Location Expansion & Buying Routes
Mike Hoffmann
Vending Machine Expert
Learn the strategic approach to expanding vending machine businesses through verified revenue acquisition and effective location management.
Route & Location Acquisition
Mike outlines how he acquires profitable vending routes, evaluates opportunities with precision, and lifts performance using telemetry, pricing strategy, and product mix optimization.
Finding Sellers & Pre-Screening Deals
His first calls are to local vending suppliers—they often know retiring veterans.
He also contacts brokers, location finders, and sets alerts for online vending route listings.
Seller interviews cover: reason for selling, vending history, site standing, theft issues, machine details, and repair records.
Due Diligence & Pricing Benchmarks
If no sales records are provided, Mike does spot visits to clock traffic.
He insists on an in-person inspection under NDA and asks for post-sale support.
Valuation rule: 50–80% of annual revenue. Sites under $500/month need a clear upside or he walks.
Machine Quality & Value-Add Strategy
He accounts for site commissions and evaluates machine brand, age, MDB compatibility, and cashless readiness.
He checks product pricing. Underpriced bestsellers are margin opportunities. If card readers are missing, he upgrades.
Post-Acquisition Optimization
In months 2–6, he adjusts SKUs to pair with winners or swap to higher-margin equivalents.
He tests small price increases (25–50 cents) by category, informed by market behavior.
If shrink persists, he upgrades to locked coolers or AI smart fridges for loss prevention.
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Complete the following exercises:
1. Reflect on the importance of verifying sales history before purchasing a vending route. Consider how this data can impact the decision-making process and the potential risks of proceeding without it.
2. Imagine you are optimizing a newly acquired vending route. Think about the steps you would take to adjust the product mix and pricing strategy to maximize revenue. Write down your plan including specific changes you would consider.
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QUIZ
1. What is a key strategy for expanding a vending machine business effectively?
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Leave your comments and questions below.
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