Vending Guide

Notes on 1.) Eight main Outlets

Sam's Club and Costco require Memberships. Get a Business Membership for both. I know that Sam's Club allows Business Members to do "FAX-in" orders. Business Members also have the privilege of making purchases before regular member times. This Business privilege starts at 7 or 8 am. All the information is available in their New Member Packet. Costco is similar but best to check with them for their Business Member Privilages.

Sam's Club and Costco prices are the same around the year and any sales come in the form of coupon books that you would receive in your mail if you have memberships.

Regular purchases from Sam's Club include:
Pepsi (36 Pack 12 oz. Cans) $8.30
$0.231/can

Mt. Dew (36 Pk. 12 oz Cans) $8.30
$0.231/can

Az Tea (24 Pk 16.9 oz Cans) $10.16
$0.423/can

Dr. Pepper(24 Pk 16.9 oz Bttls) $10.43
$0.435/can

Lipton Green Tea (24 Pk 16.9 oz Bttls) $9.79
$0.408/bttl

Monster Energy (24 pk 16.9 oz. Bttls) $27.36
$1.14/can

The larger grocery stores Albertsons, Bashas', Fry's, Safeway and WalMart have soda deals throughout the year. These stores more commonly have the best deals. When WalGreens promotes soda deals they usually advertise at 4/$11(as described below). The sales are never the same from week to week and rarely do any of these stores have the same deal in the same week. The upside is that when they have deals, the deals are really good.

The best deals occur during the holidays but happen other times of the year also.

IMPORTANT: The sales schedule for the grocery stores starts Wednesday and finishes on Tuesday at midnight.

The grocery stores sell soda that I resell in the following formats:
12 packs
a.) "Fridge Packs" (Coke/ Pepsi) 2 x 6 long
b.) Regular (Kalil) 3 x 4 long

Cubes (Pepsi Products only, Fancy shaped 24 pack. The shape is like
what it sounds)

Cases (Coke Products, a fully boxed flat of 24 cans)

On 12 packs:
For 12 packs priced HIGHER than 3 dollars, my business model is not satisfied!
12 packs at 3 dollars or less is GOOD!

12 pack sales that fit my business model are commonly sold in the following groupings:
OK deals - $3.00 ea
1. 2/$6
2. 3/$9 .
3. 4/$12

Good Deals - $2.75 ea
4. 4/$11

Better Deals- $2.50
5. 4/$10

Best Deals - $2.00
6. 4/$10 get one free (basically 5/$10)
7. 5/$10

Other deals occur and often are less useful to my business, but the above
examples are the most common based on my experience. For example,
4/$10 and get 2 bags of Lays chips free.

Cost break down:
On 12 Packs:
12 packs @ $3.00 ea. = .25 cents/ can
(i.e. 2/$6
3/$9
4/$12)

12 packs @ $2.75 ea. = .229 cents/ can
(i.e. 4/$11)

12 packs @ $2.50 ea. = .208 cents/ can
(i.e. 4/$10)

12 packs @ $2.00 ea. = .167 cents/ can
(i.e. 5/$10 also same as 4/$10 and get one free)

On Cubes:

Cubes are rarely sold for exact dollar amounts. But anything less than 6 dollars per Cube fits my business model.

Cube @ $6.00 = .25 cents/ can

Cube @ $5.99 = .2495 cents/ can

Cube @ $5.98 = .2492 cents/ can

Cube @ $4.99 = .2479 cents/ can

On Cases:

Cases only come around the Grocery stores from time to time.

Best Case prices follow Cube pricing.

Purchase Strategy:

I purchase all of my soda so that any and all fees cause my cost to be less than 25 cents. For example:

I tell all my customers that my can soda costs me 25 cents and my bottles 50 cents. Therefore, 10% rent would cost me 2.5 cents and 5 cents respectively.

By purchasing a can for 20.83 cents and having a fee of 2.5 cents, my soda cost becomes 23.33 cents/ can. This leaves me with 1.66 per can or 6.7% towards gasoline.

By purchasing a can for 16.7 cents and having a fee of 2.5 cents, my soda cost becomes 19.2 cents/ can. This leaves me with 5.8 per can or 20.8% towards gasoline.

Or I will work on an average if I am unable to acquire a deal that directly fits into my business model. For example, if a 12 pack is being sold for $3.50 (or 29.2 cents/ can) I am 4.2 cents over my business model. I will find a 12 pack of soda for 16.7 cents/can causing my average soda cost before fees to be 20.9 cents/ can, fitting well within my business model.

Notes on 2.) Higher Volume

Once higher volume is achieved Coke, Pepsi and Kalil should be contacted to find what volume must be purchased to get the best price. At this point the business model you have chosen for pricing ought to be reevaluated.

Higher volume can be achieved two ways:
1.) 20-30 machines or more
2.) Less than 20 machines requiring restock at least twice per week.

Notes on 3.) Natural Soda

If you want to use Natural Soda as one or more of the beverages in your soda machines, Sunflower Market is a good source. Other sources include Mountain People or Wild Oats. You will need a wholesale license for your purchases through Sunflower Market.

Machine Operation

Machine Volume:
My Soda Machines have 4 column formats for hold soda:
1.) Double wide columns 2 deep
2.) Double wide columns 3 deep
3.) Single wide Columns 2 deep
4.) Single wide Columns 3 deep

Vendo 475 or Vendo 570's have double wide columns 2 deep that hold nearly 3 cases of soda and single wide columns 2 deep that hold nearly 1.5 cases. These machines have 8 columns. Depending on the machine there are either 3 or 5 double wide columns. And therefore 3 or 5 single columns. Each one of these machines holds aproximately 16.5 to 19.5 cases of can soda (396 to 468 cans). Approximately half these numbers for bottles.

Dixie Narco 440's hold a similar volume as the above Vendo's do, but they are configured with 4 double wide columns 2 deep and 4 single wide columns 2 deep. Therefore they hold approximately 18 cases of soda or 432 cans. Approximately half these numbers for bottles.

A Cavalier 345 has 5 double wide 2 deep columns only. Therefore 15 cases or 360 cans. Approximately half these numbers for bottles.

A Dixie Narco 501 has 4 (four) double wide columns 3 deep and 4 (four) single wide columns 3 deep. The machine itself is not as tall, but because of the depth they hold approximately the same volume of soda as the Dixie Narco 440's. Approximately half these numbers for bottles.

Money Exchange:

There are two ways that my soda machines accept money.
1.) Coins
2.) Dollars

Coins:
Each machine has a "coin acceptor". The Company CoinCo is one of the most prominent manufacturers of these units. A coin acceptor determines what coins are accepted. Specifically this means that the coin acceptor, depending on the model, will only accept US coins limited to Quarters, Nickels and Dimes. These acceptors are programmed to understand the difference between acceptable US coins and foreign coins as well as "Slugs" or shaped metal that in some way resembles one of the accepted coins sizes.

Some of my coin acceptors have toggle switches that will allow them to accept Canadian Coins (Quarter, Nickel and Dime).

Dollars:
Each Machine has a "dollar validator". The dollar validator works much like the coin acceptors. Except they screen incoming paper and only accept US Currency. My dollar validators only will accept up to 5 dollar bills. There are a number of switches on the dollar validators that can increase or decrease the security, or acceptance measures, for an incoming bill.

Electronics:
Quite simply there are switches, wires and motors that are screwed to or attached to something metal in each of the machines. Depending on the machine there is more or less equipment.
For Vendo 475, 570 Dixie Narco 440 and Cavalier 345 machines:

Switches:
The switches are all similar with minor variations. Should you want to modify a switch to be used in a different location, in most cases it is very simple. Acquiring new switches can be done through the companies that manufacture them like Vendo or Dixie Narco all the switches run off the same electrical structure. Meaning that a Vendo switch can be used in a Cavalier machine. It is rare for these switches to go bad but is more common than a motor or a wire.

Wires:
I have never seen a wire go bad.

Motors:
The motors are electromagnetically driven. This is all I know.

Relay:
This is a fancy capacitor. It is the electronic stopping point between when money is inserted and a soda is selected. Once a soda button is depressed an electronic pulse is released that basically unsticks the relay, activates the appropriate motor and releases the selected soda from the correct column. These relays in my machines come in a "Ice Cube" format (a common description in an electronic store the carries such items).

For Dixie Narco 501 machines
These machines have one addition and one subtraction from the above
examples. You could call it a trade if you like. The relay is removed an
a motherboard is added.

Motherboard:
The motherboard replaces the relay due to the complexity of the Electronic environment. These machines are multi priced machines allowing each soda selection to be programmed to the operators choice and changed whenever it suits the operator. Here the relay is embedded somewhere inside the motherboard and is not the "Ice Cube" format as described above.

IMPORTANT: It is important that all multi price machines have a "SurgeProtector" between the outlet and the machine power chord. The reason being that and electrical surge can "FRY" a motherboard in one of these machines. I have never seen it happen, but I was warned so I best warn you!

-the X-Cellent Credit team
Read On ...