🍦 Ice Cream Vending Machines: How Much Can You Make?

Hey there, Vendpreneur!

Welcome to Becoming a Vendpreneur—where every week I help you navigate the challenges of running a vending machine business, whether you’re just starting out or looking to expand your operation.

This week, I’m going to explore the exciting rise of ice cream vending machines and their lucrative earnings potential. Here’s what I’ll cover:

• The emerging trend

• Profitability insights

• Prime locations

• Key operational tips

• How I would launch

But before we jump into more details, I want to share a few quick updates on my vending business, Pod Plug:

Business Updates

• 🤝 In the first week of announcing my capital raise, I had 12 investor meetings (two of them being newsletter readers!)

• 💰 Forging a partnership with a financing company to help subsidize the franchise fees. This means franchisees could start with only a few thousand dollars!

• 🚀 Interviewed a community manager to help create marketing materials and assist with the backend creation of my first coaching accelerator, Vending Machine LaunchPad.

• 🎬 Had a final interview with a video editor for my upcoming YouTube, TikTok, and Instagram content. T-2 weeks!

• 🍻 Pitched 3 bars in LA and one of the managers said yes. I sent them a custom proposal, and now he's taking it to the owner.

• 🎓 Had 2 interviews for a Head of Campus Recruitment, to lead the charge on finding franchisees in college towns using a mix of their internal network and cold outreach via Instagram and LinkedIn.

Now, let’s dive into this week’s newsletter!

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• Experience Japan’s latest craze: Watch your orange juice being made in a vending machine! 🍊🇯🇵 (Arab News Report)

People loved my recent take on perfume and salad vending machines, and I've been flooded with DMs asking about other types of vending opportunities.

I've decided to delve into another intriguing option: ice cream vending machines.

We'll check out how profitable these machines can be and what it takes to run them.

I'll go over the costs to how I’d get started and tips on making good money from selling ice cream this way.

If you're thinking about adding ice cream vending to your business, this breakdown will help you see if it's worth it.

The Rising Trend

Recently, I stumbled upon a TikTok viral post that really piqued my interest—a (loud) ice cream vending machine placed in a library!

It's not every day you see something like that.

This particular machine was a vacuum type, which works by sucking up the packaged ice cream, much like traditional snack vending machines.

On YouTube, I found even more fascinating types of ice cream vending machines.

Some offer soft serve ice cream and let buyers customize their own flavors by picking toppings and ingredients.

These machines are more advanced, featuring touchscreen displays where customers can make their selections and watch their ice cream being made right before their eyes.

Sure, ice cream vending is quickly becoming a lucrative niche in the vending business world.

Here are a few players already making waves with different models:

1.) Blue Bunny Vending Machines

2.) Ben and Jerry's Vending Machines

3.) Dippin’ Dots Ice Cream Vending Machines

It’s exciting to see how creative and innovative the vending industry is becoming, especially with such a beloved treat like ice cream!

Profitability Breakdown

Now, let's get into the monthly earnings of these machines (always the most exciting part).

Here's what the numbers reveal:

• Best Location: Parks, schools, and other high-traffic outdoor areas, especially during the summer when ice cream is in high demand.

• Foot traffic: Approximately 5,000 people per day during peak summer months.

• Impressions: Let’s assume 15% of people see the machine. This means the machine will get 750 impressions per day.

• Purchase rate: Roughly 4% of the people who see the machine make a purchase, which is 30 purchases per day.

• Average retail price per item: $5 per ice cream, fitting the typical price point for a quick snack in these locations.

• Daily revenue: 30 purchases x $5 per ice cream = $150 in revenue

Cost Breakdown:

Cost of Ingredients: $1.50 per item for the ice cream and toppings (70% gross margins).

• Ice Cream Base: The basic cost of a single serving of ice cream (e.g., a scoop, soft serve, or a pre-packaged item) range from $0.75 to $1.00, depending on the quality, quantity, and supplier.

• Toppings: Common toppings like sprinkles, chocolate syrup, nuts, or fruit add an additional $0.25 to $0.50 per serving, depending on the type and quantity used.

Commissions: 10% of revenue paid to the location for hosting the machine.

Processing Fees and Software: 5% of sales. Nayax is my card reader of choice. Click here for a special discount and use code “ETHANPROMO” upon checkout.

Maintenance: 4% of sales, considering the refrigeration needs and regular servicing, especially in outdoor settings.

Profit Breakdown:

• Monthly revenue: $150 daily x 30 days = $4,500

• Net profit margin: 36%

• Profit = $4,500 × 36% = $1,620 a month!

If you had one in all 3 popular parks or school districts, that’s nearly $5,000 a month in PROFIT!!!

Who’s going to jump on this? If you’re serious about this, reply to this email and I will be happy to put you in touch with a great supplier to make this happen.

Ideal Locations for Maximum Profit

Here are 5 ideal spots:

1. Parks and Recreation Areas

Parks attract a diverse crowd, including families, joggers, tourists, and people enjoying outdoor activities. During warmer months, the demand for cold, refreshing treats like ice cream increases significantly. Parks often lack nearby stores, making a conveniently placed vending machine a popular option.

2. Beaches and Boardwalks

Similar to parks, beaches see a high volume of foot traffic, especially in the summer. The combination of sun, sand, and relaxation creates a strong desire for cold snacks like ice cream. Boardwalks often have tourists and locals alike who are looking for convenient refreshment.

3. School Campuses

Schools, particularly those with large student populations like universities and colleges, are excellent locations for ice cream vending machines. Students are often on the move between classes, and a quick, sweet treat is a popular choice. After-school hours and events (like sports games) provide additional sales opportunities.

4. Shopping Malls

Malls attract large numbers of shoppers who often spend several hours walking around. Additionally, the climate-controlled environment keeps foot traffic steady year-round.

5. Tourist Attractions

Tourist hotspots like zoos, amusement parks, historical sites, and museums have high foot traffic and a captive audience. Visitors often spend several hours at these locations, making them likely to purchase refreshments.

Getting Started Today

So, here's how I'd go about launching a salad vending machine business today:

Step 1: Setting Up the Business

I’d start by forming an LLC to protect myself legally and opening a business bank account to handle all financial transactions.

Using services like LegalZoom can simplify this process and ensure everything is set up correctly.

Step 2: Building ‘The List’

I'd zero in on high-traffic, affluent areas that are ideal for targeting families and students, all within 15 miles of my location.

For example, since I live in LA, a prime spot would be Beverly Hills High School, where the affluent student body makes for perfect customers seeking a quick, delicious treat during and after school hours.

I'd compile a list of key contacts, such as principals and operations staff, by exploring the school’s website or connecting via LinkedIn.

Once I have my list completed, I'll consolidate it in a simple CRM to keep track of all communications and follow-ups efficiently.

There are many affordable CRM options like Monday.com, Hubspot, Salesforce, but I always return to Google Sheets/Excel.

Step 3: Selecting the Right Machines

I’d choose the USI FF 2000 from Vencoa, a reliable option for vending pre-packaged ice cream, priced at $4,495.

For a broader frozen product range, I’d pick either Selectivend's machine or the USI Alpine Combi 3000 from AVS Companies.

Fastcorp’s machines are also a good option. I’d also consider buying directly from manufacturers on Alibaba to get the best prices. If you're interested in a supplier list, just let me know and I’d be happy to make an intro!

Step 4: Stocking Flavorful Options

I’d stock the machine with premium local brands like McConnell’s Fine Ice Creams, known for their rich flavors and organic ingredients, perfect for health-conscious Los Angeles.

Popular flavors would include Double Peanut Butter Chip and Turkish Coffee—favorites among kids and adults alike. I’d also offer a variety of toppings, sourced in bulk from wholesalers like Sysco.

Step 5: Crafting the Perfect Sales Pitch

My sales pitch to the school’s administration would highlight the benefits of providing students with access to high-quality, enjoyable treats that enhance their school experience.

I’d also potentially offer a revenue share to support school programs.

And if you want my entire cold call script for free, here it is:

Step 6: Drafting Contracts and Establishing Partnerships

Prepare clear and comprehensive contracts for location hosts to formalize the arrangement.

For schools and parks, engage with the administrative bodies to navigate any specific regulations or requirements they might have for vending operations on their premises.

Here’s the exact agreement I use for all my locations. Get it below for free!

And That’s a Wrap!

Thanks for reading this week’s newsletter.

Hit reply and let me know what you found most helpful this week—I read every single reply and I’d love to hear from you!

See you next Saturday!