How To Start a Vending Machine Business: Costs, Pros and Cons (2024)

How To Start a Vending Machine Business: Costs, Pros and Cons (1)


Like any business that requires time, effort and money to scale, a vending machine business is perfect to start as a side hustle. And if you’re looking for a side-hustle opportunity, you’re not alone. A LendingTree survey conducted in October 2020 found that 45% of Americans considered taking up a side hustle during the pandemic — and those who did depend on that income.

But there’s more to starting this type of business than simply buying a vending machine and setting it up. You’ll have to complete a lot of in-between steps to make your vending machine venture successful. And while you won’t likely become a millionaire, you may be able to scale the business to the point that you can replace the income from your full-time job. Here’s what you need to know in this go-to guide for starting a vending machine business, including startup costs and what you can earn.

How Much Do Vending Machines Cost?

Vending machines can vary in cost, depending on what type of machine you choose. Here’s a breakdown of the different types of vending machines and their estimated costs. Note that estimated costs are for new machines. If you buy a used or refurbished machine, your cost could be lower.

Bulk Vending Machines

Estimated cost: $100-$500

Bulk vending machines are often placed outside of retail stores or in malls, in waiting areas of offices and transportation stations and inside kid-themed restaurants or arcades. These machines offer small toys and candy, such as stickers, costume jewelry and gumballs, and usually require quarters to vend their wares. Bulk vending machines are the most affordable of all vending machines but also provide lower profits per item than machines that vend more expensive products. An advantage of bulk vending machines is that they don’t require electricity or batteries to operate, which makes them easy to maintain.

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Food and Drink Vending Machines

Estimated cost: $3,000-$5,800

Food and drink vending machines are placed inside retail stores, malls, hospitals, hotels, airports, office buildings, event centers and schools. They offer a variety of food and drink items, including candy, chips, cookies, water, energy drinks, tea and soda, and have higher price points than bulk vending machines, which can make them more profitable — especially if they are placed in a high-traffic area. More specialized food and drink vending machines are also available, including those that dispense coffee, deli-syle sandwiches or ice cream. Note that these types of machines require electricity to operate and need ongoing maintenance.

Specialty Vending Machines

Estimated cost: $2,300-$6,200

Specialty vending machines are most often found in places where the target audience travels, such as airports, hotels, resorts, restaurants, gyms, event venues and bars. These machines dispense specialty items, such as personal protective equipment, beauty products, laundry products and electronics. These machines often include specialized technology, which can require more upkeep. Plus, they often have customized slots to fit specific products, making it difficult to switch up the products you sell.

8 Steps to Starting a Vending Machine Business

Now that you know what types of vending machines are available and their estimated costs, here are the steps to launch your vending machine business.

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1. Research the Market

Determine how many customers you will need each day or week to make your vending machine business profitable. Drive around to find available locations with plenty of foot traffic to place your vending machine. Good locations include hotels, motels, gyms, office buildings, laundromats, schools and shopping centers. Note any other vending machines in the area so you can avoid competition.

2. Register Your Business

Check with your local government about required business registration and licenses. According to the Small Business Administration, if you conduct business under your own name, you do not have to register anywhere. However, you won’t be able to take advantage of legal protection, personal liability protection and potential tax benefits that a registered business may offer. Depending on your business’s structure, you may also need to apply for an employer identification number, which will help identify your business when you file taxes.

3. Select Your Vending Machines

Now that you’ve completed market research for the area you want to service and registered your business, select the type of vending machines you want to offer. You can choose from bulk vending machines, which require no electricity and typically take coins. Or you can choose a snack vending machine, beverage vending machine or any type of specialty vending machine.


If you’re interested in a new machine, check out the warranty before you buy and note the price of common spare parts that you may need to repair the machine. If you decide to buy a used or refurbished machine, search the model number to help you find out if spare parts are available. If the machine is no longer being made, you may find it difficult to locate spare parts should the need arise.

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4. Determine Operating Costs

Make a spreadsheet detailing all of your expenses — no matter if they’re one-time costs or recurring ones. Operating expenses include inventory costs, maintenance, fuel, leasing expenses, sales tax and loan repayments, such as if you finance your vending machine. Find out what it costs to run your vending machine business in the short term, such as weekly or monthly, and in the long term, such as yearly.

5. Get Funding

If you aren’t able to launch your vending machine business with funds you already have, you can apply for a loan or vending machine financing. You’ll be more likely to land the loan or financing with a good credit score. Additionally, be prepared to submit a business plan and a budget if you apply for a small business loan.

6. Secure Each Vending Machine’s Location

Refer back to the locations you scouted for each of your vending machines, and work on securing each one. You’ll have to make contact with the business owner or property manager at the location where you want to place each machine. To get the right person’s contact information, you can either visit the location in person or call to inquire.

To secure the location, you’ll need to pitch your offer first to see if there’s any interest. Make a case for having your particular vending machine in the location, such as by noting that it could provide more variety or replace an outdated and unattractive vending machine. Once you’ve determined the property owner or manager has an interest in your machine, here are some additional steps to secure the location:

  • Negotiate the leasing costs.You may have to pay a flat fee each month to have your vending machine on the property or agree to share part of your profits. Either way, make sure you negotiate a fair deal and get it in writing.
  • Keep in touch. Understand that there are other vending machine owners who are scouting for locations just like you. It’s important to keep in touch with the property owner or manager to find out how your vending machine is performing. If you just swing by every so often to replace inventory and never check in, you may lose your lease to someone who’s more enterprising.
  • Build a lead list. Unfortunately, once you’ve secured a location for your vending machine, that doesn’t mean that it’s permanent. Anything could happen, from someone else taking over the lease to the business closing. Be aware of other potential locations where a vending machine might be profitable, and get the property owner’s or manager’s contact information. This can save you a step or two if you find yourself having to suddenly relocate your vending machine.

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7. Install and Stock Your Vending Machines

Once you’ve secured locations for your vending machines, you’ll need to install them. Be sure to bring your inventory with you so your machines can start making money as soon as possible. Choose to install machines and inventory that fit the type of traffic at the location. For example, at a hotel or in a hospital lobby, you may want to install a PPE machine. At an event venue, you may want to install an ice cream machine. If the machine will be installed at a gym, consider energy drinks and protein-packed snacks, like power bars.

Every time you visit your machine to restock, take note of items that sell well and items that are not moving. Keep restocking top-selling items, and switch out the stagnant items with items that you predict will sell well based on top sellers.

8. Keep Your Vending Machines in Tip-Top Shape

Make a schedule to revisit your machines to make sure they are clean, operating properly and fully stocked. While you’re there, you’ll need to wipe down the machines and keypads and make sure all buttons, lights, money slots and credit card readers are functional.

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Pros and Cons of Starting a Vending Machine Business

As with any business you start, a vending machine business also has its pros and cons. Here’s a quick look at some of the advantages and drawbacks to expect.

Potentially low startup costsMachine breakdowns equal loss of income.
Predictable income flowMonitoring and replacing product inventory takes time and fuel.
Potential to scale the business as desiredFinding high-traffic locations to place machines may be difficult.
Largely recession-proofLeasing agreements are the norm; you’ll have to pay a flat fee or a portion of sales to place your machine in certain locations.

How Much Money Can You Make With Vending Machines?

How much you can make with vending machines depends on various factors, such as the type of products each machine offers and the traffic in each location. For example, a vending machine in one location may make as little as $5 a week, while the same machine offering the same products in another location could make $100 (or much more) per week. It also depends on how many vending machines you are operating at one time. To scale to $1,000 or more a day in profits, you’d need at least 75-100 vending machines in operation at all times, according to information from VendSoft.

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Here are answers to some of the most commonly asked questions about starting a vending machine business.

How much does it cost to start a vending machine business?

The minimum startup costs for a vending machine business are approximately $1,592, according to information from Starter Story. These startup costs are in addition to any vending machines and inventory. They can include advertising and marketing costs, software expenses, business formation fees and any tools you may need to work on the machines.

Do you need an LLC to own a vending machine business?

No. While you don’t need to designate your vending machine business as an LLC, doing so can protect your personal belongings and finances in case of a lawsuit. Also, the profits or losses your business incurs will pass through to your personal tax return. See a tax professional for more details.

Can you put a vending machine anywhere?

No. You need a contract, or at the very least, permission, to put a vending machine on someone else’s property. Also, not just any location will do if you want to be successful. When placing your vending machine, you’ll want to find locations that have enough people consistently moving through the area who want to buy the items in your machine.

Vending Machine Business Takeaways

A vending machine business can be a profitable venture as long as you do your research first to find and secure locations that have enough foot traffic, as well as the type of customers who will want what your vending machines are offering. This business doesn’t take a lot of money to break into, either. At a minimum, all you have to do is buy one functional machine and stock it, and you’re ready to make money, which will be mostly passive income. Plus, as you make money, you can reinvest it in your business to form an LLC, buy more machines and maybe even hire an employee to help you service and restock the machines. And if you work hard, one day you may even be able to replace your full-time income and quit your job.

Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.

How To Start a Vending Machine Business: Costs, Pros and Cons (2024)


How much does it cost to make a vending machine? ›

A smart vending machine costs around INR 1.0 – 1.5 lakhs and it is a one-time investment. You own the machine and it includes everything like a digital screen, software, dashboard, and apps as well. You may have to pay a franchise fee which is between INR 5K-25K per vending machine.

How much does it cost to fill a vending machine? ›

The average cost to fill up an empty vending machine is around $200 per month. However, this price is dependent on what products you are using to fill the machine.

How profitable is 1 vending machine? ›

One vending machine will probably make you money, but it is ideal to grow your business by adding more locations. Most vending machines have 20% to 25% profit margins and earn $5 to $50 or more each day in sales. A vending machine in a respectable location making $1,500 a month will make about $375.

How risky is a vending machine business? ›

Maintenance on a single machine can be hundreds of dollars if it breaks. Add that to the fact that every machine is around $4,000 or more, and you have a lot of financial risk with maintenance of these machines.

What is a disadvantage of owning a vending machine? ›

Cons of owning vending machines

And while vending is one of the easier businesses to operate, with a more streamlined, fairly straightforward business model, it is a hand-on business that does require some regular time and attention. You will have to provide maintenance and restock your machines regularly.

How much does 1 vending machine make a month? ›

How much money can you really make running a vending machine business? According to industry data, the typical vending machine generates over $75 of revenue each week and over $300 per month.

What is the monthly income of a vending machine? ›

America has three million vending machines, an $18.2 billion industry, with the average machine generating about $525 in monthly revenue, according to the National Automatic Merchandising Association.

How to find a location to put a vending machine? ›

If a business has a break area, be sure to consider this as a location for your vending machine. Snack areas are a particularly great location if there is little nearby competition. Think about picnic areas, playgrounds, cafeterias, and other places where people normally take a break and eat at a business.

Do vending machine owners pay rent? ›

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.

How long does it take for a vending machine to pay for itself? ›

how long does it take for a vending machine to pay for itself. On average it takes around 12-16 months to completely pay off a new vending machine. The time it takes will depend on the usage, quality of service and location of the vending machine.

How much do vending machines profit a week? ›

Are vending machines profitable? The average vending machine earns $35 a week, but your profitability depends on the location of your machine and the kind of goods sold. Operators purchase goods in bulk and sell them for a premium in their machines, making margins as high as 86% on items such as water.

Is vending machine a good side hustle? ›

Vending machines: An emerging side hustle

Some owners of the automated contraptions filled with sweets and snacks have turned them into a viable side hustle, making hundreds of dollars a month.

What kind of vending machines make the most money? ›

Bulk Vending Machines

One of the most affordable types of vending machines with the biggest profit margin is the bulk machine. Bulk machines are those low-tech dispensers of gumballs, other candies, and toys you see at playgrounds, parks, and restaurant waiting areas.

How much should I pay for vending machine? ›

On average, you can expect to spend between $3,000 to $5,000 for a new snack vending machine. The price can go up or down based on the size of the machine, brand, and manufacturer.

Is owning vending machines worth it? ›

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.

What are the benefits of vending machines? ›

Having a midday snack gives employees the fuel they need to keep going, and because vending machines function as an on-site source of food and drinks, employees don't have to waste time and leave the office to grab food. This allows them to be more efficient and spend more time in the office for improved productivity.

Is it a good idea to own a vending machine? ›

Vending machines can be very profitable. If you can get products to stock machines at good prices, and your vending machine is in a place that a lot of people go to, you can make a decent amount of money with little investment and time.

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