Passive income is one of the most exciting ideas in personal finance. Making money while you’re sleeping, or sitting on a beach, or even while making more money at your other jobs or businesses…few things can speed up your wealth journey like passive income!
Starting a vending machine business for passive income is an idea that many people haven’t considered before. But all those soda machines, snack machines, and ice and water machines you see scattered around grocery stores, apartment complexes, hotels, libraries, and other public spaces are owned by someone, and it’s usually not the property owner. Heck, it could be someone who is sitting on a beach while you’re buying that bag of Fritos!
In partnership with Everest Ice and Water Systems, let’s dive into more info and benefits of using a vending machine business for passive income.
Benefits of Owning a Vending Machine Business for Passive Income
Why buy a vending machine as a side hustle? Let’s count the perks…
1. Truly passive income
A lot of common “passive income ideas” aren’t actually that passive. Take the idea of starting a blog, for instance: you have to do a ton of legwork just to get it off the ground and find monetization strategies, then you have the ongoing work of continuously publishing new content, updating old info, optimizing SEO, and so on.
With vending machines, the setup process is literally:
- Buy vending machine
- Find a place to put it
- Get inventory
- Start earning money
Your only ongoing duties are maintenance and refilling, which can both be outsourced. And if you choose an ice and water vending machine like the ones through Everest, it’s even better: there are no inventory requirements and no need to hire someone to restock chips and sodas every week (or do that work yourself). They have lower maintenance needs as well.
You should also check to make sure that you’re purchasing a vending machine that you’ll actually own, not one that’s technically a franchise or charges expensive annual fees. That’s the case with Everest: when you buy one of their machines, you own it, with no fees, royalties, or franchise fees tacked on.
2. Great ROI potential
We’ve covered the “passive” part of “passive income”—now for the other half! Starting a vending machine business isn’t cheap out the door, so what kind of income returns could you see on your investment?
With vending machines, the key to an amazing ROI really lies in the placement. If your vending machine is out in the middle of nowhere, you’ll be lucky to make a couple dollars a day. But if you can negotiate a great placement in an area with high foot traffic and where you know there’s demand, then the sky is the limit.
On their website, Everest has an ROI calculator you can play around with to see what kinds of profits you could be looking at, adjusting for different pricing and levels of demand. But vending machines can be lucrative: even if you only sell $10 worth of product a day, that’s already over $3500 a year.
Some great spots to scout out for vending opportunities include:
- Apartment complexes
- Hotels
- Athletic clubs
- Offices
- Schools
- Grocery stores
- Small businesses
Here’s a quick guide to approaching establishments about placing a vending machine on their property. You’ll want to make it a good deal for them too, so you can offer a monthly flat fee or a percentage of sales. If you’re considering an Everest ice and water machine, they offer services to help find vending machine placement locations to make your life even easier.
Nothing is guaranteed in the vending business, but it’s worth remembering that beyond the upfront cost of a machine and whatever rent you pay to the property owner, your ongoing costs will be fairly low. Once you’ve earned enough that the machine has paid itself off, it’ll be a lot easier to turn a regular profit.
3. Eco-friendly options
If you’re like me, you’re always thinking about ways to live more eco-friendly. That’s why personally, if I were going to start a vending machine business for passive income, ice and water would be my type of choice.
Soda and snack machines can be interesting passive income options, but let’s face it: they involve a lot of single-use plastic. If you’re trying to minimize your plastic waste, you might cringe at the idea of all those Coke bottles winding up in the trash.
Ice and water vending actually helps solve the plastic problem. If someone is currently relying on plastic gallon jugs of water and bagged ice from the grocery store to provide for their household in an area where water contamination is a concern, they don’t have many options. Unless, that is, they have access to a machine where they can take refillable jugs or ice buckets and get high-quality, filtered ice and water that didn’t have to travel through a high-emission supply chain to reach them.
4. Help your community
Jumping off the previous point, access to clean water is such an important factor in community health. If you decide to pursue the idea of an ice and water vending machine business for passive income, make sure filtration is one of your top considerations.
For example, Everest’s five-step water filtration system includes a pre-filter to remove sediment, two sub-micron carbon filters to improve taste and remove chlorine, odor, and chemicals, a scale reduction filter to protect the machine from hard water, and UV sterilization as a final step to ensure safe, clean drinking water for anyone who visits the machine. It’s actually the same filtration system that McDonald’s uses for their water!
If you’d prefer to run a snack vending machine for passive income, you can still help your community by providing health-conscious options like nuts and protein bars.
5. Low barrier to entry
Vending machine businesses can cost tens of thousands of dollars to start, but that doesn’t mean you have to have all that money in your bank account today. Just like you’d probably take out a loan to buy any business, you can pursue financing for your vending machine purchase so you can start earning passive income without needing to save up a huge down payment first.
Before you actually pull the trigger, it’s worth scouting out locations and talking to business owners first. Spend a day or two observing foot traffic and even chatting with people in the community to see if they’d appreciate having water, ice, or food vending there. This way, you’ll have a solid plan and be able to hit the ground running with your new passive income business right away.
