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Whether you manage an office space (little or large) or public venue (of any size), vending machines can be a great way of keeping the people around you happy. They’re also another strong revenue stream to consider if you have a large amount of footfall.
From a coffee vending machine to snacks – sweet or healthy – there are plenty of options to make your vending machine business choice unique and profitable. Ultimately, doing your research first is key – comparing the market enables you to get the best deal and optimum drink machine for your business, saving both time and money. Whether you’re looking for a coffee vending machine, or another type of vending machine, there’s plenty to choose from with help from Cost Compare Limited.
Buying A Vending Machine
Vending machines offer a fantastic automated, labour-free way of selling products to customers or staff. Ranging from snacks to alcohol, cigarettes to toys, soft drinks to meals, all it takes is for money or a credit card to be inserted into the machine and anything can be bought.
Perhaps surprisingly, the most modern type of vending machines dates back to the early 1880s when they were developed in England for dispensing postcards. Later, a man who went by the name of Simeon Denham received a patent in 1867 for his stamp-dispensing machine, which was the first completely automatic vending machine.
Historically speaking, the first known reference to vending machines came from the work of an engineer and mathematician in first-century AD Greece, the Hero of Alexandria. He created a machine that accepted a coin and, in return, holy water was dispensed. Unlike the modern vending machines, it worked through a pan that was attached to a lever, which was all triggered once the coin was deposited. In turn, the lever opened a valve and this allowed water to flow out. The pan would continue tilting until the coin’s weight fell off, and at that point, the valve would turn off.
Machines that followed a similar mechanism with coins were also being used in the 1600s in English taverns for the sale of tobacco. They were made of brass and could be moved around. Vending machines were also used during the early 1800s by an English bookseller by the name of Richard Carlile, who sold banned literature through a machine.
Some of the most common vending machines these days include change machines, cigarette vending, birth control and condom vending machines, food and snack vending machines, hot drinks machines, candy machines, newspaper vending machines, toy vending machines, coin-operated photo booths, stamp vending machines and ticket machines. Vending machines are becoming increasingly smarter and are now also able to vend everything from hot pizzas to books to French fries, as opposed to the standard hot drinks machine you would find in a corporation’s foyer.
Industry Statistics On Vending Machines
It was reported by Statistic Brain that in 2016, the revenue generated by the snack and vending machine industry came in at $73,320,000 while the total number of vending machines in the U.S. was 7,125,000. They also found that the average amount spent was £27, while 56% of sales at a vending machine were for soda or cold drinks.
Globally, according to UK Vending Machines, Japan has the most vending machines per capita, where there is one machine per 23 people. You can get just about any kind of product from these machines, ranging from DVDs to live lobsters. There are also over a million machines in the country dedicated to nothing but Coca-Cola.
In Europe, there are around 3.8 million machines with a turnover of around £9.5 billion. The market for vending machines tends to grow in Europe by 5-10% each year. In the UK, there is one machine for every 55 people, with custom vending machines gaining the greatest prominence. In Europe, the UK is the second largest vending machine market following on from Germany, with one in every nine vending machines in Europe operating in the UK.
There are more than 7 billion items vended to customers across the UK throughout over 500,000 machines. This generates more than £1.5 billion in profit. The most successful type of machine in the UK is drink vending machines, particularly hot drinks. 60% of hot drinks machines are found within workplaces, with over 8 million cups of coffee served to staff each day across the UK. Drinks machines also vend out 2 million cups of tea daily throughout the country.
Vending Machine Trends
As a convenient and low-cost way of providing snacks and drinks, vending machines are constantly evolving. There are several key trends that define how the future looks for vending machines. These include tackling the obesity epidemic with healthier food and snacks being offered, amongst a coffee vending machine and other types of food and drink vending machines.
This would involve completely replacing crisps and fizzy pop with fruits, nuts and vegetables. Laws are currently being introduced across America that will no doubt expand to the UK. These involve a mandate on the percentage of products on sale meeting a minimum health food standard. The goal is to specifically prevent obesity in children, and in turn with adults.
Another trend is to meet the needs of people with busy schedules. This includes offering meals such as breakfast cereal with milk for those on the go – or other quick breakfast options.
Finally, there is also a growing demand for food and drink vending machines to offer the opportunity to order online and combine with social networks for rewards and mobile applications for ease of use. As much as this benefits customers, there is also the opportunity for businesses to gain a lot of useful data about their customers this way.
Creating A Profit With Vending Machines
Vending machines can quickly pay for themselves as a solid and proven business model. That’s not to say a profit is guaranteed, but with proper management and good positioning, they stand a very good chance.
A franchise cost can significantly vary depending on what you are looking to sell and who you want to work with. However, for a ballpark figure, you could be looking at anywhere between £3,000 up to £10,000 and more.
It’s important to establish at the point of sale if there are any ongoing costs. Generally, you can expect a vending machine to make an annual profit of around 20%, but again this can vary and it is best finding out from the franchise provider what they project or have experienced.
Finding The Right Vending Machine
Getting a vending machine can be a solid investment, but it doesn’t necessarily come cheap. It is, therefore, crucial to compare what is available on the market beforehand and do your research to find the right one. Getting the decision right can be paramount.
If you are buying an already established vending machine business, it is important to establish why the current owner is looking to sell their business. It’s also key to find out where they have had the vending machines located and what results they’ve seen. You’ll need to inspect all the vending machines to check they are in good running order. You’ll also need to look over their profit and loss sheets, view their tax statements, and review all contracts (plus clauses).
If you are considering buying from a vending machine provider or franchise, you’ll need to ask questions including: what the projected profit is, what products you can stock and what limitations there are, how often this stock list gets updated, how often vending management systems check in on you to look over the machines, what repairs are covered and if there is any warranty, what systems are required for it to work, the general running costs (electricity, etc), and what training/customer support is available. Reading online reviews can be particularly helpful to find out about other people’s experiences.
Purchasing Vending Machines
Whether you are looking to buy an existing vending machine business or purchase a brand-new franchise, the crucial thing to do is compare the market. You can use Cost Compare Limited to review an array of vending machines and save your business time and money.
In the long run, this can be a significant saving of up to 65%. We work to help make your life easier and your decisions much more secure and well-researched. Get in touch with us today for more information or start your search here.