If you want to make more money, an ATM business is a great way to earn passive income without taking another job. Notably, when a consumer needs access to cash, most are willing to go to the nearest ATM service machine and withdraw their money. Remarkably, this makes life easier, and the swift process makes an ATM business a good venture as it attracts people. However, before beginning any venture, it is crucial to understand the cost implications. Hence, here is a simple guide to how much it costs to start an ATM Business. These ATM business start-up cost breakdowns will ensure you are fully aware of the amount to have before starting an ATM business.
ATM Machines
Your greatest worry is probably, how much does an ATM cost? Well, ATMs range from $1,000 to $10,000 depending on whether it is new or it’s being resold. It might be cheaper to buy a used machine, but they are slower and look a bit old so you might lose potential clients. We also have smaller machines and bigger ones. A small device has fewer features and costs less; for instance, a small ATM with a single cassette and an LCD screen could go as low as $ 1,500. On the contrary, an ATM with advanced features like multiple cassettes ranges from $ 10,000 upwards. Additionally, we have different types of ATMs, such as freestanding or countertop models, and each style has its price. We shall discuss in detail some types of ATM machines.
Built-in ATMs
These are the most expensive ATMs; they are the kinds you find in banks and are built into the walls. They are more often found on a bank’s drive-through. These ATMs require substantial construction; hence, expect to pay $10,000 on average to cater for purchase and installation.
Wireless ATMs
Wireless ATMs are an advanced model of dial-up ATMs; they use WiFi capabilities to connect to the internet. They are faster than other dial-up machines; however, customers won’t be able to access money when they lose internet connectivity. These ATMs cost around $ 3,000, but you can get a used one at $ 2,000.
Freestanding ATMs
These are the cheapest ATMs; they are small and commonly found in restaurants, gas stations, and small retail shops. They cost around $1500 to $2000.
Dial-up Machine ATMs
They are similar to Freestanding units; they contain a small 56kps modem. These machines connect to the internet; hence, you will need a different phone line to hook them. They are slightly more expensive because of the hardware compared to freestanding units.
Loading Fee
Remember, you are the one to load the ATM with cash. You have two options; use a third party to load it with cash or load it yourself. Notably, to spend less money, you can pack money from your business to the ATM to cut out a third party, reducing costs. However, if that is impossible, you can use a third party to load the cash. Several companies offer loading services for individual ATM owners. These companies will cost you between $50 and $ 100 weekly. Notably, this amount varies based on the number of ATMs you own. You can pay about $50 and $80 for each machine if you have many ATMs. Remember that each company has its charges; research the ones offering the best package and determine how they benefit. In addition, the machines should be loaded on a rotating basis.
Installation and Set
Another significant cost when starting an ATM business is shipping and installation costs. We have seen different ATM manufacturers, most of which offer delivery at an extra cost. In this case, have an estimate of $ 400 for delivery.
Regulatory and Licensing Fees
Some people ask, ‘Do I need a license to start an ATM business?’ Yes, you do, and you should plan for its cost early. You must get a state operating machine license and also a local one. Licensing cost is entirely dependent on the state. However, you can spend $100 on one-time licensing fees. However, always inquire how much you must pay annually to validate your ATM business.
Internet
When dealing with ATMs, you will need to pay for connectivity. Most internet services charge $20 to $30 per month. However, when you subscribe to more advanced WiFi, you will pay around $ 60 and $70 monthly.
Vendor Fees
If you don’t own your store where you can place an ATM, you need to find a willing business owner to rent you the space to set up your ATM machine. This amount is affected by the location. In that, the more busy the location, the higher the charges. When you foresee that you won’t be able to make a profit after deducting the projected rent revenue, you might suggest to the business owner you split the payment instead of having a set rent price. This way, you will always generate a profit even when business could be faster.
For an estimate, vendor fees vary widely and depend on the traffic the ATM gets. For instance, when charged on a transaction basis, the business owner gets about 20 to 50 cents per transaction. An ATM gets used about 300 times monthly; hence, you can pay the vendor around $60 to $ 100 monthly.
Paper Cost
Paper cost is the most undermined budget or easy to forget. Remember, most ATMs will use paper reel receipts. However, other ATMs don’t use paper for a paper reel receipt ATM plan for around $30 and $50 monthly.
Maintenance Fee
Another cost to consider is the maintenance fee; many people use an ATM, and you must keep it in check. People get skeptical when an ATM is slow or doesn’t function well. Hence, I have some money aside for maintenance after some given timeline.
Accessories
ATMs have around four cassettes for $1, $5,$10, and $20 used to hold bills of different denominations. You may decide to get additional cash cassettes for $50 and $100 bills. The cost of an ATM cassette varies based on the brand but averages between $ 50 and $ 100.
Miscellaneous Expenses
Always factor in other expenses like signage and other security measures you may want to implement, like a CCTV camera or a guard.
Major Factor that Affects the Cost of an ATM Business
Location
Well, the location you pick is a significant factor that determines the cost of running your ATM business. Look at an ATM business in a rural area with less traffic than one in the city. Hence, it will cost less to operate, but it has lesser profits, but we have some exceptions. The higher the need for cash in a particular area, the more the traffic. Now that you have a rough budget estimate research the location before starting an ATM business.
Hiring Vs Buying an ATM Machine for Business
Now that you have a rough estimate, you may decide to start by leasing an ATM. You can hire a machine since you may need more resources to create an ATM business. What happens is that when you rent, another company will provide the engine and most of the logistics. Your work will be to focus on daily operations and maintenance. In return, you will pay portions of the profit to the company and licensing fees to them.
To get a company to lease from, you must conduct thorough research; some companies may require a $100 monthly licensing fee and 20% to 30% of your profits from surcharges. The prices change based on the location and type of ATM. Some companies waive surcharge fees and ask for a higher monthly payment and vice versa. It depends entirely on your budget to decide which is better for leasing or starting your own.
Conclusion
An ATM business can be very profitable; 15 to 30 monthly transactions can lead to a high return. Hence, it is a good source of extra income and could earn you around $20,000 and $ 30,000 annually. We can’t give an exact number, but we have a breakdown of what’s needed to help you figure out the numbers before starting an ATM business. It is excellent that you are already researching the cost of creating an ATM business. It would help if you were strategic with location, insurance, and other features. That way, you will be able to know whether this business is right for you. Generally, the ATM business has fewer implications compared to other start-up businesses.
Frequently Asked Questions
How much profit can an ATM Business make?
Well, having a rough idea of the estimated profit is crucial. But this is affected by many factors, including location and rent. Most successful ATM business owners report an average of $500 monthly per ATM.
How can you make your ATM business more profitable?
It would help if you made it profitable once you decide to invest in the ATM business. The profits are highly dependent on the location. Hence take time to do research on your location before you start one. To add up, many new ATM businesses and invest in franchises.
Is Starting an ATM Business Worth It?
Surprisingly, it is worth it. You need a good location with traffic and a good machine. An ATM business has high-profit margins because they are automated they require little upkeep and maintenance.
