To Insure or Not to Insure…

By Vito | February 8, 2011

During my days of owning and running my ATM business in Los Angeles I often pondered whether or not to insure my company owned ATM machines.  Initially, as a small operator, I assumed the costs would be too great and that ultimately I’d be better off without the added expense.

At a certain point however, the business grew, and I began to search for insurance carriers specializing in coverage for ATM machines, but had no success finding any!  I had heard through different sources that Lloyd’s of London was the main underwriter in the industry, but could not seem to find an agent here in the US through which to buy a policy.  One day, I received a marketing letter from a company called Marshall & Sterling offering me ATM insurance.  Who would have known that those random letters actually worked!  So, I spoke to their agent, found out some pricing, and ultimately signed on with them.

So, the golden question is, how much does it cost to insure an ATM machine/ year?  About $150 per machine per year, not bad I thought.  There is a catch, however.  Their minimum policy was about $1,500, so it only made sense if you have about 10 machines or more.  So, the bad news is that if you’re just starting up and only have a handful of machines it doesn’t make economic sense to get yourself a policy.  But once you grow, it’s definitely something worth considering.  There was a $1,000 deductible, but if stolen both the machine and cash were covered.  How much cash you choose to insure per machine is up to you, you can determine this but of course this affects your pricing.

Many clients to whom I sold a machine also asked about insurance.  If you offer to cover them under your policy you could easily charge them a bit more (i.e. $200 – $250 per machine) and help yourself recoup some of your yearly insurance costs.  Of course, there may be other companies out there and it’s worth exploring.  If anybody else out there has had success stories with other ATM insurers we’d love to hear your comments below.

Topics: Insurance | 1 Comment »

Phone Lines for Your ATM

By Vito | January 26, 2011

Those pesky phone lines we need for our ATM’s can cost us $20 – $30 per month.  That may not seem like a ton of money, but sooner or later it all adds up.  Just another cost of doing business, right?  Well, there are certainly viable alternatives these days, especially with internet TCP/IP connectivity.  But, as we all know most of our target businesses (c-stores, gas stations, bars) are not well-equipped with high speed internet.  When we do have that connectivity, sometimes there are security concerns with having to connect in a special manner to the existing routers or other complications.

Another popular alternative is the wireless dial up devices we can install inside the ATM.  Sometimes these devices are much more cost-effective than a traditional land line, however they too aren’t free.  Aside from that, you have to know the area in which you’re placing your ATM and ensure that the particular network (Verizon, AT&T, etc.) has a strong signal in that area, otherwise the phone call won’t go through.

So, if your ATM machine is conducting fewer than 300 transactions per month, why not ask the owner to share one of his existing lines?  After all, the calls generally tend to last less than 60 seconds.  Some operators might be timid to ask, but often times a business has a second line or fax line.  It’s perfect to simply piggyback off one of these, and voila, you save $30 per month ($360 per year).

They key is to offer professional installation of the split.  Find yourself a local contractor who can install phone jacks for $100 per jack or less.  From time to time this may cost more because the job is difficult, covers lots of distance, etc.  However, even if you end up paying $200 for a one time installation this is still a vast improvement over the monthly recurring phone line bill.  Working with a professional contractor to handle the jack gives your client comfort that nothing messy is going to occur with the phone line (phone lines can be touchier than you think), and ensures that the job is done cleanly and looks good.

If you’re location has heavy volume, than a dedicated line is a good idea.  But for low to medium volume locations, ask the owner of the establishment to share the burden and you can surely save yourself a nice chunk of money every year.

Topics: Equipment | No Comments »

ATM Wraps: A Good Idea

By Vito | December 6, 2010

Want to endear yourself to your customers? The illustration below is one way of doing that. In my recent visit to New York city I observed no shortage of ATM”s in the shops and bodegas of Manhattan. As you can see, this particular Hantle 1700 ATM is wrapped with the branding of Dunkin’ Donuts. The ATM looked to be operated by an outside vendor, meaning that Dunkin’ Donuts made an arrangement with the operator to wrap this machine up.

From what I’ve been told, these wraps cost approximately $300. We all know that most ATM’s aren’t the prettiest thing to look at, so this could be a great throw-in if your customer isn’t happy with the look of the machine and has any desire to project any additional branding for his business.

An additional approach is to brand machines with your own logos and company name to give your own company additional exposure. I do not have a picture here, but I have seen such machines in different regions of Canada quite often. Why this practice has not caught on as strongly down here in the U.S. I’m unsure of. What I do know is that as one can imagine, the name of the particular companies whose branding I saw stuck in my mind more prominently.

In any business there is no such thing as too much exposure, and for a small price there’s every incentive in the world to brand your business as much as possible.  Certainly the costs will add up, the wraps are not free, however the wraps lend themselves to a more professional look and renders your company image more strongly in the eyes of not only potential new ATM sites, but to the clients who become reliant on withdrawing from machines with your brand.  As long as the proprietor of the business has no objections, any ATM operator should seize the chance to brand their business as much as possible.

Topics: Branding, Marketing | 1 Comment »

How Can You Not Have a Website?

By Vito | October 23, 2010

News bulletin: A new powerful marketing tool has revolutionized the way we do business, market, communicate with customers…. Yes, it’s called the internet! It still stuns me how many ATM operators (not to mention business owners in general) still do not have websites. Owning a business these days and not having a website is like owning a sailboat without a sail.

Of course, this may not sound like an earth-shattering revelation to most, however it’s sadly true that many successful ATM operators do not have any web presence. There are misconceptions that a website costs tons of money, is really not all that important (after all certain operates grew efficiently ten years ago without a site), and is just not that big of a deal.

Times change and the internet is revolutionizing the world as we know it. You’ve discovered me here, so you know that without this whole internet thing you wouldn’t even be reading this blog. Granted, not everybody can afford an expensive fancy site, but you can put together the most basic of websites for a couple hundred dollars. Of course, as your business grows you can either revamp the site, or tear it down and build a more complex one from scratch. I initially invested approximately $15,000 on a website back in 2004, which undoubtedly is a ton of money. However, within the first two months I landed a contract that yielded me over $6,000 in profit.

Ultimately, my website and web presence produced 85% of my business over the years, I would have been lost without it. The site more than paid for itself many times over. The beautiful thing is that nowadays sites can be put together for a fraction of that cost and still produce amazing results. So, for the old-schoolers or naysayers of the internet concept, please believe me that it’s a crucial tool to your success in the ATM industry, as it is with any business nowadays. Do some research, and even if you have some doubts, you’re likely to find avenues to put an initial site together for a couple $100. Once up, you will have a recognizable presence to the rest of the world.

I will discuss in later blogs how exactly to make that website earn you profits through various marketing methods that were highly successful for me.

Topics: Marketing | No Comments »

Creative Financing

By Vito | October 6, 2010

Gone are the days of easy credit and a deluge of credit card offers in the mail from banks. Five years ago one could easily refinance a home in order to draw out cash and finance your business needs, but those days are in the past. For the small ATM operator, this has presented a new set of challenges and cause for innovative solutions to supply our ATM’s with cash and to purchase new equipment.

As most ATM operators might be aware, many ATM ISO’s and equipment suppliers are now offering equipment financing depending on one’s credit. If your supplier currently does not offer such solutions, I would encourage you to start calling different ISO’s and/or authorized equipment distributors that might be eager enough for your business to offer equipment financing. In addition, there are equipment leasing companies that specialize in financing capital purchases, though beware of their rates and terms, as they’re not always favorable.

More difficult has always been acquiring access to cash. If you have a thriving, growing ATM operation, sooner or later you may well confront the reality that you no longer have enough cash to keep your machines filled. What could be worse than having a successful business operation that you can no longer fund? This is when the ATM operator has to think outside the box.

Do you have relatives or friends sitting on cash that don’t know what to do with it? There are more people sitting on their money now than you might realize, people are scared to put their money anywhere, yet are eager to put it somewhere more lucrative than in a CD that yields 2%. Go to your friends, family, and close acquaintances and open up your books, showing them how your business works and how it has grown, yet needs cash. Offer them a handsome return (between 5 – 10%) and if they want security, offer to allow them to put a lien on your property or perhaps on your business.

It’s a situation in which both parties can benefit. If you get into a bind with cash, these are the types of solutions you’ll need to survive in our tough financial times.

Topics: Cash | No Comments »

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