Good investment? Wise Potato Chips Route sales anyone?

[scottpA_GS]

Hey all...

I am tired of working here at a motorcycle dealership  . I have an opportunity to purchase a Snack food vending route (not machines) its deliverys to Walmart, Grocery stores, etc... Does anyone here do that? or know someone who does? Is it a good business?

I have done some research but I would like as much input as possible.

Thanks! 

[bettingpython]

It used to be buying a route was a very lucrative business. Make no mistake though you are you're own boss and you will have to work long hard hours or yoiu won't make it. It truly is customer service oriented you gotta get along with people.

I wish I could have bought a snap-on route that was for sale a while back but I didn't have the 120K to spend on it.

[The Buddha]

Snap on routes ... cool, I love snap on, especially when I steal from the clowns that buy the stuff ... yea ...
Never mind, there was a idiot mechanic that screwed up my AC in my truck, but too bad for him, he left a bunch of snap on sockets and wrenches in my truck under the seat, and a key for something ... man did I screw the clown over ... Sure made up for paying the idiot 700 bucks and still have a AC that is marginal. He called and cried about the key endlessly ...
Cool.
Buddha.

[Caffeine]

Route sales:  Be ready to work some long hours.  50/week minimum, 60-70/week more likely.  And the receivers at your stops can be very nice & cooperative, or they can be buttholes that make you take twice as long as necessary to work the stop.  Who will work your stops when you are on vacation or sick?  Diesel and insurance are not cheap...who pays for all that?

You CAN make a lot of good money, but you will be working for it!

[scottpA_GS]

Thanks guys!

I would be paying my own insurance.. about $600 a year (not bad). The truck is Gas so no Diesel  I wondered about vacation time, but I am not to concerned about it as the past few years I havent had $$ to take a good one anyway 

This route seems to be pretty set. It runs from about 5am-1PM 4 days a week  The truck is all I wory about.. its a 1997 Chevy Step van w/ 220K on it.. the motor and trans have about 50K  but I think I want to do it... I wish I knew a bit more about the ins and outs like taxes (alot of its cash  ) and so on...

Thanks for all the input so far!

[yamahonkawazuki]

DOCUMENT EVERYTHING ie gas, supplies for business, supplies for vehicle, or anyhting which relates to said business. and if at all possible, get another vehicle as a spare. or be able to rent one

[frankieG]

i wish you success.  i am thinking of opening my own bike shop, parting out bikes and selling them on e-bay like i used to do before i got sick

[bombadillo]

Open up a business on the side and take things out for write offs.  I wouldn't go route work unless you're really wanting to have zero life outside of it.  I have a friend who owns a fed-ex route and its flat horrible.  Also a few merchandisers for pepsi, coke, and a safeway chain and not one of them is happy at it for what they make.  Its around a 50k a year job at 19-25 bucks an hourish.  I don't think its worth the 50+ hours a week if you work out the real math involved and how much time you ACTUALLY spend there.  Married, kids?  its up to you but, meh?

[DoD#i]

Working for yourself - the dream - set your own hours, be your own boss, watch the money roll in.

Working for yourself, the unvarnished realities - Work as many hours as there are, wish there were more in a week, and everything is your problem, since you haven't got anyone else to cover it.

If you say your insurance is $600, you're probably talking about insurance for driving the truck. What about medical coverage for yourself, or any other "benefits" you may (or may not) get with your present job?

In Route Sales, you are going to want to have a solid backup plan worked out for when the truck dies on you - no deliveries, no income to fix the truck. You either need a whole spare truck, or the ability to reliably rent something suitable in a very short time when it goes south.

Likewise, if you have no-one to cover the route, you are depending on never getting sick - which may go along with your health insurance plan, but may also not be quite realistic.

Despite the higher price per gallon of diesel, you'll probably find you wish you had one since they also get better milage and hold up to long-term high-milage use much better than gas motors, for the most part.

Best not to get too casual about the cash part of the income - the tax folks smell for that sort of thing and can make your life very exciting.

[scottpA_GS]

thanks again guys, lots of good advise 

Today I went for a ride along w/ the guy thats selling his route. He was very cool and straight foreward. We basicly go in see what they need go out to the truck and get it, put it on the shelf.. DONE! I LOVED IT! Very easy work. We started at 6AM and I was home by 12:30. He made about $260 after gas for the day  not bad for 6hrs of easy work. I found out alot of good things about the route and hardly any negatives... So far the downside is benefits and the truck maintenance/breakdowns. But contrary to what some have said the hours are great! 4 days a week, no weekends and about $1200 a week after gas but before insurance and maint.

I found that there may be a chance to buy a route closer to my house as well    So far I am sold on it. I hope that the closer route is avail 

[DoD#i]

Not trying to harsh on this - if it is really your dream job, go for it. But go with your eyes wide open.

$260 "after gas" - is that after paying for his stock (what's in the truck) and after gas, or just after gas? Not clear from what you wrote. And it's clearly a variable number, depending what has sold or not in a given week.

Peel off all the business expenses - stock if not included above, uniforms if needed, required maintenance on the truck, etc. Grab a copy of last year's schedule C to see what sorts of things typically fit.

Take what's left at that point and peel off about 15 % for self-employment tax. (see schedule SE) Basically both halves of Social Security (which you only pay half of as an employee of someone else). After that your income tax is fairly normal, though there are some options to do things like set up your own retirement fund, etc. Don't ignore it all and say "I'll hire an accountant at tax time" - you should at least understand it, even if you do hire help, and a lot of pain will be saved if you set up decent recordkeeping from day one, either from getting a better understanding of what's needed yourself, or from consulting with an accountant who can set you up to keep records so that you won't have a huge bill in April for being an idiot and making a lot of extra work by not having your paperwork organized. If you keep records on a computer, learn to make multiple backup copies frequently.

Taxes aside, before you get to spending your new-found money, you'll want to save some serious dough by whatever means is required for the "new truck fund" - far cheaper than financing a new truck, and you will need one eventually.

Look up SCORE in your local area for some experienced small business advice http://www.score.org/index.html

[scottpA_GS]

Awesome DOD Thanks 

The $260 was what he took home, the stock we used was included so it was proffit minus maint, taxes, etc. he didnt hide anything from me as far as I can see. I was shown last years tax returns, monthly sales and payments from Wise as well as bank statements and all records for the truck. I do know that the truck can become a big expense fast $$$ depending on what happens to it but from what I saw of other (Wise) guys trucks, this one is in WAY better shape 

From what I am told, the gas, maint and other writeoffs balance out the taxes at the end of the year to the point that this year they (IRS) owed him like $400  I will keep the books myself and bank plenty away each month "incase" (taxes, repairs etc..)

I used to own 2 retail stores so I know a bit about the accounting just not route sales.


I cant thank you all enough for the input! These are exactly the responses I was looking for 

I will send you all some chips if I buy the route 

[yamahonkawazuki]

i wish you success.  i am thinking of opening my own bike shop, parting out bikes and selling them on e-bay like i used to do before i got sick

lol i was contemplating the same thing frankie. heh ill be damned