How To Start A Vending Machine Business

Kreg Bale
Kreg Bale September 16, 2020
Updated 2020/09/16 at 7:01 AM
how to start a vending machine business

Do you desire a business opportunity that does require special training or skills, that can be on part-time, and even involve the entire family? Then the perfect fit is to start a vending machine business.

Here are a few statistics about the vending machine business that should amaze you;

In 2018, the global vending machine revenue hit $23 billion

Globally, 59% of the vending machine is now built around cashless policy mechanisms such as mobile wallets or credit cards.

In the United States of America alone, there are about 2.08 million vending machines.

Chilled drinks like juices, water, and soft drinks make up the largest product category of the vending machine with about 31.2% purchases.

With the continuous expansion of healthier snack options, 7.6% of sales was recorded in 2018 and this is as a result of legislation in certain areas mandating healthier choices in food/drink vending machines.

How to start a vending machine business
How to start a vending machine business

The newest pizza vending machine can produce a pizza cooked to perfection in less than three minutes with the option of three toppings. In Beverly Hills malls, the vending machine has the capacity of delivering gourmet delights like escargot, bottarga, and caviar.

Merits Of Starting A Vending Machine Business

The following are the merits of starting a vending machine business;

It Is Simple – Immediately the machines are installed, the only duty expected of you is to restock and maintain the machines, and collect the money whenever necessary.

Low Startup Capital – Aside from the money spent on buying the machine, other capital costs are low. There would be no need for a building or an office space. Getting a space in a utility room, garage, or basement is all that is necessary. Aside from a utility vehicle to help service your business, there won’t be any need for other machinery or equipment.

It’s Scalable And Flexible – The business can be started with just a few machines and expand the vending business as finance and time permits. Also, this business is the right option for families. A spouse can easily be trained and children integrated into the business to stock, purchase, do bank deposits, account, and many other assignments.

Transactions Are Cash-based – In the vending machine business, you are either receiving credit cards from companies or collecting cash directly from the machine.

Also, in addition to the low financing, it is required for the handler to be physically fit because servicing the vending machine involves walking and hauling of products as they are heavy.

The following are the basis on how to start a vending Machine business;

Do A Proper Research On The Business

Just like any other type of business, it is essential to embark on market research and planning because they are the keys to success. The following are ways by which the business can be established;

Starting from the bottom: Here, new machines are acquired and your source for location. It’s quite flexible because it allows you to grow as your finance permits. It would require you to do the legwork – purchasing the machine and sourcing the location (except you are in contact with the machine distributor who also sources for the location)

Taking over an existing vending business: This allows for the immediate flow of cash from the existing business. However, it is good to inquire why the business is put for sale. Other things to check out include the accounts, machines, check the current contract, the existing location, and possible challenges.

Getting into a franchise arrangement: It is easy to do this because a franchise offers an established business model targeted at vending a particular product(s). Here, the franchisor earns a particular percentage of the profit or a monthly charge in addition to the franchise fee initially paid. However, the franchisee is limited to renting or purchasing machines and products from the franchisor.

So, it’s time to write a business plan of which market research is an integral part; the market research would help you test the viability of the business. For instance, you could talk to people who are already in the business and could discover that your area is already saturated with a vending machine.

Find A Good Location And Sign A Contract

It is good to find a location with high human traffic like airports, schools, shopping malls, office areas, and in front of large stores. So, you require a location without an existing vending machine, you would get one.

Also, the right location isn’t enough; you need the right product selection that would fit the area. A candy vending machine located outside a health food store is not on the path of success

A popular product might not do well in a high traffic environment if the target market is not suitable.

Consider the following;


As you search for a suitable location, do not forget to find out about the crime rate in the area and avoid the environment with high theft and vandalism. This is important because it can deplete your profit. So, the location should be visible, security patrolled, and under security cameras.

Contract agreement

There has to be a form of arrangement between you and the property or business owners where the machine is installed because you use their electricity. It’s based on an agreed percentage of your sales. 7% is usually the average commission but this varies based on the size and number of the machine.

The contract would contain a statement of sales and commissions, other things to be contained in the contract are;

  • The duration of the contract
  • The product and machine type
  • Terms of termination in the event of breaches or unprofitability
  • The right of replacement decreases or increases the number of machines
  • The right to exclusivity (if applicable)

Buying Or Renting Of Equipment

If you are not acquiring an existing business or going into franchising, there would be the need to buy one or two machines to start. Before this, you need what product to sell (beverages, foods, or specialty) and the machine types you would require.

Types Of Vending Machine

Bulk machines

They are small and can dispense bulk snacks like gumballs, and peanuts. You can get it for between $50 to $200, they have a slim profit output. You do not need to refill as often as possible and they are easily repaired and serviced. A few of these machines are required to generate enough profit.

Mechanical machines

These are much larger than the bulk machines and they permit the dispensing of multiple products. Its price starts from $2,000 for one machine and its profit margin is higher than the bulk machine.

Electronic machines

They are designed with modern touch screens and take other forms of payment like credit cards and bills. They are a bit pricey but they are more reliable than mechanical machines. Its cost could be as high as $3,000 per machine. It is more sophisticated, dispenses different products, and accepts several payment options.

Acquiring a used machine

These can be a discounted rate, other options include; is a platform for getting used vending machine based on type, location, and price

eBay and Amazon are good avenues for locating used vending machines. The views would provide the necessary information on the reliability of products.

Craigslist is also a good source where local machines can be sourced

There are several machine dealers, so, check the internet to locate the dealers in your environment.

Repairs and Warranty

A newly acquired vending machine comes with a one to two years warranty. Any mechanically inclined person can repair the machine otherwise there might be the need to consult a technician for the repairs.

Select The Right Products To Maximize Profit

The type of product would form part of the contract, some products are location-dependent while others sell better in several public areas.

Toys, candy, and other specialty products are more suitable for play parks, malls, supermarkets, and other centers where families visit regularly.

Personal items like toothpaste, feminine accessories, and other over-the-counter products would do well at restrooms in malls, service stations, and public transit facilities.

Sandwich and hot food vending machines would thrive better in a business environment like universities, schools, and the business environment.

Vending machines for snack products like candy, water, sodas, and chocolate bars would sell better in many environments.

Also, hot drinks like tea, hot chocolate, and coffee would sell well in most locations.

Choose Healthy Products

The healthy options available are;

Nuts, fruit cups, baked chips, fresh salads and sandwiches, sugar-free gums, and fruit juices or water in the place of sodas.

Product Sourcing

Excellent Customer Service And Good Maintenance Plan

The customer service policy should include;

Visit the location regularly to keep the vending machine fully stocked

The machine should be clean and put in good repairs. Poor maintained and the dirty machine would turn-off customers any day and any time.

Provide a channel of feedback for customers for them to report cases.

Do a plan for the old product to sell first.

Do a routine sales analysis with the property owner on the best product

You should be professional at all times.

Be in regular contact with the machine handler because they get a lot of complaints.

In conclusion, the vending machine business just like other businesses requires a strong passion and hard work to succeed. Owning a vending machine would not get you rich instantly but the joy of being your boss is rewarding as getting good locations would generate constant revenue for you.  


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