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 want to dive into the rise of perfume vending machines and their surprising earning potential. Here’s what I’ll cover:

• The rising trend

• Profitability

• Best locations

• Operational insights

• How I’d get started

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

🏆 Business Wins

• 💰 Secured the first-ever deal with Nayax Capital to finance all my future vending machines at extremely competitive interest rates!

• 🤝 Seeking an Operating Partner in Dallas to manage our machines and expand our market. They'll earn 25% of the entire Dallas market's profit for stocking, growing, and maintaining the machines.

• 📊 Completed our latest sales presentation deck.

• 🍻 Hit the field and began pitching bars in my hometown LA, starting in West Hollywood. Out of 14 bars approached, only 1 declined. Many follow-up emails to be sent tomorrow!

• 💻 Successfully launched our Hubspot Sales CRM!

• 🎁 Finalized our 6 mystery bag offerings!

• 👨‍💼 Officially began the onboarding process for Charles, our new Operations Manager!

• 🚀 Setting up some incredible supplier partnerships for discounts in my upcoming accelerator coaching program called Vending Machine LaunchPad. Interested? Fill out this quick application.

P.S. Are you looking to become a franchisee in October? Hit the button below to get on our franchisee waiting list!

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

Non-traditional vending machines are shaking things up in the retail world, and I've stumbled upon a hot trend: perfume and cologne vending machines.

These machines are turning heads with their unique appeal and surprising profitability.

Let's dive into why these machines might be your next great business move (and how I’d get started if I did this today).

The Rising Trend

Perfume and cologne vending machines are popping up everywhere, from nightclubs to gyms and even busy shopping centers.

We're all about getting what we want fast these days, and these machines nail it by offering a quick luxury fix.

I've been seeing these machines all over TikTok lately, and they're grabbing a lot of attention.

People are recording their experiences with them, and it's pretty cool to see how much they enjoy that quick spritz when they need a refresh.

Plus, I got a message on Reddit from someone who’s just as curious about these machines as I am.

Clearly, when convenience meets luxury like this, it's a hit.

Here’s a fun fact: this isn't even a new trend.

Way back in 1950’s, coin-operated perfume sprayers were already a thing in both ladies' and men's restrooms.

And an old Reddit thread talks about these machines—it looks like what’s old is new again.

Yep, the same company that rolled out those vintage sprayers back in the day is also behind these new ones you're seeing now.

Profitability Breakdown

Here’s the scoop on how profitable these machines can really be.

I ran the numbers and here’s what I found:

• Location: High-traffic areas are prime spots. Bars, clubs, and gyms see about 3,000 visitors a day.

• Engagement: Let’s assume 30% of foot traffic (900 people) notice the machine.

• Sales Conversion: About 2% of those who notice, end up using the machine. That’s 18 sales a day.

• Pricing: We’ll say each spray is sold for $2.

• Monthly Revenue: This equals $1,080 per month from just one machine.

• Costs: The cost for the cologne or perfume is about 8% of revenue.

• Zero Commission: By presenting these machines as an amenity, you negotiate zero commissions with venue owners.

• Operating Expenses: Maintenance and processing fees take up another 6%.

• Net Profit: After all is said and done, you’re looking at an 86% profit margin, or $928 per month in profit from a single machine.

If you're thinking about investment and payback, a machine costs about $2,750, meaning you'll break even in just under three months.

After that, it's profit all the way!

Ideal Locations for Maximum Profit

Choosing the right spot to place your vending machine is crucial.

High foot traffic areas where people might want a quick refresh are perfect.

Here are the 5 best locations for perfume and cologne vending machines (and why they work so well):

1. Bars and Nightclubs: Here is where you want to smell good. Party-goers want to freshen up before hitting the dance floor (or mingle).

2. Upscale Gyms: After a workout, many people want to refresh before they leave, especially if they’re heading somewhere else right after.

3. Popular Shopping Centers: These areas see a lot of foot traffic, especially on weekends. Shoppers who spend hours browsing stores might want to refresh themselves.

4. Luxury Hotels: Guests often head out to meetings or tourist spots directly from their hotel. A quick stop at a perfume vending machine in the lobby can provide a convenient way to freshen up on the go.

5. Movie Theaters: Sounds like an odd choice, but think about it—people go on dates at the movies and might appreciate a chance to refresh before showtime (pun intended).

Each of these locations offers a unique opportunity to meet customers right where there’s a demand for a quick spray.

Operational Insights

Running a perfume vending machine isn't just about setting it up and watching it go. There are costs involved, but they're pretty manageable:

• Product Cost: The actual cologne or perfume costs about 8% of your revenue.

• Maintenance: Set aside about 3% for keeping the machine in tip-top shape.

• Processing Fees: Another 3% goes towards transaction fees and software to keep the sales rolling. Nayax is my card reader of choice. Click here for a special discount and use code “ETHANPROMO” upon checkout.

And here’s a pro tip: you can cut down on the cost by negotiating with venues to consider the machine an added amenity for guests, which can help you avoid paying commissions.

Getting Started Today

That said, here's how I'd launch a perfume vending business today:

Step 1: Setting Up the Business

First up, I'd form an LLC. This shields me legally. Then, I’d open a business bank account.

Using a platform like LegalZoom makes this super simple.

Step 2: Building “The List”

This is your database of potential locations. It includes contact details and all the necessary info you'll need to reach out and pitch your perfume vending machines.

Step 3: Selecting the Right Machines

I’d choose specialty vending machines for perfume, which cost between $1,000 and $3,000 from reputable. Alibaba seems like a good place to find suppliers. If you want my favorite supplier, reply to this email.

Or, I can go with Perfumatic, that same company I talked about earlier.

Step 4: Buying the Perfume & Cologne

Next, I'd source high-quality perfume & cologne that are very popular, like Tom Ford, Chanel, Louis Vuitton, and Hugo Boss. Eventually down the line, buying in bulk from these reputable suppliers will reduce costs.

Step 5: Developing a Sales Pitch

I’d craft a killer sales pitch. The focus? Showing locations how a perfume vending machine can boost their customer experience and add a neat and convenient feature. It also adds to the social media virality effect of their business.

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

Step 6: Drafting Contracts

Finally, get those contracts ready. These agreements will formalize the partnership with locations, ensuring both parties understand their rights and responsibilities.

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

And That’s a Wrap!

Perfume and cologne vending machines are a profitable venture that taps into the modern consumer’s need for convenience and luxury.

With high profit margins and quick returns, this could be the opportunity you’ve been looking for.

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!