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Sunday, February 27, 2005

Museums, Malls, and SuperMarkets

Lately I've been thinking alot about "Good Locations". I am often asked what locations are best and I never know exactly what to tell people. As I said yesterday the two primary things I look for are corporate offices and low hassle accounts. Now while these locations are nice they simply don't make that much money - usually about $40 - $50 a month. Now don't get me wrong. So long as you buy machines at the right price you'll have a nice ROI (return on investment). I could easily run my business on only small locations - I just wouldn't have a huge profit (in dollars - NOT percentage).

I like having several "big locations" that gross $200+ a month. The best way to get these locations is to approach Museums, Malls, and Supermarkets. The locations don't rely on the comission income (but they do expect 25%) so the "hassle factor" is very low plus the shear volume of foot-traffic makes it a vendor's dream. Realize that most of these accountants have contracts with Vending Management companies - so placement will be difficult. I only acquire about 3-4 a year (I also lose about 1 a year) but that still leaves me with a net gain in my number of "big locations". I've found that if you use a specialized machine (i.e. stickers or super balls) that does not compete directly with the current machines a manager will let you place your machine there.

Once you have about a dozen or so of these locations your monthly numbers start looking real nice. Personally I hit the my "small office" locations during the week. This revenue pays for all my costs. At the end of each month I hit my "big locations" and they provide me with my profit. It is a two tiered system that has worked very well for me. Good Luck!

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