Requesting advice on starting an ATM business!!

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Requesting advice on starting an ATM business!!

Christopher Aleman
Dalton, GA · Member since 2015 · 23 posts · 13 votes

I have been doing some research online and there seems to be a lot of potential in the ATM industry.  From what I understand so far, you make 100% of the transaction fee from the ATM withdrawals.  So the plan would be to approach multiple business owners (whose businesses seem to get a lot of foot traffic) and discuss the benefits of installing one of my ATM's in their business.  I would stock/refill (with my own cash), and maintain the ATM's, and the business owner would get a percentage of the fee (an example would be a $2.50 transaction fee and the business owner getting 50 cents per transaction).  Not to mention the increased business and reduced credit card charge-back's the business owner would benefit from.  ATM's surprisingly average around $2,500 and I plan to stock about $2,500 in each machine.  So each ATM would cost around five thousand and I would continue to expand/reinvest the money into the route.  

Does anyone have any advice or experience with this type of business?!

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Brandon Shapiro
Rockville, MD · Member since 2013 · 7 posts · 6 votes
7y

Your generally right but quite a bit off on your numbers.  The business is good and you will earn high returns, much higher than real estate.  If a machine is making 2500 a month you would be putting more like 20-30k in it a week.  Most machines make around 200 bucks.  Good machines make 300-500 a month.  Steller machines make up to 3500 a month.  The better the machine the more you pay out to the merchant and thus the more fill cash you are supplying for a lower margin.  

It is a very capital intensive business.  We have grown our business for 6 years but have about 700k invested in it now just to keep our machines full.  It is scalable, the returns are good, you don't need a lot of employees (we have none currently) to grow a good size business but you do need capital. 

Happy to talk to you more about it if interested.

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  • Jacqueline Carrington
    Investor · Corona, CA · Member since 2014 · 746 posts · 372 votes
    10y

    While I commend and actually like this idea; this is a real estate investing site/forum and discussions for other business ideas are great but the site would lose its focus if we started talking about everything else.

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  • Max T.
    Investor · Philadelphia, PA · Member since 2015 · 3k+ posts · 3k+ votes
    10y

    In order to connect this to real estate - It seems like a good idea if you have a multi family building in an area with a lot of commercial activity, like a central business district in a city.

    The problem I see with your approach is that other people have already beaten you to it. These businesses already have ATMs, and are usually owned by the business owner. You also cant saturate a market with the machines or they won't be used enough.

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  • Casandra M.
    Rental Property Investor · Janesville, WI · Member since 2016 · 87 posts · 42 votes
    9y

    Maybe not the correct site for this discussion, but please take the time to read the below Reddit Thread, which I found amazingly helpful with starting an ATM business:

    https://www.reddit.com/r/Entrepreneur/comments/324m48/i_own_an_atm_business_anybody_interested_in_how/?sort=old&limit=500#bottom-comments 

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  • Brandon Shapiro
    Rockville, MD · Member since 2013 · 7 posts · 6 votes
    7y

    Your generally right but quite a bit off on your numbers.  The business is good and you will earn high returns, much higher than real estate.  If a machine is making 2500 a month you would be putting more like 20-30k in it a week.  Most machines make around 200 bucks.  Good machines make 300-500 a month.  Steller machines make up to 3500 a month.  The better the machine the more you pay out to the merchant and thus the more fill cash you are supplying for a lower margin.  

    It is a very capital intensive business.  We have grown our business for 6 years but have about 700k invested in it now just to keep our machines full.  It is scalable, the returns are good, you don't need a lot of employees (we have none currently) to grow a good size business but you do need capital. 

    Happy to talk to you more about it if interested.

    1Reply
  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    7y

    @Christopher Aleman I’m not in the business, but your numbers seem way off. At 2.50 per transaction, you’d need 1000 transactions/mo to get $2500.  At say $50 average per transaction, that $50k/mo in cash going out, $12,500/week.  I don’t know how long it takes for the money to get from “the customer’s bank” into Your account, and I’d assume there is Some transaction fee for this.  Still, seems like a Large amount of cash needed on an out of pocket basis, to generate a few thousand in fees.  

    I also have to think new desirable sites for ATM’s will be a slow process as every business that would want one seems to already have one.  Seems familiar to buying “pay phone franchises” back in the day, not that I believe atm’s will become absolete.

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y

    @Wayne Brooks  its the vending business..  I like it for small businesss to have their own.. my sister in law has her own in her coffee shop.. and she makes money with it.. not sure how much.

    not quite like have lottery machines in Oregon those can make a bar owner a pretty good amount of money.

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