According to the latest numbers, there are more than 470,000 automated teller machines (ATMs) in operation across the United States.
Of those, nearly 192,000 are serviced by banks and other financial institutions. The remaining 278,000 are independently owned and operated by non-bank merchants.
Are you interested in investing in an ATM business yourself? This can be a profitable venture if you know the right steps to follow. Today, we’re sharing how to get started. We’ll also answer questions such as “How much does an ATM cost?” and “What are the benefits of owning one?”
Read on to learn all of the details you need to know.
Buying an ATM: The Potential for Passive Income
In today’s ever-shifting economy, it’s smart to supplement your full-time income with some type of side gig. In fact, research shows that around one in three Americans has another hustle that they work in addition to their day job.
For some, this means pouring their creative energy into a craft or hobby and then selling the finished result for a profit. Others turn to companies such as Uber or GrubHub, using their spare time to drive others around or deliver meals.
Then, there are investors who generate what’s known as passive income. These are earnings that are generated from a venture in which the owner isn’t actively involved. For example, someone who owns a rental property can earn money each time the unit is rented but doesn’t have to be involved in its day-to-day upkeep.
Owning an ATM machine works in a similar fashion.
When you invest in the machine itself, you will have to pay an up-front fee. However, that’s the majority of the work you’ll do. Once it’s permanently installed and in place, you can earn a percentage of the transaction fees that are charged each time it’s used.
How to Buy an ATM
There are full-service ATM companies, like Carolina ATM, that work with individuals and businesses that are interested in purchasing an ATM machine. Especially if you’ve never worked in this space before, it’s in your best interest to utilize their services.
While you’ll have to pay for the expert guidance, these teams will know exactly how to help you get up and running. They’ll research your local market, find the ideal location for your ATM machine, and walk you through the steps required to install it. When it’s in place, they’ll even provide monitoring services to ensure security and technical support to help you fix any operational bugs.
When you’re ready to research ATM machine prices, it helps to know what you can afford. These machines will vary in cost based on their age, condition, and model.
Typical Prices to Expect
A brand-new ATM machine will typically cost around $2,000 to $3,000. However, advanced and newer models can run as high as $5,000 to $8,000. Small, countertop models will cost less than a larger, freestanding unit.
If those numbers are outside of your price range, you can also look into buying a used ATM machine. Used machines are typically no more than $2,000, but keep their appearance in mind. If the machine looks old and outdated, users may not visit it as frequently.
You can even find ones priced as low as $1,500. In addition to paying for the actual machine itself, you’ll also need to pay a one-time installation charge of around $200 to $300.
Want to waive that last charge? If you’re willing to install the ATM on your own, you can do so. That money goes toward relinquishing that task to the consulting company you hire.
Choosing the Right Location
Not every business is an ideal place to install an ATM. Ideally, your area should have a steady amount of traffic flow, and cater to a wide audience of shoppers. Bonus points if those shoppers traditionally shop with cash!
A few of the best places to install an ATM machine include:
- Bars
- Restaurants
- Convenience stores
- Gas stations
- Beauty salons
- Retail shops
- Shopping malls
- Nightclubs
If you partner with an ATM marketing company, they can help you determine if your location is well-suited for an ATM. As you grow your business, you may consider adding machines in each new location.
Or, you might decide to buy ATM machines and sell or lease them to business owners yourself! If you do so, try to negotiate a good deal that allows you to retain a solid amount of profit. If you advertise a full-service model, you’ll be the one responsible for maintaining the machine.
Make sure you’re charging enough to help cover those costs. Otherwise, you could wind up with a fleet of ATM machines around the city, and only minimal earnings to show for it.
Stocking the ATM
As you might imagine, an ATM needs to be stocked with cash! Users will visit it to withdraw funds from their own bank accounts. You can expect your machine to go through between $6,000 and $8,000 worth of funds every month.
Business owners will use money from their business to keep the machine loaded at all times. While that might seem like a hefty investment, consider the fees you’ll earn on each transaction.
Typical ATM fees range from $2 to $3. Each time someone uses the machine, that’s money back in your pocket.
Renting vs. Owning an ATM
If you don’t want to go through all of the steps required to buy an ATM, you may choose to rent one instead. While it’s easier to get started this way, keep in mind that you will be sharing any commissions you may make from the machine.
For instance, if the fee for your ATM is $2, then you may be able to take $1 as the renter, but the other $1 will go to the business that owns the machine.
This is one advantage of owning an ATM outright versus renting one. Yet, the drawback to having all of the responsibility on your shoulders is that you’re the one responsible for maintaining the machine. If it breaks down, you’ll either have to fix it yourself or hire someone to get it back up and running again.
Benefits of Owning an ATM Machine
Owning one of the different types of ATMs can be a profitable and rewarding experience. Are you eyeing one and planning to install it at your business? If so, here are a few benefits you can expect.
Enable Cash-Only Transactions
Today, most modern businesses accept multiple types of payments, including checks and credit cards. However, there are still some companies that operate on a cash-only basis. If this applies to you, then having an ATM machine on your premises can enable you to serve more customers.
This way, if someone doesn’t come prepared with cash, they can simply visit the nearby ATM machine to withdraw the money they need. Meanwhile, you earn a sale plus the commission from their transaction.
Limit Credit Card Processing Fees
Having an ATM at your place of business enables your company to accept more cash payments. This can lower the number of credit card transactions you complete. In turn, this means paying less in processing fees.
It can also encourage more shoppers to frequent your store. If you’ve been charging a percentage of each transaction to cover the card processing expenses, that can be a major deterrent to prospective buyers. If you can waive this fee by making cash payments easier, you’ll help ease that concern.
Freedom and Flexibility
If you work with an ATM company to set up your machine, you will have the flexibility to rent or own it. This allows you to make the best decision for your business. If you change your mind down the road, they may be able to work with you and adjust your plan as required.
Better Customer Support
Customers appreciate having an ATM machine close by. It saves them from having to run to their bank to get cash and enables an easier transaction for everyone.
Over time, you might find that customers become more loyal to your store and your brand. According to one study, 83% of shoppers value convenience more today than they did five years ago, and this is one way you can cater to that need.
How Much Does an ATM Cost? Know Before You Buy
If you work with the right full-service company, owning an ATM machine can be a lucrative investment. The key is to understand the answer to “How much does an ATM cost?” and budget accordingly.
You should also consider how hands-on you’d like to be. If you’re up for the challenge of managing the ATM on your own, then you can retain more of the earnings. Otherwise, a full-service company can take the reins and some of the stress.
Looking for more information to take your company to the next level? Check out the guides in our Business section!
