“Now I only work 4 hours a week.”

Today, at age 31, I have a thriving vending machine business that brings in over $300,000 a year. But a few years ago, I was living at home with my mom in Rochester, New York, working a $17-an-hour management job.

My goal was to save enough money to buy a rental property that was not generating income. One day, a friend of mine saw a woman taking money out of a vending machine and the idea for a new side hustle was born.

I thought about how it could be a profitable business with a little heavy lifting. So in 2018 I moved to Philadelphia and bought two machines.

Joyner Vending made only $5,000 in its first year. But I stayed, and now have 21 vending machines throughout Baltimore, Philadelphia, Detroit, and Washington, D.C. I’m on track to generate $500,000 in sales revenue by the end of 2022.

Here’s what I’ve learned in my entrepreneurial journey – and my best advice to anyone looking to start a similar business:

1. You need at least $4,500 to get started.

I had $10,000 saved from my 9-5-5 job, but my startup costs were about $4,000, which I paid for a snack machine, a drink machine, two credit card readers, food and beverage products, and delivery fees.

Things are more expensive today because of inflation, so I recommend saving $4,500 to $5,000. Machines can run anywhere from $1,000 to $10,000 depending on whether they are new or refurbished. Delivery costs are usually between $200 and $500.

I’ve found that when credit card readers are optional, they can increase sales by up to 25 percent because you’re not relying solely on customers having cash.

2. Look for reputable machine dealers.

Crane, AMS, Dixie Narco and Auto Products are all reliable manufacturers. Check to see if there are vending machine warehouses in your city and on platforms like Craigslist, Facebook Marketplace, and eBay.

There are many types of machines. A refurbished Vendo 511 beverage machine, for example, you know as a classic Pepsi machine, can sell for $1,500. It costs around $3,500 new.

Gram’s most profitable machine is an online gaming site in Philadelphia, on track to gross $100,000 this year.

Photo: Mickey Todiwala for CNBC

If you only have room for one machine at a given location, I recommend going with the Crane National 449 Combo Machine, which includes both snacks and drinks. A refurbished machine sells for about $3,500, while a new machine can cost up to $7,000.

3. Never buy a machine until you have the space.

Location is everything. I always wonder about places with a lot of foot traffic. Apartment complexes, hotels, student housing, and warehouses with many employees are all good options.

When trying to determine whether a niche is profitable, know:

  • Office Hours:- The more days and times you are open, the higher your chances of making sales.
  • How big is the workforce in the area? More people working in or around the building means more potential customers.

One of my best spells is an online gaming site in Philadelphia that is on pace to make $100,000 this year.

I don’t pay much to put a machine in a certain location, which I find is common in this business. Many businesses just want the service and don’t want to pay for the machines or installation. Out of all my locations, I pay only one location which is 15% of monthly profit.

4. Yes, brand name and customer service is important.

Three years after starting Joyner Vending, I quit my full-time job and now only work four hours a week. I am often shopping online for food and beverage products. And once a week in Maryland I’ll be picking up a machine myself.

Many people think that there is no branding or customer service involved in this business because the machines work on their own. But it is not like that.

What sets me apart from my competitors is my quick response time. I do my best to accommodate my customers – the places that keep my machines and the people that buy stuff from them.

In the future, Gram hopes to open his own vending machine warehouse.

Photo: Mickey Todiwala for CNBC

When I started, I spent $30 on a company polo shirt that I wore all the time, and I invested $20 in business cards. I paid for a website and had a business proposal ready whenever there was a machine placement opportunity.

5. Study what customers want.

Some of my best selling items are Coca Cola, Red Bull, Peanut M&M’s, Doritos Nacho Cheese and Lipton Iced Tea. I usually get them from wholesalers like Sam’s Club, BJ’s, and Costco.

There are also local vending machine stores that sell food and beverage products, such as Pinnacle Vending in Philadelphia.

At Pinnacle, I can buy a bottle of Coca-Cola in bulk for $0.55 and then sell it for $1.75, which gives me a profit of $1.20 per bottle. A bag of Doritos costs me $0.60, I sell it for $1.50 and make a profit of $0.90.

About 30% of my income goes to stocking products, 10% goes to pay my five part-time employees. Another 10% is for miscellaneous expenses, and your take-home profit is 50%.

6. Share your knowledge with others as your business grows.

In the future, I would like to expand to more states, grow my team, and eventually open my own vending machine warehouse.

In the year I started offering an online class on how to start a vending machine company in 2020 and wrote an e-book based on the course. I have earned $90,000 to date from these digital products. Next year I will be launching a one-on-one coaching and mentoring program.

Joyner Vending was life-changing not only for me, but also for my family. My favorite part is being an expert in the business and sharing my knowledge with other people.

Marcus Gram He is the founder and owner. Joyner Vending.

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I quit my $35k job to grow my side hustle - now grossing $141 million a year

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