How An ATM Machine Can Be A Goldmine For Small Businesses
An ATM machine can do much more for a business than merely help customers withdraw cash as they purchase goods in the store. It can also make any business a sizeable profit each year as well as attracting a host of new customers. Of course, there are numerous things a business needs to know about an ATM machine before purchasing one but rest assured, if everything is planned correctly, this cash machine will help a small business greatly in the form of a second income.
ATM Machine Costs
Advantages of owning an ATM machine include the fact that no existing employees will be forced to neglect current duties to tend to it nor will new workers be required. The initial start-up cost could be high if a business decides to buy the machine outright but it is likely that the $6,500 spent will be recouped in less than a year. Another big plus when it comes to ATM machines is that you can own as many as you like so long as there are suitable locations to place them.
The $6,500 figure quoted for an ATM machine is the absolute maximum cost. It is possible to purchase machines for about half that amount. An alternative is to rent the machine monthly. This is probably the best idea for a small business new to the ATM game. In general, one of these machines will cost approximately $100 a month to rent. There are a host of online companies that deal with this product. Shop around to find the best terms for your business.
Things To Consider
Two of the most important things to consider when purchasing an ATM machine is where to place it and whether or not the area chosen has high enough traffic on a daily basis. If at all possible, find a site within your premises to place the machine. If you are forced to place it elsewhere, you will have to pay that business owner a rental fee or worse yet, a slice of the ATM profits.
Having the machine on your premises also ensures that more people will enter the store. Once people find out that your business is the site of a convenient ATM machine, hordes of prospective customers will enter to withdraw cash. This could very well have a knock-on effect of attracting extra business. Once an individual has passed through your doors, it is possible that they will become new customers if they are interested in your goods.
Your business is a prime location for an ATM machine if at least 250 people travel through the premises a day. There is actually a specific formula used by businesses that own these machines. Approximately 4% of people that pass by an ATM machine during the course of a day will use it. The average additional charge for using once of these machines is about $2.25 per transaction. 4% of 250 people equals 10 users of the machine a day which totals $22.50. This equates to $8,212.50 per year. Imagine making over $8,000 a year simply for having a machine in the corner that gives people cash!
The only work you have to do is replace the money in the machine once in a while. You may use the company’s money or personal savings but it is a better idea to borrow the cash. At $100 per month rental, the total annual cost for your business is $1,200. However, you must also take into account the extra energy bill plus the fact your insurance costs per annum will be a little higher. If the machine deals with a high volume of cash, it may be necessary to have an armored car and guards to deliver the cash that is borrowed from a bank. Owners or leasers of ATM machines are also responsible for dealing with customer queries and complaints.
Getting An ATM Machine
In order to process transactions, you will have to deal with an Independent Sales Organization (ISO). Be sure to do plenty of online research to find the company with the most reasonable rates and best service. As each state has different requirements when it comes to owning an ATM machine, it is also necessary to find out what paperwork needs to be completed. In general, you will have to file a notice of ownership within 2 months of purchasing the machine.
Expect 48 hours before the transactions fees accrued from the machine end up in your account. In the meantime, ensure that the machine remains fully stocked. If customers continually find a machine that is ‘out of order’, they will soon look elsewhere. When it comes to security, always have the ATM machine located indoors with a CCTV camera trained on it. If it is to be located outside, you will probably be required to hire a security guard as part of your insurance.
There is also the possibility of becoming involved in an ATM franchise but be prepared to enjoy a smaller percentage of the profits. Before purchasing an ATM machine, always have a solid business plan. If utilized correctly, a cash machine can add extra income as well as increasing a small business’ custom.