Do you know what is vending machine? Have you seen vending machines? If your answer is Yes. Then, you will get to know about the business of vending machines in this blog. If your answer is NO. Then, you will get to know everything about the vending machine and how you can do business with a vending machine.
As you know, vending machines are not much prevalent in India as it is outside India. But by the time, it is getting popular in India in a few places. It has evolved in number over the past several years.
A vending machine as you know primarily use for food and beverage purposes. It is easy to take food by putting few coins into the machine. You generally would have seen these vending machines in malls, metro stations, Offices, Hotels, etc.
If you see around very few people are running this business. So, the competition in this business is not high. Also, I guess we need to cheer these kinds of businesses where people become self-sufficient.
If you want to create competition by starting vending machine business, then you should go through this whole blog. You will be going to have a detailed discussion on how you can start and grow this business.
Does vending machine business exist?
I think the first question which will surround your mind is whether this kind of business exists or not? And It is genuine because you haven’t heard much about it. But when you see few people doing this business, you will automatically believe that it does.
Yes, this business exists but not on a wider term. And that is the main originality of this business. Now, you will wonder how? So, let me brief you. As you know, every business you are seeing around the world was primarily new but over the period it became famous. People started to know those businesses and it doesn’t happen overnight. It took months and even years.
If you are wondering that you are not much aware of this business and its new. Don’t overthink much. Because that’s the main plus point of this business. There is very little competition and very high demand for vending machines at several places. Sometimes, people prefer to have these vending machines at places where not many shops are available. You can place your business there, and see wonders happening.
Who can start vending machine business?
I guess, there is no specific curriculum for starting vending machine business. Anyone can start it, whether a student or a working professional. If you want to start a part-time business besides your normal regular job, you can start with this business. This is going to be a good decision. If you are not working specifically and want to indulge in this business with 2-3 vending machines at different places. Then, go for it. It would give you amazing results.
You just need to decide few things before starting and you would be ready to blaze. You will get to know about all those things further in this blog. So, keep reading.
Can someone make a profit from this business?
I would say, why not? Why not someone can make money from this business? There are numerous ways of earning out of this business. You just need to grab those ways and start working on that.
When you will start, you will work as a small business operator. And I think, you probably know the benefits of starting a small business. There are so many. So, the first benefit you will reap as a small business.
Second, there are things which can help you to have profit from this business. They are as follows;
- The choice of stock you are selling will impact the margin of your profit from this business.
- The location of the vending machine would be going to be an important factor in deciding the profit you are going to earn.
- The number of vending machines you are going to install at different locations will be an important factor for your business.
Besides the above points, what you have to keep in mind is that you need to make this business work. It means you have to put effort into stock food in your vending machines always and choose a place that is well deserved for your vending machine. That’s how you going to make a profit.
Advantages of vending machine business
Like any other business, vending machine business also has a few advantages. These advantages will show you how this business can be beneficial for you. So, let’s read the below advantages of starting a vending machine business;
- Flexible business– There is so much flexibility running this business, you can schedule your own time. You don’t have to have fixed timing for stocking the vending machine with food. You can also receive the money whenever you need it. There is no such stringent schedule to do it at a particular time.
- Low investment– You don’t need to spend too much money on this business. It demands very little things like a vending machine or stock to fill the machine. If you have to fill stock regularly, that means you are making money and you are going to make a profit.
- Growth prospect– You know this business has a growth prospect. But you can choose to control that growth when you are ready to give it a full time besides your regular job. If at any point in time, you do so then you can see your business expanding. You can scale it to as many locations as you can.
- Flexibility to change products– There is no limitation that you can stock only a particular product in your vending machine. You can change your choice of product at any time you want. If you feel like customers will love something else, fill the machine with it.
- Continuous sales– If you look deep, you will be making money 24*7. There are no particular hours of its working. It is working throughout the day. And if it is working the whole day, that means you are making money at any time of the day.
These are the few advantages of the vending business, which will make you see how you can reap benefits from this business. Even when you don’t need to give it your whole time.
Disadvantages of vending machine business
There would be hardly any business without disadvantages. Similarly, vending machine business also has few disadvantages. Let’s read a few of those disadvantages of having a vending machine business;
- Chances of theft– This is the main disadvantage of this business; you never really get a hint about your money being stolen from your vending machine. So, you need to find a safe and secure location for your vending machine. You need to be vigilant about this, otherwise, your business would get either vandalized or stolen.
- Chances of fraud– As you know, these days people are becoming smart with different technologies. And they use these technologies to fraud other businesses, which is devastating. Similarly, in this business people hack the machine and took out the stock for free.
- Less security– As you know, you cannot have 24*7 surveillance at your vending machine. And it can create chances of theft. No one can be there to surveillant your business 24*7. You have to make certain security arrangements for your vending machines in the form of locks or something.
- Transportation cost– If you have vending machines at several places, which need servicing then you are going to bear the transportation costs to reach there. And it is a compulsory thing to do. You cannot just let your machine do all the business. You also need to give attention to that.
- Operation cost– Besides the setting-up cost, you need to also spend on its operation. There are several operating costs which you have to bear like maintenance, insurance, advertising, stocking, license fee, etc. You need to manage all these costs to run this business properly.
You can administer the disadvantages here, which you can overcome if you manage the business smartly. So, try to focus on these disadvantages and prevent them to happen.
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Is FSSAI registration is mandatory for vending machine business?
When you are indulged in manufacturing, storage, processing, distribution, and sale of food should compulsorily have an FSSAI license. So, you need to have an FSSAI license as you are also involved in the stocking of food.
I guess you already know what FSSAI is, if not then let me brief you. FSSAI is the Food Standards and Safety Authority of India. It is mandatory for a food operator dealing with food to have an FSSAI license. There is a set limit for applying to an FSSAI license when it crosses the limit.
As you know, this license is just to protect the food and safety of the customers. It is proof that you are not playing with the safety of others and ideally running your business keeping the safety of your consumers in mind.
There are different kinds of FSSAI license, which an owner can choose according to the need of their business;
- Basic FSSAI license
- State FSSAI license
- Central FSSAI license
You can choose your category and fill up the requirements accordingly. Please note that the FSSAI license is the prior requirement of your business, you may be get caught not using it and liable to penalties.
Types of vending machines
There are different types of vending machines that you can choose to run. It varies from product to product. You can choose to run your vending machine from one product or you can choose to have multiple products. Also, you can choose different products for your different vending machines. So, let’s have a look at the kinds of vending machines:-
- Food and beverages– You know it is the most common stock you can fill your vending machine with. IT is always on demand and never goes off. People crave snacks and beverages at times which makes it more ordeal to have it on your card. To make the sales regular, it is a good option to fill your vending machine with food and beverages. Because the demand of these two always remains in the market.
- Coffee machine– You must have seen this kind of vending machine at workplaces. It is available almost at every office for catering to the demand of caffeine people have these days. It makes it easy for them to have coffee at any time when they are at their rush hour of work. It calms their mind and creates a focus. So, you can choose to provide your services to different workplaces.
- Frozen food– A lot of vending machines have this kind of facility too, where they store frozen food which people can easily access. The reason behind this is to make availability of food to people at any time. Generally, this food is in the form of sandwiches, buns, bread, etc. You can find these vending machines at malls and metro stations, where people generally prefer this food.
- Ice cream– Who doesn’t love to have a vending machine of ice cream? People love to have these vending machines around. You will find these ice-cream vending machines at different markets and malls. It is one of the famous vending machines you can have in your city.
So, these are the few kinds of vending machines from which you can choose to start a vending machine business.
Steps to start a vending machine business
Now, when you have got an idea about a few of the important things about this business. You can now move towards the steps to start this business. In these steps, you will get to know from where you can start. So, let’s start the steps;
- Choose the product to sell
You know how important it is to choose the product you want to sell beforehand. You can’t delay this decision, because if you do you probably going to delay your business. Choosing a product must be your first thing to do before jumping on next. For this, you need to research which product will give you effective income.
You need to see whether any of your competitors are selling those products or not, if they do then you need to check the competition you going to have in the market. Also, you need to keep in mind the preferences of people. You need to see whether the product is in demand or not. Because at the end of the day, it depends on customers whether they will prefer it or not. So, choose your selling product wisely.
- Choose the location of your machine
The next important thing in your vending machine business would be the location of your vending machine. Your business somewhere depends on the location you choose for your business. The location of the vending machine matters the most in this business. The location you would choose must be a place where people are most available or also a place where shops are less available.
In both these places, your business has a chance to grow handsome money. If you choose a place where people hardly went, then you would see a fall in your business growth. Because there would not be a person to have snacks from your machine, how you would earn? That’s why choosing a place is an important as well as difficult task to do. It must be decided based on different parameters. So, look for better locations.
- Buy your vending machine
The vending machine will be an asset to your business. You must invest in buying your vending machine rather than taking it on lease or borrow from someone. Because if you will borrow or something, then you will have to bear a regular expense of paying rent on it, which will be an extra expense for your business.
So, it is advisable to borrow your machine if you can, because it will then become your asset instead of a liability. It will reap good money for you. Also, whatever you will earn would not go into any kind of rent other than the maintenance of your machine.
- Store your vending machine with products
Can you think of a vending machine without any food? No, right. So, you know what would be the next step. Filling the machine with a lot of food. If you have decided what products you are going to fill it with, then you should start filling it with them. Because an empty vending machine would not earn any income.
Also, it is important to decide the products must be those which can have more chances of being purchased. In other words, those products can maximize your income. So, start putting food inside the vending machine.
- Name your business
Now, you have plotted things for your vending machine business. It’s now time to give it a name. Choose a name for your business by which it would be recognized. Your business name must be chosen smartly because it is going to recognize your brand. While choosing a name, you must make sure that it is not taken by someone else in the market. Your business name must stand unique to add value to your business.
- Register your business
When you have chosen a form of your business, it is important to register it under valid laws. Registering a business is one of the mandatory tasks you have to do before going ahead. Your form of business can be;
- A Sole proprietorship
- A Partnership
- An LLP
- A Company
You only have to make sure to register your chosen form of an entity under a valid act. If you don’t have any knowledge regarding the registration, you can consult a professional working in this field. If your business will not be registered under valid acts then it would create troubles in the future. You may be liable under different penalties.
- Take license under FSSAI
We have talked about it earlier, how your business needs to have an FSSAI license to operate without any hurdle. FSSAI works for consumer safety. Some norms have to be followed with running the business of manufacturing, storage, processing, or sale of food. Those norms are defined by FSSAI which are followed by every vendor. If you want to run your business with all the necessary protocols, then please ensure taking a license under FSSAI.
- Make the contract with owners
This point will be in the application when you are purchasing a vending machine business or leasing a vending machine from someone. But if you are purchasing your vending machine and starting your vending machine business from scratch, then this would not apply to you. If in case, you are leasing a vending machine from someone.
Then it is advised to make a contract with the owner of the machine. In case of any contingency, the contract will save your rights on the machine. Also, it acts as a safeguard in case the owner takes a different turn towards you. So, always make a contract before getting into any kind of borrowing.
- Creating a marketing plan
How would you make people know that your vending machine lies at someplace? How they will recognize you as a brand? The answer is only one and that is through “Marketing”. You cannot tap on people without marketing your business in front of them. You need to make people aware of your place in the market. How can you market your business? The answer is in the following points;
- By Advertising the business
- Words of mouth
- Email marketing
- Creating a website
- Billboards
This is how you can make people familiar with your business. Further, if you want to start a marketing campaign for your business, you can simply contact us at Traffic Tail for running a marketing campaign exclusively for your business.
Important things about this business
There are few things which you need to know before starting this business. I guess these are the things that can help you make an exclusive strategy for your business. So, here are the following things you should keep in mind while starting this business:-
- It is not an easy business to run, you have to make equal efforts to run this business to ultimate goals. You have to put effort into this business to make it successful.
- It can be a part-time business. You can earn a passive income from this business. You just need to give few hours to this business daily to make strategies and execute plans made for this business.
- Once you will understand how this business works, it would be easy for you to run this business and make good money out of it.
These are the few points that you have to kept in mind while starting vending machine business. I hope you understand the technicalities of this business which you can overcome with your presence of mind.
Conclusion
While concluding this blog, I believe that you have got all the important information which are necessary to run this business. All I want to conclude by saying that this business can be an amazing business for you in terms of both comfort and money if you run it sharply. We have discussed enough everything you need to know before starting this business.
You just need to know one more thing i.e you cannot become rich or earn a very good amount in one day, you need to have patience and effective strategies.
Frequently asked questions
Q1. Is vending machine business profitable?
Who says it is not? It is a profitable business, once you understand what it takes to earn that profit. You have to juggle with ideas to earn a profit. You must figure out ways to make a profit out of this business. The things which would earn you profit are writer below;
- Location of the vending machine
- Number of vending machines being used for this business
- The stock you are selling would be the main factor
These are the main factors which will help you to earn a great profit.
Q2. Does there any specific criteria for starting vending machine business?
No. Not at all. There are specific criteria for establishing a vending business. You can start it anyway. You don’t need to fall into certain criteria. Anyone can start this business, whether he is a professional worker or just a graduated student.
Q3. What are the pros of vending machine business?
Starting a vending machine business has its advantages, which are given below;
- Flexibility to run this business
- There is the low investment cost
- There are great growth prospects for this business in future
- Flexibility to change the products anytime you want
- There are 24*7 sales
Q4. What are the cons of vending machine business?
Just like we have pros we also have cons of starting a business, so here are a few cons of this business;
- There is a chance of theft and vandalization of vending machine
- There is a chance of fraud by people
- There is a lot of operation cost
- There is a transportation cost
- There is very little security
Q5. What are the types of vending machines?
There are the following types of vending machines;
- Food and beverages
- Coffee machine
- Frozen food machines
- Ice-cream machine
Q6. Can I borrow a vending machine?
Yes. You can borrow one or two vending machines. If you borrow a vending machine you would have to pay regular rent on that machine. So, we advised you to not do it unless necessary. Because it would create a recurring expense for you.
Q7. Where I can place my vending machine?
You can place your vending machine at any place which is crowded or where there are fewer shops. In this way, you would have a lot of customers. Choosing a location would require a wise decision because the future of this business depends on the right location.
Q8. Would it be necessary to take an FSSAI license?
Yes. It would be necessary to take an FSSAI license to run your vending machine business. Because when you are manufacturing, selling, storing, or processing food, you are required to have an FSSAI license.
Q9. What are the steps to start the vending machine business?
Following are the steps which you can follow to start the vending machine business:-
- Choose the products to sell
- Choose the location
- Buy your vending machine
- Purchase the products for your vending machine
- Name your business
- Register your business
- Take the license under FSSAI
- Make the contracts with owners
- Create a marketing plan
You can start your vending machine anytime by following the above steps.
