New Business Ideas: Starting an ATM Company

Have you ever wanted to earn income like the Banks? Owning and operating an ATM company can be a very rewarding and lucrative opportunity and re-occurring residual income is the game.

How will owning an ATM Generate Income for me?

ATMs charge a fee called a surcharge. This fee is normally $ 1.50 to $ 3.00 depending on the location and the surrounding ATM competition. The nationwide Average is around 300 transactions, so if you had a machine that did 300 tx / mo x $ 2.00 = $ 600 / mo income. This income is usually shared with the location owner.

What are the Costs?

1. The ATM Machine- The ATM machine itself is a small piece in the puzzle. There are many different manufacturers, different configurable options, etc, but a good quality new machine will cost around $ 2000.

2. The Cash- You load the ATM with your own money. This money is constantly recycling itself. What is dispensed today- you get a deposit in your bank account the next business day.

3. Communication- ATMs need a way to communicate via telephone line, internet, or wireless. In some instances it is recommended that you either share the merchants existing internet (if they have internet) or share a phone line. If this option is not available, wireless is a very easy add on. Wireless fees range from $ 15 to $ 30 a month depending on carriers and options.

4. Your Time- It takes 3 to 5 minutes to replenish the vault cash in an ATM. If you are adding ATM services to an existing route- this time may be meaningless- but if you are starting from scratch- I recommend having ATMs in a close geographical area. This will make your life easier- as well as be more productive. Once you get a feel for the business, and understand whats involved, then diversify to different areas if you feel comfortable.

5. Compensation to the Location Owner- Pay for performance. Set an agreed upon payment schedule that you are comfortable with. I would recommend a something similar to: Less than 100 / transactions per month the merchant does not receive anything. If the ATM does 100-200, the merchant will get 30% of the surcharge, if the ATM does 200-400 transactions / mo the merchant will get 50% of the surcharge, if the machine does over 400 + transactions / mo the merchant will receive 60% of the surcharge. Its easier and good business to give the merchant more money if they are entitled to it, but if you are not making money- there is no point to be in the ATM business, so be careful in what deal you cut. Remember- you are the one doing the work, and taking the risk and making the investment. The merchant gets to reap the benefits all your $ 20 bills go into his or her register and reducing credit card fees.

What to Look for In A Location?

Foot Traffic! The more customers the better. On average 1 in 30 people will use an ATM. Or ask the merchant how many customer's they have each day. The number of customers each day will equate to the estimated number of transactions the ATM will perform each month. So if a merchant says they have about 200 customers a day- you can expect the machine will perform 200 / withdrawals a month and so on.

Cash Businesses- Businesses that either want to reduce their credit cards, or do not take credit cards are no-brainer's for ATMs. Bars, clubs, convenience stores … etc. These businesses will encourage customers to take money out of your ATM, because they would rather have cash in their register!

The Do's and Don't of the Business

Do- Invest in proper hardware in the beginning- if you have a location that you know will be busy, it may make sense to get that extra capacity cassette, or have an internet connection so the machine will do more transactions in less time.

Do- Be competitive in your surcharge- if all the surrounding ATMs are $ 1.99, then you be $ 1.99. Don't be more, and don't be less.

Do- Keep your machine full at all times. No inventory – no transactions. This is the most important thing!

Do- If you have a machine that is not making you money- remove it immediately! Pull it out and find a new location ASAP. I have spoken with countless ATM owners over the years and they have excuses like "well I don't have any place to put it". Bring it home with you, put it in your living room, put in on your back porch- it will make you find a new location that much sooner. If its not making money- its wasting your money.

Do Not- Give a Sign Up Bonus- The math almost never works! Giving away your money to sign up locations will only hurt you in the end. I can not tell you how many ATM companies have gone out of business because they have run out of capital. An ATM Business is an investment. Invest wisely, and give away only what you have to. No deal is too good that you can not walk away.

Do Not-Give away all your profit to the location owner. Cut a deal that is fair for both of you.

Do- Have the location owner sign an agreement, with their responsibilities, and your responsibilities.



Source by [lakajira]

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