The Undeniable Benefits of Starting Your Very Own ATM Business
There are 32.5 million small businesses in the U.S. Do you want to be a small business owner in the near future? An ATM business may not be the first idea that comes to be mind but as you’ll see in this article, there are many benefits.
You might think there are already many ATMs everywhere, surely the U.S doesn’t need them anymore. However, the growth of 7-11 stores in the U.S demonstrates that the public thrives on convenience. When it comes to accessing cash when you need it, there can never be enough ATM machines.
One of the keys to success in business ownership is doing your research first. Your knowledge-gathering begins with this article as we are going to talk you through what you need to know about starting your ATM business.
The ATM industry is a good place to start your business. The value of the market is predicted to be tens of billions of dollars before the end of this decade. One of the reasons for this drive-in ATM popularity is that the machines themselves have become much more sophisticated.
Gone are the days when all you expected from the ATM was cash. Know they are able to offer a wide range of digital banking services. You can pay bills, transfer money, deposit money and do a multitude of other things through your debit card.
Know you don’t even need your bank card to draw out cash. You can make transactions using a cardless connection with your mobile banking app. Understanding these different elements of ATM services is an important beginning in planning your business.
Importance of Location
Convenience and location go hand in hand. Well-located ATMs will make you money. Poorly located ATMs will not make you any profit so getting your location right is at the heart of a successful ATM business.
Ideal locations involve significant footfall but also cash-based businesses in the vicinity such as markets and fresh food outlets. Near bars, and other entertainment venues are also good locations. You don’t have to make these decisions on your own.
You can reach out to brokerage services that have a network of qualified locations. Some of these services are free but you may need to buy your ATM machine from them so do your research.
Build and Protect With Contracts
Once you’ve got your location make sure you’ve got a rock-solid contract. It could be that you’ve been able to cut a very good deal with a retail shop or another location that will house your ATM machine. As that machine becomes popular, the value of your business grows.
The last thing you want is that after all that hard work the business sells or closes and you lose the location. So make sure you secure your venues through a contract that is as tight as possible. Invest in legal help as you need it as this will serve you again and again with future new locations.
How to Get an ATM Machine
You need to consider whether you will buy an ATM that is new, buy a used ATM, or hire an ATM. Some people will say that the best types of ATMs are always new. This thought does have merit but it is unwise to close the door on other options as they may still be valid depending on the circumstances.
It is good to think about the individual venue that will house the machine and the expected client profile. Another major consideration is your starting capital and how many locations you want to work from.
So, in short, the best ATM is the one that matches the circumstances. A basic guide is that a new machine setup with stocked cash will cost you about $5000.
Cash Flow Management
You must understand how cash will flow through your business. You will need to estimate, in an accurate way, the weekly and monthly cash movement through your ATM. The more successful your machine the more cash will move.
Typical monthly cash withdrawals will amount to between $8000 and $10,000 depending on the location. Make sure you have established your key banking relationships before your get your ATM. You want to be certain that the main banks will support your ATM.
Calculate Surcharge and Margins
The surcharge is the fee that people pay to use your ATM. Set this fee too high and people will choose to use another ATM or they will only use your ATM once. Set it too low and your business will flounder due to a lack of operating income.
What all of this means is that you need a clear business plan with your projected costs and income. Be conservative and set your profit margin in a reasonable way and you will see how much you need to charge for each ATM transaction.
Maintaining Your ATM Business
ATMs are electronic machines that need maintenance. Make sure you stick to the supplier’s maintenance schedule. These machines have moving parts and do a lot of work so they need to be kept in excellent condition.
The more you know about the machine and how it operates you will see there are many simple things you can do to keep it operating and save time and money. For example, reloading paper and fixing paper jams. Keep everything in order and these machines will silently make money for you for years.
Start Your Own Business
In this article, you’ve read some insights into what it means for you to have a successful ATM business. Business management and good sense combined with the information in this article will help you make some good decisions in starting your ATM business.
One of the great things about an ATM business is that it’s scalable so you can start at a level within your grasp and as you gain experience expand in a way that suits you.
Check out other business-related articles on our site that inspire the entrepreneurial spirit.