The word passive income is quite popular but often misused to attract people to a business idea. Unfortunately, not all businesses that are described as passive income ideas actually generate passive income.
There have been debates on whether a vending machines can truly generate passive income. This review will focus on answering this question.
However, before you keep reading about online vending machines, I need to say that I don’t recommend starting your business using this model. Why? Because have to be on a continual hustle to find clients to host your vending machine.
I prefer a much more autopilot business model. This video teaches a business model using google maps where you setup your OWN websites and rent them out to clients instead. If a client decides to leave, you can simply find another client and point the leads to them instead. I highly recommend this business model as opposed to online vending machines.
Here’s a video of my daughter’s business using this :
The course my daughter used above is much better than an online vending machine business. But since you are here to learn about vending machines, lets get back to that:
What is a Vending Machine Business?
Vending machines dispense products to customers when they pay by slotting the required amount into the money slot. These machines usually accept coins and they do not require the regular presence of a salesperson to manage sales.
This means you can still make money while you sleep, walk your dog, or even go to a corporate job. You only need to stock the machine with products and coins. Then run regular maintenance when needed. Vending machines stock different kinds of products and are placed in busy places including schools, hospitals, shops, and other places where people frequent.
Online vending machines are a bit different from the traditional ones described above. The online machines allow you to check stock, check sales, and even check maintenance information remotely.
How to Start an Online Vending Machine Business
Just like traditional machines, you need to identify a good location for your business. The place should have a lot of traffic. Ideal places include schools, malls, apartment complexes, office buildings, and fitness centers.
Find a good vending machine brand. Make sure you opt for one that supports online operations. If you don’t have a lot of money to invest, consider leasing a vending machine.
Pick a reliable card reader for your machine. One advantage of online vending machines is that they can accept cashless payments. Conduct thorough research so that the card reader you choose does not require regular maintenance. It is also important that your card reader is working at all times so that you do not miss sales simply because people are unable to make payments.
Identify a product that will sell at the location. For example, you should stock healthy choices at a fitness center and snacks at schools. Use the opportunity to find suppliers who can offer you good products at affordable prices.
You should also price your products properly. The price should be high enough to attract profit but it should also be affordable for people to purchase.
Research into business registration and register your business according to the regulations of the state you are going to run your business in. Although the laws vary from state to state, look into getting a business permit, vending machine permit, and sales tax permit. Ensure that all your registration is properly done before you launch your business to avoid problems.
How Does the Online Vending Machine Work?
Once you have your vending machine, supplies, business registration, and location ready, it’s time to get to the real work.
Get the machine to the planned location and stock it. You need an inventory system to help you keep track of sales and stocks.
You also need a maintenance schedule. Since the machine will be touched regularly, you need to clean it on schedule. You may schedule maintenance and restocking for the same time.
Although a vending machine sitting at a popular location sells itself, more advertisement wouldn’t hurt especially at the start of the business. Online vending machines allow customers to create profiles and you can use the opportunity to reward loyal customers to encourage them to keep coming back.
You can use the screen to advertise these loyalty promotions and other reward systems you decide to implement.
Vending Machines That Can Make You Profit
Most of the high-demand products can make you money if you place them at the right location. Let’s talk about popular vending machine types and their ideal locations.
These are the most popular ones and they are best placed at schools, parks, and any location where people could drop by and enjoy a cold drink in the summer. These machines are branded with the kind of soda they stock. Remember that you can’t stock different brands of the same kind of beverage. For example, you cannot stock Coca-Cola and Pepsi in one machine. For convenience, stock the available sizes for the soda you sell.
Bulk vending machine
If you find a good location where kids frequently visit such as parks, you can choose a bulk machine. Stock toys, candies, gumballs, and other low-cost fun stuff for kids. This is one of the most profitable because the products are not expensive when you get a good supplier and they move quickly at a good location.
You need to identify the snack options that are popular in that location. To be on the safer side, opt for snacks that are widely popular such as Snickers, Lays, and Twix.
Is the Online Vending Machine a Good Source of Passive Income?
About 7 years ago, vending machines were great sources of passive income. It was easier to get good locations and the machines were inexpensive. But in recent times, the industry is saturated and it also requires lots of capital to start compared to years ago. The maintenance may not be time consuming but the income is not worth all the time and money you put into it. Most of the positive reviews about vending machines were from 8 to 9 years ago. All recent reviews talk about how expensive it is to get a machine these days and how difficult it is to find a location.
The bottom line is that if you already have a vending machine sitting at home and you already know of a good location, you can try this business if not, don’t bother investing in one.