Buying or selling an existing vending business requires looking at all of the components that form the business to determine the true value. That’s because a vending route is worth more than just the machines and products you put in them. If you want to sell, you need to carefully review your accounting records to calculate the value of your business. Otherwise, you’ll be taking guesses about what you spend and what you make, and your valuation may be completely off.
If you’re selling your vending business, get started on your company’s valuation by creating a list of all of the assets you bought to run the business. This includes vending machines, any vehicles you own to transport vending machines and products to fill the machines. Determine the worth and depreciation on each of your major pieces of equipment. Then add up how many vending machines you have running and in how many locations to show potential buyers what you’ve built. Look at each of your vending machines and determine how much income each one brings in annually to determine your gross revenue.
The cost of doing business needs to be calculated to determine your overall revenue. Calculate business expenses by adding up the cost of the products you put in your vending machines. Add gas, auto loans and maintenance costs to keep your delivery vehicles in working condition if you plan to sell those as part of the business. If you lease office or warehouse space, include expenses such as utilities and rent in your calculations.
Determine the worth of your company by dividing your annual gross revenue by half. Add this amount to the wholesale value of your vending machines and remaining inventory, along with the depreciated value of your vehicles, says Peter Siegel, president of BizBen.com. This gives you the standard value of your business. If your machines feature the latest technology, such as the ability to take debit cards as well as cash, Siegel says you may be able to get up to 10 percent more for your machines.
Some buyers want to know what they’ll be paying themselves per hour as part of researching the value of buying a vending business. Find out from the owner how long it takes per month to pick up supplies and run the route to restock machines. Ask them to show you their accounting books so you see the total annual income and expenses. Then take the income, minus expenses, and divide it by how many hours per year the current owners works in the business. This amount is how much you’ll be paying yourself by the hour to run and maintain the vending business at its current level.