Vending Machine Business Plan Template
Whether you want to start your own vending machine business or expand an existing one, you need a business plan. The following vending machine business plan template lets you know what elements you need to include in a successful vending machine business plan.
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To ensure your vending machine business success in this highly competitive market, you need a properly structured vending machine business plan. With over 12 years of experience in business plan writing, we have helped over 5,000 entrepreneurs create business plans to start and grow their vending machine businesses. Using the following vending machine business plan template, you can put together an effective business plan.
Things to Know Before Writing a Vending Machine Business Plan?
Vending machine operators provide and service automated machines that sell snacks, soft drinks, cigarettes, newspapers, and other products.
In the five years to 2023, the Vending Machine Operators industry has experienced slight growth. Although there have been challenges, increased per capita disposable income and consumer spending have supported industry revenue during the period.
Thus,acording to IBIS-World over the five years to 2022, industry revenue is expected to increase by an annualized 0.8% to $10.2 billion, including an increase of 3.8% in 2022 alone.
Among the major products and services in this industry are
- Hot beverages
- Cold beverages
- Frozen products
- Food and snacks
- Other products
- Healthy item
Key Success Factors for Vending Machine Business
Despite the challenges of the Vending Machine industry, We have identified five factors that can help you boost profitability, efficiency, and ultimately success.
- Having exclusive rights to sell a particular popular product: If an operator can secure the sole right to sell a particular popular product at a particular location, demand is likely to be high.
- Transferable cost increases: Any cost increases from suppliers need to be passed on to consumers since profit makes up a small percentage of revenue. Customers generally accept small price increases for a well-stocked, reliable machine in a good location.
- Scale economies: Businesses that service and control many machines gain economies of scale by purchasing bulk products, which lowers their maintenance costs per unit.
- Scope economy: Companies with a wide variety of products in their vending machines are more likely to attract customers.
- Close proximity to key markets: Operators who are able to place vending machines close to many potential customers will likely generate more revenue.
- Easily accessible for clients: A vending machine that is conveniently located for customers will likely receive a higher volume of traffic and usage.
What is a Vending Machine Business Plan?
A business plan for a vending machine business is a written document that sets your company’s financial goals and discusses how you’ll reach them.
A solid, comprehensive plan will serve as a road map for the next three to five years of the vending machine business. Any bank or investor you approach will require a vending machine business plan, so putting one together will be critical to securing funding.
In short, writing a business plan can help you succeed if you’re thinking of starting a vending machine business or pitching to investors or venture capitalists.
Why You Need a Vending Machine Business Plan
A business plan gives a picture of your vending machine as it currently stands and outlines your growth strategy for the following five years. It describes your company’s aims and plan for achieving them. Market research is also included to back up your goals.
A solid, detailed plan gives you a clear path to follow, forces you to examine the viability of a vending machine business idea, and may help you better understand your company’s finances and competition.
Vending machine business owners who have a business plan grow 30% faster than those who don’t, and 71% of fast-growing businesses have one.
A vending machine business plan is a living document that should be updated annually as your company grows and changes.
Funding Sources for Vending Machine Business
Here are some possible funding options for your vending machine business:
Entrepreneurs who wish to enter into the vending machine business might benefit greatly from short-term business financing. Lenders will normally consider your personal or company credit, the latter of which may need you to already be a business owner before entering into vending machines.
These criteria may restrict businesses without prior vending machine expertise from obtaining short-term loans. However, if you qualify, short-term business loans are a wonderful fit for this line of company.
These criteria may restrict businesses without prior vending machine expertise from obtaining short-term loans. However, if you qualify, short-term business loans are a wonderful fit for this line of company.
Because vending machines classify as equipment, equipment financing may be a viable option for you to get capital for your business. The terms of these loans are determined by the worth of your equipment, which serves as collateral for the loan in the event that you default on your payments.
Personal and Business Credit Cards
Considering how inexpensive it is to acquire new or old vending machines compared to starting other types of small companies, using credit cards to fund your business is a viable option. Look into some of the best business credit cards for establishing a business to determine whether this is a viable option for you.
How to Write a Vending Machine Business Plan
To write a vending machine plan, you don’t need to be an expert. Our step-by-step guide will show you how to write a vending machine business plan, or you can just download our proven sample business plan pdf to get a better idea.
The executive summary is the most important part of the document since it outlines the whole business plan. Despite the fact that it appears first in the plan, write the executive summary last so you may condense key concepts from the other nine parts.
It’s a part that catches the investor’s eye and provides key information about your company’s overview and upcoming short- and long-term goals.
Tell them what kind of vending machine business you have and what stage you’re in; for example, are you a startup, do you have a vending business company that you want to expand, or do you have a lot of vending machine businesses?
Finally, an executive summary should provide investors with a preview of what they may expect from the rest of your document.
- Provide a high-level overview of the vending machine industry
- The name, location, and mission of your vending machine company
- A description of your vending machine business, including management, advisors, and a brief history
- Discuss the type of vending machine business you are operating, Give an overview of your target customers., and how your company differs from competitors in the industry
- Create a marketing plan that describes your company’s marketing strategies, sales, and partnership plans.
- And give an overview of your financial plan
Check out these executive summary examples to help you write a perfect one for your vending machine business plan.
Free: Executive Summary Examples
An executive summary is the most important part of your business plan, and it need not be challenging to write. This is why we have put together some awesome free Executive Summary examples for you.
The company analysis follows the executive summary as the second section of a vending machine business plan. Your company overview will be short and clear, similar to the executive summary.
Even if they just have a few minutes, your reader has to understand what your company does and who your customers are.
The following sections will be included in your business plan’s Company Analysis:
- Company summary: Your company analysis will describe the type of vending machine business you are running and its future goals.
The type of vending machine you might be focused on ( Groceries, Drinks, Snacks, Children’s toys, Beauty products and cosmetics, Fruits, Vegetables, Handkerchiefs, Towels, Flowers, etc)
- Company history: When and why did you start your vending machine business?
- What milestones have you achieved so far? Milestones might include sales goals achieved, new machine installations, and so on.
- Legal structure and ownership: Do you have S-Corp status? Is it an LLC? A sole proprietorship? Describe your legal structure.
- Mission statement: An overview of your vending machine company’s guiding principles. Learn how to write a perfect mission statement.
You need to include an overview of the vending machine in the industry analysis you performed before sitting down to write your vending machine business plan.
While this research may appear to be unnecessary, it helps you to build strategies that maximize business opportunities while lowering or avoiding the identified risk.
Furthermore, market research can improve your strategy, especially if it identifies market trends. For example, if there is a trend toward selling advertising on vending machines, make sure your strategy includes a variety of ad formats and sizes.
The third purpose for conducting market research is to demonstrate to readers that you are an industry expert.
Industry analysis can be presented as a 8-step process when written as part of a company’s business plan.
- Give a quick overview of the vending machine industry. Define the vending machine business in terms of size (in dollars), historical background, service region, and products.
- Examine previous trends and growth patterns in the vending machine industry.
- Identify the market’s major competitors.
- Age, gender, and general lifestyle of the targeted market
- Determine the factors that have an impact on the vending machine industry. These might include government regulatory rules and other businesses’ competitive activities.
- Using research data, the industry forecast expected growth over the next five to ten years. Predictions should be made for both the long and short term.
- Describe how your vending machine business intends to position itself in the industry. Concentrate on how your vending machine business can benefit from opportunities highlighted in the industry.
Free: Business Plan Examples
Do you need help creating a business plan? Check out these six free, proven business plan examples from different industries to help you write your own.
The first condition for a vending machine business is to identify its target customers clearly. Customers can be categorized into the following segments: Households, office buildings, Business People, Sports Men and Women, Students, Children, Adults, Tourists hotels,, correctional facilities, etc.
The customer analysis section is an important part of any vending machine business plan since it evaluates the consumer segments that your company serves. It identifies target customers, determines what those customers want, and then explains how the product will meet those requirements.
Customer analysis may be divided into two parts: psychosocial profiles (why your vending machine suits a customer’s lifestyle) and demographic profiles (descriptions of a customer’s demographic qualities).
With regards to demographics, include information about: When moving residential, the ages, genders, locations, and income levels of your customers. When targeting businesses, describe what kind of business, size, and location your target customers are.
The psychological profiles of your target clients reveal their wants and needs. The better you understand and identify these demands, the better your chances of attracting and retaining customers will be.
It is necessary to do a competitor analysis. Because you may use their data to define your goals, marketing plans, tactics, new product lines, pricing, and more.
4 Use competitor analysis to:
- Identify the strength and weakness of your vending machine business competition.
- Search for opportunities to distinguish your vending machine company from competitors.
- For setting your product’s price.
The first step in competitive analysis is to determine who your direct and indirect competitors are.
The direct competition consists of other vending machine businesses that offer essentially the same services or to the same people as you do.
Your indirect competitors are other options that customers have to purchase from you that aren’t direct competitors.
This includes grocery stores, pharmacies, and quick-service restaurants.
Once you’ve identified the competition, concentrate on the direct, head-to-head competitors, since they are the most threatening to your vending machine business— but keep an eye on the indirect competition as well, just in case.
Provide an overview of each direct competitor’s business and detail their strengths and weaknesses.
You will be able to position yourself competitively in the market if you perform proper competition research. Perform a SWOT Analysis to learn your competitors’ strengths, weaknesses, and competitive advantages in the following areas:
- Prices – Are they offer lower prices or more costly than you and other competitors, what value do buyers get for that price?
- Quality – Are they offer premium products, the perceived worth in the eyes of the customers
- Customer service – How they respond to their consumers, whether they treat them poorly or well, and the degrees of satisfaction customers show
- Reputation — The sum of everything mentioned above: their credibility, how loved the brand is, and the loyalty of their customers
The final section of your competitive analysis should include a list of your areas of competitive advantage. for example: Are you going to offer excellent customer service culture, highly competitive prices, reliable and easy to use payment option or Will you provide superior products?
Consider how you will outperform your competitors and include them in this portion of your vending machine business plan.
Free: SWOT Analysis Examples
Take advantage of our free SWOT analysis examples. Make your business future-proof by identifying your strengths, weaknesses, opportunities, and threats using this free SWOT Analysis Template.
Creating a marketing plan for a vending machine involves identifying the target demographic and finding products that suit their preferences.
As part of your marketing plan for a vending machine company, you should include:
Pricing and Product Strategy
Your vending machine business must offer products that are different from those of your competitors. Research what your competitors offer and how they price their vending machine products. Unique products identifies your vending machine business as the place to go for unique services and differentiates it from others.
Placing and Promotions
The position of your vending machine is referred to as place. Record your location and explain how it will affect your success. Is your vending machine, for example, in a high-traffic office building or gym? Discuss how your site may deliver a continuous stream of consumers.
Promoting your vending machine business is the final part of your marketing plan. In this step, you document how you will drive customers to purchase your vending machine business. A few marketing methods you could consider are:
- Give vending machines a unique look, so that they are easily identifiable to customers.
- Advertise on blogs and forums, as well as on social media sites like Twitter, Facebook, and LinkedIn to get the word out,
- Creating an online presence (listing all of the vending machines) using a basic website
- Join local vending machine associations for information on industry trends
- Offer discounts to customers on special days
- Advertise in local newspapers, TV and radio stations
- Listing the vending machine business in the yellow pages
- Use word-of-mouth marketing (referrals)
You should also think about your vending machine company’s Unique Selling Proposition (USP), which should explain why clients should choose you over other vending machine businesses. Ensure that your USP is reflected in your marketing.
Pro Tips: Learn how to create a marketing plan in a business plan by pros!
While the previous sections of your vending machine business plan described your goals, your operations plan discusses how you will achieve them.
An operations plan is helpful for investors, but it’s also helpful for you and employees because it pushes you to think about tactics and deadlines.
Your operations plan in a business plan should be divided into two individual parts, as seen below.
Daily short-term processes include all the tasks involved in operating your vending machine, including purchasing products, delivering and restocking, keeping the machines clean, etc.
Long-term goals are milestones you hope to reach. It may be the date when you expect to place your 5th vending machine or when you hope to reach $X in sales. Another example would be when you expect to hire your Xth employee or start a new location.
When writing a vending machine business plan, the management section in a business plan‘ outlines your management team, staff, resources, and how your business ownership is structured.
This part may be easily organized by dividing it into the following points:
- Ownership Structure
- Internal Management Team
- External Management Resources
- Human Resources
This section outlines your vending machine business’s legal structure. If your company is a sole proprietorship, it may simply be one phrase. It might be longer if your company is a partnership or a corporation. You should make it a point to clarify who owns what part of the business.
Internal Management Team
This section should not only outline who is on your management team but also how each person’s skill set and experiences will contribute to the growth of your vending machine business. Ideally, you and/or your team members have direct expertise in the vending machine business. If this is the case, highlight your experience and skills.
External Management Resources
Think of these external management resources as your internal management team’s backup. Consider forming an advisory board if your team is lacking expertise and experience with vending machine business.
An advisory board would consist of 3 to 7 people who would serve as mentors to your vending machine company. They would assist in answering queries and providing strategic direction.
If necessary, search for advisory board members with expertise running vending machine.
Describe all of your company’s external professional advisers, such as accountants, bankers, attorneys, IT experts, business consultants, and/or business coaches.
The final topic to consider in the management area of your vending machine business plan is your human resource needs.
In your financial plan of a business plan, you should present a 5-year financial statement broken down monthly or quarterly for the first year, and then annually. Financial statements include your income statement, balance sheet, and cash flow statement.
A profit and loss statement is more commonly called an income statement. It shows your revenue and subtracts your expenses to determine whether you were profitable or not.
As you develop your income statement, you need to develop assumptions. Will you serve 70 customers per day or 150? Will sales grow by 3% or 15% per year? Your choice of assumptions will greatly impact your business’s financial forecasts. Conduct as much research as possible in order to ground your assumptions in reality.
Want to learn how to make an income statement? Download our free income statement templates to make a stunning one for you.
Free: Income Statement Template
Create a financial statement for your business by downloading our free income statement templates.
While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities.
The balance sheet shows your vending machine business’s net value at a specific point in time. It categorizes all of your company’s financial data into three categories:
- Assets: Tangible goods with the monetary worth that the company owns.
- Liabilities: Debt owing to a company’s creditor.
- Equity: The net difference when the total liabilities are subtracted from the total assets.
The equation that expresses the relationship between these financial data elements is Assets = Liabilities + Equity.
Create a pro forma balance sheet for your vending machine business plan that highlights the information in the income statement and cash flow projections. A balance sheet is normally prepared once a year by a company.
Balance sheets indicate your assets and liabilities, and while they contain a lot of information, they are simplified to highlight the most important things you need to know.
For example, spending $15,000 to build out your vending machine business will not result in instant revenues. Rather, it is an asset that should help you earn money for many years to come.
Similarly, if a bank sends you a check for $5,000, you do not have to pay it back right now. Rather, that is a liability that you will repay over time.
Want to learn how to make an balance sheet? Download our free balance sheet templates to make a beautiful balance sheet template .
Cash Flow Statement:
Your cash flow statement will help you determine how much money you need to start or grow your vending machine business. In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a vending machine business:
- Fees for registering a business
- Equipment costs, such as vending machines, refrigerated delivery trucks, etc.
- Costs associated with sufficient inventory management
- Business insurance costs
- Costs of obtaining licenses and permits as well as accounting services (software, P.O.S. machines, and other software)
- Insurance coverage (general liability, workers’ compensation, and property casualty) at a total premium
- Operational costs for the first 3 months (salaries of employees, bills, etc.)
- Start-up inventory costs
Free: Balance Sheet Template
Create a financial statement for your business by downloading our free balance sheet templates.
List any additional material you cannot include elsewhere, such as resumes from key employees, licenses, equipment leases, permits, patents, receipts, bank statements, contracts, and personal and business credit histories.
Attach your full financial projections along with any supporting documents that make your plan more compelling in the appendix.
Bonus Tip: Find out what to include in a business plan appendix when writing a vending machine business plan.
Summary of the Vending Machine Business Plan
A vending machine business plan is a worthwhile investment. As long as you follow the template above, you will become an expert in no time. By following the template, you will understand the vending machine business, your competition, and your customers. The plan will help you understand the steps necessary to launch and grow your vending machine business.
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Since 2010, Wise business plans’ MBA professional business plan writers has developed business plans for thousands of companies that have experienced tremendous success.
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