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Vending Machine Commission Agreement

For example, a vending machine operator would offer vending machine owners other incentives, such as newer or more modern appliances, additional services or lower selling prices for drinks in soft drink dispensers or sweets and snacks in candy dispensers. The net effect of these incentives may well lead to a lower ROA than the payment of commissions. Vending machine operators can often increase their share of the vending machine market by offering higher commissions. An increase in commission rates may be covered by an increase in the unit price of vending machine items. For example, if a vending machine operator wants to offer a 5% increase in commission rates, they can also negotiate a unit price increase of $0.25 for all beverages and candy snacks in refreshing beverage and candy/snack vending machines. As a result, all candy vending machines would be priced at $1 instead of US$0.75, and all soft drink vending machine items would go from $0.75 to $1 or more. Rising VENDing machine prices and commission rates often delight homeowners, who will ultimately more than double their profits. Although some vending machine operators are reluctant to raise prices, studies have shown that while sales initially decline, they return as soon as customers adjust to higher prices. Any expected distributor gain beyond the ROA can be offered as a commission. Contrary to popular belief, commissions are not the Achilles heel of vending machines. Instead, they are a tool used by experienced vending machine operators to increase their market share.

ATM operators who are having difficulty paying commission rates due to a low ROA rate should look at their overall management.. . .