How To Make an Extra $5000/MONTH With Vending Machines

Summary

In this informative video, Don Lama shares his expertise on starting a successful vending machine business in 2024. He outlines the importance of structuring your business with an LLC, business phone, email, and bank account. Lama emphasizes finding the right locations with seclusion, high foot traffic, and long operating hours. He provides tips on pitching to potential hosts, leveraging social media, and negotiating smartly when buying vending machines. He also advises on the types of machines to buy, the importance of testing them, and using card readers for inventory and sales tracking. Lama's guidance is aimed at helping viewers avoid common pitfalls and set up a profitable vending machine business.

Takeaways

• 😀 Starting a vending machine business can provide a significant additional income stream, ranging from $1,000 to $55,000 per month.
• 🏢 It's essential to structure your business with an LLC, business phone number, email, address, domain, and bank account for credibility and potential funding.
• 📞 For a business phone number, consider services like Ring Central, Google Voice, or Freedom Voice.
• 💻 Use Google Workspace for a professional business email to replace generic email addresses like '[email protected]'.
• 📫 A business address is crucial for privacy and professionalism, and can be obtained from services like iPostal, Regus, or Alliance TimeMailBox.
• 🏦 Opening a business bank account with an existing bank can simplify financial management for the vending machine business.
• 🌐 A business domain and website, obtainable through platforms like Wix, Squarespace, or GoDaddy, are key to appearing professional online.
• 📝 Registering for an LLC and obtaining an EIN number through services like Incfile, Taylor Brands, or LegalZoom is a foundational step for the business.
• 📍 Finding a good vending machine location is critical, looking for seclusion (minimal competition), high foot traffic, and long operating hours.
• 🗣️ When pitching to place a vending machine, offer the machine for free, handle service and repairs, and negotiate without paying commission initially.
• 🔍 Utilize 'driving for dollars', social media, and online marketplaces like Facebook Marketplace for finding and securing vending machine locations.

Q & A

What is the recommended business structure for starting a vending machine business?

The recommended business structure is to form an LLC (Limited Liability Company) to provide legal protection and potentially allow for easier funding in the future.

Why is it important to have a business phone number, email, address, domain, and bank account for a vending machine business?

These elements are crucial for establishing a professional image and separating personal from business operations, which can be beneficial for tax purposes, credibility, and securing funding.

What are some platforms to get a business phone number?

Ring Central, Google Voice, and Freedom Voice are platforms where you can obtain a business phone number.

How does the speaker suggest obtaining a professional business email?

The speaker suggests using Google Workspace to obtain a professional email that does not end with a generic service like 'gmail.com'.

What are some sources for obtaining a business address?

Sources for a business address include iPostal, Alliance, and Anytime Mailbox. It's important to get a virtual office, not just a mailbox.

Why is it advised to have a business bank account separate from personal accounts?

A separate business bank account helps in managing business finances, building a financial history for the business, and is a requirement for many banking services.

What are the key factors to consider when looking for a vending machine location?

The key factors are seclusion (minimal competition), customer loyalty, foot traffic, and long operating hours of the location.

What is the strategy suggested for pitching a vending machine to a potential location?

The strategy involves offering a free vending machine with the promise of filling up, servicing, and repairing it, and using a trial period if necessary to demonstrate its value.

What is 'Driving for Dollars' and how does it help in finding vending machine locations?

'Driving for Dollars' is a method where you physically visit different locations to assess if they meet the criteria for a good vending machine location, such as seclusion, foot traffic, and operating hours.

How can social media platforms be utilized to find vending machine locations?

Social media can be used to advertise the vending machine business, offering incentives for leads or referrals, which can result in people suggesting or providing locations.

What is the importance of word of mouth in finding vending machine locations?

Word of mouth is crucial as it can open doors to locations that may not be accessible through traditional methods, leveraging personal networks and community connections.

What should be the approach when buying a vending machine from a location?

When buying a vending machine from a location, ensure the machine is already operational, evaluate why the seller is parting with a potentially profitable asset, and negotiate a smart deal based on the machine's performance and cost.

How does the speaker recommend testing vending machines before purchase?

The speaker recommends testing every coil and function of the vending machine with actual coins to ensure it works properly before making a purchase.

What are the recommended types of vending machines to buy and which to avoid?

The speaker recommends Automatic Products (AP) and USI vending machines for snacks, and Dixie Narco Royal for drinks. Sega machines and combo machines with two doors are advised against.

What is the importance of ensuring a vending machine is MDB compatible?

MDB compatibility is crucial as it allows for the use of credit card readers, which can increase sales by accommodating customers who prefer cashless transactions.

What are the roles and benefits of using a card reader in vending machines?

Card readers track sales and inventory, enabling precise restocking (preting or pre-kitting) and potentially increasing sales due to cashless transactions.

How should maintenance costs for vending machines be handled?

Maintenance costs are typically minimal and involve replacing parts like coin mechs or bill validators, which are usually straightforward and affordable.

What is the advice given for dealing with location commission requests?

If a location requests commission, the advice is to position yourself as a service provider and negotiate to absorb the commission cost by adjusting the product prices accordingly.

How can one verify the profitability of a vending machine location?

One can use card reader statements to verify the profitability, but it's also advised to do due diligence to ensure the trustworthiness of the owner and the accuracy of the statements.

What is the general advice on taxes for vending machine businesses?

The advice given is to consult with a Tax Advisor, as the speaker is not a tax expert, and to treat it as a regular business, deducting all relevant costs from the annual income.