Are You Saving Money?

In last month’s blog, we looked at analyzing your business.  This is the best way to determine what specific actions can generate savings that best benefit your business.  This article will present a number of ideas for your consideration.  Hopefully, some of these as can be applied or adapted to help your business.
The first idea is something many might consider unconventional.  


There are several ways of using a contractor.  Using a contractor may lower your profit margin, but the savings offset is you don’t have to pay benefits to a contractor.  First, let’s look at ways to use the contractor in a vending service:

  • Contract out a vending route.
    • By hiring a contractor to service an existing route.
      • Establishing new routes or new territories to be serviced by contractors.
    • Selling or leasing your old machines to someone to establish their own route with you as their supplier.
      • Territories can be defined to prevent direct conflict.
      • Be sure to include a noncompetition clause
  • Contract with a building or leasing company for exclusive rights to provide vending, micro market and coffee service to a building.
    • Sub-contracting out any service that is not part of your normal business.


  • Become a direct so purchaser from some of your manufacturers.  These savings could be significant.
    • Determine the volume of necessary for direct purchase. 
    • Examine purchasing less often and in larger volumes.   
    • Consider using your discounted price to offer products to other businesses.
      • Make sure your purchase agreement allows products can be sold for resale.
      • You can sell to both competitors and on competitors
        • i.e.  If you have a vending machine business, you sell to micro-market vendors.

Overhead Savings:

Explaining this process requires subdividing this section.

  • Vehicles
    • For major expenditures like a new vehicle be sure to check with your CPA or tax attorney about depreciation and other tax benefits.
    • New refrigerator modules and coolers over the flexibility to use smaller vehicles
      • This eliminates the need for a dedicated truck with a refrigeration unit.
      • Many of these units are removable making the uses for the vehicle more flexible.
  • Routes
    • Consider redesigning route for reasons besides geography.
      • Possibly using more than one vehicle
      • Including a dedicated vehicle for refrigerated, fresh or specialized products

Overhead-Equipment & Office:

  • Check into to depreciation value of all your equipment.  Information from your analysis is vital here. After reviewing your:
    • Maintenance costs? 
    • Upgrade costs? 
    • Replacement costs?
  • The results should indicate if it is beneficial to purchase new equipment.
  • When factoring in cost savings, time and labor must be included.

Overhead-Business & Labor:

  • The tax-deductible status of the items in this area is an important area of concern.
    • Consult your tax advisor for information on applicable state and federal taxes.
    • Or visit the IRS website.

To use this best, see the previous blog A Guide to Analyzing Your Business.

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