Vending Machine Business: Insider Secrets and Strategies

Adam Hill, founder of Hill Vending, shares secrets to $50k/month profits, emphasizing quality machines and service for success.

### The Secrets of Running a Successful Vending Machine Business
* 💼 Adam Hill shares his journey from leaving a corporate job to building a vending machine empire, **grossing over $50,000 a month**.
* 🏠 Starting from home: Hill started his business from his living room, emphasizing that you can **begin small and scale up**.
* 💰 Profit margins: Hill follows a **50-30-20 rule**, allocating **50% to product costs**, **30% for payouts**, and **20% for miscellaneous expenses**.
* 👥 Building a team: As the business grew, Hill brought in family members to help with operations, allowing him to **focus on backend tasks**.
* 🤖 Machine quality: Hill emphasizes the importance of **investing in high-quality machines**, cautioning against **buying cheap, outdated models**.
* 🏢 Location is key: Successful vending is all about foot traffic, with **high-traffic locations generating more sales**.
* 🚀 Growth strategy: For small vending businesses, **outbound sales** are recommended as a **cost-effective way to secure new locations**.
* 🔮 The future of vending: Hill predicts that **all machines will have credit card readers in five years**, reflecting changing consumer preferences.

- How much money can you really make selling chips and soda? (dramatic music) (coins clanging) - We gross more than $50,000 a month here at Hill Vending. - That is a ton of snacks, and today I'm talking to founder, Adam Hill, to hear how he started Hill Vending with absolutely no experience. - You can definitely do this from home. I know people who do this out of their SUV. Well, there's four keys to vending. You have to nail all four of those in order to be successful. I don't think there's anyone in the country that's doing the level of sales we're doing out of one box truck in a vending business. - I don't wanna drop this thing. - Yeah, it's gonna be an expensive bill. - UpFlip and Adam partnered up to develop a complete blueprint that you can use to start your own seven-figure vending machine business.

(dramatic music continues) Guys, welcome to a new episode where we are covering a guest that's been previously
featured in our podcast. We'll make sure we share
that link with you later on in the video, but for now, we're meeting his business, a vending machine business
that skyrocket rapidly. And today, Adam is gonna share
all his secrets to success. So, let's go meet him. (upbeat music) Adam, it's good to meet you. - Good to meet you. - Let's get into this. I'm so excited to get
to know the industry, the business, and so on, but for those that haven't
heard you on our podcast, tell us a little bit about your story and how you got into the
vending machine business. - Yeah, awesome. Well, thanks for being here. - Our pleasure.
- I've been in business about eight years now. I was in the corporate nine-to-five.

I wanted something with more freedom and flexibility, so hopped in, bought a vending route with no experience, made some mistakes along the way. Which machines are good, which machines are bad. And here I am now, able to turn it around and get profitable locations. But out of all the industries and all the businesses you could have switched to from corporate, why the vending machine? Who gave you the idea? Where would the inspiration come from? Yeah, it's just the vendor that was doing the vending at my work, at my job. - [Paul] Gotcha. Okay. - Just started talking to him and he wanted to get outta the business, so kind of one thing led to another and I kind of got into it. - [Paul] Well, we're standing here in front of your shop, right? This is where the operation begins. - [Adam] Yep. - Why don't we take a quick peek inside

and show our audience kind of
what everything looks like. - Come on in.
(air whooshing) - So you've got a warehouse.
How many square feet here? - [Adam] About 1600 square feet. - [Paul] What do you pay for it? - [Adam] Roughly, 1600 bucks a month. - Not that bad. But for somebody watching
us right now, Adam, inspired, wants to get into this business, doesn't have a shop, has a home. What can you tell 'em in terms
of starting this business from home, is that possible? - Yeah, well, I mean, when I
started, I didn't have this. You know, I had where I'd
find a deal on Coke or Pepsi, and I'd store it in my living room. I lived with my brother at the time, yeah, I didn't have a wife and family, but you can definitely do this from home.

I know people who do
this out of their SUV, so you don't need a huge operation. We have around a hundred machines now, but you can start with two, four, and build it to what you want. - At which point do you
think, I need a shop? - You know, something like this, you can start with a small storage unit. You don't wanna store a lot
of the oddball characters. You wanna store the stuff that you're gonna go through a lot, you don't have to constantly
be going to the store for. But yeah, two car garage, you know, you could fit a couple machines
in there, some product, a good base to get started. - Awesome. Okay. (air swooshing) What were your profits
over the last couple months and what kind of profit
margins do you shoot for? - Yeah, so, so your markup, I mean, on a can of Coke,

you at least need a hundred percent markup. You know, chips and snacks, everything's a little bit different. I mean, at the end of the day, I say the 50-30-20 rule, which is 50% of your income goes to product, 30% would be what your take home, or payout for employees or yourself, and then 20% would be miscellaneous for your credit card fees, gas, insurance, all the rest. (air swooshing) - You started the route by yourself, solo. At which point did you decide that, Hey, I need help. I need to delegate this task to X, Y, and Z, and why? Let's talk about that team structure and how you built it today. - Right, so when you're a solo kind of operator, you can never, you have to be there all the time. So it's kind of like you're handcuffed

to the business as well, so after doing it for a couple years, my brother was interested
in getting involved in growing the business. Then a couple years later, my brother-in-law joined. So it just kind of, as the route grew and as the
number of locations grew, you need more help and
more people to fill it 'cause there's only so
much you can do in one day. - But are they doing the
same tasks as you're doing, ultimately, or did you say, Look, you focused on that, you focus on that, and
I'll be at the center? - Yeah, so our general, our basic setup right now
is we have our box truck and that services, Monday through Friday, all of our machines on the route. And then I'll handle
all the backend stuff, the paperwork, the inventory,
the moving machines, responding to service calls. - [Paul] You do that too? All right.

- I'll handle all that kind of stuff. So yeah, they focus mainly on making sure that our customers are happy and everything's good. So that's a full-time there, is having those guys fill the, do the route. (air swooshing) - Now, when you guys started, what? Eight years ago you mentioned, right? What was the biggest challenge you faced? How did you overcome it? What can you advise our viewers in terms of prep to avoid that mistake? - Yeah, and I fell for it, and a lot of new vendors do. It's, you think every vending machine is the same. You think, just 'cause, a vending machine is a vending machine, and now, especially in this day and age with credit card readers, the old machines that are not compatible, they don't make parts for 'em anymore. Buying quality machines is the biggest mistake that I see people make. A $300 machine is

not the same
(buzzer buzzing) as a $3,000 machine, and there's a reason why.
(bell dinging) So if somebody's just getting started out, I would recommend, invest
in quality equipment because it's gonna pay
you in the long run. - So interestingly enough, they're still selling
the crap old equipment. - Right, right. - Is that a fact? - It is. I mean, people don't know. I mean, there's not a lot
of education out there for people. You can't take a high school course in it. You can't take a college credit. There's no education there
for the vending business, so people just think, yeah, I'll just pick this one up
on Facebook for 500 bucks and I'll put it in here. - [Paul] And make money.
- Then they realize, it doesn't take a card reader. You can't get a keypad for it.

and the board, the parts you can't get. So now you have basically
just a piece of scrap. So that's unfortunate, and that's why I try to
help people. You know, to get away from that and to invest in the quality equipment. (air swooshing)
- So tell us, how many machines you got in your route right now, roughly how much on
average each one makes, and what factors determine whether a machine makes a thousand or 500? - Yeah, so right now we have roughly around a hundred machines and average, you know, 500 to a
thousand a month in sales. Vending is all about
locations and foot traffic. Meaning whether it's customers, employees, or visitors. The more people that
come across that machine, the higher volume, the higher sales that it's gonna produce. And
the more money it's gonna make. - [Paul] Location's number one. I'm guessing price is number two.

- Well, there's four keys to vending: location, machines, service, and pricing. You have to nail all four of those in order to be successful. (air swooshing)
- All right, let's talk about a good strategy that a small vending business can pursue to grow their route. What comes to your mind
with your experience? - Yeah, so for small companies, I mean, outbound sales, like going and talking
to potential customers, is gonna be your cheapest,
most effective way. Going into locations and finding
out if they have vending, if they're not happy, and
offering your service, finding out they have a problem
and you be the solution. So that's the cheapest way
and the most effective way to go about that. - Doesn't cost you
anything but time, right? - You print up some brochures, have a game plan, and drive
around and get started. - Do you literally just drive around,

or do you make phone calls ahead of time? Or can you show up to a, you know, Safeway and be like, Hey, can I talk to the manager? Can it be that simple? - You can. You can blindly go in. I mean, we have a whole process and a whole system that we use here. You can go on Google Maps and look at parking lots in your area and see how many, what business is this? Instead of driving blindly, you can go and see, Oh, okay, this is a manufacturing plant here. They have a hundred vehicles here. Let me put that on the list to check out and see, you know, before you even get in the car, you can go around. You can pick up the phone and call before you go, that way too. But it is nice person to person, right? - [Paul] Gotcha. - To walk up and talk to them and find out if they're happy.

and talk to them about your service. - See your eyes.
- Right. - See your body language.
- Exactly. - See how nice you are,
your beautiful smile. It all goes a long way. Cool. Guys, keep watching. Adam's gonna share more about the tactic, semi-outbound sales that he
mentioned, so keep watching. (air swooshing) Would you
guys like to start your own million-dollar vending machine
business like Adam did? Well today, you're in luck. UpFlip and Adam partnered up
to develop a complete blueprint that you can use to start your own seven-figure vending machine business. - Thanks Paul, yeah, so this blueprint, it goes over A-to-Z how to get started, whether you want one machine
or a hundred machines. It's gonna show you how to
start from zero experience and it's gonna be broken down into six different modules that are gonna go over
the four keys of vending. First is location.

how to get profitable locations that are actually gonna make money. Two, the machines, how
to buy quality machines, which machines to buy. Three, your service, what should you put in the machines? What's the best products
to put in the machine? How often should you go to the machine? And then four, pricing. What do you price 'em all for? In this day and age, what do you need to make the
amount of money that you want? So if you want, check out the course. - Guys, we at UpFlip only choose
the very best professionals to bring you the insights into success, and Adam is among the finest. In fact, we believe in
the blueprint so much that today we're giving
you a free training on how to start a
vending machine business. So click the link in the
description below and get started. (air swooshing) Well, as we're surrounded
by the world of snacks here

and drinks and sugar. Let's talk about how you purchase all this stuff. Where, what's the best way to source it? Are their relationships you build over time to get the best deals, et cetera? - Yeah, so a lot of people ask, Hey Adam, do you link up with, you know, Coke or Pepsi for these distributors? There's a number of options. I could order directly from, you know, Coke or Pepsi for product and get it delivered, but the problem is, it's a lot more expensive. So 90% of everything you see here is from Sam's Club. - [Paul] Mm-hm, oh wow. - [Adam] So I put the order in online and then we go pick it up 'cause there's a Sam's Club less than a mile away from our shop. This is why we're strategically located here. - [Paul] Everything's close by.

- So we can get the product
in and stock the shelves. The problem when you're ordering through these larger
distributors. For example, a can of Sprite at Sam's Club is 50 cents. If I were to order that and
have that delivered from Coke, or any of these other
distributors, it'd be 75 cents. - Interesting. Because you're not buying
in that bulk that Sam's is. - Exactly. Whatever you can get the best price from, at the end of the day, is
where you wanna order from. (air swooshing) - What mistakes did you make early on with regards to managing or growing your route and what
did you learn from it, Adam? - Yeah, so when I first started, I was trying to do too much.
I was doing vending machines. I was doing frozen food machines. I was doing coffee machines. I didn't have an expertise in anything. And once I kind of cut the fat

and kind of just focused on,
Okay, let me get this right. Let me get snack machines
and drink machines down before I try to expand
into everything else, that's when really things changed. - Wow, hyperfocused on one thing. You said, that's really when
things started to change for the better.
- Exactly. - That's really cool. (air
swooshing) I see you got all this repair stuff. What's all this? Do you fix everything, absolutely
everything in machines? - Yes, so most of the vending machines, most of the parts are plug and play. For example, like if
your coin mech goes bad, you can turn the machine off, unplug it, get a new one and install it. We don't really dive deep
into fixing the internals. We just send them off to get repaired. - [Paul] Gotcha. - Kind of the same, these are all refrigeration
decks for vending machines

that need to be have a repair tech take a look at. But I mean, you still fix some things. So, you've got some machinery. Yeah, if we need to install stuff or drill some holes, or you know, fix some things, but yeah, this is kind of a nice work area to work out of. (air swooshing) So you mentioned that you purchased an existing route. I'm curious, what did you pay for it? And was that typical in that time to pay for that market? I paid 120,000. [Paul] Whoa. For it, but 60,000 down and then he owner financed 60,000 for the route, which was paid off over three years. The 120 includes the machines, the inventory, the contracts, everything. [Adam] Everything. [Paul] How did you finance the 120, besides the 60 seller carry.

- Family. My dad, brother, and I pooled in money. They believed in the vision
and wanted to grow it, and it's turned into a
nice family business. - For somebody who says, Hey, I don't have the money
to buy an existing route. I wanna start new. Where would you start,
knowing what you know today? - Yeah, I would start talking
to your local network, your churches, schools, people you know. Talk to 'em, say, Hey, do you guys have
vending at your work? Where you work, do you
have a vending machine? How's it going? And then you can reach out to businesses in your area that are
viable vending locations. - Start with one, two,
three, and so forth. Cool. (air swooshing) How do you keep costs low in
a vending machine business and overall, you know, increase your profits and revenue?

- Yeah, I think it's about being as efficient as possible. If it doesn't hit our criteria of the amount of people, the amount of foot traffic in our radius of service area, we don't just drive somewhere to drive somewhere. It's gotta fit our system, and I think that's what's helped us, back to the focus. Once we focused on this area and we focused on our business and making it efficient, it really shows based on, I don't think there's anyone in the country that's doing the level of sales we're doing out of one box truck and a vending business. (air swooshing) - So if I wanted to buy a route, Adam, what places do I look to purchase around? Is there a website? - Yeah, there's different websites. I mean, Route For Sales- - [Paul] They have those, okay. - Is a... Where different routes, right?

Like Snyder-Lance route, bread routes, and they have ATM routes, vending routes. But really, you know, a main way to get started for people is to just google vending companies. Pick up the phone, call 'em. Say, Hey, do you have anything you're looking to sell? Any locations that you might wanna sell? And more times than not, Yeah, we have some locations that are too far away. We wanna sell them off. Or, I'm looking to get out of the business. We might be interested in selling. But mainly it's a, there's not a ton of listing places for 'em. It's more of a word of mouth kind of kind of deal. - Gotcha. Is it the fact that there's always routes for sale? They're transferring hands. I mean, in real estate obviously, right, sales never stop. I'm surprised to hear that that's the fact in vending machine sales and routes as well.

- It's not, the volume is
definitely not as high, obviously, as real estate. So, it just depends on
your area, where you live, and the amount of machines in that area, but people are always moving, right? So if I'm someone moving
from Tampa to Texas, they're gonna need to sell their business, so there's always opportunity
that comes up there. (air swooshing) - Adam, as we're loading this up, talk to our audience about the 30-30 rule. I know you touched on it a little bit, but how does that benefit your business, and how do, do I click this up, or? - Yeah, so you just
push this in right here. - Oh, push this in, okay.
- Yep. So yeah, 30-30. - Basically, it's about to be
being as efficient as possible and keeping your drive
time as low as possible because you want to be near your machines.

and near your accounts. - You don't wanna expand
your territory so big that you're driving two
hours one direction. - Right, because if something comes up, if something comes up, and
you have to fix a machine or repair a machine, then you're dealing with
a two-hour round trip just to remove a coin jam or something. - Are there are a lot of
people out there doing the two-hour commutes? - I know somebody in this
area who drives two hours to do a route once a week, and it's... I mean, but everyone
can do their own thing. Everyone has their own way they wanted to grow their business. It's just for us, that's
not the way we wanna be. We wanna be lean, mean fighting machine. - [Paul] There you go. That's what 30-30's all about, you guys. (air swooshing) What's the best setup? What are the best types
of machines to get?

Let's talk about that. - Yeah, so if someone's
just getting started, I mean, I have my favorites, right? It's like Ford Chevy. People have different
brands they recommend, but after doing this
for this long, you know, your Vendo 21 series drink machines are the Cadillac of vending machines, so that's what I recommend everybody gets. That's the majority of our routes. That's this machine right here. - What is the cost? - This, new, you're
looking four to $5,000. - [Paul] Four to five grand? - I mean used, you probably get half, for half of that. The reason why, durability, reliability. It's gonna, this machine, knock on wood, we have a
lot of 'em out in the field, no issues. It's a bulletproof machine that people aren't gonna
have to worry about. For snack machines, I like the brand AMS.

Again, it's the same thing. Reliability, easy to work on. Parts are inexpensive, simple programming. You don't have to worry
about all the headache that comes with other machines. - And the setup, talk about the setup. Three coke machines, or
three and two generals? - Yeah, the general setup
that I would recommend for your first location is, you need a viable location first. If it can only take one
machine, I don't recommend that. I recommend a full-size drink machine and a snack machine, like this setup here. - That's the best duo? - Right, just because if you put in a, it's called a combo machine, which has snacks and drinks
in it in one machine, the amount of product
that it holds is so low that it just doesn't make you enough money to go back and service it. Or if it is a good location, it will empty out too fast, then you have to be there every two days.

- That's what I thought, yeah.
- So with a full-size setup, you're actually gonna be in a location that's gonna produce sales
that's gonna make you happy. (air swooshing) - All right. Well, so we're
loading this thing back up in the truck, right? - Yeah, we're gonna load this up and take it to the location.
- Head out there. Sweet, okay. Well, I'm happy to help. You tell me what to do. I don't wanna drop this thing. - [Adam] Yeah, it's gonna
be an expensive bill. - It will be.
- You're good. - Is it not gonna tip over? - Yeah, you should be good there. Once it's off the ground,
just pull it and spin. - I'll let you do it.
You want me to do it? - Pull it, spin it around, you got it. - You trust me that much, Adam?

- I trust you. I trust you.
- [Paul] All right. - [Adam] Push it up and on. There you go. Then hold on. Yep. (machine grinding) - [Paul] Some physical labor
definitely involved, huh? - [Adam] There we go. Good deal.
- So as we're doing this, talk to us about concept of pyramid. - Prospect pyramid, yeah. - Prospect pyramid, yeah. What is it all about? - Basically it's just a guide I created to basically help people know at what point is a location viable. Obviously, there's different
types of locations, and there's different levels
that they do in sales. - Is that something you
created, thought of, or? - It is, yeah, but it's based on just industry standards. So the minimum viable
account that I tell people is 50 people, foot traffic. There needs to be 50 for
it to be a viable solution.

- So it's basically a criteria, simply put, right? - It's a guide. - It's a guide. - It's a guide to show people if it has 200, there's 200 people there, it should do this amount in sales. If there's 50 people, it should do this amount. What type of machines you're gonna wanna set it up with, or that it's gonna require, so just helps people know going in what they should expect. - Yeah, you have a guide. You're not just kind of winging it every time you find a location that you think is gonna do well. What should a new business that's just starting out, in terms of levels, what should they focus on? What's the sweet spot? - Yeah, I'd say around, any place with about a hundred in foot traffic. You know, whether that's employees or customers, because the problem is, if you get something super big,

you're not gonna be able to service it, and you're gonna bite off
more than you can chew. So, you know, something
with 50 to a hundred, 100 people around. Foot traffic. Foot traffic, that
would be a nice start. Put your Sweet Marys there with the Coke and the chips, and then you should be set. There you go. (air swooshing) All right, blitz time with
Adam. Let's dive into it, Adam. You have like 10, 20 seconds to answer these wonderful
questions submitted by our audience and subscribers. So thank you guys for taking your time. Alfonso is asking, How can I bid on a property that already has vending machines? What is a good strategy to approach a building manager and
offer them machines? Right, so really it's
communicating with them and asking 'em, what
is their current issue? At the end of the day, if
a location has machines

and they're doing great
service, and they're happy. It's gonna be hard to get them to switch. So your whole goal is, when you're talking to this manager in this situation, is find out where they're lacking and then use that as your
entry and your solutions. Alfonso, thanks for
submitting your question. Marco is wondering, What do the conversations sound like when talking with an
owner or property manager about making an agreement for a location? Give us a quick script. Yeah, basically I tell 'em, If you want a contract,
we'll do one week, one month, one year. It doesn't matter, we're
not gonna lock you in. We stand by our service. If you're not happy,
we'll remove our machines. We want you to be happy, and if you're not, we
haven't had it happen before, but we'll pull our machines out. Puts them forward.

puts them above everything. - Right, they're in complete control. - Yep. I love that. Okay, Joe, thank you for
submitting your question. Joe is asking, How do I get machines put in malls and government offices, railway stations, et cetera? Do larger organizations require
you to be well connected, or do they work with sole traders? Is insurance possible, and so on? - So it's a case by case basis, but when you start talking
about maybe national contracts or national companies,
they do typically have contracts in place, but it doesn't hurt. You have to start the
conversation somewhere. - [Paul] Yeah, doesn't hurt to reach out. - And they may want to
use local providers. A lot of big companies don't
want to use big companies as their vendors. They want the small, local feel. So the only way to do it is to ask. - The key, start the conversation.

- Right, right. - Perfect. Okay. And then Suliman, thank you
for submitting your question. This was the last one. What are the risk and loss
of money in this business? Is this business manageable remotely, or do you have to be around all the time? - Yeah, I mean, I wouldn't advertise that
you're doing vending, as far as flashing the
cash and doing all that. As far as risk as an investment. I mean, the only investment you have is your machines up front. So if you buy quality machines, you'll be able to resell
'em and get your money back if you're not happy. But yeah, no, I haven't known a ton of
people that have had risky, like getting robbed, or anything like that if that's what we're talking here. (air swooshing)
- Adam, tell us where we are. I'm really curious 'cause
it's a huge, massive building.

And most importantly, like how did you secure this
contract or this account? - Yeah, we're at one
of our school accounts, this training facility. But the way we got this is, I actually met the director in Sam's Club. - [Paul] Oh wow, really? - He was around shopping for
an event they were having, and I saw the logo that he was wearing. - You were paying attention. Back to paying attention.
- Yeah, went and asked him, Hey, you know, you guys have any trouble
with your vending? Long story short, they were, and set up a meeting and
were able to take over. - Tell us about common
mistakes that you make when you're prospecting
from new locations. What's obvious? - Yeah, the sales cycle, people need to understand,
is a little bit longer. You have to follow up. It's not just gonna be a
one time meet and greet.

boom, they're done, they're happy. You need to follow up with the location, or with the contact, and make sure you're your front of mind and top of mind. - [Paul] So the key boils down to just follow up. - [Adam] Right, follow up, continue to offer value, and be on their mind that you're gonna solve their issues that they're having. - Specifically on a follow up, let's say you visited the director here, or a new location, a new prospecting location, and you didn't secure the deal at that particular moment. What follow up in place do you have to then follow up, either via email, text? Is it a software system, or is it just, again, we're going back to old school? - No, it's old school. You just want to, when you contacted them and then every couple weeks, you wanna follow up until they tell you not to follow up

or email, phone call; try different variations of follow-up. - All right, guys, make sure you follow up. That's where the key to success is. (air swooshing) Let's say I found a great opportunity for a vending route. I don't have cash in hand, but I really want to acquire it. What are my first steps? What are my options? - Yeah, what I would say is, you know, you can always ask friends and family for money, go to the bank to try to get a loan. You can ask the seller of the route if they'll do owner financing. - [Paul] That's a good one. - [Adam] Hold some of the note so that you can stretch out the terms. If you really want it, you'll talk to some people and find a way. - I just wanna encourage our viewers that no money does not mean you can't pursue a business opportunity, business idea.

Would you agree? A lot of people limit themselves. - Right, yeah. - Because, Oh, I have no money, therefore I can't do anything. No, no, no. - Yeah, creative financing
is definitely a way, especially with vending, to get into it. - I didn't know that. I
mean, being in real estate, I always thought creative
financing was just there, but today you've educated me that, hey, it's even available in
buying vending routes. - Right, exactly. Owner financing, for sure. - What kind of terms though,
since we're on that note? - I mean, you could do, it's obviously dependent on the seller, what they want to accept. Maybe a 12-month note of the
remaining balance at 10%. Who knows what the interest
rates are at the time, what they're gonna want. But then you're gonna collateralize that with the machines in the locations.

so that if you don't pay,
they're gonna take back over. - Gotcha. Sounds like
everything is negotiable. Whatever you and that seller
agree on is up for grabs. - They may have a medical health issue. They can't physically do the route, so they need someone to do it. So there'll be more favorable terms. It just depends on case by case, kind of what you can negotiate, right? - Gotcha. (air swooshing)
Let's talk about your pricing strategy. How do you determine that? How did you work that? What's a good advice
for our viewers as well? - Yeah, so we're in front of a what's called a five-wide snack machine, which means there's five selections across here at the top. The way we set it up, I mean, people can set
it up however they want. Instead of having things just mix-matched all over the place, we start with these
are larger bagged chips.

at a dollar, whatever price point you pick. And then we do smaller bagged chips at their price point, cookie row, we have a chocolate row- - A buck 25. - Non-chocolate row, and then at the bottom you have your pastries and honey buns. So that's, kind of, a general playbook. That way, if you're shopping at Sam's Club or wherever, and Cheetos are outta stock, you can substitute that for another item that's similar in the same cost structure, but put it in, you know where it goes. And especially when you talk about drivers, or having people help you, you don't want to have things mixed up all over the place. - Yeah, but how did you determine that a buck is what this should be, versus a buck 25 or 70? - Yeah, and you play with that at different locations. Like a location like this, the volume's high.

At another location, we may charge a $1.50. It just depends, you know, per location. But I mean, the general markup is, you at least need to double your price of whatever you're charging. So if you buy a can for 50 cents, you need to get minimum at a dollar, and then you could set the price for $3 for a can, but no one's gonna buy it. You have to find that happy medium to where you can generate volume. Sometimes it takes a little bit of time to figure out per location. Exactly, well, it's like here in Florida, there's a number of resorts on the beach. When people go on vacation at a resort, they'll pay $2 for a can. Whereas if you're in a workplace, or a blue-collar environment, they don't wanna get gouged like that, so knowing your audience. Yep, know your audience, well said. (air swooshing) All right, sales kit.

you have one. Tell our audience what's in it, what's important to have in there, what's not important to
overwhelm the client. - Yeah, basically you want
to have a sample contract, a proposal. You want to have your
agreement, or whatever you want. Marketing brochures, a list of
the machines that you carry. Maybe some product that you
would put in the machines. It's always better with
sales to show, don't tell. Show them a picture of the machine. Don't just tell 'em, We're
gonna put a vending machine in. So just those key elements, yeah, to make sure that you're prepared. (air swooshing) - All right, let's talk about the brands of machines that are
most favorable, proven, where to buy them, get the
best price, and so forth. I mean, we're surrounded
by all of your machines.

besides the ATM, right? - Yeah. So these are Vendo 721 machines. They're 10 selections, right? They hold a bunch of product. I mean, over here, these are AMS machines. Same thing, these are refrigerated. They can do food items,
or they can do drinks, everything like that. So as far as where to get 'em, these are all sold through distributors. You might go through a distributor if you're in California that has a distributorship in your area. Just find-
- Find who distributes them. - Right. Just go on their
websites and you can look up where in your area is the closest distributor. (air swooshing)
- What do companies want from a vending machine company and how do you provide
that at Hill Vending? - Right. So 90%-
- What does is boil down to? - Yeah. 90% of the accounts that call us, they already have vending. They already have vending.

- [Paul] Interesting.
- There's not gold mines out there where people don't have a machine. If they need it, they'll just call someone and get machines. But the reason that they call, or that we transfer into those locations is service. Service is the number one lacking trait of the majority of vending businesses. There's a lot of mom-and-pop operations, or there's a lot of smaller vendors that they're doing it on the side, and you know, it can fall by the wayside, and the machines are empty, and the employees or customers are not, you know, not being able to use the machines. So at the end of the day, that's the glaring deficiency in the vending business, is the lack of service that people provide.
- Do you feel like there's a gap in this industry with regards to the poor service? Like, is there a missing software, or a missing technique, or something?

I'm just thinking out of the blue. If there's a lot of people out there that are calling you and saying, Hey, we need you to
come in 'cause our guy, what is it? Is it because there's a lot of
small mom-and-pop operations that are kind of screwing it up for the ones that are doing it the best? - Yeah, well, even the small mom-and-pop, but even the larger companies, don't wanna name any names, but some big large national companies. - [Paul] Doesn't make them. - That's who we get a
lot of of accounts from. Maybe they're too spread thin, maybe they're just focusing on
their large, massive accounts and letting the other
stuff fall by the wayside. - Just like in any other business, right? - Right, right, exactly. Things get in the way
and then people don't... Yeah, people just want
their machines to be full.

and taken care of. - Sweet.
(air swooshing) Credit card readers, let's talk about 'em. Do all of your machines
have them, pretty much? - Not all of 'em, but most of them, yeah. - Would you say that that's
where things are headed? - I would say in five years, all of our machines will
have card readers, yes. - I mean, I've even seen machines where they're going no
cash, just card only. - [Paul] Oh, wow. Talk to us about the
setup, the cost to you. - Yeah, so this brand
is called Cantaloupe, is the provider of this. They run roughly $300 to buy the device. - [Paul] So the machine
doesn't come with it. - This does not come with it, right. Then they run off cell service, which is $10 a month. Whether this machine does one transaction

or 200 transactions, you gotta pay that fee
for it to be connected to the internet. - So, you're spending
60 bucks a month here 'cause you have six machines here. - Exactly, per device. This is a newer vending machine. This is a Wittern brand machine, but that has the iVend, which basically means that
it guarantees the delivery of the product. There's a laser beam down there. - [Paul] Oh yeah, you can see it. - That guarantees that the product drops. So these are what you get
when you buy newer machines, you get a little more technology. It's card capable. Even this is handicapped
accessible area, location. - Just like everything. (air swooshing) In terms of servicing your machines, talk to us about how you do that. Is there a system, a tool
that you use that pops up and says, Hey, something's broken there. Or how does that work in your world?

- How we do it is, we have our locations set on a service schedule. You can run a report, and it'll tell you, you need four Body Armor, five Arizona, this, that. You pre-kit here in the warehouse, then go to the location. The way we do it is a rolling inventory on our box truck. So some locations maybe twice a week, some three times a week, some once a week, every two weeks. It just depends, based on the volume. - So you mean you go there, whether it's broken or not, but that service schedule is gonna tell you, Hey, go visit, make sure everything's good. - Normally, if there is something wrong, we have a contact person at the location that will let us know. - Gotcha, so they call you right away. - Right. Anything that has a credit card reader on it, you can dial in. It runs off cell service, and you can get a live look at it.

- Nice, okay. (air swooshing) Here's what I'm curious about, too. Like, how do you make the
selections for each machine? Like, how do you know
to put Milanos and Lays, versus other products? There's so much out there
that you can put in there. - Right, after having so many machines out and seeing what sells, you kind of know what sells based on what's moving
through the machines. So if we come back and Lays
Salt & Vinegar haven't moved, then we know that that's
not a good seller. We'll switch that out. - And it's different per location. I'm guessing there's no playbook
that you open up and say, Here, here's what sells more. - Well, there is. Yeah, like so for example, like on a drink machine,
Coke and say, Mountain Dew, are in every drink machine because those are the one, two sellers.

So we already figured that out. - Yeah, that's a no-brainer. - Like, water, water's in, bottled water in machines. So, but then when you get down to like, the last selections, you may put in ginger ale in one machine, and maybe tea in another. It just depends, but you have your core
staple kind of items, yeah, for both machines, drink and snack. (air swooshing) - What, the last couple pieces of advice, can you give them as we conclude? - I mean, my main goal is, for whatever advice I give anybody is, at the end of the day, I
don't want you to lose money. You're gonna invest money
in machines and equipment, and I want you to buy quality machines, so that if you find
out in a couple months, vending's not for you, you can sell your equipment and you're not gonna get bottom barrel.

pennies on the dollar for your equipment. So at the end of the day, you're investing thousands
of dollars into equipment. I want you to be able to recoup that if you change your mind. - Okay, awesome. Make sure you guys check out the link in the description below for the course. Doesn't hurt. One hour free to get you going. And Adam, this has been a pleasure. - Awesome. Thank you.
- Thank you so much. - Thanks. (air swooshing)
- Well, there you have it, guys. This is a wrap with Adam Hill, the owner of Hill Vending. Thank you so much for watching. I trust you enjoyed it. The goal for you is to execute
on everything you've learned and succeed. Thank you again for watching. Make sure you check out our other videos that we've done with other industries and take a second to like, subscribe, and hit that bell so that you
don't miss any of our videos.

2-Day Workweek Earns $700K -  Vending Machine Business

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Making Money in the Vending Machine Business

A successful vending machine business can gross over $50,000 a month.

It is possible to start and run this business from home or a small storage unit, gradually expanding as needed.

The key to profitability lies in maintaining a good product markup and having a clear financial plan, including budgeting for expenses and potential profits.

The Key to Success in the Vending Machine Business

Investing in quality vending machines is crucial, as older, cheaper models are often incompatible with modern needs.

The key factors for a vending machine's success are its location, the quality of the machine, good service, and pricing.

A small vending business can grow its route most effectively through outbound sales, by identifying potential customers with vending needs and offering solutions.

Sourcing and Growing a Vending Machine Business

Most of the products are sourced from Sam's Club to keep costs low, rather than ordering directly from distributors like Coke or Pepsi.

Focusing on a specific vending machine niche, such as snacks and drinks, and hyperlocal areas, rather than trying to do too much at once, is key to growing the business.

Keeping the business efficient and focusing on specific, high-traffic locations is crucial for keeping costs low and maximizing profits.

Tips for Getting Started in the Vending Machine Business

Vending routes are often found through word of mouth or by contacting vending companies directly.

The 30-30 rule, focusing on efficiency and minimizing drive time, is crucial for a successful vending business.

When starting out, it's recommended to invest in the Vendo 21 series for drink machines and AMS for snack machines, with a typical setup including a full-size drink machine and a snack machine for optimal sales.

Understanding the Prospect Pyramid for Vending Machine Business

The prospect pyramid is a guide to help determine the viability of a location for vending machines, based on foot traffic and potential sales.

For new businesses, focusing on locations with 50 to 100 people of foot traffic is ideal to avoid taking on more than they can handle.

Approaching property managers and building owners requires understanding their needs and offering flexible contracts to prioritize their satisfaction.

Larger organizations may work with sole traders, and the vending machine business is manageable remotely with minimal risk and investment.

Securing Business Contracts and Financing for Vending Routes

Meeting potential clients in unexpected places, like a director in a store, can lead to securing business contracts.

The key to prospecting in new locations is understanding the longer sales cycle and the importance of follow-up.

When it comes to acquiring a vending route without upfront cash, options include asking for loans, seeking owner financing, or involving friends and family for financial support.

Creative financing is essential for pursuing business opportunities, and negotiation is crucial in determining the terms.

Pricing strategy for vending machines can be based on the product layout and cost structure, with flexibility to adjust prices based on location and volume.

Setting Prices and Providing Service for Vending Machines

Setting prices for vending machine products can vary by location, but a general rule is to double the cost, while considering the audience and location to find the right price point.

Vending machine companies like Hill Vending differentiate themselves by focusing on providing excellent service, addressing the industry's common lack of maintenance and attention to machine refilling.

The use of credit card readers in vending machines is becoming increasingly popular, with a projection that all machines at Hill Vending will have them in the next five years, at a cost of around $300 to purchase plus $10 a month for cell service.

Vending machine internet connection requires a fee per device, leading to significant monthly expenses.

The owner uses a service schedule and location feedback to restock and maintain the machines, with a live monitoring option for machines with credit card readers.

Product selection is based on sales data and location, with core staple items in every machine.

The advice for those entering the vending machine business is to invest in quality equipment to have the option to recoup the investment if needed.