Vending Types Compared
One of the most frequently asked questions we receive from prospective vending business owners is:
WHICH TYPE OF VENDING IS THE BEST? or plainly WHICH TYPE OF VENDING MAKES MORE MONEY?
This question should be answered in the context of today’s conditions and current demand. The short answer is that, today, the U-Turn Bulk Vending business is delivering the higher profits and the higher returns.
Vending Types Compared: U-Turn Bulk Vending and Electronic Snack and Drink Vending.
This article will detail explain the three main reasons behind the U-Turn Bulk Vending success:
1. Profit Margins on Stock
2. Maintenance Costs of Equipment
3. Available Locations and Relocation of Units
Non-electronic U-Turn Bulk Vending machine (four-products)
Profit Margins on Stock
Leaving every other consideration aside, lets look at an example on the two most popular products sold through both types of vending: Coca Cola and M&M’s.
One can of coke cost around 65c and 90c when you buy wholesale and then it retails on an electronic vending machine for around $1.40 and $1.80. The gross profit is between 75c and 90c per can.
One kilo of M&M’s in bulk cost around $11 when you buy wholesale. The M&M’s retails at $2 for a 35grm handful. There are 28.5 handfuls in one kilo, which means that it retails on a bulk vending machine for $57. That means that the gross profit is $1.60 for a $2 handful or $46 per kilo.
Maintenance Costs of Equipment
The U-Turn Bulk Vending machine DOES NOT require electricity to operate. Therefore there is no need for external technicians to maintain, service or repair your U-Turn machine
The electronic vending machine DOES require electricity to operate and it has also a computerized motherboard, individual motors to move the coils and a refrigeration unit. The maintenance of your electronic vending machine must be carried by a qualified external technician or you risk to void the warranty. Usually you would like this to be done on-site, which requires the technician to visit your machine.
Call-out fees for the first 30 minutes are around $90 if within metropolitan areas in capital cities. Then the problem is explained to you and a quote to fix it is produced.
Electronic Snack & Drinks vending machines
Available locations and relocation of units
Available locations for electronic vending machines are very restricted to the independent, private vending business owner because the three big corporations (Coca-Cola, Nestle and Smiths) have the financial power to purchase the larger locations that are required to support an electronic vending machine.
What this means is that the large hospitals, airports, universities, shopping centres, train stations and big factories are already taken. An electronic vending machine requires a minimum of 100 items sold per week (usually 6 days week) to be profitable. Electronic vending machines need large, crowded places that are harder and harder to find.
On the other hand, the U-Turn Bulk Vending machines only require to sell 2 vends per day (on the same 6 week day) or $3 on average per day to deliver a substantial profit.
With this in mind, the number of businesses that are effectively available is very large. Furthermore, the number of small businesses that can host a U-Turn Bulk Vending machine is increasing every month. Additionally to this, the fact that the U-Turn machines DO NOT require electricity to operate, makes the proposition of hosting one quite attractive to the small/medium size business owner.
Finally, when it comes to relocate a vending machine, the U-Turn Bulk Vending machine will fit on the back of a standard, non-commercial vehicle. An electronic vending machine weights in excess of 200kg and will require either a taxi truck or a heavy-duty trailer with at least 2 people to move it. Which option do you think will cost you more?