Welcome to the comprehensive guide on vending machine costs for 2023! Are you considering diving into the world of vending machine businesses and wondering about the financial aspects? Look no further. This article breaks down the expenses involved in starting a vending machine venture, providing a detailed analysis of the average prices you can expect.
We’ll cover the various elements, starting with the upfront expenses—such as the cost of purchasing or leasing a vending machine—to give you a clear picture of the initial investment. Additionally, we’ll delve into the ongoing maintenance costs, highlighting the factors that impact these expenses over time. Whether you’re eyeing snacks, beverages, or specialized vending machines, this guide is your roadmap to understanding the monetary commitments and potential revenue streams. Stay tuned for insights that can help you make informed decisions and kickstart your journey into the vending machine industry.
Vending Machine Buying & Renting Costs
The cost of a typical new vending machine is usually between $3000 and $7000, but many more advanced machines are being sold for higher amounts over $10,000. The most expensive vending machines on the market today can cost up to $ 38,000 (like some of the Moet and Chandon champagne vending machines).
There are also cheaper machines available on the market, such as used vending machines which can be bought sometimes for as little as $200, or mini vending machines which cost from $300 upwards.
The most recommended machines for people with little capital and beginners are used and refurbished vending machines, which can be purchased for around $1200 to $3000.
To sell products from a vending machine, you don’t have to buy one. It is possible to lease or rent vending machines. This option is very popular and full of many advantages (such as the ability to start a vending machine business without much initial capital). A major advantage of leasing or renting over buying is that you don’t need to worry about restocking and repairs, as the vendor is responsible for these tasks.
Leasing vending machines usually costs between $50 and $150 per month. Snacks machines are usually more expensive than soda machines. In addition, there is the cost of refilling the machine. Most companies that lease vending machines require you to buy products from them – at inflated prices.
Customized vending machines are also a popular type of vending machines and typically cost from $10,000 to as much as $200,000-$300,000 (e.g. here).
License & Taxes Costs
The licenses or permits you will need largely depends on three factors: 1 where you live, 2 how many vending machines you have and 3 what products you will be selling in your vending machine. This license is most often one time only license which allows you to sell from multiple vending machines. In addition to the license, vending machine sales are taxed differently in different states.
Examples of license costs, fees and taxes for vending machines in selected states:
Arizona: There is no general vending machine license in Arizona. “Vending licensing requirements and vending rules change depending on the vending location and type of regulated vending activity.” The sale of products in vending machines is taxable. (source: phoenix.gov)
California: To start selling from a vending machine you will need a seller’s permit (with few exceptions such as a vending machine at a school bought by parent-teacher associations). In California most products sold from vending machines are normally taxed the same as products sold in a store. (source: www.cdtfa.ca.gov)
Massachusetts: In Massachusetts, it is mandatory to have a license from the Food Protection Program to operate a food and/or beverage vending machine. Application fee per 1 vending machine is $10. (source: www.mass.gov)
Texas: When earning from vending machines in Texas, you will have to pay the following taxes: General Business Fee (different rates for owners up to 50 ($400), up to 200 ($800) and over 200 machines ($1,000). Each machine must also obtain a Registration Certificate Fee (cost $1000) and occupation tax permit (60$ annually). Also, a $1000 import license fee will be required for importing machines from outside Texas. Vending machine sales are also subject to sales tax (source: comptroller.texas.gov)
Vending Machine Maintenance Cost
If you decide to own a vending machine you must include maintenance and operating costs in your business plan.
Maintenance & repairs
Average maintenance cost of vending machines (including service, repairs, electricity consumption and others) is around $50-100 per month.
The cost of maintaining such vending machine depends on how sophisticated model you have (more sophisticated models will cost more to maintain). It is also important to take care of the machines on a regular basis, so the machines will break down less often.
Repair costs for new vending machines are usually lower because new vending machines typically come with at least a one or two-year parts warranty.
Depending on what items you will be selling at the vending machine, restocking can cost you anywhere from a few hundred $ to several thousand dollars per month (even more for more expensive products).
A common cost associated with a vending machine is also renting space for the machine in an attractive location. The average commission is around 7% but can vary depending on the number of machines and their size.
How Much Do Vending Machines Make?
Earnings from vending machines vary greatly depending on the products sold and the location.
On average, vending machines generate between $35 and $300 of revenue per machine per month in the US.
Little experienced vending machine owners often earn around zero to $50 per month. On the other hand, vending machines in the best locations that are well stocked often make over $1,000 per month. The best of the best vending machines located in ideal places are able to earn even more than $10,000 per month (e.g. a machine located in a hotel or in front of the entrance to a large office building).
What You Should Know About Vending Machines Business?
- Beverages are the most popular product sold in vending machines. The U.S. Chamber of Commerce reports that bottled water, soft drinks and other beverages make up about one-third of all vending machine sales. (source)
- The right location is the key to a successful vending machine. Your machines must be located where people will most need the products they sell. For example protein bars, energy drinks and other gym accessories will sell perfectly near a gym and toys and sweets will sell perfectly near schools and playgrounds.
- One of the most profitable types of vending machines are those placed in high-traffic areas devoid of shops. Vending machines, being smaller than shops, can be situated in numerous such locations. This enables vending machines to monopolize the sale of goods in a given area, making them highly profitable. They thrive notably in parts of airports, train stations, crowded bus stations, offices, and educational spaces. To discover more about the best locations for vending machines, check out our article where we’ve compiled the top 100 most profitable vending machine locations.
- Hot food and sandwich machines usually make the best profits in business environments, schools, and universities.
- The most expensive vending machine in the world sells luxury cars. It is Singapore-based Autobahn Motors.
Buying vs. Leasing – Which One is Better?
Deciding between buying and leasing a vending machine involves a careful evaluation of the inherent merits and drawbacks of each approach. Purchasing a vending machine outright offers distinct advantages. Ownership translates to full control, eliminating ongoing lease payments. This autonomy enables customization, allowing operators to select products and set prices according to their preferences. Yet, this ownership model demands a substantial upfront investment, potentially straining initial capital.
On the flip side, leasing presents an appealing alternative. Leasing a vending machine requires minimal upfront costs, easing the burden on immediate finances. This avenue often includes maintenance and servicing, relieving lessees of additional expenses and logistical concerns. However, leasing entails ongoing payments over the lease period, accumulating costs that may surpass the machine’s actual value.
When dissecting the cost implications, buying necessitates a significant initial outlay, but long-term savings may outweigh this initial investment. Maintenance and repair costs usually fall under the owner’s responsibility but can vary widely depending on machine usage and quality.
Conversely, leasing involves manageable initial costs but implies continuous payments over the lease term, potentially accumulating to surpass the machine’s outright purchase cost. Additionally, limited customization options may restrict revenue potential.
Ultimately, the decision hinges on individual circumstances and priorities. Those seeking control and long-term savings might favor purchasing, albeit with a substantial upfront investment. Conversely, individuals prioritizing flexibility and manageable initial costs might find leasing a more viable option.
– Disclaimer –
The data presented in this article was determined through research conducted by BusinessNES. Before you begin your vending machine adventure, familiarize yourself with the local laws in your state and estimate the costs you will incur in the location where you want to sell goods from vending machines. These costs may vary slightly from those outlined in this article.
Do you have experience with running a vending machine business? Share your knowledge with us in the comments below!
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