Buy a Vending Route or Start your Own?

Once you have decided to enter the vending business, one of the many choices that you will have to make is whether to buy a vending route from another operator or to start your own from scratch. Your decision will depend on many factors and in this article we look at the differences that you will be facing with each option.

Price

If you are buying an established business that runs well, makes money and has good relationships in place then you will pay for this privilege. The cost of buying the business will be considerable but if you can manage to keep the business on its successful course then you will recoup your investment over time.

On the other hand you can start up your own vending operation on an extremely low budget but it will take time to get your business profitable. It's all about deciding which approach will give you the best return on the time and money that you are investing.

Set your own Course or Follow Someone Else's

When you start your own vending business you can start it off the way that you like and create something unique that you can be proud of. By buying a business you will be inheriting the creation of someone else and all the good and bad things that go along with it. Think about your own plans and goals and decide if you can use someone else's business as a vehicle to achieve them.

Your Personality

Starting up a vending business from scratch will take time and determination. You will have to learn through your own research and trial and error. This process can be lengthy before you start to see success. If you feel that you are the kind of person that will become disheartened easily and have trouble seeing a project through to the end then you may be better to start off with an existing business that works well right away (if you can afford it).

Relationships

If you buy a vending route then you should find that it is easy to carry on the relationships that the former owner worked hard to establish. Make sure that you have the seller introduce you to all the key suppliers and location managers before you buy.

If you are starting from scratch then you will have to put a great deal of time and effort into finding machine distributors, product suppliers and locations for your machines. Starting from scratch is not as hard as it sounds though and you will find numerous vending information resources available. You may even be able to find a successful vending business operator (who is not in direct competition with you) to mentor you for a small fee. You could also consider starting out working for a large vending company to get a feel for the business before jumping into your own venture

Risk 

No matter which path you decide to follow there are risks involved. The vending industry is rife with scams and rip-off artists that prey on newcomers to the industry. If you are starting off independently you really have to do your due diligence so that you don't get ripped off by machinery dealers, professional locators or those selling phony or overpriced startup packages. Look into subscribing to industry publications like the Vending Times and contact the industry association NAMA before making any major purchases. Do a search online and check with the Better Business Bureau to find out if a company that you want to deal with has had any complaints filed against it.

On the other hand there are also risks involved with buying an existing business. Vendors selling their businesses can obviously inflate figures and generally make their business sound like a much better opportunity than it really is to justify a higher sale price. Do your due diligence here and look for proof that the business is indeed performing at the level that is promised. Get your accountant and lawyer involved and consider getting the business valued by an expert.

Try to find out if the owner has a genuine reason for selling and insist on an arrangement whereby the previous owner stays on for a few months to teach you the ropes. Insist on paying the sale price in installments. Give yourself a way out of the deal if you start to observe the returns from the machines over a few months and find out that they are not as high as the owner claimed they were.

Start off Slow or Fast? 

With your own vending business you will be able to start off slowly, buying a few machines here and there. You could even keep your day job for the first year while your business slowly grows.

Buying an existing business though will mean jumping in at the deep end so you must be prepared and know something about managing a business if you are to keep it performing well. By starting off small with your own business you won't be committing yourself fully. You can give yourself a trial period to see if it works out without spending a fortune on a business that may be difficult to exit if you find that it is not what you want to do.

Choosing whether to buy an existing vending business or to start your own is not an easy decision. Your decision will be influenced by your access to funding, your past experience in business and your personality as well as the level of risk that you are prepared to take on. Both alternatives offer you an excellent way to get into what is still one of the best business opportunities around.