business plan for coffee vending machine

Coffee Vending Machine Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business ideas » Wholesale and Retail Industry » Vending Machine

Are you about starting a coffee vending machine company? If YES, here is a complete sample coffee vending machine business plan template & feasibility report you can use for FREE . Okay, so we have considered all the requirements for starting a coffee vending machine business.

We also took it further by analyzing and drafting a sample coffee vending machine business marketing plan template backed up by actionable guerrilla marketing ideas for coffee vending machine businesses. So let’s proceed to the business planning section.

Why Start a Coffee Vending Machine Business?

If you are contemplating starting a business in the united states of America, then one of your options is to start a coffee vending machine business. The truth is that anyone can vend coffee from a machine. This business is not financially tasking to start as you can purchase a used vending machine, even that of a popular brand at a cheap price, and still get the most out of it.

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The coffee vending machine business doesn’t require any expertise or know-how, and any serious minded entrepreneur is likely to make good profit out of this business.

If you are sure that this type of business is what you want to do after you must have conducted your market research and feasibility studies, then the next step to follow is to write a good business plan; a detailed blue print of how you intend raising your seed capital, setting up the business, managing the flow of the business, sorting out tax and marketing your services.

The truth is that it is one thing to have a fantastic idea cum business plan, it is entirely another thing for the business plan to translate to profits, that is why it is important to assemble a team of experts to work with if you want to be successful with your coffee vending machine business. Below is a sample coffee vending machine business plan template that will help you write yours in record time.

A Sample Coffee Vending Machine Business Plan Template

1. industry overview.

A vending machine business is a retail business that does not require face to face interaction with customers, and can be run 24 hours a day depending on the location.

This business offers operators flexibility, because it can be tailored to suit the lifestyle of the owner, thereby creating a balance between work, life and family. Entrepreneurs can also go into other businesses, while others can decide to make it a part-time business venture.

Coffee vending machine business is part of the vending machine operator industry and basically, a vending machine dispenses items such as coffee, ice, beverages, snacks, lottery tickets, alcohol, cigarettes, perfumes, toys, candy and so much more.

There are very strict laws regarding the sale of alcohol and cigarettes through vending machines due to concerns regarding underage buyers.

If you are a close observer of the Vending Machine Operators industry, you will notice that the industry has struggled over the past decade. This decline was caused by decreasing per capita soda consumption and a rise in the healthy eating index.

However, the decline was offset slightly by rising per capita disposable income, most notably in 2015 when the industry experienced growth.

In addition, a change in product mix toward healthier snacks, beverages and other food items, along with increasing use of technology, helped companies spur demand from new consumers. These gains were mitigated, however, by increasing competition from external competitors. Over the five years to 2022, industry revenue is estimated to continue declining.

The Vending Machine Operators industry that coffee vending machine business is a subset of is a thriving sector of the economy of the United States and the industry generates over $7 billion annually from more than 21,064 vending machine companies scattered all around the country.

The industry is responsible for the employment of over 54,291 people. Experts project the industry to grow at – 0.5 percent annual rate. Aramark Corporation and Compass Group are the market leaders in this industry.

A recent report published by IBISWorld shows that the Vending Machine Operators industry is in the decline phase of its life cycle.

The report shows that over the 10 years to 2022, industry value added (IVA), which measures an industry’s contribution to the overall economy, is expected to decrease at an annualized rate of 1.4 percent. In contrast, US GDP is projected to grow at an annualized rate of 2.0 percent during the same period.

An industry is considered to be in the decline phase of its life cycle when IVA growth is below GDP growth over a 10-year period. One key indicator that an industry is in decline is a shrinking market, as shown by declining revenue. Since 2005, the industry has experienced constantly declining revenue, except for a small growth in 2015.

Over and above, the vending machine industry is a profitable industry and it is open for any aspiring entrepreneur to come in and establish his or her niche vending machine business; you can choose to start on a small scale in one or two public facilities or you can choose to start on a large scale with several outlets in key cities.

2. Executive Summary

Johnson Travolta® Vending Machine Company is a US licensed and incorporated business with strong bias in coffee vending. Although our business will be based in Nashville – Tennessee where we were able to secure a 40 by 40 feet warehouse, we have the plans to spread across major cities in the United States.

Aside from retailing assorted coffees from our vending machines, our vending machines will also dispense products such as groceries, drinks, snacks, candy, hot and cold beverages and other products.

We are aware that there are several businesses around Nashville – Tennessee that run vending machines, which is why we spent time and resources to conduct our feasibility studies and market survey so as to position our coffee vending machines in strategic places.

We are aware of the trend in the vending machine industry and we are not only going to operate a system where our customers would just make purchase from our machines without getting useful data from them that will help us serve them better.

We will also go ahead to ensure that we position money changers in some of our busiest coffee vending machine locations so that our customers will not find it difficult looking for change to make purchase from our vending machine.

We have put plans in place to operate a mini but standard call center/customer complaint center that will operate on a 24 hours a day and 7 days a week for the sole purpose of resolving customer’s complaints as fast as we can.

Johnson Travolta® Vending Machine Company is a family business that is owned by Johnson Travolta. The business will be managed by his son Ashton Travolta, a graduate of Business Administration who has extensive experience working with one of the leading retail outlets with several vending machines in the United States of America. He will bring his wealth of experience to help build Johnson Travolta® Vending Machine Company.

3. Our Products and Services

Johnson Travolta® Vending Machine Company is in the vending machines industry for the purpose of making profits and we will ensure that aside from vending coffee, we will also make available a wide range of beverages and snacks in our vending machines.

Here are our product offerings;

• Coffee beverages (cappuccino, espresso, iced coffee, decaffeinated coffee, alcoholic coffee (Irish Coffee and Brandy Coffee et al), filtered coffee, cold brew coffee, Turkish coffee, coffee with milk, and flavored coffee et al.)
• Hot beverages
• Cold beverages

4. Our Mission and Vision Statement

• Our vision is to build a coffee vending machine business that will have active presence all over Nashville – Tennessee.
• Our mission is to establish a coffee vending machine business that will make available assorted coffees, beverages and snacks at affordable prices to residents of Nashville – Tennessee.

Our Business Structure

Johnson Travolta® Vending Machine Company do not intend to start a business whose vending machines can only be found in few outlets around Nashville – Tennessee; our intention of starting a coffee vending machine business is to have coffee vending machines in strategic positions in key cities all around Nashville – Tennessee.

We will ensure that we put the right structures in place that will support the kind of growth that we have in mind while setting up the business.

In putting in place a good business structure, we will ensure that we hire only people that are qualified, honest, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders.

As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. In view of that, we have decided to hire qualified and competent hands to occupy the following positions;

• Chief Executive Officer (Owner)
• Admin and Human Resources Manager

Merchandize Manager

• Client Services Executive

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
• Creates, communicate, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization

Admin and HR Manager

• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Carries out induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Manages vendor relations, market visits, and the ongoing education and development of the organizations’ buying teams
• Helps to ensure the right coffee brand and beverages are on our vending machines
• Responsible for the purchase of goods and products for the organization
• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensuring compliance with taxation legislation
• Handles all financial transactions for the organization
• Serves as internal auditor for the organization

Client Service Executive

• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with students on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the school coordinator in an effective and timely manner
• Consistently stays abreast of any new information on the schools’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to students when they make enquiries

6. SWOT Analysis

Our intention of starting our coffee vending machine business with a dozen vending machine installed in strategic locations all around Nashville – Tennessee is to test run the business for a period of 3 to 6 months to know if we will invest more money, expand the business and then install 50 coffee vending machines first all-around Nashville – Tennessee before spreading to key cities in the United States.

We are quite aware that there are several vending machines all over Nashville – Tennessee and even in the same locations where we intend installing ours, which is why we are following the due process of establishing a business. We know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.

Johnson Travolta® Vending Machine Company employed the services of an expert HR and Business Analyst with bias in retailing to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives.

This is the summary of the SWOT analysis that was conducted for Johnson Travolta® Vending Machine Company;

The strategic locations we intend installing our coffee vending machines, the business model we will be operating on, ease of payment, wide range of products, competent team members and our excellent customer service culture will definitely count as a robust strength for Johnson Travolta® Vending Machine Company.

A major weakness that may count against us is the fact that we are a new coffee vending machine business and we don’t have the financial capacity to compete with multi – billion dollar retail outlets who also run coffee vending machine business when it comes to retailing at a rock bottom prices.

• Opportunities:

The fact that we are going to install our coffee vending machines in some of the busiest streets in Nashville – Tennessee provides us with unlimited opportunities to sell our coffee and other products to a large number of people.

We have been able to conduct thorough feasibility studies and market survey and we know what our potential clients will be looking for when they visit our coffee vending machines locations; we are well positioned to take on the opportunities that will come our way.

Just like any other business, one of the major threats that we are likely going to face is economic downturn. It is a fact that economic downturn affects purchasing power. Some other threats that may likely confront us is the arrival of a new retail outlet or new vending machines in same location where ours is located and also seasonal fluctuations cum unfavorable climatic conditions.

7. MARKET ANALYSIS

• Market Trends

The coffee vending machine business is part of the retailing industry and the retailing business has been in existence for as long as humans started trading goods, but one thing is certain, the retailing industry is still evolving especially with the advent of technology.

The introduction of technology is what gave birth to vending machines. In recent time, you can find vending machines designed specifically to dispense several goods ranging from snacks to drinks to groceries and to even cigar.

It is now a common phenomenon for vending companies to leverage on technology to effectively predict consumer demand patterns and to strategically position their vending machines to meet their needs. No doubt data collected from customers goes a long way to help vending machine businesses serve them better.

Another common trend in the retailing industry of which coffee vending machine falls under is the pricing system. Aside from having varieties of products in a vending machine, one of the easiest ways for vending machines to sell the goods on their vending machines as fast as they can and keep re – stocking is to ensure that the prices of their goods are a bit lower than what is obtainable elsewhere.

For example, it is common to see items with prices in this format; $3.99, $99 and $199 et al as against $4, $100 and $200. As small as the price difference, consumers are likely going to be swayed to make purchase because of that.

8. Our Target Market

Perhaps the vending machines industry has the widest range of customers; everybody on planet earth has one or more things that they would need from a vending machine. It is difficult to find people around who don’t patronize vending machines when they come across one.

In view of that, we have positioned our coffee vending machines in strategic locations to service the residents of Nashville – Tennessee and every other location our coffee vending machines will be located. We have conducted our market research and we have ideas of what our target market would be expecting from us.

Aside from coffee vending, we are in business to dispense a wide range of beverages and snacks via our vending machines to the following groups of people;

• Event Planers
• Corporate Executives
• Business People
• Sports Men and Women

Our competitive advantage

The competitions that exist in the vending machine line of business is stiff because anyone can start a coffee vending machine business; it isn’t financially tasking to start, as you can purchase a used vending machine at a cheap price, and still get the most out of it. The coffee vending machine business doesn’t require any expertise or know-how, and any serious minded entrepreneur is likely to make good profit out of this business.

One thing is certain, we will ensure that we have a wide range of products available in our vending machines at all times. It will be difficult for customers to visit our coffee vending machines and not see the type of beverages that they are looking for.

Our excellent customer service culture, highly competitive prices, reliable and easy to use payment option and the visibility of our vending machines and competent team members will serve as a competitive advantage for us.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Johnson Travolta® Vending Machine Company is established with the aim of maximizing profits in the retailing industry and we are going to go all the way to ensure that we do all it takes to sell a wide range of products to a wide range of customers.

Johnson Travolta® Vending Machine Company will generate income by retailing the following products via our vending machine;

• Coffee beverages (cappuccino, espresso, iced coffee, decaffeinated coffee, alcoholic coffee (Irish Coffee and Brandy Coffee et al), filtered coffee, cold brew coffee, Turkish coffee, coffee with milk and flavored coffee et al.)

10. Sales Forecast

One thing is certain when it comes to a vending machine business, if your vending machines are well stocked and centrally positioned, you will always attract customers cum sales and that will sure translate to increase in revenue generation for the business.

We are well positioned to take on the available market in Nashville – Tennessee and we are quite optimistic that we will meet our set target of generating enough profits from the first six months of operation and grow the business and our clientele base.

We have been able to examine the vending machine industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projections for Johnson Travolta® Vending Machine Company, it is based on the location of our business and other factors as it relates to vending machine startups in the United States;

• First Year: $240,000
• Second Year: $550,000
• Third Year: $950,000

N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown or major competitors positioning their vending machines in same locations where ours are. Please note that the above projection might be lower and at the same time it might be higher.

• Marketing Strategy and Sales Strategy

Before choosing locations for installing our coffee vending machines, we conducted a thorough market survey and feasibility studies in order for us to be able to penetrate the available market and become the preferred choice in Nashville – Tennessee.

We hired experts who have good understanding of the vending machine business/retail industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in Nashville – Tennessee.

In summary, Johnson Travolta® Vending Machine Company will adopt the following sales and marketing approach to win customers over;

• Print handbills about our coffee vending machine and its location, and also give our vending machines unique look, by painting them with bright colors or putting a large neon sign on it, so that it is easily recognizable to customers.
• Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get our message across, so that those on the social media or those who read blogs can know where to go when they need products that we retail
• Creating a basic website for our business, so as to give our business an online presence (list the locations of our coffee vending machines)
• Directly market our coffee vending machine business.
• Join local vending machine associations for industry trends and tips
• Provide discount days for our customers
• Advertise our business in community based newspapers, local TV and radio stations
• List our business on yellow pages’ ads

11. Publicity and Advertising Strategy

Despite the fact that our coffee vending machines will be strategically located, we will still go ahead to intensify publicity for the business. Here are the platforms we intend leveraging on to promote and advertise Johnson Travolta® Vending Machine Company;

• Place adverts on both print (community based newspapers and magazines) and electronic media platforms
• Sponsor relevant community programs
• Leverage on the internet and social media platforms like; Instagram, Facebook, twitter, et al to promote our brand
• Distribute our fliers and handbills in target areas
• Position our Flexi Banners at strategic positions in the location where our coffee vending machines are located.

12. Our Pricing Strategy

Johnson Travolta® Vending Machine Company will make sure that we have assorted coffees, beverages and snacks in different sizes of cups to meet the financial capacity of our customers. The prices for all our assorted coffees, beverages and snacks will be affordable and at the same time competitive with what is obtainable in the industry.

• Payment Options

Due to the nature of vending machines, there are no options when it comes to payment for items purchased other than to insert your money in the vending machine and then the machine will dispense what you paid for. We will ensure that we position money changers around our busiest coffee vending machines so as to make change available to our customers.

13. Startup Expenditure (Budget)

When it comes to starting a coffee vending machine business, the major areas that you should look towards spending the bulk of your cash is in the purchase of coffee vending machines and of course renting or leasing warehouse facility. Aside from that, you are only expected to pay your employees and stock your vending machines .

These are the key areas where we will spend our startup capital;

• The total fee for registering the business in the United States of America – $750.
• Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300.
• Marketing promotion expenses for the grand opening of Johnson Travolta® Vending Machine Company in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
• The cost for hiring Business Consultant – $2,500.
• Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
• The cost for payment of rent for 12 months at $1.76 per square feet in the total amount of $75,900.
• The cost for the Warehouse remodeling (construction of racks and shelves) – $20,000.
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000
• The cost for Start-up inventory (stocking with a wide range of products) – $100,000
• Storage hardware (bins, rack, shelves, food case) – $3,720
• The cost for the purchase of vending machines – $25,000
• The cost for store equipment (cash register, security, ventilation, signage) – $13,750
• The cost of purchase and installation of CCTVs – $10,000
• The cost for the purchase of furniture and gadgets for the office (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – $50,000.
• The cost of launching a website – $600
• Miscellaneous – $10,000

We would need an estimate of three hundred thousand dollars ($300,000) to successfully set up our coffee vending machine business in Nashville – Tennessee.

Generating Funds/Startup Capital for Johnson Travolta® Vending Machine Company

Johnson Travolta® Vending Machine Company is owned and financed by Johnson Travolta and his immediate family members. They do not intend to welcome any external business partners which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.

• Generate part of the startup capital from personal savings
• Source for soft loans from family members and friends
• Apply for loan from the bank

N.B: We have been able to generate about $100,000 (Personal savings $70,000 and soft loan from family members $30,000) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

It is an established fact that the future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and the business structure. If all of these factors are missing from a business, then it won’t be too long before the business closes shop.

One of our most important goals of starting Johnson Travolta® Vending Machine Company is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.

We know that one of the ways of gaining approval and winning customers over is to retail our coffee and other related merchandize a little bit cheaper than what is obtainable in the market and we are prepared to survive on lower profit margin for a while.

Johnson Travolta® Vending Machine Company will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

• Business Name Availability Check : Completed
• Business Registration: Completed
• Opening of Corporate Bank Accounts: Completed
• Securing Vending machines: In Progress
• Opening Mobile Money Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Leasing of facility for warehouse and remodeling: In Progress
• Conducting Feasibility Studies: Completed
• Generating capital from family members: Completed
• Applications for Loan from the bank: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents and other relevant Legal Documents: In Progress
• Design of The Company’s Logo: Completed
• Printing of Packaging and Promotional Materials: In Progress
• Recruitment of employees: In Progress
• Purchase of the needed furniture, racks, shelves, computers, electronic appliances, office appliances and CCTV: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business both online and around the community: In Progress
• Health and Safety and Fire Safety Arrangement (License): Secured
• Compilation of our list of products that will be available in our vending machines / warehouse: Completed
• Establishing business relationship with vendors – suppliers of all our products (assorted coffeess, beverages and snacks): In Progress

Coffee Vending Machine Business Plan Template & Guidebook

Are you looking for the perfect business plan template to help you launch a successful coffee vending machine business? Look no further – the #1 Coffee Vending Machine Business Plan Template & Guidebook is here! This easy-to-follow guide provides step-by-step instructions on how to create the perfect business plan for your coffee vending machine business. It covers all the essential topics such as market analysis, financial projections, operational planning, legal considerations, and more. Get ready to transform your dreams into reality with this ultimate resource!

Get worry-free services and support to launch your business starting at $0 plus state fees.

• How to Start a Profitable Coffee Vending Machine Business [11 Steps]

How to Write a Coffee Vending Machine Business Plan in 7 Steps:

1. describe the purpose of your coffee vending machine business..

The first step to writing your business plan is to describe the purpose of your coffee vending machine business. This includes describing why you are starting this type of business, and what problems it will solve for customers. This is a quick way to get your mind thinking about the customers’ problems. It also helps you identify what makes your business different from others in its industry.

It also helps to include a vision statement so that readers can understand what type of company you want to build.

Here is an example of a purpose mission statement for a coffee vending machine business:

Our mission is to deliver high-quality and convenient coffee vending machines to the community, providing an enjoyable customer experience and fostering a healthy business relationship with our vendors. We strive to build long-term brand loyalty by providing quality service, innovative solutions, and customer-friendly products. Our goal is to become the go-to supplier of coffee vending machines in the region, while contributing to the growth of local businesses.

2. Products & Services Offered by Your Coffee Vending Machine Business.

The next step is to outline your products and services for your coffee vending machine business. 

When you think about the products and services that you offer, it's helpful to ask yourself the following questions:

• What is my business?
• What are the products and/or services that I offer?
• Why am I offering these particular products and/or services?
• How do I differentiate myself from competitors with similar offerings?
• How will I market my products and services?

You may want to do a comparison of your business plan against those of other competitors in the area, or even with online reviews. This way, you can find out what people like about them and what they don’t like, so that you can either improve upon their offerings or avoid doing so altogether.

3. Build a Creative Marketing Stratgey.

If you don't have a marketing plan for your coffee vending machine business, it's time to write one. Your marketing plan should be part of your business plan and be a roadmap to your goals. 

A good marketing plan for your coffee vending machine business includes the following elements:

Target market

• Who is your target market?
• What do these customers have in common?
• How many of them are there?
• How can you best reach them with your message or product?

Customer base 

• Who are your current customers? 
• Where did they come from (i.e., referrals)?
• How can their experience with your coffee vending machine business help make them repeat customers, consumers, visitors, subscribers, or advocates for other people in their network or industry who might also benefit from using this service, product, or brand?

Product or service description

• How does it work, what features does it have, and what are its benefits?
• Can anyone use this product or service regardless of age or gender?
• Can anyone visually see themselves using this product or service?
• How will they feel when they do so? If so, how long will the feeling last after purchasing (or trying) the product/service for the first time?

Competitive analysis

• Which companies are competing with yours today (and why)? 
• Which ones may enter into competition with yours tomorrow if they find out about it now through word-of-mouth advertising; social media networks; friends' recommendations; etc.)
• What specific advantages does each competitor offer over yours currently?

Marketing channels

• Which marketing channel do you intend to leverage to attract new customers?
• What is your estimated marketing budget needed?
• What is the projected cost to acquire a new customer?
• How many of your customers do you instead will return?

Form an LLC in your state!

4. Write Your Operational Plan.

Next, you'll need to build your operational plan. This section describes the type of business you'll be running, and includes the steps involved in your operations. 

In it, you should list:

• The equipment and facilities needed
• Who will be involved in the business (employees, contractors)
• Financial requirements for each step
• Milestones & KPIs
• Location of your business
• Zoning & permits required for the business

What equipment, supplies, or permits are needed to run a coffee vending machine business?

<ul><li>Coffee Vending Machine</li><li>Compatible coffee equipment such as filters, grinders, and brewers.</li><li>Coffee ingredients such as beans, ground coffee, and flavored syrups.</li><li>Business permits and licenses.</li><li>Cashbox or cashless payment solutions.</li><li>Cups, napkins, and other necessary disposables. </li><li>Marketing materials. </li><

5. Management & Organization of Your Coffee Vending Machine Business.

The second part of your coffee vending machine business plan is to develop a management and organization section.

This section will cover all of the following:

• How many employees you need in order to run your coffee vending machine business. This should include the roles they will play (for example, one person may be responsible for managing administrative duties while another might be in charge of customer service).
• The structure of your management team. The higher-ups like yourself should be able to delegate tasks through lower-level managers who are directly responsible for their given department (inventory and sales, etc.).
• How you’re going to make sure that everyone on board is doing their job well. You’ll want check-ins with employees regularly so they have time to ask questions or voice concerns if needed; this also gives you time to offer support where necessary while staying informed on how things are going within individual departments too!

6. Coffee Vending Machine Business Startup Expenses & Captial Needed.

This section should be broken down by month and year. If you are still in the planning stage of your business, it may be helpful to estimate how much money will be needed each month until you reach profitability.

Typically, expenses for your business can be broken into a few basic categories:

Startup Costs

Startup costs are typically the first expenses you will incur when beginning an enterprise. These include legal fees, accounting expenses, and other costs associated with getting your business off the ground. The amount of money needed to start a coffee vending machine business varies based on many different variables, but below are a few different types of startup costs for a coffee vending machine business.

Running & Operating Costs

Running costs refer to ongoing expenses related directly with operating your business over time like electricity bills or salaries paid out each month. These types of expenses will vary greatly depending on multiple variables such as location, team size, utility costs, etc.

Marketing & Sales Expenses

You should include any costs associated with marketing and sales, such as advertising and promotions, website design or maintenance. Also, consider any additional expenses that may be incurred if you decide to launch a new product or service line. For example, if your coffee vending machine business has an existing website that needs an upgrade in order to sell more products or services, then this should be listed here.

7. Financial Plan & Projections

A financial plan is an important part of any business plan, as it outlines how the business will generate revenue and profit, and how it will use that profit to grow and sustain itself. To devise a financial plan for your coffee vending machine business, you will need to consider a number of factors, including your start-up costs, operating costs, projected revenue, and expenses. 

Here are some steps you can follow to devise a financial plan for your coffee vending machine business plan:

• Determine your start-up costs: This will include the cost of purchasing or leasing the space where you will operate your business, as well as the cost of buying or leasing any equipment or supplies that you need to start the business.
• Estimate your operating costs: Operating costs will include utilities, such as electricity, gas, and water, as well as labor costs for employees, if any, and the cost of purchasing any materials or supplies that you will need to run your business.
• Project your revenue: To project your revenue, you will need to consider the number of customers you expect to have and the average amount they will spend on each visit. You can use this information to estimate how much money you will make from selling your products or services.
• Estimate your expenses: In addition to your operating costs, you will need to consider other expenses, such as insurance, marketing, and maintenance. You will also need to set aside money for taxes and other fees.
• Create a budget: Once you have estimated your start-up costs, operating costs, revenue, and expenses, you can use this information to create a budget for your business. This will help you to see how much money you will need to start the business, and how much profit you can expect to make.
• Develop a plan for using your profit: Finally, you will need to decide how you will use your profit to grow and sustain your business. This might include investing in new equipment, expanding the business, or saving for a rainy day.

Frequently Asked Questions About Coffee Vending Machine Business Plans:

Why do you need a business plan for a coffee vending machine business.

A business plan is essential for any new business venture, including a coffee vending machine business. A business plan can provide a roadmap and guide for setting up the business, defining the company's goals and objectives, researching the market, determining target customers and pricing, creating a marketing strategy, and tracking progress. A business plan can also help identify potential investors and secure financing.

Who should you ask for help with your coffee vending machine business plan?

It's best to ask an experienced business consultant or mentor for help with a coffee vending machine business plan. Additionally, you may want to ask an accountant or financial advisor to review your plan and provide additional advice.

Can you write a coffee vending machine business plan yourself?

Writing your own business plan can be an arduous task. You will need to research industry trends, customer needs and preferences, competition, your local market, and the costs associated with starting and running a coffee vending machine business. You should also create detailed financial projections for both the short-term and long-term as well as a marketing strategy. Additionally, you will need to consider legal requirements such as permits and licenses, insurance, taxes, and other related costs. Depending on the scope of your plan, you may also want to consider hiring a professional consultant for help in developing your plan.

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How to Start a Vending Machine Business: Cost, Tips, Pros and Cons

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Vending machines are not a novel business idea — they’re basically everywhere. However, if you’re looking to start your own business, there is a lot to like about the vending industry. Consider that there are millions of machines in the U.S. alone — and the vending machine industry in the U.S. generated over $8.6 billion in annual revenue in 2023 [0] IBISWorld . Vending Machine Operators in the US - Market Size (2005–2030) . Accessed Feb 21, 2024. View all sources .

The vending machine industry is an attractive option for both new and experienced entrepreneurs because of its versatility. It can be a great weekend side hustle, a low startup-cost business or an interesting new way to expand your portfolio.

Vending machine costs

The majority of the cost to start a vending machine business comes from the vending machines and the stock items, and can be financed through a small-business loan or personal savings. With as little as a $2,000 investment, you can generally get a basic vending machine business up and running.

Many vending machine operators recommend buying used or refurbished machines, which you can find between $1,200 and $3,000. A new vending machine will cost anywhere from $3,000 to $10,000, depending on its size and features.

Besides the machine itself, you'll also want to consider the cost of inventory to stock your machines. Depending on how many machines you plan to own and what kind of inventory you'll stock, this could span a few hundred to thousands of dollars.

How much do you need?

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

How to start a vending machine business: A step-by-step guide

Though helpful, previous experience and connections in the industry aren’t necessary to get a vending machine business off the ground — and make money doing it. Here's how to start a vending machine business in six steps.

1. Consider your vending machine options

There are a wide range of vending machines available today. In general, there are four different categories of vending machines (which we'll outline below). Consider all four types when choosing the machine whose products are best suited to the target market you’ve defined in your business plan .

Whichever type of vending machine you choose, start out with one or two machines with a specific market focus. That way, you can gradually learn about popular stock- and site-specific patterns, and add new machines accordingly.

Food and beverage vending

According to a report from Vending Market Watch released in 2023, food and beverage vending machines with snacks, soda and candy make up the majority of the vending market share in the U.S., with beverages alone accounting for 23% of vending sales.

You can get a machine that just offers drinks, snacks or snack-and-drink combinations. Some vending machine entrepreneurs choose to purchase different types of machines for one location or place one kind of machine in multiple locations. If you’re a new vending operator, consider starting with a specialty — healthy snacks, beverages or fresh food — until you learn more about the industry.

To make the most sales, cater your offerings to a specific, location-driven market. For instance, you might stock healthy alternatives such as protein bars and shakes at a gym location or juice and granola bars in a school vending machine.

Bulk vending

Starting a vending machine business with machines that stock gum balls, stickers or rubber balls — also known as bulk vending — requires very little capital and low maintenance costs.

These typically low-maintenance vending machines might not be glamorous, but the quarters do add up. A refurbished vending machine could cost you less than $50 and bring in $30 per month with only a few sales a day. The products you’re offering have incredibly low overhead. In the right market — like a school or amusement park — this modest investment offers the potential for a reliable, passive income source.

Most bulk vending machines are mechanical devices and don’t require electricity or battery power to operate, which means the cost of operation is low to nonexistent. That said, many candy and toy vending machines are older, so a used device might require minor repairs before it’s functional.

Specialty vending

You're not just limited to food and drinks when starting a vending machine business. Large public places like arenas, airports and malls often have machines offering goods like tech accessories, beauty products or other specialty items. Some of these vending machines use the same technology as standard vending equipment, and some with advanced features like touch screens and contactless payment are differentiated as Automated Retail Machines.

Some specialty vending items include:

Hot beverages: Coffee or hot beverage vending can be successful in offices, universities and conference centers. Manufacturers often produce both specialty beverage equipment and traditional machines, so you may be able to combine your purchases.

Retail merchandise: Essential travel items like phone chargers, headphones and neck pillows can be lucrative vending products if you’re able to negotiate a contract with a local transit station or airport. Upscale vending machines in malls and airports often contain luxury skin care products or electronics.

Laundry products: Individually packaged detergent, fabric softener and dryer sheets make great vending products if you identify the right market for it — like laundromats, apartment complexes or dormitories.

Tobacco: Tobacco vending is legal in many states and can be lucrative, depending on the state taxes. Even cannabis vending machines are becoming available, but with a much more limited market.

Franchising options

If you don’t want to build your business from scratch, you may want to consider buying a franchise to start your vending machine business. As a franchisee, you will be able to work within a proven business framework and receive extra support and training to get your vending business set up. You’ll also be able to decide how many or how few machines you want to invest in. However, keep in mind that as a franchisee, you will be responsible for paying a portion of your profits to the franchisor.

» MORE: Best franchise financing options for your business

2. Find the right location for your vending machine

The location of your vending machine is a crucial factor in earning a profit. For instance, an upscale food and beverage vending machine might fail in a strip mall full of restaurants, but that same machine might flourish in an office park.

When starting a vending machine business, think about the locations where you have personally purchased something from a vending machine, as well as the times when people are most likely to purchase beverages, snacks or other items.

Some location ideas for your vending machine include:

Schools, colleges and university campuses.

Hospitals, medical centers and care facilities.

Grocery and retail stores.

Airports, train and bus stations.

Shopping malls.

Laundromats.

Gyms and other exercise facilities.

Business offices and complexes.

Apartment buildings.

Manufacturing plants, distribution centers and industrial parks.

Car dealerships.

Secure your location

If you already have locations in mind, reach out to proprietors or work on getting contact information for the relevant manager. Talking to prospective proprietors about location needs can help you get a better understanding of local demand and inform your vending machine and product selection.

Researching online or contacting your local Chamber of Commerce for information about major businesses in your area can help you identify potential locations. Ideally, try to place your vending machine at companies with at least 100 employees or considerable foot traffic, like a multi-business office park.

Understand state-specific vending laws, regulations and compliance

Different rules apply to various types of vending machines, and vending regulations vary by state. Before starting a vending machine business and reaching out to prospective location proprietors, find out how your state governs vendors by looking up your state and local small business regulations online.

Also, any vending machine you put in a public place may be subject to certain ADA compliance standards , and it’s a good idea to keep accessibility in mind when considering vending machine options.

Know commission requirements and prepare a proprietor contract

You’ll need to pay commission to the proprietor who provides the location and the electricity required to operate your machine. Generally, you can expect to pay the property owner 5% to 25% of the revenue from your vending machine.

Draw up a contract with the proprietor stating your agreed compensation rate, contract length and terms. Include provisions for breach of contract, too. It’s also smart to include expectations and obligations regarding servicing and restocking your vending machines, vandalism or theft, and the possibility of unprofitability. As always, have a lawyer look over the contract before signing.

3. Find your vending machine

Finding your vending machine can be as simple as an online search. To get an idea of the different vending machines offered and price points, search both local and national suppliers. You’ll also want to consider the cost of inventory when looking at vending machine prices.

You can start your search with these three types of sellers:

Manufacturers or wholesale vending suppliers have the widest selection of vending machines for sale, new technology and end-to-end services for delivery, repairs and training. This is likely the most expensive option.

Secondary market sellers or specialty online retailers allow you to browse multiple brands and models of vending machines and often have helpful resources for business owners.

Consumer-to-consumer platforms like Craigslist and eBay have vending machines for sale. Save time by filtering by merchant or owner location, so you don’t have to worry about major shipping costs. This may be the best option for first-time vending entrepreneurs who don’t want to spend thousands on a new or refurbished machine.

Vending machines come with a range of features and capabilities, all at different price points.

Some of those special features include:

Snack/drink combination machines.

Credit card and large bill functionality.

Touch or voice accessibility.

Remote monitoring software and low-stock alerts.

Branded “wraps” for the front of your machine.

Interactive screens.

These special features can be tempting, but they will often add to the overall cost of the machine. Choose the vending machine that best fits the products you want to offer and what you can afford.

4. Explore your financing options

Starting a vending machine business doesn’t typically require as much startup capital as some other small businesses, which can cost hundreds of thousands of dollars to start.

However, depending on the type and number of machines you want and the stock you plan to carry, you may want to explore financing. Here are some options to consider:

Short-term loan

If you’re already a business owner and have the business financial history to prove it, securing a short-term loan to finance your vending machine might be your best course.

Short-term lenders deposit a lump sum of cash directly to your business bank account, and you’ll repay your loan, plus interest, over a predetermined amount of time. Repayment terms for short-term loans are usually 12 months or less, although you may find terms up to 24 months. Interest rates are a bit higher than longer-term loans .

Short-term loans can be easier to qualify for than other forms of financing because lenders are often more flexible when it comes to credit score and time in business.

» MORE: Best online business loans

Equipment financing

An equipment financing loan is another option to consider. The terms of these loans depend on the value of your equipment, which also acts as collateral in case you default on your loan payments.

In addition to your financial information and business plan, you will need equipment quotes for the machine(s) you plan to purchase when you apply for an equipment loan. And, if you need capital to purchase inventory, you may want to consider inventory financing .

5. Stock your vending machine with inventory

Once you’ve settled on a vending machine, you have to stock it with inventory.

Rather than choosing to stock items based on wider food and beverage trends, pay attention to local, site-specific needs. To stay on the safe side, don’t over-order stock in the beginning, and adjust your offerings based on demand.

If you choose to provide combined food and beverage services in your vending machine business, drinks will make up most of your sales. As the growing refreshments market expands to flavored water and healthier beverages like coconut water, consider what your location can support in terms of pricier specialty foods and drinks.

Drink size and shapes will affect your range of machine choices, so if you feel strongly about selling cartons or irregularly shaped products, try to find a machine with adjustable product sizing.

6. Make the right investments

After you’ve purchased your machine and placed it at a selected location, you’ll want to focus on making the business profitable.

Invest in a vending management system (VMS)

Depending on the technology in your machine, your vending equipment may come pre-programmed with management software, which you can use to streamline operations, record inventory and track revenue.

If you have machines that require you to manually manage your inventory, it might be possible if you own just a couple of vending machines. Once you have five to 10 vending machines, though, it’s probably a good idea to invest in a vending management system to help you stay on top of your inventory remotely. VMS software allows you to remotely manage your vending machines from an internet-enabled device. Most VMS systems provide real-time inventory updates and reporting tools.

Invest in customer service

Even if you only have one or two vending machines, it’s worthwhile to emphasize customer service from the beginning of this (or any) venture.

Most importantly, ensure that your vending machines are stocked and functioning on a weekly or biweekly basis. You can also consider providing an 800-number for service requests and comments, which is a great way to get useful feedback.

Like many location-based businesses, vending operators are often dependent on word-of-mouth referrals and in-person connections. Foster relationships with business owners, look up your state’s vending association or join local networking groups for entrepreneurs.

Invest your time

Starting a vending machine business requires more than just capital investment — you’ll have to invest some time and attention to your vending machine business, too.

A full-size vending machine might require you to collect money weekly, which is important to keep in mind when determining how much time you can realistically spend traveling to locations. In addition to the time it takes to purchase inventory, visit locations and restock, operating a vending machine business requires you to spend time researching trends in sales, new products or locations, and talking to peers.

If you can’t get away from your full-time commitments often, bulk vending — with non-perishable candy or stickers — might be a good way for you to break into the vending machine business without sacrificing too much of your time.

Pros and cons of starting a vending machine business

Like any new venture, starting a vending machine business has advantages and disadvantages to consider.

Easy to scale: Scaling your vending machine business is relatively easy. You can start off with a few vending machines, and as you become more successful, expand locations.

Variety of choices: There are all types of vending machines. Vending machines now serve healthy foods, gourmet options and items completely unrelated to food.

Little to no overhead costs: There are little to no overhead costs of running a vending machine business, especially if you don’t have employees or require office space.

Time commitment: Operating a vending machine business will require you to commit some time and energy into stocking, servicing and collecting money from your machines on a regular basis.

Theft and vandalism: Vending machines can be an easy target when it comes to theft and vandalism. Ensure that your machines are in secure and safe areas to avoid a loss in profits.

Yes, vending machines can be profitable. The average vending machine generates $75 a week or around $300 a month. However, vending machines that are well-stocked and placed in safe, high-traffic locations can generate more than double that.

Yes, vending machine owners pay rent or commission to the owner of the property. Vending machine owners generally pay between 5% to 25% of their vending machine sales.

Yes, vending machines are charged sales tax on the revenue they generate. The amount of sales tax varies depending on your state.

You can place vending machines in most commercial spaces such as offices, retail shops, bowling alleys and more. But you'll need to sign a contract with the property owner first.

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A version of this article originally appeared on JustBusiness, a subsidiary of NerdWallet.

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