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VENDZONEWINDOW OF OPPORTUNITIES

Vending Business Guide 2010 Version 1.0

Vending Business Guide. Vendzone Pty Ltd. All rights reserved

Copyright and Disclaimer

Copyright 2010 Vendzone Pty Ltd. All rights reserved.

This material is subject to the laws of copyright and is restricted to registered licence-holders who have entered into a User

licence agreement with Vendzone Pty Ltd.

It is an offence, punishable by AUD$250,000 for the licence-holder to make the material available to any unauthorised person,

either via email messaging, by placing it on a network or by supplying hardcopies.

To arrange for additional user licences please contact us:

Vendzone Pty Ltd PO Box 5353 Clayton Vic 3168 or by e-mail info@vendzone.com.au

Disclaimer

This document is intended for informational purposes only. It contains the findings, research and opinions of the author(s). Any

use of the methods in this document is the complete responsibility of the reader. By reading and applying these methods the

reader agrees to hold the authors and publisher totally free from any liability from the results of the readers actions.

Note

For the purpose of ease all figures used in illustrations and calculations are GST Free.


Hi...

My name is Kapil Sheth

Owner of Vendzone


Introduction

Vendzone is a provider of completesolution that allow individuals,families and businesses to make theirmoney work harder, smarter andmake a positive and real differenceto their financial income


What is a Vending Machine?

Vending Machine is a retail store except:

It does not require you or your staff to run it!

It never closes!

It doesn't have to be established at one fixed permanent place!

It doesnt require large capital outlay associated with establishing many other retail businesses!

Vending business can be as big or as small as the owner wishes it to be!

It doesnt require you to leave your job in order to get yourself into the business!


WhyVending?

Vending machines are becoming the fastest-growing

method of merchandising. Retailers can benefit from

enhanced security this method of retailing provides.

Furthermore, it also requires lower inventory needs

as well as no employee involvement.


The opportunity

Vending industry is worth over $100billion per year worldwide and growing fast!

With 5.4 million vending machines in Japan, there is one for every 23 people

In the United States that ratio is roughly double.

Comparatively Australia has a lot lesser per capita machines

It means there are opportunities...heaps of them!


Recipe for success in Vending

Successful Vending Business primarily requires:

Right Vending Machines

Right Locations/Sites

Right merchandise stock

Right attitude towards the business

The knowhow to get all above right!

And hard work!


Right Machine

Right machine means:

Type of machine that is suitable for a given location/site

Majority of businesses in Australia are either small or medium sized (up to 100employees), which means that your ideal machine should be a compact combinationmachine unless you have secured large locations (over 100 employees), in which caselarger machines would be required.

A Compact combination machine is one which is smaller in size and can vend chips,chocolates and drinks all in one instead of having separate machines for drink andsnacks.

Machine should be of high quality, reliable and technologically advanced

Investment in your machine should justify sales generated in an average office,warehouse or a factory. In other words an expensive high end machine may not beright for your business especially in Australia.


Right Location/Site

Right Location/Site means:

A location that is safe and secure. End of the day a vending machine is yourproperty

A location that has a good number of staff preferably above 20 and with goodvisitor traffic

There is no set formula to know in advance how good or bad a location/sitecould be. Generally speaking blue collar males tend to use vending machinesmore than their counterparts. Again that is not necessarily right in all cases.

Best way to find out is try out a location/site and give your best, however movethe machine away to another location/site if sales figures fall a lot below youraverage target in spite of your genuine efforts to improve sales for a period of6-8 weeks.


Right Merchandise Stock

Right Merchandise Stock means:

Quite simply stock that sells! Basic retail principle.

Try and put nationally advertised famous products (Coke, Solo,Sunkist, Lemonade, Smiths chips, Mars, Snickers, Picnic bars..etc)

Avoid products that are not known

Study your customers and their needs. Give them more of whatthey use (not necessarily what they ask for!)

Be dynamic, creative and enthusiastic about your customers andtheir consumption patterns.


Right Attitude

Right Attitude means:

Vending business is a business. You have the full authority,accountability and responsibility of your business.

All the rules of running any successful business applies

Yes it can be run as a part-time but not as a part-effort.

Be fully committed to your business.

You need to have goals, plans and perseverance

You are the Boss, and vending machines are your employees, whowork hard, earn money for you and yet never ask for holidays!


The knowhow

The knowhow:

It is my intention to present as much insight into the vendingbusiness as possible in this document however you can notexpect to learn how to swim without actually getting in thewater!

Get the basics right, if in doubt, ask us and be enthusiasticabout your business.

Enthusiasm is the real secret of success


Hard work

Nothing can be achieved without hard work!

There is no substitute for hard work

Vending business is no exception

Whoever tells you that vending is a lifestyle

business is really kidding you!


Basics

Getting a brand new compact combo vending machineinstalled at an average site should roughly cost you not morethan $5000

Average sales from a location/site should not be less than$60 per week

Average cost of goods should not be more than 50% of sellprice

Operating expenses should not be more than 8% of totalannual sales


Worst case scenario

If these basic rules are followed strictly then the worst case scenario would be:

Cost of machine: $5000

Annual sales: $60 X 52 weeks = $3120

Maximum of 50% Cost of goods sold = $1560

Operating expense (8% of sales) = $250

Return on investment: $1310 or 26% (not bad for worst case scenario, is it?)

How much interest would your bank give, if you left your $5000 with them for a year?


Best case scenario

Some of the good vending machine operators

recover over 100% of their investment within 1 year

using Vendzone Vending machines.

Please feel free to use our Profits Calculator tool on

www.vendzone.com.au for your individual analysis


Investment of time

10 of compact combo vending machines should take

around 4-6 hours per week to service or refill.

(assuming they are all in one or neighbouring areas)

Add another 2-4 hours per week for house keeping,

stock purchase, stock count, bank deposit etc.


Purchase of Merchandise stock

Merchandise stock can be purchased from:

Wholesalers (Campbell's Cash & Carry, Accredited Distributors etc)

Manufacturer (Coca-cola Amatil, Cadbury Schweppes, etc)

Supermarkets

Key is to stay aware of the specials and try to buy

when your required items are on special.


Smarter buying is the key

Normal purchase scenario

Normal cost of a can of drink is say $0.65

Your selling price is say $1.30

Gross Profit margin = $0.65 or 100% mark up on cost

Smarter buying scenario

Specials cost of can of drink say $0.55

Your selling price is still $1.30

New Gross profit margin = 0.75 or 136% mark up on cost

That's a straight increase of 36% into your bottom-line profit! Imagine buying same can now for $0.40!!

Keep your eyes and ears open for specials all the time! Very very important !!!

Visit www.vendzone.com.au for tips on current special offers from different vendors


5 Steps to your own Vending Business

Step 1: Determine your investment level

Step 2: Determine the amount of time you can afford to spend on the business every week

Step 3: Call up 03-8555 2120 to speak to our friendly sales consultant to discuss a solution that suits you the best.

Step 4: Decide on the purchase plan

Step 5: Go for it!


Vendzones role

Vendzone understands the importance of setting the business in motion. Therefore we offer:

Extremely cost effective Vending Machines

Carefully chosen location/sites

Thorough business and technical training

Unlimited business support for life

Simply send an e-mail to info@vendzone.com.au or fill out an inquiry form on www.vendzone.com.au or call 03-8555 2120 for more information.


Wish you all the best!

Thank you for your purchase of Vendzone - Vending Business Guide. Please feel free to contact us if you have any further queries.

Note: Cost of Vending business guide is refundable to the customers, who purchases Vendzone vending machines.

We would like to wish you good fortune and prosperity in all your endeavours!

Thank you


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