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There is a growing demand for self-service experiences across the economy. The rising demand has incentivized companies to develop automated kiosk systems that allow consumers to access various products conveniently without interacting with personnel.
Vending machine statistics in 2023 show that the retail industry is one of the biggest beneficiaries of the rising demand for self-service experiences. For instance, Global Industry Analysts, Inc's research indicates that the global vending machine market size will reach $31 billion by 2027.
The global vending machine market stood at $21.3 billion in 2020, and analysts expect the vending machine industry to have a compound annual growth rate (CAGR) of 5.5% through 2027. These global vending machine market figures show that now is the best time to start, form an LLC, or expand your vending business. This article covers all the valuable vending machine statistics you need to make informed executive decisions for your vending business.
How Big Is the Vending Industry?
A conservative estimate by Global Industry Analysts put the size of the global vending machine market at $21.3 billion in 2020. This was before the peak of the coronavirus pandemic, which occasioned a sharp increase in the demand for contactless retail systems.
Later in 2021, an ambitious projection by Grand View Research estimated that the size of the global vending industry in 2021 was $51.9 billion. They projected that the vending machine industry would record a compound annual growth rate (CAGR) of 10.7% through 2030. Notably, the earlier projection by Global Industry Analysts in 2020 was that the industry would have a CAGR of 5.5% through 2027.
The global vending machine market is enormous, even if you take the lower estimates provided by Global Industry Analysts.
Is the Vending Machines Industry Growing?
Yes, the vending machine industry is a growing one. Grand View Research ambitiously projects that the vending machine industry will have a compound annual growth rate of 10.7% through 2030. Moreover, technological advances increase the range of products offered through vending machines, thereby fueling further growth.
Vending machine business offers a unique convenience to customers whose hectic lifestyles constrain their ability to visit specialty stores to buy simple snacks and beverages. They range from As lifestyles get more complex and demand for on-the-go services increases, you should expect the vending machine business to continue growing.
What is the Number of Vending Machine Companies in the US?
According to IBIS World, there are 17,273 vending machine companies and operator businesses in the United States. States with the highest number of such businesses, that top the vending machine industry, include
- Florida - 1,964 operators
- Texas - 1,625 operators
- California - 1,437 operators.
According to Vending Market Watch (2020 State of the Industry Report), small independent operators control 67.1% of the vending machine market. The data breaks down as follows:
- Small operators (less than $1m annual revenue) - 67.1%
- Medium ($1m to $4.9 m) - 16.5%
- Large ($5m - $9.9m) - 7.1%
- Extra large ($10m+) - 9.4%
While most of the businesses in vending machine industry are small holdings, there are big companies that have a footprint in several states. Compass Group PLC and Aramark Corp are the biggest operators in this space.
Which Country Has the Most Vending?
The United States, with over 7 million vending machines, has the highest number of installed vending machines. This figure represents about one vending unit for every 50 American residents.
At 30.7%, the United States also has the highest revenue share of the global retail vending machine market, according to Grand View Research. Head over to this post if you want to find the hotest vending cities around the US.
On a per capita basis, Japan has the highest number of vending machines of any country in the world. The country has over 5 million vending machines, representing one machine for every 25 Japanese residents.
If you want to find out more about vending machine numbers throughout the world, head over to our full piece on country-related vending machine numbers.
What US Cities Are the most promising for vending business?
While most of the citites around US should be a fertile soil for a vending machine business, there are those cities that stand out as most promissing. All in all, a city where that has a high demand for vending services, high foot-traffic in best places, and has friendly business and regulations environment qualifies as a promissing.
These areas that we've listed in our top vending locations page indeed qualify. In particular these 8 US cities exhibit favorable potential:
- Vending companies in Atlanta
- Vending companies in San Jose
- Vending companies in Los Angeles
- Vending companies in Jacksonville
- Vending companies in Houston
- Vending companies in Chicago
- Vending companies in Pittsburgh
- Vending companies in New York
How Much Can a Vending Machine Make in a Day?
A vending machine in a decent location will generate between $10 to $50 per day. This translates to $300 to $1,500 per month. Nonetheless, it is not uncommon for a vending machine to generate significantly more than this in great locations. Head over to the vending profit calculator to verify yourself.
The amount of money a vending machine generates mainly depends on its location, which drives factors such as traffic and customers’ income levels. With a good location and an excellent product offering, you will have an above-average vending machine revenue.
How Often Do People Use Vending Machines?
In the United States, 100 million people use vending machines every day. Considering there are 7 million vending machines in the country, the average vending machine gets about 14 patrons daily.
Naturally, vending machines in high-trafficked areas get patronized more. People use vending machines selling snacks and beverages the most. Snacks and beverages account for 72.4 percent of the market.
How Much Does It Cost to Start a Vending Machine?
According to Step by Step Business, starting a vending machine business costs between $1,400 to $4,000. The biggest cost driver determining how much you spend is the vending machine.
Choosing a low-cost or used vending machine will reduce your startup costs significantly. Prices for good vending machines range from $1,000 to $3,000. On average, expect to spend the following on the other vital startup costs:
- Licenses and permits - $250
- Insurance - $300
- Inventory - $40
- Rent (probably as a percentage of vending machine sales) - ~$50
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Additionally, the process of scouting for a good location might cost money. To save money, it is best to do the scouting yourself. To kickstart this process, use our list-building service to get a list of all the potential vending locations in your town or city and their contact details.
Are Vending Machines Profitable in 2023?
Vending machines will remain profitable in 2023 and the foreseeable future. Typically, a vending machine owner spends about 50% of the revenue on the cost of goods sold. Another 10% to 25% goes to paying the property owner where the machine sits.
Most small independent vending machine operators buy supplies from local retailers such as Costco or Sam’s Club. Product offering, location, and pricing determine how profitable a vending machine is. Typically, an operator will price their products at 2X what they paid for them to cover their costs and maintain a healthy profit margin.
Is Having One Vending Machine Profitable?
You are likely to turn a profit from one vending machine, but it is best to expand your operation by adding more locations. The profit margins on most vending machines are 20% - 25%, with revenues ranging from $5 to $50+ per day.
A vending machine in a decent location generating $1,500 in monthly revenue will profit ~$375 monthly.
If capital is a problem and you cannot buy more than one new vending machine, consider getting used vending machines or cheap options on reseller sites such as Craigslist. Otherwise, make sure you understand your financing options when buying your first vending machine. The more vending machines you have, the more profits you will make.
Where Are Vending Machines Most Profitable?
Like in real estate, the most important factor determining a vending business's success is LOCATION. Vending machines are most profitable where there is a large concentration of potential customers. These locations include
- Establishments with high foot traffic, such as entertainment joints, malls, bus and train stations, and large apartment complexes
- Businesses with a large active workforce, such as manufacturing or processing factories and construction sites
- Places where people stop when they are in transit to another location, such as gas stations, airports, and bus stations
- Institutions with a large population, such as schools, universities, and large office buildings
- Service providers with a waiting period such as hospitals, large private medical practices, and state or federal government service centers.
You should match your product offering to the location. College students, for instance, will have different snacking habits from those actively working at a construction site. Here are some locations that are historically bringing in loads of profit for vending operators:
- Airports
- Parks
- Gyms
- Parks
- Shopping malls
- Factories (large-item vending machines)
- Transit systems
- Gas stations
What Is the Most Profitable Vending Business?
Vending fresh food is the most profitable vending business, with profit margins ranging from 30% to 45%. This is way higher than the usual vending machine industry margins of 20% to 25% for most products.
Vending fresh food, however, is hard to scale for a small independent operator. While operating several vending machines, you will likely find it more convenient to sell products with a longer shelf life, such as snacks and beverages.
What Is the Success Rate of Vending Machines?
Vending machines as a business have a success rate of above 80%. Given the low startup costs and the high success rate, vending is a great way for new entrepreneurs to get into business.
Depending on the cost of the vending machine, with used ones being more affordable or even free, you can expect a 100% return on investment - according to a profit calculator - within 12 to 18 months. Business owners with multiple vending machine locations will likely have a higher success rate as some locations will significantly outperform others. This goes to prove the false assumption that vending business is a dying business. If you need more vending machine location ideas, head over to our comprehensive location-finding guide.
What Sells Most in Vending Machines?
Snacks, beverages, and sweets sell the most in vending machines. Products from popular brands that consumers already know and trust are the easiest to sell.
The most popular items among vending machine customers include
- Snacks such as potato chips, crackers, pretzels, Snickers bars, Clif bars, Reese’s Peanut Butter Cups, and granola bars
- Popular soda brands such as Coke, Pepsi, Sprite, and Mountain Dew (Check out our piece on most popular drinks and snacks for vending machines)
- Branded water bottles such as Evian and Dasani
- Energy drinks such as Monster and Red Bull
- Sports drinks such as Vitamin Water.
Healthy alternatives to popular beverages and snacks are becoming more popular. Diet soda, for instance, is incredibly popular with vending machine customers.
What Is the Most Popular Credit Card Reader for Vending Machines?
The most popular credit card readers for vending machines are
- Nayax’s VPOS Fusion
- USA Technologies’ Cantaloupe ePort, and
- AirVend’s Picovend.
Since 80% of consumers prefer cards to cash when purchasing goods and services, more vending machines now have card readers and therefore allow buyers to pay by card. It is a good business decision as research indicates that consumers spend more when using credit cards than when paying with cash.
70% of vending machine operators say credit card readers are a great investment for their vending businesses. According to a study by Parlevel Systems in San Antonio, Texas, installing a card reader increased vending machine sales by 42%.
What’s New in Vending Machines?
One of the most significant changes in vending recently - aside from smart vending machine options - is the growth of healthy food options in vending machines. The vending machine industry is seeing an increasing number of vendors promoting healthy eating by increasing their proportion of healthy products.
This is a welcome development as research has shown that increasing the proportion of healthy food options in vending machines from 20% to 80% lowered the amount of sodium, fat, sugar, and calories consumed without lowering the vendor’s revenue or units of goods sold.
Final Thoughts
The statistics above show that vending machine industry will continue to grow in 2023 and beyond. Small independent operators are carving a niche for themselves and building reliable incomes by securing prime locations for their vending machines.
Finding a good location for your machine will be the biggest determining factor of whether you become a successful vendor. Vending machine locator service helps both new and established vending machine companies find great locations. We can help you too. Learn how it works here.
