We know about the convenience of an ATM but an ATM Business Basics Plan? Sweet!
When we need cash right away, our favorite ATM isn’t very far away and it always operates correctly when we need money. It’s a great plan, that’s why we wrote the “ATM Business Basics Plan“.
What about the other end of the operation? Cash doesn’t just appear in ATMs magically, and there are a lot of high-tech tools that go into ATM networks. Running a series of ATMs presents a great way for business owners to have a passive income, meaning you make money with just a little effort while repeat customers do most of the hard work.
Think of running an ATM as investing in the stock market.
The employees and executives of the companies in which you invest do the hard work of making your investment pay off while you simply buy stock in the firm. An ATM does the same thing. All you do is maintain your machines while regular customers pull into the business, swipe the card and push the buttons.
Here’s Our ATM Business Basics 101:
ATM Business Basics #1
Buying equipment represents the single-largest expense of running an ATM business. Lower-end products may run you between $2,000 to $3,000 each, while higher-end machines reach close to $10,000 apiece. Depending on your network, you may need an initial investment of $50,000 or more.
Other initial investments include extra clips in which to carry money to refill the ATMs, buying the money itself and a truck with which you transport the machines. You might consider investing in an armored car service or some kind of security detail to guard your machine when you service it or refill it.
Just like starting any other type of company, you don’t need to have cash up front to run an ATM business. Utilize your good credit wisely and take out a business loan. The good news is that an ATM business costs less to start than, say, a fast food chain, a restaurant, a retail store or a manufacturing firm. You still have a physical business, but the upfront costs are lower compared to other retail businesses.
When you find the best ATMs for your business, do your research. Do you want huge machines with more options for bills, or do you want basic machines that dish out 20s to people who need them? If you’re just starting out and want to reduce your risk, consider going with good, basic machines.
Also, consider companies that have few added fees when it comes to buying ATMs. Try to find suppliers that don’t have annual contracts that entangle you with certain goals, overhead costs and extra expenses just to have access to upgrades and services.
ATM Business Basics #2
Calculate Your Profits
When you invest in an ATM, you make money from the fees. Fees typically range from $2 to $4 per withdrawal. The physical cash you put into the machine pays for itself because the ATM’s customers withdraw the funds while the extra money comes back to you in fees.
Find high-traffic areas that see a lot of foot traffic. For example, an entrance to a popular business represents a great place for an ATM. Think restaurants, convenience stores, gas stations, sports venues, grocery stores, meeting rooms and agency buildings with public services.
Assume that 3 to 5 percent of the foot traffic uses your ATM and then multiply that weekly number by the fees associated with your ATM. That’s your weekly profit margin. Depending on your fees and the traffic, you can make hundreds of dollars per day and thousands of dollars per week, but these results depend on a lot of factors.
For example, foot traffic may decrease on days with bad weather. If you have an ATM at a sports venue, that income may remain steady only when particular sports are in season. Population shifts and crime rates may change the traffic to a particular area over the long term. Do your market research before you invest your money in an ATM business.
ATM Business Basics #3
Arrange Legal Aspects
Because your business deals with large sums of money, sensitive personal information and banking information, you must protect yourself along every step of forming and running your ATM business. Register your company as an LLC with your state and local government to protect your liability. Bond and insure your company against losses, because banks may not deal with business owners who can’t insure themselves should something go wrong.
Once you have your legal business status in place, it’s time to reach out to banks and business owners to sign contracts. Your contract spells out precisely who is liable for what when it comes to an ATM. Who is responsible for the security of the machine? How often do you refill it? Who has authorization to get inside the machine? What happens in case of an emergency at the physical location? Iron out all of these aspects of your business before you place your first machine.
ATM Business Basics #4
Research What Others Do
Like most startup owners, you probably look to a mentor when you seek advice about how to run a business. Find a colleague who owns an ATM business and ask for advice. Reach out through LinkedIn or a trade organization for someone who walked the walk at some point in the past and connect with that person. Find blogs or other resources on how to run an ATM business.
Your mentor should have a trustworthy attitude and a willingness to give you practical advice. Compare this person’s advice with others in the business to see if the tips and tricks make sense. Your ATM machine supplier and banks represent other great resources for tips about how to run an ATM business.
ATM Business Basics #5
Nuts and Bolts of Your Machines
Your ATM machines need several things when it comes to a physical location. First and foremost is security. Your ATM must stay in one place and remain protected from the elements. Some ATMs simply stand upright and stay against a wall. Others are built into the physical structure of the building. ATMs that sit within a wall can be any size since no one can remove them. Stand-alone machines must be heavy, secure and self-contained so no one can pick them up or get into them.
In addition to the physical appearance of an ATM, you need to have well-lighted signage so passersby can see the location. If your location gets dark at night, potential customers need to see the ATM with a sign above it.
Inside your ATM, you have to supply power and the ability to communicate with banks. That means your location must have a power outlet protected from anyone unplugging the cord from the wall. The ATM must also have a secure internet connection. You can do this through a hardwired Ethernet connection or a steady wireless connection. Either way, the connection must have top-notch cybersecurity measures and encryption to prevent intrusions and breaches. A wireless connection has the advantage of letting you access your ATM remotely through an app on your mobile device or smartphone.
ATM Business Basics #6
Picking the Right Machines
Once you figure all of this out, it’s time to pick your ATM machines. Your cadre of machines should all be the same kinds so people know what ATMs within your network look like. A uniform appearance among all machines helps create brand awareness for your business. The types of machines you invest in determines your profit margins.
Lower-end machines are smaller and cost less while possibly having smaller fees. Smaller fees may draw more traffic to the ATM itself compared to other machines with higher fees. On the other hand, your ATM business may make money faster at a high-traffic location that has an ATM far away from other locations. A bigger machine with higher fees may be in order. Keep in mind that the time frame for turning a profit may be the same. Consider this: smaller fees plus less investment in smaller machines may equal the same time frame for profit as higher fees with a greater investment in larger machines. Most importantly consider the option of adding an ATM wireless service to the machine.
Free ATM Processing is here to help. The company has years of experience with ATMs, ATM businesses, and the banking industry. We use our industry knowledge, top-notch hardware and customer support to create a customized ATM network that fits your business model. Whether you’re just starting out or want to upgrade your processors, we have the technical knowledge and know-how to get the job done right. We have more than 60 years’ combined experience within the industry to dedicate to your ATM business.
Contact us today and see what we can do for you, whether you want to invest in 100 machines or just need a little advice for your ATM business. We can sell you the ATMs you want, and we have the ability to supply technical support for what we sell. Get on the path to prosperity today with a great passive income model that needs a minimum investment and by using our ATM Business Basics Guide, a lot of mistakes can be avoided.