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Earn Great Passive Income With a Vending Machine Business

Updated on August 19, 2016

Vending Machines are Ideal for Passive Income

Have you ever given thought to what your dream job would be like? I mean, not so much the specifics of what you'd be doing, but what the organization would be like? How money would be made? If not, let me give you some ideas.

First of all, for any dream job, you should be the boss. You shouldn't be taking orders from anyone. (Is it really a dream job if someone else is in control? That sounds more like it's their dream job!) Next, it should be an easy-to-operate business that doesn't require a lot of effort from you. Moreover, it would be great if the business were something you could operate from home. Finally, it should generate as much income as possible in a passive manner.

If all of that makes sense to you and descibes something you coud get on board with, you should consider starting a vending machine business.


Getting Started with Vending Machines

Vending machines are machines that typically dispense consumer goods such as snacks, beverages and the like.

Traditionally these machines were coin-operated, but most modern devices are configured to take dollar bills of various denominations, and even credit cards in some instances.

Moreover, the vending machine industry includes a wide range of products, and includes items such as kiddie rides that you find in malls and grocery stores. Basically, almost any kind of coin-operated machine can fall into the category of vending machines.

The Most Important Factor in Vending Success

Success in vending primarily depends on three factors: location, location, location!

The locations of your machines are going to be the primary determinant of your success or failure in vending. For instance, a vending machine near the entrance of a grocery store that sells its products for twice as much as those inside the store isn't going to do well.

You want to place your machines in an area with a lot of potential customers who want what you have to sell. Placing a machine in a school, for instance, would be ideal. In that scenario, you have a captured segment of the population (students) who actually wield a significant portion of buying power. Moreover, they have limited options with respect to what they can buy (i.e., they can only purchase from vendors - or vending machines - on campus).

Thus, you can see the importance of location.

Keeping Your Vending Machine Stocked

Next, it is important that you keep your vending machine well-stocked. There are few things worse than missing out on potential profit because your machine ran out of goods.

Moreover, the type of products you stock is also important - probably the second-greatest factor after location. By way of example, if you get a prime location like a gym or fitness center for your machine, it would be a mistake to stock it with a bunch of junk food like chips and sodas. You'd want to stock it with energy drinks, protein bars, etc., in order to get the most bang for your buck. (This may also involve taking particular note of what is selling and what isn't when you restock.)

Also, don't forget to have regular maintenance performed on your machine. A malfunctioning machine is just about the worst thing that can happen to your business.

Other Factors to Consider

Although it has a lot of benefits, the vending machine business is not a get-rich-quick scheme. Although vending machines are a multi-billion dollar industry, the average machine has been estimated to earn about $10 - $15 per day. (This number is presumed to be significantly higher for machines in elite locations, like schools.) Thus, unless you start out with a large number of machines, you will not be earning large amounts of passive income immediately. That said, it is not uncommon to start a vending enterprise with only one or two machines and build up from there.

Moreover, most locations will not allow you to simply insert a vending machine for free. You will have to make arrangements with the owner. Paying them a percentage of profits is typical; 15% - 33% is common, but you might go as high as 50% for a prime location. (If you are lucky, maybe you have a family business whereby you can insert a machine at no cost.)

I would recommend against having your machines located outside because of the risk of vandalism during off-peak hours. However, if you you find an outdoor location that you feel is worth the risk - such as a highway rest area (which are normally acknowledged as great locations for vending machines), you may want to purchase insurance.

Vending Machine Poll

What types of products do you think would sell best in a vending machine?

See results

Summary of Passive Income from Vending Machines

In retrospect, vending machines can be a great source of passive income. However, like any other potential business venture, you have to approach it with both eyes open and know what you're getting into. That said, there are few other industries that you can step into for such a small initial investment (some machines are just a few hundred dollars) and yet have such potential for growth.

Also, a vending machine business is a great way to introduce your kids to the world of entrepreneurship. Letting them operate their own business empire - even if it's just a single machine, like one that sells gumballs - can teach them the value of a dollar, the benefits of a strong work ethic, and perhaps put them on the path to being moguls in their own right. (Again, this would be a particularly great way to let your child start earning his own money if you have a family business, where he doesn't have to find a location himself to put his machine.)

In addition, please note that you can find other great ideas for passive income by visiting the following:

Passive Income Business Ideas

Resources for Generating Passive Income, and

How to Earn Great Passive Income with Dividends.

Hopefully these will give you some additional thoughts and ideas with respect to how to earn income passively.


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    • Daniella Lopez profile image

      Danielle Lopez 3 years ago from Arkansas

      Excellent post! My husband and I have been looking into investments that our kids could work with and benefit from. I think this would be an excellent option for them Voted up!

    • profile image

      Vending Machines 5 years ago

      You described greatly that Success in vending primarily depends on three factors: location, location, location!

      Yes it is true that the success and failure of vending machine depends mainly upon the location.

    • profile image

      Ryan 5 years ago

      Nice post,Presentation style is unique.

    • ChristinS profile image

      Christin Sander 5 years ago from Midwest

      voted up and interesting - this is something I had not considered before, but could be a great idea.

    • profile image

      WhydThatHappen 5 years ago

      Great, great article