Crossroads Vending Company

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Executive Summary

Crossroads Vending Company is a vending machine route business in Ohio. We place snack, drink, coffee and fresh-food machines in workplaces, gyms, clinics, schools and apartment buildings, restock them on a set schedule and keep them working. The people in each building get a snack or a cold drink without leaving; the building owner gets a service that costs them nothing to host.

Why this fits. Many buildings have people who are there for hours and no easy place to buy food. A small route business that keeps its machines full, clean and working fills that gap. The work repeats every week at the same locations, which makes sales easier to forecast once the route is built.

Here is what our numbers show. In Year 1 we plan to run about 20 snack and drink machines and 4 coffee and fresh-food machines. That is 220 and 44 machine-months of sales (a machine-month is one machine working for one month). It brings in sales of $169,840, growing to $549,071 by Year 5 as we add machines. We expect a loss of about $3,400 in Year 1 because machines cost money before they earn it, then a profit of about $11,400 in Year 2, a profit of about $47,700 in Year 3 and a profit of about $78,800 by Year 5. A route grows one location at a time, and the plan shows that honestly.

We need $136,000 in total. Of that, $111,600 is startup costs (the machines, a used van, first stock, permits, signs and insurance) and the rest is cash to get through the first months. I am putting in $66,000 of my own savings and asking for a $70,000 equipment loan.

I am Tasha Greene, the owner and route operator, with eight years of warehouse and grocery stocking work, the last three as a stocking lead who counted inventory and ran a weekly delivery route. These numbers are estimates based on the assumptions listed at the end of this plan, not promises.

Company Description

Crossroads Vending Company is a small, independently owned vending company in Ohio, planned as a limited liability company (LLC). We serve workplaces, gyms, clinics, schools and apartment communities in our metro area and the towns around it.

Our mission. To keep every machine we place full, clean and working, and to be the vendor a building manager never has to chase.

What we believe. A machine that is empty or broken costs the customer a sale and costs the location its patience. We show up on schedule, fix problems within one business day, take a refund request seriously and never leave expired food in a machine. We are honest with locations about what they will earn and what we will not do.

What we offer:
- Snack and drink machines. Chips, candy, granola bars, bottled water, soda and juice, with card readers on every machine.
- Coffee and fresh-food machines. Hot coffee, sandwiches, salads and yogurt for locations with larger groups, such as clinics, factories and offices.
- Healthier choices on every machine. At least a third of the slots hold lower-sugar and lower-fat items.
- A simple deal for the location. We supply, stock and repair the machine at no cost to the building, and some locations get a small commission on sales.

Who we serve. Small and mid-sized employers, gyms, medical offices, schools with adult staff areas, and apartment and senior communities with common areas.

What we do not do. We do not put machines where we have no permission, sell tobacco, vape or alcohol, or sell to schools anything that breaks the school's food rules. We do not leave a machine unserved for a week.

How we are run. I am the owner and route operator and I stock and service the machines myself in Year 1. A route driver and stocker joins in Year 2, and a second one in Year 4. An accountant keeps the books and a free mentor from SCORE or the Small Business Development Center reviews our numbers.

Where things stand today. We have quotes from two vending equipment dealers, a draft location agreement reviewed by an attorney, and verbal interest from a few workplaces, a gym and an apartment manager. (Replace this with where you really are.)

Problem & Opportunity

Most buildings with a few dozen people in them have the same problem. There is nowhere close to buy a snack or a cold drink, and the nearest store is a drive away. People skip meals or bring less, and managers hear about it.

Vending can fix that, but it is not as simple as plugging in a machine. Machines break. They run out of the best-selling items. Product expires. Card readers fail. Some operators sign a location, place a machine and then rarely return, and the building manager is left with an empty, unhappy box in the hallway. Large vending companies often skip small locations because the sales are too low for their trucks.

For a new route owner the hard parts are the cost of machines up front, finding good locations and learning what sells in each one. A machine placed in the wrong spot may earn half of what a good one does. Theft and spoilage cut into margins, and fees for card payments and tracking add up.

We want to be clear about what we know and do not know. Vending is a real, steady business when the locations are chosen well. We do not know how much each location will earn until the machine has been there a few months, so our plan assumes a loss in Year 1 and enough cash to cover it. We will use current local numbers when we finish the plan and will not overstate them.

Products & Services

Crossroads Vending Company will give small and mid-sized locations a clean, working, well-stocked machine and one person to call.

How it works, step by step:
1. Find the location. We visit the manager and look at foot traffic: how many people are in the building, for how many hours and what is nearby to eat.
2. Agree on terms. The location signs a short agreement with us. The machine is free to the building, and we agree on how long it stays and whether the location earns a small commission.
3. Choose the machine and products. We match the machine to the crowd: a snack and drink machine for most places, a coffee or fresh-food machine for larger groups. We ask the manager what people want.
4. Install. We place the machine, test the card reader and post our phone number on the front.
5. Restock on a schedule. Each machine has a visit day, usually weekly. Our software shows what has sold, so we bring the right items and fewer wasted ones.
6. Fix problems quickly. A call or text about a jam or a refund gets an answer within one business day.
7. Adjust. After three months we review what sells and move items around. If a machine is not earning, we move it to a better spot.
8. Report. Managers who want to see it get a short monthly note on sales and any commission.

Why this approach is strong. Locations stay with a vendor that is reliable. Reliable machines get used, and used machines make more money than neglected ones.

Market Analysis

Who we serve: workplaces, gyms, clinics, schools and apartment communities in our metro area and the towns around it.

Our primary group is employers with roughly 30 to 200 people on site, such as factories, warehouses, medical offices and call centers, where people have set breaks and limited choices nearby. Our secondary group is gyms, apartment communities and similar places with steady traffic. We will use current local numbers for employers and traffic in our final plan.

How we sized our plan. We plan to start with about 20 snack and drink machines and 4 coffee and fresh-food machines (220 and 44 machine-months in Year 1), growing to 578 and 164 machine-months by Year 5, which is a little under 50 snack and drink machines and about 14 fresh-food machines working all year. Our Year 1 sales are about $600 per snack machine each month and $860 per fresh-food machine, rising about 3% a year.

Demand data. Verbal interest from a few workplaces, a gym and an apartment manager covers part of the first machines. We do not count on any one location. A location may close or remove us on short notice, which is why we plan to keep adding locations steadily.

We do not take every location. We pass on places with too little traffic, locations that want large cash payments up front and spots that are hard to restock.

Competitive Landscape

Other choices for a building that wants vending, and what makes us different.

- Large vending companies. They have big fleets and strong prices on product, but they often skip small locations or visit rarely. We specialize in smaller locations and visit every week.
- Other small route owners. Some are very good. We compete on reliability, clean machines and cashless payment on every machine.
- Micro-markets and self-checkout kiosks. They work well for large employers. We will offer a fresh-food machine as a lower-cost alternative for mid-sized locations.
- Nearby stores and delivery apps. They are convenient only if a store is close. A machine is faster and does not require leaving.
- Employees bringing food. This is the hardest competitor, and it is free. We win on convenience and fresh choices at fair prices.

What makes us different.
- A visit every week, a fix within one business day and a phone number on every machine.
- Card readers and a way to pay with a phone on every machine.
- A health-minded product mix that managers are glad to host.
- A simple, short location agreement that is easy to read.

What we do not claim. We are new. Larger companies have more machines and can buy product cheaper. We plan to earn each location one good month at a time.

Marketing & Sales Strategy

How we will reach customers.

Walk-in visits. We will walk into small and mid-sized employers, clinics and gyms within about 20 miles of our storage space, leave a one-page offer and ask for the person who handles building services.

Referrals from locations. Every happy manager is asked to introduce us to one other manager. A gym owner may know three other gym owners.

Property managers and chambers of commerce. We will join the local chamber of commerce and ask property managers who handle several buildings to put us on their vendor lists.

Online. A simple website with a request form, a Google business listing and a QR code on every machine that lets people leave feedback or request a product.

Pricing. Most items sell for between about $1.50 and $3.50, and fresh-food items for more. Our average works out to about $600 per snack machine each month and $860 per fresh-food machine in Year 1. We set prices to be fair compared with nearby stores.

Operations Plan

How the business will run.

Setup (the 6 to 10 weeks before the first machine). We will form the LLC, get an EIN and open a business bank account, register for sales tax and get the vending and health permits our state and county require. We will buy and inspect the machines, test every card reader, rent storage space, set up the sales-tracking software and sign the first location agreements. We will not place a machine until it works and the insurance is in place.

Storage space. A small rented unit or warehouse bay for stock and spare parts. The plan counts $4,800 a year in Year 1.

Stocking. We buy from a wholesale club and a snack and beverage distributor, count stock on each visit and rotate items so the oldest sells first. Any expired item is removed and logged.

Staffing. In Year 1, I do the route, the repairs and the paperwork. A route driver and stocker joins in Year 2, paid $30,000 a year, and a second joins in Year 4 as we add locations.

Costs. Product cost and commissions are about $282 per snack machine-month and $420 per fresh-food machine-month in Year 1. Van fuel, maintenance and repairs are about $8,400 a year. Machine repairs and parts are about $2,800, card processing and tracking fees about $4,600, insurance about $4,200.

Quality and safety. We follow our state's food rules, keep fresh food at the right temperature with alarms on every cooler and record checks. Machines are cleaned each visit.

Payments. Most sales are by card or phone and arrive in the bank within a few days. Locations that earn a commission are paid monthly.

Insurance. We carry general and product liability, commercial auto for the van and coverage for the machines against theft and damage.

Management & Organization

The people who will run Crossroads Vending Company.

Tasha Greene, owner and route operator. Eight years in warehouse and grocery work, including three years as a stocking lead who counted inventory, ordered product and ran a weekly route. She leads sales, stocking, service and finance. (Replace this paragraph with your own background.)

Route driver and stocker (from Year 2). Covers a second route and handles refills and repairs.

Second route driver (from Year 4). Joins as the route passes about 40 snack and drink machines.

Outside advisors. An accountant, an attorney, an insurance broker, a vending equipment dealer who will help with machine placement and a free mentor from SCORE or the Small Business Development Center.

Staff pay in this plan is a full year per person: owner and route operator $34,000 and route driver and stocker $30,000. Replace them with the pay you can offer where you live.

Milestones Narrative

Our goals and when we plan to reach them.
- Before opening (6 to 10 weeks ahead): sign at least 5 location agreements or letters of interest, get machine, insurance and lender quotes, form the LLC, get an EIN, register for sales tax and get the vending and health permits. Do not place a machine until it works and the insurance is in place.
- Year 1: about 20 snack and drink machines and 4 coffee and fresh-food machines placed and running; $169,840 in sales and a loss of about $3,400.
- Year 2: about 10 more snack and drink machines, a few more fresh-food machines and a route driver; $279,212 in sales and a profit of about $11,400.
- Year 3: about 38 snack and drink machines and about 10 fresh-food machines, and the first strong profit; $384,088 in sales and a profit of about $47,700.
- Year 4: about 44 snack and drink machines, about 12 fresh-food machines and a second route driver; $469,875 in sales and a profit of about $52,600.
- Year 5: about 48 snack and drink machines and 14 fresh-food machines working all year; $549,071 in sales and a profit of about $78,800.
Growth depends on winning and keeping customers, so treat the later years as goals, not promises.

What we check every week: sales per machine, items that sold out, items that expired, refunds, machines down, time spent on the route and cash in the bank.

Funding Request

How much we need and how we will use it. Total we are raising: $136,000.

How we got that number. The Funding Need Calculator in this plan adds up three things:
- Startup costs of $111,600, listed item by item in the Startup Costs section: $48,000 for 20 refurbished snack and drink machines with card readers; $20,000 for 4 combination coffee and fresh-food machines; $17,600 for used cargo van, shelving and stocking carts; $2,400 for remote sales-tracking (telemetry) hardware and route software setup; $9,000 for first stock of snacks, drinks and coffee supplies; $3,600 for storage space deposit and first month; $1,200 for vending license, sales tax permit and health permits; $2,800 for attorney: location agreement and LLC setup; $3,200 for machine decals, signs and a simple website; $3,800 for insurance down payment.
- The cash the business uses before it breaks even, about $0. Running the route covers its own costs once machines are placed, so the money we need up front goes mostly to buying the machines and van, which are counted in the startup costs.
- A cash cushion of about $17,000: three months of Year 1 operating costs.
- Together, the cash used before break even and the cushion come to about $17,000, and the three pieces add up to about $128,550, rounded up to the nearest $500: $129,000.
We are raising $7,000 more than that, $136,000 in all, to cover the extra weeks it takes a new machine to earn what a settled machine earns and the cost of adding machines in Years 2 and 3. With this funding, the lowest year-end cash balance is about $38,800, at the end of Year 2.

Where the money comes from:
- My own money: $66,000.
- Equipment loan for the machines and van: $70,000.

Kind of funding we are looking for. An equipment loan from a lender that finances vending machines and vans, with the machines and van as collateral, backed by my own savings. Later machines are bought from profit and cash, not new borrowing.

How we will pay it back. We expect a loss of about $3,400 in Year 1, a profit of about $11,400 in Year 2, a profit of about $47,700 in Year 3, a profit of about $52,600 in Year 4 and a profit of about $78,800 in Year 5. With this funding, the business has money in the bank at the end of every year of the plan. Our loan is the equipment loan for the machines and van at 10.5% over 7 years, about $1,180 a month. That payment is already included in our cash flow. We chose these as cautious planning rates; ask the lender for the real rates, which may be lower or higher.

What we are offering the lender: the machines and van as collateral and my personal guarantee.

A smaller first step, if needed. If we cannot raise the full amount right away, we can start smaller and grow into this plan:
- Phase 1: start with 12 snack and drink machines and one fresh-food machine, run the route myself and rent a smaller storage space, which lowers startup costs and the loan.
- Phase 2: once the first machines earn steadily, add machines and a route driver and follow this plan.
To plan the smaller start, make a copy of this plan (use Duplicate) and lower the numbers to match.

All numbers in this plan are estimates. We will update them as real results come in.

Appendix Notes

Documents to attach before you send this plan:

- Your resume and a personal financial statement (a list of what you own and what you owe; lenders usually provide a form).
- Business registration papers and your EIN (your business tax number from the IRS, free at irs.gov).
- Quotes for the machines, the van and the sales-tracking software.
- Your location agreement, reviewed by an attorney.
- Your sales tax registration and vending or health permits.
- Letters of interest from workplaces, gyms or property managers.
- A map of your first 10 locations and the weekly route.
If you don't have any of this yet, no worries - let's continue.

The assumptions behind our numbers (change them in the Financials section to match your own):
- Snack and Drink Machines (per machine, per month): about $600 in Year 1, rising to $675; about $282 in direct costs, rising to $324; about 220 in Year 1, growing to 578.
- Coffee and Fresh-Food Machines (per machine, per month): about $860 in Year 1, rising to $968; about $420 in direct costs, rising to $482; about 44 in Year 1, growing to 164.
- A machine-month is one machine working for one month. Snack and drink machines average about $600 per month in Year 1 with about $282 in product and commission; coffee and fresh-food machines about $860 with about $420. Both rise about 3% to 4% a year.
- We add machines each year ($36,000 in Year 2, $30,000 in Year 3, $26,000 in Year 4 and $22,000 in Year 5), which is why profit grows slowly at first.
- Pay (a full year, per person): owner and route operator $34,000; route driver and stocker $30,000.
- Other yearly costs in Year 1: van fuel, maintenance and repairs $8,400, machine repairs and parts $2,800, card processing and sales-tracking fees $4,600, insurance (product liability and vehicle) $4,200, storage space $4,800, marketing and location sales $2,600, accounting, legal and licenses $3,000, payroll taxes $3,400. These grow between 4% and 12% a year.
- Startup equipment and later purchases ($88,000 in Year 1, then $36,000, $30,000, $26,000 and $22,000) are spread evenly over five years in the plan's books.
- Customers and payers pay about 7 days after service, so at the end of Year 1 about $3,397 is still owed to us. Income tax at 21%.
- Every dollar amount is an estimate. Replace them with your own quotes and research.

Startup Costs