Starting an ATM business in 2024 can be a profitable venture if approached correctly. Here’s the “Best Products” comprehensive guide on how to begin!

Written By Peter Wilkenshoff, President – with 18 years of experience!

1. DO NOT PAY FOR AN ONLINE ATM COURSE!

I am 100% behind the idea that knowledge is power and taking an online course may seem like a fool proof idea to jump start yourself to success. Unfortunately there are many individuals online who take advantage. The internet has given rise to many self proclaimed gurus wanting to sell you their course based on their self proclaimed expertise. Be aware – they make money on the idea and concepts they are teaching. The vast majority do not make money by running successful ATM businesses themselves. I will not say that all these guys are bogus- some are the real deal. Be aware that their portrayed expertise – is nothing more than paid advertisements. Lets face it- if they were making money hands over fist in the ATM business- they would not be selling a course or teaching their competitors how to be successful!

The reason I am warning you- is most of these courses are costly. If you are getting the courses from them for free- typically they are making money by overcharging for hardware, processing services or locator services. Some do not depict an honest representation of interchange and when you are entitled to earn it. Learn more here:

Understanding ATM Interchange Fees: A Closer Look from Your Trusted ATM Company

So where should you get your information?

The ATM business is really not that complex. Most information can be found online for free and by calling the processing company you plan on going with (like Best Products). There are dozens of real ATM companies out there, happy to help you with real world understanding and hands on practical experience. Don’t be afraid to call these companies, and see if you and them are going to be a good fit.

2. Understand the ATM Business

Before diving in, it’s crucial to understand how the ATM business works. Essentially, you’ll be purchasing ATMs, placing them in strategic locations, and earning money through transaction fees called surcharges. Familiarize yourself with the types of ATMs available, their features, and the technology involved. Familiarize yourself with the ideal locations to place ATMs and how to approach potential business owners. More on that later.

3. Market Research

• Identify Locations: Look for high-traffic areas lacking ATMs, like small shopping centers, gas stations, convenience stores, hair & nail salons, or areas with active nightlife. Look for “CASH ONLY” locations!
• Competition Analysis: Study existing ATM locations to understand where your services might be needed. Look for areas without banks. If there are ATMs nearby- what are they charging?

4. Develop a Business Plan

Craft a detailed business plan covering:

• Budget: Estimate costs for purchasing or leasing ATMs, maintenance, cash loading, and communications. Budget approx $2,500.00 for the hardware. Budget $2,000 – $4,000 for vault cash. More if a high volume location.
• Revenue Projections: Calculate potential earnings based on transaction fees and estimated number of transactions. If you are targeting specific locations, you could find existing ATMs. Perform a balance inquiry and save the receipt. Then follow up with another balance inquiry in a week. If you look at the receipts- the difference in the sequence numbers is the number of transactions that ATM has done in the last week. Keep in mind approx 20% will be non withdrawals. So for example if your first test is sequence number 0100, and a week later it is 0200. 0200 – 0100 = 100 x 80% = 80 transactions. Multiply that times 4 and that’s approx. how many transactions to expect in a month.
• Marketing Strategy: Plan how you’ll promote your ATMs to location owners and users. Signage. Cash Only Business signage, etc.
• Removal Strategy: Honestly, some locations are going to be duds. Just a fact. Even the most experienced operators are going to have a 20%- 40% “dud” rate. Write down your minimum dollar amount you are willing to make per location. Stick to that number. If you are not making that- remove the ATM and find a better location. STICK TO THIS AND YOU WILL BE SUCCESSFUL. I recommend a minimum of $120 – $150 per month per ATM.

5. Find a Bank to Work With

I could write a whole blog post on this. In fact I did!

List of ATM Business Friendly Banks by State

6. Legal and Compliance Requirements

• Register Your Business: Choose a business structure and register your company. I recommend NOT having the word ATM in the business name, as it can sometimes be detrimental to your banking relationship. Most startups are LLC’s. Speak with a professional about what specific entity is most appropriate for you goals and income.
• Permits and Licenses: Investigate what permits or licenses are required in your area. Most states do not have any restrictions.
• Compliance: Ensure compliance with local and federal regulations, including those related to banking and financial services. Outside the state of Massachusetts and a handful of counties in New York- there are no restrictions nationwide. Speak to your processing company (like Best Products) as to these details.

7. Secure Financing

Consider options like small business loans, personal savings, or investors to cover initial costs. Most successful entrepreneur’s start out with approximately $5,000 – $6,000. in capital per ATM. Most start out with their own money invested. So keep in mind $5,000 is $2,500 in hardware and another $2,500 for vault cash. I don’t like getting people into debt- but at last resort- if you know you have a home run location – there are many zero interest credit cards. You can purchase an ATM on a credit card- and make monthly payments to the card company interest free.

8. Find Suitable ATM Locations

The number one- absolutely most important thing in starting an ATM business in 2024 – is finding good locations. Just like real estate- Location. Location. Location! Location is everything. Check out our blog post on tips in finding top quality ATM locations yourself below!

As far as knocking on doors – the best results come from your feet on the street. Don’t pay a locator. Learn what to look for. Pay your dues. Put your time in. When you find what you think will be a good spot- go in. Introduce yourself. Smile. Be friendly. Speak with conviction. Ask to speak with the owner. If you get them- tell them that your business provides ATM services and you think this would be a great location. If you get them or get past the gatekeeper, ask them open ended questions that will get them thinking Yes- this is a good idea- my customers will benefit and want this! Some open ended questions to ask to make you sound like you know what you’re talking about are:

• Can you tell me more about the typical customer who visits your business?
• What are the busiest times of day for your business, and how do you think an ATM could impact that?
• In your experience, have customers ever requested or looked for ATM services here? Do you send them away? How many people do you send away each day?
• Do you have any specific suggestions or requirements for an ATM service in your establishment?
• How much foot traffic does your business see per day? (tip 1 in approx 35 people will use the ATM on average)

Upsell- what’s in it for them. I’m going to tell you something no one else will. All a perspective location owner thinks is: what’s in it for me. Revenue share. Cash to customers. Full turnkey ATM with no strings attached, etc. In my experience- most business owners have literally no time for you. They may seem mean and rude- but they are busy! So you have to get them at a good time, you have to say something that will get their attention, make them smile- and want to engage in conversation with you. If you get this far- you’re doing great!

Tell them you are willing to invest in their business and get them a new ATM. The only thing they need to do is give you some floor space up front and electric and you will need to bolt the ATM to the floor.

Leave out the word “FREE” in your vocabulary. It commoditizes you. You are not giving them a “FREE ATM” you are investing in an ATM for their business. If the owner is not there, ask for the owners name and number. Call. Follow up. Repeat.

Its a numbers game. You are going to get 10 NO’s before you get 1 Yes. Don’t take it personally. It is what it is. If you go to 10 spots a day, follow up in a few days. At the end of a week you will have your first location. Almost guaranteed. Here’s some more info:

Quick Tip: Finding the Best ATM Locations

9. Purchase ATMs

• Buy New or Used: Decide whether to buy new or used machines based on your budget. I always recommend new ATMs, as they come with a warranty. Unless you are a seasoned veteran, and you know what your getting into- always buy new.

10. Location Agreements

Negotiate agreements with business owners where you’ll place your ATMs. These agreements should outline terms like space fees or profit-sharing models. Typically for the first few ATMs, I recommend handshake agreements, until you are comfortable and you understand the value/ importance of location agreements. We have free sample agreements you can use- simply call and ask us!

11. Installation and Maintenance

• Professional Installation: Ensure ATMs are installed professionally and securely. Best Products can help with out nationwide network of technicians or help you over the phone for free. Always bolt your ATMs down!
• Regular Maintenance: Plan for routine maintenance to keep machines operational and secure. Your business plan should budget approx. 1 service call per year per ATM. As well as a few hundred dollars in parts annually. The most common issue are card reader failures! Remember for 2 years most new ATMs come with a parts warranty, however as time goes on- failures are more common. Lifespan for an ATM is approx 7 – 10 years.

12. Load Cash and Monitor Transactions

• Cash Loading: Start up ATM companies should always be loading their ATMs themselves. Never pay a service initially. I have never witnessed any startup be successful this way.
• Monitoring: Use ATM monitoring software to track transactions and cash levels. We provide free monitoring tools.

13. Marketing Your ATMs

• Visibility: Use signage to make your ATMs visible. Your ATM should be placed upfront- in a visible location so that everyone can see it.
• Promotions: Work with location owners to promote the ATM. Remember- the benefit to them is cold hard cash in their register. You dont get that benefit – you only get surcharge. So the more cash the ATMs dispense- good for you and good for them. Suggest they offer cash incentives. Or credit card fees for charge cards. Maybe they provide discounts, etc.

14. Customer Service

When you land your first location- offer excellent customer service to both the location owners and ATM users. Quick response to any issues can enhance your reputation. Always keep the ATMs full and operational. Pay your commissions timely, and include a statement! Most small business owners know other small business owners. If you have a happy customer- ask if he knows anyone else that may benefit by having you place an ATM in their business.

15. Scale Your Business

When you start making money, consider expanding your network of ATMs or diversifying into related services. I always tell people to start with one. Find a location, and see how it goes. From there- grow your business.

Conclusion

Starting an ATM business in 2024 requires careful planning and a strategic approach. By understanding the market, establishing a secure banking relationship, complying with legal requirements, securing prime locations, and providing reliable service, you can build a profitable ATM business. Remember, like any business, it’s about providing a valuable service where there’s a demand.

FAQs

Q: How much can I expect to earn per transaction? A: Typically, ATM owners charge a fee ranging from $2 to $4 per transaction.

Q: Is the ATM business still profitable in 2024? A: Yes, especially in underserved or niche markets, the ATM business can be VERY profitable.

Q: What are the biggest challenges in the ATM business? A: Location acquisition, machine maintenance, and banking relationships and cash management are some of the primary challenges.

Embrace the opportunity and with the right strategy, your ATM business can thrive in 2024!

If you need help, or have any questions- please do not hesitate to call us. We will help you any way we can- FOR FREE!!!! We have been successfully deploying and processing ATM transactions since 1998!