 6 machines and everything is working and everything was transacted smoothly and then after a couple of days he accused me of selling lemons, I immediately called my technician to fix it but he had to delay it to a point that I received a letter from a lawyer to sue me and have to pay him back 17,000$, this is an ongoing case. Right now all 5 machines are perfectly working and the 6th machine compressor will be replaced by my technician and I even offered the buyer 1 month opportunity loss of profit of $150. My deceased father is a lawyer back in the Philippines and I know how to play the rules, I believe im innocent and these things are electronics, anything can happen anytime.

8th location

that I lost was when I had a machine in downtown in a filming school, the manager was moving and renovating and was trying to have a single vendor from numerous vendors in the school, of course they will opt me out since im just starting out and they choose a big vendor which is no surprise.

9th location

that I lost was a larger manufacturing company in Kebet Way Port Coquitlam in which my wife invested her hard earned savings of $10,000 on 2 vending machines. When we increased the prices from $1 to $1.25 on the chips and from $1 to $1.25 on the pop, we got a call on the production manager and say to change back the prices which we did, after a week our snack vending machine was destroyed and coin mech stolen and all cash box gone. The next week the office people on top of the lunch room called us that they need to renovate the lunch room and eventually the machines were placed outside the lunchroom.

We actually had rapport with the customers in the location and visited this every week and maintained the machines. We did a surprise visit to the lunch room and found out that there is a new vendor installing the micro market. The office people should have informed us that they wanted options sicne we are in talking terms with us. The office staff in this location is very tricky and cannot be trusted on how they move their weight around people.  Sometimes i wish they can feel what it is like to loose $10,000 dollars

10th location

lost was the biggest so far I have invested around $10,000 out of my own pocket and they have 3 vending machines in an animation studio in west broadway vancouver, I cherished this location and whenever there was problem I go there as soon as I can since my locations mostly are in vancouver. I had talking relations with the facilities manager and tried to please everyone. Finally after serving 2 years I got a call to have the machines removed in a week`s time because they decided to go with a single vendor and choose the coffee guy to put his machines in their premises.

11th location

lost was in downtown in a big financial institute in burrard, the facilities manager met me upon turning over the business to me and asked me that I should change the machine because people are banging it when getting products, I was running it for 2 years and I told her that now I have the money to change the machine into a new one. She agreed to have it replaced to a new one but the problem was the new machines which was a Alpine VT 3000 was not functioning properly and people in the office are constantly complaining on getting free items so the manager decided to have it removed and told me that they have a new national assigned vendor in place which is decided by the head office.

12th and 13th locations

were lost was in downtown too, there are 2 financial institutes that I was servicing they gotten out of business so I have to move out the machines.

14th location

that was lost was not owned by me but my sister in law in which she invested some money in the vending business and lost it in a location in richmond in the healthcare field. After servicing it for a month they just changed vendors

15th location

in richmond was also in the healthcare industry, the manager told me to move the machines because they are renovating the spot. I found out that she called another vendor and soon the new vendor left the location too because the manager wanted state of the art machines but the location cannot support it. She finally called me back to put my machines back but I told her that I had my previous machines moved somewhere else and recommended her another vendor which they kept until now as I know of.

After all of this things happening to me , during that time I have a 1992 Ford E250 Van and had so many problems too with it and I was repeatedly told my wife maybe its a bad idea to come to Vancouver, BC Canada and maybe its time to move on again, probably pack our bags and head back to Philippines.

I was trying the make things working out during that crises, which financially drained me and I really wanted to go back home to philippines.

In spite of all these happening to me I got replacement locaitons for the ones that lost. Mostly it was government locations that was the replacements and I found the locations myself and the earnings are quadrupled compared to the locations that was lost.

My First Couple Of Years

I also have around 8 locations that are under performing and had machines removed and moved somewhere else maybe i should have not been moving things around since locations are hard to come by and should have just stick with them since they are still generating revenue but very small and negligible.

So right now I believe it is just karma. Presently my locations are warehouses, factories, transportation logistics, apartments, schools, hotels ,community centers and public locations which are exponentially performing a lot lot more, don`t get me wrong. I still have lots of offices locations in downtown but they are big companies that don`t mind too much on minding my vending machines and too busy with their thing and leave Francis Vending to do his job, mostly these are professional west end office locations in Kitsilano where I had my ALMA Store before.

Basically for Hotels, Schools, Public places they are mostly concerned with commissions and you don`t have to actually have rapport with people, they will even remind you the payment check if you are late.

Conclusion

Be very careful when entering into the vending locations if you are dealing with people in the office locations, try not to talk, stare, mind your own business and try to do the job as quickly as possible and offer commissions even they don`t ask for it, just to make the company happy. I have talked to lots of vendors and they likewise have the same experience. Just do it!

I`m very grateful that I experienced beforehand before I get more mature on doing this vending machine business and it will make you wiser and be super cautious on human involvement and acquiring new locations.

Don`t be mislead by a smiling beautiful attractive person when servicing your newly acquired location but in reality a underlying cloaked crook inside who can manipulate and change vendors at will, these kind of people will get back bad karma many folds, because I have been in the business for too long since i`m in my late 20`s back home in the Philippines even cheated with bouncing checks, fake cra audits on money extraction in asia its a wild wild west especially in the Philippines.  That`s why the best profession in Philippines is a lawyer because they are connected with prosecutors, legislators and policeman which i think my Dad was untouchable in some sort.

In some cases people rob you on the streets and stab you while your taking public transportation by druggies and crackheads. Everyday in Philippine news in the city where i live there are thousands of crimes happening everyday.  Here in Vancouver, BC im just learning the ways, but everything is very subtle.

For the meantime, im very happy with my locations and the results are very good and most of them are in vancouver, downtown and the eastside vancouver presently i have around under 150 machines to maintain so far everyone is happy.

After all it is business and business can be risky business or good business.

In case if I loose a location I already have stand by machines and there are tons of places that need vending machines, did I mention that this is a simple business after all.  For the meantime it seems that everything is in place.

Vending Machine Business Using Coinco Coin Mechanism Payout Problems ?

As i have mentioned i going to make a full review on the various types of coin mechanisms commonly used here in Vancouver, BC, i ones that i encountered are namely : Coinco, MEI, Conlux and Mars coin mechanisms for the vending machines.

The common problems that i encounter on my vending business is the commonly used parts on the vending machine, which is the : Coin Mechanism Bill Acceptor and Card Readers. Almost 90% of the problem are caused by improper operation of the coin mechanism either be a mechanical or electronic.

Lets start by reviewing the most common coin mechanism that is used here in Vancouver, BC Canada.

Coinco Coin Pro 3 Series

CoinPro 9300 SeriesDescription : this is a very reliable coin mech and absolute sturdy and can receive a lot of punishment and i have a lot of these inside my vending machines and they are still performing very well, the only problems i encountered is the top portion of the coin mech which sometimes need to be changed or cleaned in order to properly function.

Coinco Guardian GLX

glx frontDescription : this is a fairly new model and i got this inside on one of my combo machines and it never caused a problem for me, it`s just that i always have to carry a lot of change because there is only 1 column of $2, 1 column of $1 and if the location has a lot of bill users, the change always run out and the staff might sometimes put an out of order sign, so always bring lots of $1 and $2 rolls.

Coinco Guardian 6000XL

Guardian 6000Description : i have a lot of these installed in my pop and snack machines, because it has 6 tubes of change and you will never run out of change and normally you don`t need to carry rolls with you when you are servicing the machines with this type changer, the only downside i encountered is that if this coin changer is getting used a lot and getting old you might be encountering some payout problems like $2 goes into the $1 slot and the Nickels goes into the Quarter Slot, attached is the recent problem i encountered today while servicing a very busy location in Downtown Vancouver.


All coin mechs need to be maintained so in 2 to 3 years you always need to check them and maybe time for an upgrade.

MEI cashflow 7000 Series

MEI CASHFLOW® 7000Description : Second most common coin mech i have is this very reliable coin mech in my other vending machines, this is a very reliable coin mech and i never had an issue with this because the design is very simple with few moving parts inside the coin mech and so far i never had any coin jams, i wish i can upgrade all my coin mechs into this MEI, this is the favorite for the veterans in the vending industry.

Conlux MCM5

Conlux CCM5G MDB 5 Tube Coin MechDescription : this is also one of my favorite coin mech, this has also a few moving parts and simple design, i also never had any problems with coin jams and any other problems.

Conclusion

I hope this simple reveiw which is done by an actual vendor servicing vending machines everyday would help you in making a wise decision when you are planning to upgrade or change your exisiting coin mech when you encounter more than usual problems. As vendors we like to make sure everything is working with the minimum calls and complaints by customers.


Vending Machine Unusual Coin

Monday is a good start for me on the vending machine business.  Im off to locations early and mostly the best days to go to locations like Hotels or Motels would be best for mondays or tuesdays since it is quiet.  It is a bad idea if you go to your hotel location on weekends since there are lot of guests checking in and out and enjoying Vancouver Downtown and sightseeing for tourists.

I had my collections as usual and as a vendor of course you carry with you a lot of coins, i normally go to Vancity for the conversion of my coins to bills, it is a free service to the community in using their coin counters.  There are also coin counters in Safeway by coinstar if you urgently need some bills on sundays in which Vancity is closed.  It is not advisable to go to Safeway to have your coins changed to bills simply because they charge 10%, let’s say you have about 200 to 300$ coins, Safeway will be charging you 20 to 30$ taken away from your coins which is a rip off.  Using Safeway’s coin counter is a sure way to loose money.

As usual i go to Vancity and had my coins put into their coin counter and viola i found an unusual coin, see the picture :

Well what do you think the person made this hole on the coin?  As mentioned before there are always self proclaimed genius who always wanted to get freebies by inserting a nylon on a hole on a coin.  This technique will work during the 80’s on old arcade game machines which i observed way back in the philippines at QUAD Arcade in Makati ( you can click to see how QUAD looks like during the 80’s )

I grew up practically in a very big city called Makati City during the 80’s similar to big cities all over the world.  I plan to keep the coin for memorabilia on my vending business adventure in vancovuer, bc canada.

If you have inserted the coin with a nylon on the new vending machines the nylon would break and the coin will go thru the coin mech and coin box, the problem is when the person is trying the fish the nylon cord he or she will end up loosing the coin!

This shows you that everyday there are so many interesting methods on people trying the hack and steal something out of the vending machine.  It will be my obligation to blog for everyone to see how this business works and what to expect if you are getting into the vending business.

High Security Vending Machine Setup

i have mentioned on my previous posts that i have some locations that people likes to visit every week and see if they can try to steal a few bucks and get some free chips and chocolate bars.  They actually succeeded on my machine is not properly secured. The snack machine that was vandalized was connected with a simple hasp and a regular padlock, they simply used a bolt cutter to cut the hasp and took all the products inside including the coin mech + coins inside coin mech + and the cash box with lock.

I was almost thinking of giving up this location but it is a very lucrative location for me which i visit 2X a week! so since im a business guy im willing to take another chance and have a custom order on a high security snack vending machine.  Here are the pictures.

Sometimes in business you have to take chances since you already know that if you have a particular location in a public area and with tons of traffic even if it is vandalized you just have to improve its security setup.  If you spend an additional $500 to $1,000 but your location can cover that expense in 2 to 3 months then it would be advisable to have it secured and custom made.  Of course, do not forget that the vandalized equipment or snack vending machine can always be traded in for a few hundred dollars, this is the most best method that works for me.

But if you are also selling vending machine then you have it repaired and sell it back to the market again since there are always buyers for inexpensive snack vending machine as a backup machine.  I’m used to these kinds of incidents already, the more locations you have then statistically you have to be prepared with more problems since there will be more people using the machines.

But in due time with the same locations that you are maintaining, after solving the problem the people who are using it will be aware and be cautious the next time when they use your equipment because it will cuase inconvenience for the others.  Normally it is the same person in the building who just keeps in destroying and trying to get freebies.  There are always these kinds of people.  This not happens only in the eastside of the neighborhood but i happen to have a west end location inside in a very nice office and it is always the same person complaining the same problem, there are always people who simply doesn’t know how to use a vending machine or is unlucky when using a vending machine. Some people are very attracted to a series of unfortunate incidents that always happens in their daily lives.

 

Is It Wise To Lease A Vending Machine with Location ?

There are vending supplier companies that are offering leasing on vending machines with locations as a bundle and offering a very good term of 24 months or 36 months to pay. This is a very dangerous proposition if you don’t know the outcome of the location since you cannot judge the approximate sales if you are given an approximate number of people in the company.

But if it is a public location with random people it might be worth the take the risk especially if it is a hotel or motel, but the problem is that there is an increase risk of vandalism if there are a lot of traffic but very consistent sales. Let’s say that you are given a location in a hotel with a leasing period of 24 months than it might be a good chance to consider it if you are betting that the profit will be more than the monthly leasing bill that you have to pay.

I tried this method in obtaining more locations but I have to buy a machine bundled with a location and the problem that I have experience is that some months my profits cannot cover the leasing payments and some months my profits exceed the leasing payments, on average I would just make $20 to $50 dollars a month after paying off the leasing payment.

In order to succeed you have to look on a long term scenario since you are tied to the leasing company for 24 or 36 monthly payments and make sure that you will not go into default or else you will be forever be blacklisted to the Vending Supplier Companies and will be hard to do business in the future.

If your aim is to acquire more assets and locations by expanding via leasing, this is a little bit risky business. But lucky enough for me in able to pay my leasing payments and my journey in this vending business I was able to successfully paid around 3 machines with locations and right now my strategy is to bear the painful process of paying off the 24 or 36 months leasing terms and than buy another new machine bundled with a location.

But you have to keep in mind that you cannot do this method of running your vending machine business or else you will end up bankrupt and in bad credit, because there are some unlikely events that might happen which is not in your favor like : business slowdown, business relocation and people complaining about your service etc.

You can only do this method of business if you have a lot of other machines that are already making a stable income for you and if encountered problems with the new machine bundled with location than the other machines can subsidize your loss.

Conclusion

Leasing a vending machine bundled with location is a very dangerous proposition and not a wise decision. You have to crunch a lot of numbers before you make a decision.

If you have around at least 30 machines you can try to take the risk, because it will be subsidized in case you lose it.

Bulk Candy Vending

Do you know that I started this vending business with the Bulk Candy? I bought an existing business on the Bulk Candy Route and I got about 12 candy locations during the year of 2012 when I was starting out on the vending business and slowly expanded into another 6 candy locations. They are all placed in very good location and im generating around $1,200 gross sales on just candy alone! ( skittles , m&m, almonds, and trail mix ).

On the gross sales of $1,200 I was netting around $500 more or less and I buy the bulk candy at Costco and Wholesale Club. I visited my places about once a month and placed them in lunch rooms and break rooms. I even have them in Costco, The Home Depot, Superstore lunch, Fancy restaurants etc. I even upgraded them into $1 slots and my take home was even bigger maybe around $600 net profit.

I wasn’t happy with the profit because I cannot pay for my rent and cannot afford to have extra money on the side. This was when I have a part-time jobs, this was a very difficult time for me because I don’t have the Canadian experience and the problem was I practically left Vancouver, BC during the expo mid 80s and went back to Philippines to finish my Engineering Degree way back and started my successful journey being an entrepreneur in Asia.

I came back to Vancouver, BC on 2011 as a returning Canadian citizen not as a university student but a family man so this profit so too small for me even thou the return is big for a small investment on bulk candy machines. When I was first bought my Vending Route after selling my Bulk Candy Route then I just keep on expanding.

Conclusion

If you wanted to try a hand on the vending business concept on a smaller scale and wanted to feel what it is like to move around and refill machines then you can always begin with a Bulk Candy Vending Business for starters. By the way I sold the Bulk Candy Vending Business to one of the parents in the same school where my kids studies and the last time I asked him about the status if his business, he was quite satisfied.

How To Get More Vending Business Locations ?

This is long been the dilemma for every vendor, how to get more locations since the more locations you have the more income revenue at the end of the month to pay bills. According to my experience is you can always begin with your existing accounts. Some of your locations may have satellite offices in a nearby city for example, Vancouver office and another office in Richmond which houses the warehouse and delivery logistics.

Where to Find a New Location?

Maybe if you have a location in the office inside an airport, they might be able to recommend their contacts if there are some spots that needed a pop or just a snack machine. There are many ways in getting a new location if you know your account well and if you are aware if they are another office or a business partner affiliate, you can always ask for recommendations from the procurement manager or the office employees.

Vendors are always on budget since they have to set aside some earnings for emergency repairs and move on their machines, so most of them do not aggressively find their own locations. But my suggestion is to look around within your contacts and existing accounts first and ask some questions and when you get some leads then you can prepare a proposal and make an offer, but sometimes this is a risk since you do not know if the new account will be performing well.

Personally, I would like to take the shorter route and would not like to have guesswork since I don’t like to put a vending machine on a new location and visit weekly to observe the sales and adjust visits after a period of time. My method is to buy existing route or locations in that way I already know how much income I can take home on a monthly basis and without taking the risk of a new location without a history. But the problem also if the seller is not honest and gives you a bloated sales figure based on the sale of the vending location. In the vending industry here which I have dealt with other vendors, some of them would say that you can make a 20% more sales from the real sales so that you can sell your vending location at a higher price because this is the common practice here in Vancouver, BC.

Since you already know what im implying then it would be wise for you as a buyer to try to make a counter offer on the selling price of a seller. Right now most experienced vendors when expanding and buying more locations know how to haggle and make a reasonable counter offer so that they get the most value of their money.

There are some cases that if there are several bidders on the vending route or vending location offered then it would be wise just to stay on the sidelines since if you were not able to buy at your expected price then there will be more opportunities down the road, there are always vendors who are selling locations and since it is a simple business and doesn’t require high technology or millions of dollars or even hundred of thousands of dollars to run, there are always vending locations changing hands all the time.

It would be wise to be sure when parting with your hard-earned money!