There are so many different, unique ways to earn income. If you’re someone who reads a lot about side hustles and passive income opportunity, then it might actually feel like you’ve already thought of all of your options. However, there’s always something else out there that just might be the next right opportunity for you. For example, have you ever thought about how much money you can earn from an ice vending machine? It’s not as obvious as “start a blog and get affiliate ad income,” right? But it’s such a great option for certain people to boost their income.
How Does An Ice Vending Machine Business Work?
It’s actually really easy to earn from an ice vending machine. First, you buy the vending machine. Then you install it, preferably in a high-traffic location. For example, place the machine at a visitor’s center or a gas station. Obviously, you’ll have to work with the owners or government operating the location to get approval for the installation. But after that, if you do things correctly, the business pretty much runs itself. The machine will make ice. People will purchase the ice. You just need to check in regularly to make sure that the machines are operating properly. Once you get set up, it’s truly easy to run this type of business.
Are You Sure There’s Not More To It?
Obviously, the actual details of starting any business can get complex. You’ll have to think about your business name, logo, marketing if you choose to do that, etc. Moreover, you’ll need to file your business (for example as an LLC.) Then you’ll need to set up contracts with the locations where you’re going to place your ice vending machines. So, yes, of course you’ll have to handle those details as you would when setting up any business. Overall, though, this is a fairly simple business to start.
The main thing that you need to think about before launching this kind of business is how much it costs to get started. You’ll have the initial startup costs that any business might have, as aforementioned. So, you’ll likely have some minimal (but important) costs to register your business, set up a website, etc.
Buying an Ice Vending Machine
The biggest cost, of course, will be your purchase of the ice machine. There are several different companies that sell these types of vending machines. (Just to clarify, we’re talking about big machines that create ice. People drive up to them and fill up their coolers directly from the ice dispenser. Alternatively, the machines have bags available that they can fill up.) Bag of Ice and Ice House America are just two examples of companies from which you might purchase your machines.
Each company does their sales a little bit differently. For example, some consider your vending machine to be a franchise of their business. Therefore, you have to pay them a franchise fee or a percentage of profits. Obviously, you have to figure out what’s right for your business. But, generally speaking, you’re better off if you select to buy your machine outright from a company. You don’t want to have any other ongoing costs with that company once you’ve made the purchase. You want it to be all profit from there on out.
What Does An Ice Vending Machine Cost?
Having done extensive research, we can say that this question is difficult to answer. Some ice vending machines cost as low as $20,000. Others cost well into the six figures. It looks like you might want to consider the range from $45,000 to $100,000 per machine. Machines that cost less than this often just aren’t durable. In other words, they’ll need a lot of maintenance and just won’t last the long haul. On the other hand, more than $100,000 is a huge investment that might really eat into your long-term profits.
Does It Cost Money to Install the Vending Machine?
You need to place the vending machine in a high traffic area. Sometimes a company will let you do so at no charge. If you want to put it at a beach or state park, you might pay an initial permit fee. On the other hand, some businesses will charge you monthly for renting the space. You’ll have to negotiate that. Assess your competition and find out what’s fair in your chosen area.
Make sure that you choose a vending machine that accepts remote payments only, rather than cash. This simplifies your business. You’ll have minor ongoing costs with the credit card company fees. However, that’s negligible and saves you from having to visit your machine often.
Your major ongoing cost will be maintenance. Sometimes the machines do break down. Therefore, you want to make sure that you have a maintenance company at the ready. There are people who specialize in this work. You obviously never want your machine to be down for too long. Therefore, you should check in on the machines periodically. You should also make sure your phone number is on them for people to call in case something is wrong. As soon as you learn of a breakdown, call your maintenance person.
Obviously, maintenance and repair costs will vary. Just like with your car, the costs depend on what’s wrong. Changing your oil is a lot cheaper than changing your transmission, for example. So, just be aware that you’ll have occasional costs for maintenance and repairs.
How Much Can You Earn From An Ice Vending Machine?
Okay, now you know all about the costs. But that’s not what you want to know about a passive income business, right? You want to know how much you can earn from an ice vending machine. Unusual Investments gives a solid breakdown of costs and sales. They come up with an average of about $1700 profit per month per machine. Road Less Traveled Finance (linked earlier in this article) suggests you can profit about twice that.
One great way to figure out where your own profits could lie is to use the ROI Calculator provided by Everest Ice and Water Systems. This cool calculator lets you set pricing and volume. When you set it at low pricing and low volume, the estimate is slightly under that of Unusual Investments. Set it to typical pricing and average volume and it moves up towards Road Less Traveled’s price. So, a good guesstimate is that done well, your business can make a minimum of $1500 per month and potentially significantly more. That’s pretty good passive income if you can afford that initial investment.
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