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Last Updated: 11. July 2017

Could Coffee Vending Machines be Your Next Business Venture?

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Cappuccino, espresso, americano, latte, mocha, hot chocolate… Are you at a fancy Italian restaurant? Not necessarily. You are most likely picking up your morning caffeine dose. If you feel like a bit of a caffeine addict, then you are not alone - over 400 billion cups of coffee are consumed worldwide every year. Coffee vending machines have become trivial elements of our everyday life, however the story behind them and reasons why they are so successful are rarely discussed.

The Beginning of Coffee Vending Machines

The first coffee machines with hot drinks appeared in the USA in the late 1940s and it was a real breakthrough for the branch. With industrialization and scientific leaps, the impossible was becoming possible every day. The quite complicated and time-consuming technology of grinding coffee grains, compressing the ground mass and adding boiling water no longer required human efforts, and was now achieved by pushing a button on a machine.

Such machines became especially popular in places with large concentrations of people – offices, shopping malls, hospitals, schools etc. Nowadays, it’s difficult to evaluate the approximate number of coffee vending machines in the world, as there are so many. The vending business has expanded to include all kinds of beverages, snacks and other foods, but coffee machines still occupy 40% of all automatized trading industry.

Read more: How to Start A Business with Automatic Coffee Machines

Why Are Coffee Vending Machines So Profitable?

So, what makes this business so profitable? To begin with, the cost of the final product exceeds the cost of the ingredients and brewing roughly five times over. Additionally, there are very few expenses associated with the vending machine business, as you do not need to hire barista staff, or maintain café or restaurant rooms.

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This business can reap profits of more than 300% due to numerous factors, such as consumers’ willingness to pay more for quick service and fancy paper cups, as well as low expenses. This number can be slightly lower if your machine offers other beverages such as hot chocolate due to the higher cost of ingredients, but profits margins can still be very high. In fact, the average coffee machines will pay for itself within one year.

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