Snack in the box vending Franchise

[FlintVending]

Any input about the following franchise most welcome!
Basically I have been offered the £44515 + VAT Vending machine Deal in my postcode for £25k
It consists of 14 snacky combi venders at £5 per week royalty fee and 54 slimline wall mounted machines at £1 per week royalty alll up and running in mostly staff rooms of places like Homebase, Matalan, Dunelm Mill, Argos, PC World, Currys, Wickes and New Look.

here is a link

http://www.businessesforsale.com/franch ... -franchise" onclick="window.open(this.href);return false;

Seller reckons he is doing £1200 a week with 50% gross profit.
Comments most welcome especially from you guys who already do the big vendors!

Cheers
Nigel

[Vendition Ltd]

Sounds quite cheap Nigel, what's the yearly turnover? I do like the look of the snack in a box franchise

Regards

Ross

[mic79]

A friend of mine almost bought into it. He decided against it as the machines are lease only between £1-£10 a week depending on the size of machine which adds up. The honesty box seems quite good though. I'll see if I can get him to comment on this.

Mike

[Shropvend]

Hi Nigel

I know a bit about this company as I nearly bought one a few years back. £1200 is that turnover or profit? I would assume that is turnover. Part of the franchise agreement is that you need to have a van kitted out in their corporate logo and image, you also have to buy MARS products via there suppliers. In short the gross profit margin after all costs, fuel, insurance, machine parts, royalty fees etc... was around 28%, with a bit of negotiation all I could get was 30% GPM. After this you have to pay the finance costs and you have to go every week to most calls, which in all was not worth it. If you check a business for sale website you will see lots of franchisees trying to offload their business as it takes up a lot of time. Also the slimline machines run on a 12v battery and most of them did not last more than 2 weeks due to excessive use, so you had to keep on changing the battery which was so annoying.

Another negative was the price of stock, when I worked for their sister company we increased prices and the sales went down and stayed like that. The reason for that is the machines are 90% in staff rooms so the staff would bring in their own snacks. Also retail is suffering and companies are releasing lots of staff so that is effecting sales as well. Sorry to seem so negative, but they do not tell you these things at the interview process. Infact no word of a lie one of the sales directors called me last week offering a discount for an area near to where I live.
Overall if you have the time its not bad, but its alot of hassle. Anyway hope this helps you out.

Regards
Lee.

[Shropvend]

The honesty box system they have seemed ok, but they were asking for 20k+vat, for 150 sited boxes. You could easily do this yourself for alot cheaper similar to all the charity boxes out there.

Lee.

[Coin Operated Group]

AS others have said Nigel, paying £100 rent every week is a non starter
The slimline snacks go for £1-300 when you factor in fuel costs etc then there is not enough profit from these machines as you need to be chargiong a high premium for the stock when sold to make it worth while. The snakky combos are worth between £4-600 and as said before you are tied to using their stock Also you are not supposed to put other brands in ie cadburys or mccoys etc etc.

Big vending machines are good when you get your buying power up to a level that you can negotiate with wholesalers, makes it worthwhile then.

Would find out what you would be paying for chocolate,crisps & pop first. If they are working on 50% gross I would hazard a guess it is quite high.

Also worth asking if machines are all on fixed contracts. Would gladly have a look at figures for you Nigel if you wanted

[FlintVending]

Hi Guys

Great input as usual, such a lot of knowledge out there, forum worth its weight in Gold.
All bow down and praise Matt LOL

I have arranged a meeting with the Area Sales manager to see if I am "suitable" to be one of there franchisees??
will let you know how I get on and how balanced there franchise agreements are?

Cheers
Nigel

[Snackmore]

May be not such an exclusive bargain Nigel, advertised on ebay for £25,000

[FlintVending]

May be not such an exclusive bargain Nigel, advertised on ebay for £25,000

well spotted Snackmore!
So he has put it on ebay then, for this is the round I have been offered!
hmmm maybe desperate for a quick sale, me thinks??

[Snackmore]

Yes and certainly not doing you any special favours...............

As someone said previously on another thread go with your gut reaction, I think you already have

Steve