_
HOW TO CONVERT A SCHOOL
CONTRACTOR’S EXPENSES
INTO NUTRITION DEPARTMENT INCOME
School Nutrition Departments are finally beginning to take over school vending for wellness and profit. Over 90% of the operating expenses of an outside vending contractor become the profits for the school choosing to operate their own vending machines. Route trucks, off-site storage, middle management, salespeople, owner’s profits, fuel, insurance, and even an independent contractor’s income taxes would become the bottom-line profits when a School Nutrition Department started operating their own vending machines.
Schools are the absolute best vending location category in the USA. Hundreds and even thousands of teenage eating machines spend 6 - 10 hours per day at school for 180 days every year. These teens also love to make technology transactions. They like to do business with machines. It just doesn’t get any better than that for a vending environment.
The R Factor
The secret that every vending contractor doesn’t want schools to know is called the R Factor. That stands for the Reduction Factor….when it comes to promised commissions. The only way a school can audit vending sales to insure they are getting the percentage of sales they were promised is to audit each machine individually by witnessing the non-resettable sales meter. This is almost never done in schools, to their great disadvantage. In fact some vending companies will offer a computerized report to supposedly validate their professed sales. Every accounting software program I have ever reviewed in the vending industry has the capacity to generate false commission reports to clients like schools. This is the R Factor. You can simply google R Factor Vending to confirm this practice for yourself. The only way to beat the game is to demand monthly sales auditing right from the non-resettable sales meter in each machine, which is exactly what the vending operator references to make sure the route personnel are not taking unauthorized bonuses from their vending collections.
Nardonia High School reported to me that they had received about $123 every three months from their vending contractor, supposedly representing 25% of the total sales from three vending machine being operated in their High School. If that were true, those machines only generated $492 in sales over 13 weeks. No vending company could ever afford the equipment investment for sales that terrible. That is a completely impossible sales claim. This is an extremely common pattern. Now that Nardonia has their own specially configured machines selling healthy products, they see $492 in sales from their 2 machines in less than a week. The Food Service Department doesn’t make just a pretend 25%. They make more like 55% of total sales.
Easy Money
School Nutrition Departments can increase vending income by a minimum of 500% when they operate their own machines. Tracy, the Food Service Director at Richford Jr Sr High School in northern Vermont borrowed $5,000 from the School Board for a healthy school vending machine for her school. She paid them back from profits in less than four months….with a student population of just 252. Her machine pays for itself twice each year. Shelley at South Lake Tahoe High School in California installed two healthy school vending machines in late August of 2011. In her first 30 days the two machines generated over $6,500 in sales at a profit margin exceeding 50%. This list can be quite long. Schools are always looking for more money. Taking over the vending in the school is a great way to keep more money inside the school….that is being generated in the school.
Source: Jim Dillingham, President of Vend-ucation
JimD@venducation.com 800-633-1200
INTO NUTRITION DEPARTMENT INCOME
School Nutrition Departments are finally beginning to take over school vending for wellness and profit. Over 90% of the operating expenses of an outside vending contractor become the profits for the school choosing to operate their own vending machines. Route trucks, off-site storage, middle management, salespeople, owner’s profits, fuel, insurance, and even an independent contractor’s income taxes would become the bottom-line profits when a School Nutrition Department started operating their own vending machines.
Schools are the absolute best vending location category in the USA. Hundreds and even thousands of teenage eating machines spend 6 - 10 hours per day at school for 180 days every year. These teens also love to make technology transactions. They like to do business with machines. It just doesn’t get any better than that for a vending environment.
The R Factor
The secret that every vending contractor doesn’t want schools to know is called the R Factor. That stands for the Reduction Factor….when it comes to promised commissions. The only way a school can audit vending sales to insure they are getting the percentage of sales they were promised is to audit each machine individually by witnessing the non-resettable sales meter. This is almost never done in schools, to their great disadvantage. In fact some vending companies will offer a computerized report to supposedly validate their professed sales. Every accounting software program I have ever reviewed in the vending industry has the capacity to generate false commission reports to clients like schools. This is the R Factor. You can simply google R Factor Vending to confirm this practice for yourself. The only way to beat the game is to demand monthly sales auditing right from the non-resettable sales meter in each machine, which is exactly what the vending operator references to make sure the route personnel are not taking unauthorized bonuses from their vending collections.
Nardonia High School reported to me that they had received about $123 every three months from their vending contractor, supposedly representing 25% of the total sales from three vending machine being operated in their High School. If that were true, those machines only generated $492 in sales over 13 weeks. No vending company could ever afford the equipment investment for sales that terrible. That is a completely impossible sales claim. This is an extremely common pattern. Now that Nardonia has their own specially configured machines selling healthy products, they see $492 in sales from their 2 machines in less than a week. The Food Service Department doesn’t make just a pretend 25%. They make more like 55% of total sales.
Easy Money
School Nutrition Departments can increase vending income by a minimum of 500% when they operate their own machines. Tracy, the Food Service Director at Richford Jr Sr High School in northern Vermont borrowed $5,000 from the School Board for a healthy school vending machine for her school. She paid them back from profits in less than four months….with a student population of just 252. Her machine pays for itself twice each year. Shelley at South Lake Tahoe High School in California installed two healthy school vending machines in late August of 2011. In her first 30 days the two machines generated over $6,500 in sales at a profit margin exceeding 50%. This list can be quite long. Schools are always looking for more money. Taking over the vending in the school is a great way to keep more money inside the school….that is being generated in the school.
Source: Jim Dillingham, President of Vend-ucation
JimD@venducation.com 800-633-1200
