Starting an ATM business can be extremely profitable, but it can also be extremely problematic. There are numerous problems that can creep up in even the best ATM machine business plan, so it is important to make sure that you are flexible and proactive in this type of entrepreneurial venture. Any business faces problems when they first start out, but the problems of your ATM business can make you go out of business before you ever get started.
What Is the #1 Problem In Starting an ATM Machine Business?
In a business where distributing money is the key to making money, not having enough of it is the #1 problem that new ATM business owners face. Don’t make the mistake of purchasing $30k high end ATMs when you first get started. Many retail ATMs may cost as little as $2,000 and you really only need to have two or three of them in operation to have a viable business venture.
What if you can’t even afford one ATM?
All you need to do is raise a little capital to make this happen. If you can’t save back $2k out of your current salary for some reason, then look for a short-term loan from family or friends. If you’ve tapped out that resource, then prepare a solid business plan and present it to a local financial institution to see if they’ll provide you with financing.
If you strike out there, then you can always trade equity for capital. If push comes to shove, you can always put the price of a new ATM onto your credit cards, but that’s a bad debt option and should be considered your option of last resort.
Choose Your Business Structure Wisely
You’ve got two options when going into the ATM machine business: go on your own or partner up with an experienced professional. Striking out on your own path has its benefits, but you’ll generally have to learn things the hard way. Forming a partnership with someone knowledgeable within the field can help you get a jump start on your business structure, but make sure you research the reputation of a partner before signing the paperwork.
This even applies to family and friends.
Your partnership should be based on integrity. If you don’t have a partner with a reputation for honesty, then their reputation is going to rub off on you. Take your time, don’t rush the selection process for a new partner, and you’ll be able to learn the ins and outs of this business in no time at all.
Make Sure Every Agreement Is Formalized
One of the unique aspects of the ATM business today is that it is one of the view that operates on a handshake and an affirmative word. You can often place an ATM at a business location without a formal written contract. The only problem with this is that it can be extremely difficult to prove an oral contract in court today. If you have a high performing location and someone else wants to take that location from you, only a written contract is going to guarantee that you get to keep the profitable spot.
Make sure that your partnership agreements are also written down and signed. You want everyone to be very clear about their responsibilities in your business structure. Outline what your responsibilities are, to your partnership and to your clients, and then make sure that you fulfill them. This will give you the consistency you need and hold everyone accountable to their own actions.
Learn From Your Mistakes
As with any business opportunity, you’re not going to be 100% perfect when you first get started. You’ll make mistakes on ATM locations, partnerships, and even the amount of hours that you have estimated that you’ll need to work. The trick is to avoid the mistakes, but to also learn from them when they do happen. It’s an unreasonable expectation to be perfect, yet many ATM business owners have this expectation.
If they choose a bad location, they feel like they have failed. They choose to drop out of the business altogether. That doesn’t have to be you.
Knowing how to start an ATM machine business means finding good equipment, locating good sites for that equipment, and the securing contracts that will help you protect those sites. Make sure you have the permits and licenses that your community mandates and then you’ll be able to make money from this lucrative business opportunity.