This s a complete guide to starting an ATM business. We include the costs and the description of the process in a step by step approach.<\/p>\n\n\n\n
ATM businesses own and supply ATMs for public use, making their money off the ATM fees that customers pay. This business model involves three parties: The ATM owner, the owner of the venue where the ATM is installed, and the ATM processor, which processes the paperwork that keeps the ATM functioning. Those three parties share the ATM processing fees. ATM processors may have network accessing fees per transaction, while venue owners usually receive $0.50 per transaction. With ATM fees ranging from $1 to $8 per transaction, the ATM business\/ATM owner receives the rest of the ATM transaction fee.<\/p>\n\n\n\n
An ATM business will first locate a good location for an ATM and will negotiate with the property owner. Once an agreement is reached, the ATM business will buy and install an ATM and load the machine with cash. Most ATM businesses load additional cash into the machines daily.<\/p>\n\n\n\n
According to\u00a0Allied Market Research, the\u00a0global ATM industry\u00a0held a valuation of $20.58 billion in 2019. It\u2019s predicted that the industry will experience a 5.2% growth from 2020 to 2027, reaching a valuation of $30.50 billion in 2027. Current key players in the industry include Euronet Worldwide Corporation, Hess Cash Systems, Source Technologies, Triton Systems of Delarae LLC, and more.<\/p>\n\n\n\n
Industry Statistics<\/strong><\/p>\n\n\n\n Total number of ATMs in the US- 425,000 (source-National ATM Council)<\/p>\n\n\n\n Independently owned ATMs deployed- 222,000 (source-National ATM Council)<\/p>\n\n\n\n Average ATM fee\/Convenience fee- $2.77 (source-National ATM Council)<\/p>\n\n\n\n Average commission payment-$.50-$1.00 (based on my analysis of 100+ portfolios and 10,000+ locations)<\/p>\n\n\n\n Average interchange net income-$.10-.20 (based on my analysis of 100+ portfolios and 10,000+ locations)<\/p>\n\n\n\n It is possible to make a good amount of money from an ATM business. When you\u2019re just starting out, you will want to undergo a modicum of trial and error to get your business model just right. But with an ATM business, you have a low overhead and many opportunities for growth.<\/p>\n\n\n\n As long as people use your machine, you will make money. Getting people to use your machine is the hard work that you have to do once everything is set up. But once you do, you should expect to be making at least $450 monthly gross revenue. That\u2019s 180 transactions a month at $2.50 each.<\/p>\n\n\n\n You can expect 40%-70% annual ROI from any location that warrants 80-100 transactions monthly. To make $1,500-$2,000 monthly in profit, you would need to own and operate 5-10 ATM machines. This is certainly possible if you can establish an efficient routine with your first machine and find optimal locations for subsequent machines. <\/p>\n\n\n\n Many factors are driving the predicted growth in the ATM industry. The 24\/7 availability of banking services that ATMs facilitate is a major advantage that drives their popularity. ATMs are no longer cash dispensers but instead have more features and capabilities, including deposit and bill transfer capabilities, allowing banks to provide more comprehensive services at all hours.<\/p>\n\n\n\n Many trends are affecting the ATM industry. According to ATM Depot, many old ATMs are currently being replaced with new models. These new models have greater capabilities, including mobile pre-staging, dynamic branching, video banking, and contactless transactions. Equipped with touchscreens, new ATM models appeal to a younger demographic.<\/p>\n\n\n\n These newer ATMs also offer ATM owners the chance to personalize the ATM with marketing messages. Personalized messages and season-based marketing mean that ATM owners can potentially increase their profits by selling products and services to ATM users.<\/p>\n\n\n\n Smart ATMs are also on the horizon. These ATMs are capable of an even greater range of services, including multi-currency cash dispensing, loan repayment, bill pay, ticket dispensing, and account opening. These services can reduce staff costs for banks, delivering customers with unparalleled convenience and new options. As they become more popular, having a smart ATM could help a bank to win business over a competitor without this smart technology.<\/p>\n\n\n\n Other technological improvements will make ATMs more practical and safer. Solar and wireless machines will be able to operate in locations that aren\u2019t currently ATM-accessible. Security features like cardless transactions will also help to protect customers and banks.<\/p>\n\n\n\n Overall, you can expect to pay about $3,000 to $4,000 to start an ATM business. These costs are divided between the cost of the machine itself, internet connectivity, cash reload fees, and relevant vendor fees. Depending on the location and type of machine you get, you may end up paying upwards of $10,000 to get your ATM business off the ground. <\/em><\/strong><\/p>\n\n\n\n We analyze in this article, with much more detail the costs of the ATM installation and setup<\/a>. Also, we study the monthly expenses usually required.<\/p>\n\n\n\n If you’re considering installing an ATM at your place of business, there are several benefits you can expect. Chiefly, if you are a cash-only business, having an ATM machine onsite allows your customers to withdraw cash so they can pay you for goods or services. Additionally, you reap the benefit of an extra commission.<\/p>\n\n\n\n Other benefits include:<\/p>\n\n\n\n Full Service<\/strong><\/p>\n\n\n\n A full service ATM is where you purchase the ATM, install the ATM and vault the cash with your own capital. You could also outsource the service and vault cash to a 3rd party. As the owner of the ATM, you are also responsible for maintenance and all service on the machine. With full service accounts, you determine the amount of the surcharge fee with the merchants approval and pay the merchant a split of the commission. This can be a fixed amount, such as $100 per month, a flat portion of the surcharge such as .50-$1.00 or a percent of the surcharge fee based on the number of transactions.<\/p>\n\n\n\n If you don’t want to buy an ATM or worry about maintaining it, you can participate in a full-service program where a retailer maintains it, but this costs money.<\/p>\n\n\n\n “The ATM is put in a retail location, then cash is loaded,” Daniel said. “The largest cost associated with this is rent to the retailer. The rent is usually a percentage of the service charge. That is the retailer’s ‘rate’ or ‘commission.'”<\/p>\n\n\n\n Processing Only<\/strong><\/p>\n\n\n\n Processing only accounts are where you pass the initial costs of the ATM along to the merchant and you set up the machine for them. This could include the initial installment, processing and arranging the merchants banking information to your processor. In this scenario you would be making the interchange income only. Depending on who your processor is and how much volume you have throughout your portfolio this amount can be variable. The number can vary from zero up to .25 cents per transaction. If you buy or develop a route with a good volume or you can arrange a good processing relationship with an ISO (Independent Sales Organization), see glossary. The difficulty in arranging processing locations is finding merchants looking for and willing to pay for the cost of the ATM as well as maintain the ATM. Lease options are available although they are not great investments for anyone as they often end up costing 3x the cost of a machine over a 5 year period.<\/p>\n\n\n\n Service + Processing<\/strong><\/p>\n\n\n\n This is a mixed strategy where you would sell the ATM to the merchant but offer some type of service agreement to maintain the machine, not to include vault cash. Essentially the merchant would load the machine with cash you and would be responsible for maintenance when the machine needs service or repair. For a small transitional fee or a fixed monthly fee, some ATM operators find this to be a compelling case. The fee for maintenance is purely up for negotiation between the ATM business owner and the merchant. I have seen successful ATM operators charge .05 cents per transaction up to .25 or 30 cents per transaction. The ATM business owner is also making interchange income so with a strong volume location a service + processing deployer could make a good income. The expenses and overhead in this scenario would need to be considered. I have seen service plans set up as a multi-year warranty, with some deployers guaranteeing service and parts anywhere from 3-5 years. Keep in mind most new ATMs come with an initial 1 year warranty on parts.<\/p>\n\n\n\n First, just as you would before considering any business endeavor, do your research on the market, including how big the market is, who the major players are and how you would fund your business. <\/p>\n\n\n\n In addition to the above considerations, here’s a list of general steps to follow as you begin your ATM machine business journey: <\/p>\n\n\n\n Free ATM Placement<\/strong> This program includes<\/p>\n\n\n\n For more information about starting up your own ATM business, fill out the form below. Please note that the ATM operator and site locations must be based in the United States.<\/strong><\/p>\n\n\n\n SECURE THE CAPITAL<\/strong><\/p>\n\n\n\n Most people getting into the business want to know how much capitol they need to get into the ATM business. The ATM business is a very inexpensive business to get into. With an ATM business, you need no employees or a storefront. It requires a very low start up cost. Your investment into the ATM machine can be paid back in less than six months. You can manage your ATM business from home at your own schedule. You may only have to go to the location of the ATM machine once or twice a month depending on usage and amount of money stocked in the machine! You can also own an ATM business, while still working a part-time or full-time job since it requires so little time! You can get started into the ATM business for a very low cost. For as little as $2,099, you can purchase your first machine. You can stock the machine with as little as $500 or as much as $16,000+. Most customers stock their ATM machines with between $1,000-3,000. Therefore, you can get started with your first ATM machine for about $3,000. THERE ARE NO FRANCHISE FEES! You can pay off your ATM machine in the first six months or less, and everything from then on is a profit. ATM machines can last as long as 7-8 years or more, allowing you to be collecting money off of the ATM for many years. At ATM Money Machine we suggest you start with one or two machines, and build your ATM business up from there. You can gain a good understanding of the ATM machines and how they work, and then expand your business!<\/p>\n\n\n\n FIND THE LOCATION<\/strong><\/p>\n\n\n\n Your first and most important step when getting into the ATM business is finding your location. Many people ask, do I have to own the business to place an ATM machine there? You do not! All you have to do is approach the business owner and see if they\u2019re interested in having an ATM machine inside their business. Some reasons why a business owner would like a machine in their business is to lower their credit card costs, see more cash being spent, as well as to attract customers into their business just by having an ATM machine on premises. They have no responsibly of the ATM, yet get to reap all of the benefits! With credit card costs being so high, most business owners would rather see cash being spent. By having an ATM machine on premises, they will see cash being spent rather than having to take plastic! Therefore, they will see lower credit card costs and more cash spending! Many people ask what type of location will do well? There\u2019s no specific location that will do well, rather the foot traffic is the main aspect to look at when trying to find a location. Anywhere from 4-6% of people walking through the door each day will use the machine. Therefore, as an average, if there are 100 people walking through the door, that machine will get 5 uses a day. You want to find a business that averages 200+ people a day. If the business sees 200 people a day, you\u2019re looking at about 10 uses a day (300 a month) and if you\u2019re charging the national average surcharge amount of $2.66, that\u2019s a $798 profit each month!<\/p>\n\n\n\n NEGOTIATE THE LOCATION OWNER’S COMMISSION<\/strong><\/p>\n\n\n\n When placing an ATM machine in a business, some owners of the business would like a part of the surcharge. Being that the business owner sees all the benefits of having the machine there (more cash being spent, lower credit card costs, increased cash spending, etc) you have some room to negotiate to ensure you get the lowest possible rate. Some business owners simply want the machine there, and don\u2019t want any of the commission. At ATMMM we suggest you pay based on a sliding scale. For example, for 0-200 transactions, pay them .25 cents. For 201-400 transactions, pay them .45 cents. For 401-700 transactions .50 cents. For 701 and above, pay .75 cents. This way, you\u2019re protected regardless of how many transactions the ATM does!<\/p>\n\n\n\n ATM CONNECTION TYPE AT BUSINESS<\/strong><\/p>\n\n\n\n All ATM machines must be connected to the processing server. There are a few options as far as connection goes. Most businesses have internet in their business, and the machines can connect to this internet saving you any monthly fees. You would need an Ethernet jack by where the machine is going to be placed, or an open port on the modem with the cable line run to where the machine is going to be placed. Another option is a phone line. You would have to have the jack within 3 feet of where the machine is going to be placed. If a phone line or internet connection isn\u2019t available, you can purchase a wireless router that creates it\u2019s own wireless internet. All three options work the same. The phone line or internet line must be run PRIOR<\/strong> to the installation being set up, as the ATM technicians do not run lines.<\/p>\n\n\n\n PAPERWORK<\/strong><\/p>\n\n\n\n Once you have your location, and are ready to purchase your machine, there is some paperwork that has to be filled out. We also need a copy of a void check for the account you want the money to be recycled into. The paperwork will give you your own unique merchant ID, which allows you into the processing server. Once all your paperwork is filled out, you\u2019re now in the processing network and can own as many machines as you\u2019d like<\/p>\n\n\n\n ATM PURCHASE<\/strong><\/p>\n\n\n\n Once you have completed steps 1-5, you\u2019re ready to purchase your first ATM machine. You have to have your location prior to purchasing the machine. The lease option does not apply when you are getting into the ATM business.<\/strong> There are numerous different machine options, with varying aesthetics. We suggest you pick the machine that will best fit in with the business. We offer both stand alone ATM machines, as well as thru the wall ATM machines. Thru the wall machines are significantly more expensive, and are only suggested when it\u2019s a very high volume location for walking traffic. 99% of the time, a standalone machine is what is suggested. We carry all the major manufacturers of machines, and can help suggest a good fit for a certain business. We do suggest that you stay with the same manufacturer for all your locations if possible, as it will make things easier for you<\/p>\n\n\n\n SHIPPING AND INSTALLATION OF YOUR NEW ATM MACHINE<\/strong><\/p>\n\n\n\n The ATM machine will be shipped directly to the location of where the machine will be operational. A service technician will program, install, and train you on how to work your new ATM machine. We will provide you with this technician. The pricing ranges from $349-450 depending on the location of the business. The technician will program the ATM machine with all your banking information, as well as what you\u2019d like displayed on the screen and receipt. The technician will also set your surcharge amount you selected. The installation and training should take 1-3 hours. The technician will show you how to operate your machine, as well as how to stock it with cash and receipt paper.<\/p>\n\n\n\n STOCKING THE MACHINE WITH CASH<\/strong><\/p>\n\n\n\n Many people want to know how much to stock the machine with, and there is no correct answer to this question. Most machines hold between $16,000-$20,000 in 20s. However, most people don\u2019t put nearly this much into the machine. We usually suggest a minimum of $1,000 in the machine. The more money you put in the machine, the less you have to go back to refill the machine. How the cash works is as it\u2019s taken out of the machine, it\u2019s automatically wired right back into the bank account you set up with our company. If it\u2019s taken out before 3pm, it will post tomorrow morning, after 3pm it\u2019s the following day. So that cash is always recycling through. Therefore, the smaller amount you stock the machine with, the more often you\u2019ll have to take that cash out back out of your bank account and restock the machine. We do set you up with a website where you can monitor the machine, so you can track how much cash is left in the machine which will ensure that you never let you machine run out of cash.<\/p>\n\n\n\n AFTER THE ATM MACHINE IS INSTALLED<\/strong><\/p>\n\n\n\n Once the machine is up and running, next comes the easy part! You can sit back and relax, and monitor your machine from home. When the machine gets low, simply re-stock it with the same cash. You can also monitor your surcharge from this website, so you know how much you are making off of your machine! Your next step would be keeping your eye out for a new location, so you can build your business up even more!<\/p>\n\n\n\n Cash Flow required<\/strong><\/p>\n\n\n\n There are many sources online which tell you that you can make $500 per month or more from each ATM. Most of the time, these estimates are much too high. My recommendation is to do your homework and count on $250-$300 of income on the higher side. $150-$200 on the low side is a safe bet. Make some calls, talk to merchants and be conservative with your income estimates in the ATM Business. If you are looking to start an ATM Business, we can guide you in the right direction in regards to buying ATM machines and helping you to find locations, go here for more information-<\/p>\n\n\n\n You will need cash to load the machines on a rotating basis. You should count on at least $2000 per week per terminal. If you plan on deploying 10 terminals you will need at least $20k of working capital to service the machines if not more.<\/p>\n\n\n\n The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.<\/p>\n\n\n\n Establishing a legal business entity such as an LLC<\/strong> or corporation<\/strong> protects you from being held personally liable if your ATM Business is sued.<\/p>\n\n\n\n You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.<\/p>\n\n\n\n Recommended:<\/strong> You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.<\/p>\n\n\n\n Setting up a bank relationship first<\/strong><\/p>\n\n\n\n With operation Chokepoint and other issues in play, you should contact your bank or locally recommended banks and make sure they can support the needs of your ATM business. Some banks will not support the ATM business at this time so make sure yours does. We can assist you in navigating how to get a bank which will support you in the ATM business. <\/p>\n\n\n\n Set your margins high<\/strong><\/p>\n\n\n\n Be careful when negotiating your surcharge fees and your commissions to your merchants. Don\u2019t give away too much of your margin. You need to know the market and understand what is expected but at the same time not give away too much. If you set your margins correctly out of the gate you will be much happier with the income in the long run. <\/p>\n\n\n\n have signed contracts<\/strong><\/p>\n\n\n\n If you plan to sell your locations or defend your ATM location, you should make every effort to get signed agreements with all of your merchants. I have seen many operators who run their ATM business without contracts and when its time to sell, the valuation is eroded. You will also have nothing to stand behind if the merchants decide to have your ATM removed or allow a competitor to come in. Bottom line is, get signed contracts. <\/p>\n\n\n\n Location And Placement<\/strong><\/p>\n\n\n\n Make sure you don\u2019t spread your locations too far from your home base or each other. Choose a territory wisely and do your best to stick with it. The further out your locations are, the more your time and service costs go up. A tightly knit route of machines is far more appealing to buyers as well.<\/p>\n\n\n\n Machines and locations where a complete replacement is a requirement may make good targets for marketing. As 2016 approaches the deadline becomes closer, October of 2016 and October of 2017 are the 2 deadlines for acceptance of the EMV standard and fraud liability shift..<\/p>\n\n\n\n Here is a guide with make\/model upgrade or replacement costs for EMV. If you are able to target locations where non EMV upgradeable machines are located, you may have some luck replacing those machines if merchant owned or out of service and potentially abandoned by another provider.<\/p>\n\n\n\n Mobile Locations<\/strong>\u2013 Mobile locations or events are good ways to make additional income if you are up for the extra work involved in these events. Many ATM operators are not interested in the mobile events and therefore many of these smaller events can be open. Look for larger events in your area such as farmers markets, fairs, sporting events, music events etc. You can also typically charge a higher fee on these transactions of $3.00-$4.00 or more depending on the event and the value of the cash on site. If you can find one, two or tree day events where you are seeing 100+ transactions per day, this can be a compelling strategy.<\/p>\n\n\n\n 1-Power-<\/strong>Somewhere to plug in the machine- ATMs are energy efficient in case someone asks.<\/p>\n\n\n\n 2-Communication-<\/strong>The ATM requires a phone line, Internet line or wireless device to connect and handle transactions.<\/p>\n\n\n\n a-Phone line<\/em>-You can utilize a dedicated or spare phone line, fax line etc. Even the busiest location will only use the line 10-12 times per day for 30-60 seconds per transaction. If the client can install a dedicated phone line and pay for the cost, the machine will function well with this set up.<\/p>\n\n\n\n b-Internet<\/em>\u2013 If the merchant has internet and a router, you can run a internet line from the router directly to the ATM using ethernet cabling.<\/p>\n\n\n\n c-Wireless<\/em>\u2013 The 3rd option is wireless, this is typically the worst-case situation as there are additional costs of $15-$20 per month. If you can, attempt to pass this cost or a portion of this cost through to the merchant.<\/p>\n\n\n\n 3-Space <\/strong>How big is the ATM? Check your pamphlet for specs most are 50-56 inches high, by 15-18 inches wide by 22-25 inches deep.<\/p>\n\n\n\n 4-Security concerns <\/strong>What if someone tries to steal the ATM? Ask them if they have a security system. Let them know the machine will be bolted to the floor, into the cement if possible. Theft is rare although it can happen.<\/p>\n\n\n\n 5-Contract- <\/strong>here is a Sample Contract. The main focus in your ATM placements should be getting into the location and to try to attempt to get the installed and ATM on location. You can approach the contract whenever you have a comfort level. If I felt pushback against signing a contract I would wait and just get the machine installed and get the client their first check before even approaching. The easy way to phrase the contract is to say \u2018lets have some type of agreement in writing that we are the ATM owner and we are paying you\/ the merchant a split of the fee\u2019. Preferably get a 3+ year with auto \u2013renew contract in place. Again if the merchant will not sign a long-term contract, just get a 1 year agreement or any type of agreement in writing that you are the ATM provider.<\/p>\n\n\n\n See the Startup Checklist for a complete listing of tools required to install an ATM<\/p>\n\n\n\n The best and cheapest way to find locations for a start up ATM business owner is through cold calling. Here is a link to a one page sample marketing\/ad which you can drop off at potential locations. My typical procedure was to print this out along with the spec sheet of the machine I was installing at the time along with a business card.<\/p>\n\n\n\n Sample one pager, please feel free to use this sample to create your own basic one page marketing materials to drop off to potential locations. I used this same sheet to find 300+ locations. Along with the one-page marketing and the spec sheets you should also be sure to have a business card with your name, email, phone number and business name.<\/p>\n\n\n\n If you are considering more enhanced advertising such as a website or social presence, just be sure to get the basics out there. Online competition for ATMs is very strong and it will be difficult to have your website stand out against all of these national and regional competitors although it can be done. If you are looking for these types of services, check with me for additional help.<\/p>\n\n\n\n A contract is typically signed between the merchant the owner of the ATM. The key items which you should make sure to include are a term or length of the contract, statement of ownership of the ATM and payout schedule whether a percentage, flat rate etc. of the surcharge.<\/p>\n\n\n\n Sample Contract please feel free to utilize this sample contract and consult an attorney with any detailed questions.<\/p>\n\n\n\n Contracts are very important when you decide to sell a portfolio. Upon starting and building your ATM business contracts may not seem important although as you grow you will want to ensure that you have contracts in place.<\/p>\n\n\n\nATM Business Profit<\/h2>\n\n\n\n
Is The ATM Business Dying?<\/h2>\n\n\n\n
Costs Of AN ATM Business<\/h2>\n\n\n\n
ATM Business Pros And Cons<\/h2>\n\n\n\n
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<\/strong><\/li>\n\n\n\nATM Business Start Up<\/h2>\n\n\n\n
Starting An ATM Business<\/h2>\n\n\n\n
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Does operating your own ATM machine sound a little overwhelming and time-consuming? We also provide a free full-service ATM placement program for qualified locations. The location owner would still share in a portion of the surcharge revenue, but we would be responsible for filling the ATM with cash and handling repairs. This free ATM placement program is available for location owners only.<\/p>\n\n\n\n\n
ATM Business Step-by-Step Guide<\/h2>\n\n\n\n
ATM Business Requirements<\/h2>\n\n\n\n
Form a legal entity<\/h3>\n\n\n\n
What is needed for an installation?<\/strong><\/h3>\n\n\n\n
<\/a>11-Marketing and Advertising<\/strong><\/h3>\n\n\n\n
<\/a>12- Contracts<\/strong><\/h3>\n\n\n\n