Vending Machine Business Finance Options

Multiple business funding methods are available for both new and established vending companies to get the capital necessary to launch or grow. The following information will help you determine how much money you need and how to get it in order to succeed.

How Much Money is Needed?

The minimum amount of money necessary to begin your own vending machine business is approximately $1,500 to $2,500. This initial investment is used to purchase:

  • 5 to 10 brand new machines for a bulk vending business style
  • 1 or 2 refurbished machines for sodas and snacks
  • An appropriate amount of products to stock the aforementioned machines
  • Enough cash on hand to cover incidentals and unexpected expenses

If you have more money, you can obviously purchase more machines and products and expand your operation more to begin with. This can carry more risk, but also has a much greater potential for profits.

Use Personal Assets to Finance the Business

It is possible to find enough money to start or grow a vending machine business from your personal funds. If you risk your savings or investments on a new business, be sure to also have at least six months of living expenses saved before you quit a salaried or hourly job.

You can earn more money to buy more vending machines or products by selling off unwanted personal property at a garage sale, eBay or using local classifieds such as Craigslist.

  • 0% interest costs
  • No other costs associated with this funding method.

Get Financial Help from Family and Friends

If you are lucky enough to have family members or friends who want to help finance your new business, they can be a great source of startup capital or and investment to grow your operation larger. While it is a good idea to draw up contracts and a precise payback plan, people who care about you may be more willing to give you a break in the interest of seeing you succeed. It is even possible to find a business partner who would like to get in on the action and can help you run the company.

  • 0% interest in most cases.
  • Possible loss of some company control if you take on a business partner.

Consider a Loan from a Small Business Website or Organization

As the economy struggles to rebuild, small business loans from banks and other professional organizations have become more challenging to get. This has led to an explosion of peer to peer financing websites that can help you get the money necessary to start a new business. All you have to do is sign up, give basic information about yourself, the company and your goals. The decision to give you money or not can occur as quickly as one minute after you submit your data. This preapproves you for funding, which is then sent directly to your bank account after a credit check is complete. The entire process is quick, convenient and transparent. All related fees and rates will be disclosed to you upfront so you can make the appropriate monthly payments.

  • 6% to 20% interest rate based on your personal credit score and how much you borrow
  • No other costs or fees should be associated with this type of funding.

Vending Machine Suppliers Offer Business Startup Funding

Instead of borrowing money in a lump sum to cover all costs associated with starting a new vending machine company, it is possible to get financing on the machines themselves. Distributors and refurbishes of vending machines sometimes offer payment terms to new or existing customers. This is very similar to the financing you may receive from an automotive dealership. In a single meeting with the distributor you can apply for financing, sign the paperwork and set up the payment plan.

In order to make this option financially smart, it is important to understand how much each type of vending machine costs to begin with. Research prices to be sure you are getting a great deal and aren’t being charged much more simply because of the pay-over-time offer.

  • 10% to 25% interest based on credit and machine costs
  • Additional cost for vending machine insurance before the sale is complete

Alternative Funding Options Through Bottling Companies

Companies who bottle, package or manufacturer beverages or other vendor snacks may include the use of a machine with the purchase of products directly from them. In most cases, the price of the products may be higher than wholesale since you are also receiving a vending machine with them. Speedy maintenance or repair may be a problem with this type of setup.

  • No interest payments possible
  • Product prices may be higher than at wholesale sources

The Bottom Line

When you want to start a new vending machine business, take over an existing one or expand one already in operation, having cash on hand is your best bet. It allows for flexibility and growth opportunities that would otherwise be impossible to say. Using your own available money is the safest and most affordable option, but there are plenty of opportunities for borrowing or getting discounts on vending machines and other necessary equipment. Peer-run financing networks and small business loans from credible institutions are the best options.

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