Vending machine placement fees

Vending machine placement feesvending machine location

The vending machine investment has brought significant benefits to various organizations, but the availability of machines, procedure, and cost known as space, can generate rapidly generated costs. 

A vending machine contract can be placed to obtain information on the sector and, with a specialized methodology, to guarantee the earnings of all the meetings involved. The vending machine placement fees can be categorized into two areas namely; Rental or Commission Based.

Rental Based Locations

rental contract

In some areas, particularly in medical clinics and workplaces, managers or offices that support the establishment of vending machines, monthly or quarterly fees are charged for the “rental” of the machine area. 

This fee varies depending on the machine used, but typically costs about $ 5 per month for basic standalone machines, for example up to $ 50 per month for espresso and snack vending machines that require hydro and water.

According to my long-time experience in this vending machine placements, I normally pay the location basing on the sales.  Let’s say if I’m collecting around $100 per month then I should allocate around 10% to the location which is around $10 per month.

Commission Based Locations

sales commission payment computation

Although a fixed monthly payment which some locations require, most locations normally accept a predefined part of the returns collected by the machines. 

Depending on the location and the type of company, the desired rate is generally between 15 and 25% of the gross salary of the machine. 

In exceptional cases, a site owner may accept a rate as low as 10% of the gross salary of the machine, but most site owners expect a payment of 15% in all cases.

I have some locations that are always being approached by other vendors who wanted to steal my location and at times I have no choice even thou my earnings is super small just to keep the location.  The make sure that you keep the desired location then I have no choice but the shell out 20% on my gross collections every month.

empty wallet

Sometimes I really wanted to give up and sell these kinds of locations but if you are just having one avenue of income just doing vending business then I just have to stick it out.

The idea of ?? paying the vending machine placement fees for a good location in the vending machine business can be grouped under two categories: Rental costs and commission fees.

Rental Fix Cost

It is important that you understand one type of each. 

The automatic candy and non-alcoholic beverage account requires promotional and negotiating efforts to define the appropriate regulatory areas. 

Taking advantage of a vendor account finder manager to find may seem like a simple way to reach areas for your machines, but when you close that arrangement with a property, you realize you have to pay the fixed rental fee to the location with machines placed. 

These fees are usually only paid on a monthly basis but they can sometimes the managers can be considerate on late payments, depending on the season of the year.

These kinds of locations just wanted to justify the space that accommodates your vending machines and have no idea how hard in making money with chips, chocolate bars and pop cans.  These locations just come up with a fixed rental fee and absolutely no clue on the vending business.

The reasoning will be that if you cannot pay up let’s say $75 per month then someone else can.

kicked out of location

These kinds of locations are also not desirable since most of the earnings just go to the pockets of the establishment without knowing how difficult running a vending machine business.

But as I mentioned before, as a full-time vendor you just have to keep your pride to yourself and just pay up. Some months you will be making and some months especially if the machine is jammed or out of order then it will be a negative loss.

Commissions are part of vending machines. 

Not all vending locations require or guarantee commission, but in order to maintain a good connection with the manager or the owner, there should be a vending monthly commission. 

The above categories are very useful when determining the placement fee for a vending machine which should be put into considerations before placing a bid.

Most of my locations do not require me monthly commissions or rental fees.

Conclusion

Location placement fees from a locator vary from: $200 to $2,000 depending on how much traffic or people working in the location which normally is a one-time payment from a vendor.

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Vending Machine Placement Service

salesman

In this business where locations are scare especially here in the lower mainland Vancouver, BC. Most of the self-employed vendors here rely on the services of a vending machine locator.

These locators are very useful since they can find some spots for you to place your vending machines in case they go homeless for reasons below:

  • Location changed their mind on vendors
  • Competition snatching up your location
  • Manager is unhappy with your looks 🙂
  • People don’t understand that it needs time some time for you to swing by see reason below

This stems from the reason why sometimes I do not immediately go to the location and fix the problem. Why do I not go and fix the problem as fast as the 911 ambulance?

Most of my locations are like 20 minutes drive. Some locations will say Bill Acceptor cannot accept cash, Machine ate my loonie, Old machine garbage, and the likes.

These things happen all the time and the locations that call me for those minor problems have a backup device attached. Such as a credit debit reader or if it does not work then coins will work too. And normally the location’s sales are very low performing that it does not justify for me as a vendor to go and fix the problem immediately.

It can wait for a few days or a week.

Accounts that you visit once a week, of course, will need immediate attention.

With all the reasons above and you are always busy and on the run then you do not have time to look for a location since you are busy running around servicing.

What happens if you lost a location?

It would be best to request the location to give you time at least 1 month or 2 months to find a replacement location. Because if you cannot find a location immediately then you have to pay $120 moving to storage.

Then another $120 moving to the new location. Aside from the vending machine locator’s fee which ranges from $400 to $2,000 here in Vancouver, BC.

Here in the Lower Mainland Vancouver, BC there a few vending machine locators that you can ask help for finding a location for your homeless vending machines.

I have a story to tell

secret

When I was still new in the vending machine business, I heavily rely on vending machine locators for new locations.

Here in Vancouver, BC not all vending machine locators are honest.

There are locators that constantly sell locations at Craigslist Vancouver, BC. I guess this applies also the Craigslist ( City in the US or another city here in Canada ).

Do you know how to spot a cheating locator that sells you an overinflated price for a lousy and bad location?

After years of doing this vending machine business, I can now know how to read between the lines on the AD at Craigslist on the vending machine locations if the seller is genuine or just out to get and bleed your hard-earned money.

True and real locations sell locations for the prices below:

  • $250 Offices
  • $250 to 850 Very Good Office Location

That is about it! Nothing higher than $850 should be trusted by the vending machine locator.

How do you spot a bad vending machine placement service locator?

empty promise

If you go to inspect and check the location with the supposed locator that you just met on Craigslist and he or she agrees then it is a good locator.

Good locators will normally sign a disclosure agreement with you in case you do not buy the locations after showing it to you and will not force you to buy it immediately upon inspection.

Bad locators will be very impatient and will sometimes get furious and mad why you wasted his time after showing you the location? He will unjustly reason out with you that he will threaten to snatch and get all your locations one way or another.

He will let you know that it’s you and against all his henchman in a mockingly way.

I met such a person but since I’m normally calm and have been doing business for the longest time already, I just took some locations from him every time there was an offer.

Sometimes you have to be friends with the enemies

friends with enemies

This is a business strategy way back in the Philippines. Since it is wise for everyone doing business to be civil and inside your head you know that you need one another bad or good business contact as long as everyone benefits.

But here is not the case for me here in Vancouver, BC.

A bad locator normally has all the locations and contact details even after selling you the location. Some the locations that he sold you will be snatched back by the same locator.

His tactic is using another pseudo name or assigns someone to go after all the locations that he sold to you before and try to offer it to another naive and gullible newbie vendor.

How to Catch A Bad Locator Red Handed?

First things first is that a bad locator will sell you at a minimum price of at least $800 for a location. I have been buying a couple since I have some machines that needed to be placed immediately.

Sales will be dismally low, meaning about $10 to $50 at most every month. People at such locations do not buy from vending machines.

His prices will be advertising ranges from $800 to $2500 per location with very good sounding words like 100 people, Hundreds of walk-in visitors and all the good words that you wanted to hear will be promised to you.

I mentioned before that a location at most will be $250 to $850 from a reputable vending machine locator only.

I’m into this business so sometimes I talked to other vendors. And they all told me the same story.

Some of their locations suddenly wanted out and go with another vendor.

Will this is very traumatic for us vendors since every dollar counts. Even if the location is just performing say $50 a month because we need to add all the locations in totality.

Loosing will entail you expensive costs:

  • Moving in and out $240
  • Finding Location $250 to $850

The worst thing is that if we are booted out of a location and our machines are old machines then what to do with them? Storage fees charge an added headache. $30 per machine for storage.

Catching The Bad Locator

Let you lost location goes by for a couple of months or even 3 to 4 months. Ask one of your friends to visit the old location that you lost and look for the manager.

Of course, you know the manager’s name since it was your previous location. Probably you do not have a good rapport with the manager too when the location was snatched back by your locator.

friend

Ask your friend that you need to contact the new vendor because you are just starting out on your vending machine business and would want to ask help from the vendor.

Once you got the phone and contact info for the vendor on your previous location. Then it would be easy for your friend to call and connect and ask who offered the location.

It is a simple to approach to catch a bad locator who was recycling all his locations that were sold and ripping and bleeding money from some of his customers.

In a very worst case scenario, you can actually to court and ask for a pro bono lawyer and build a case against the bad locator and normally for small claims court, the judge will normally let the bad locator pay back the locator fee that he sold to you before.

For all of us vendors, I guess this is a way to get back to a bad locator.

In doing business you have to protect your investment especially your location.

How To Avoid These Problems?

happy

Stick to a good locator that has a proven track record.

Try to go and do outreach by yourself. Build up enough confidence and just try to approach a location by yourself and see ways to improve your offer when you get rejected.

I myself was able to get locations by myself which are doing extremely well compared to the ones that I bought from locators.

This will also ensure that you have a quite good rapport with managers since you got the locations yourself.

What If I cannot Do it?

for hire

Hire a temporary salesperson to do the job for you in going to establishments. Be sure to collect all the information needed and give it to the temporary sales person that you hired.

Be sure that you hire a presentable and approachable person that naturally likes to talk to people or a people person. Most probably a young university student who wanted to earn some gig on the side.

You can do this ad on Craigslist as well and be sure to hire just temporary for a sales gig.

I sincerely you have success to the experience and knowledge I had encountered.

Till next time!

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