HOW TO START AN ATM COMPANY
When a consumer requires cash, the majority is willing to pay a few dollars in service fees at the nearest ATM. Automatic teller machines strategically placed throughout town are a profitable way for entrepreneurs to earn a comfortable passive income.
Follow these ten steps to start an ATM business:
You’ve discovered the ideal business concept and are now ready to take the next step. Starting a business entails more than simply registering it with the state. We’ve put together this simple guide to getting started with your ATM business. These steps will ensure that your new company is well-planned, properly registered, and legally compliant.
STEP 1: Make a business plan.
A well-thought-out plan is essential for achieving success as an entrepreneur. It will assist you in mapping out the specifics of your business and uncovering some unknowns. Here are a few important topics to think about:
What are the initial and ongoing expenses?
Who is your intended audience?
How much money can you charge your customers?
What will you call your company?
What are the costs of starting an ATM business?
While this type of business does not necessitate an office or a large inventory of supplies, you will need to purchase a few items. The total investment will be determined by the number of machines you intend to start with. Depending on the style, each machine will cost between $3,000 and $10,000. On a rotating basis, each machine should have at least $2,000 in cash. Other than that, you should have an insurance policy, a bag for transporting cash, tools for routine machine maintenance, and a reliable vehicle. Each machine must have access to a phone line or the Internet, and you will need a computer to check each machine’s status.
What are the ongoing costs of running an ATM business?
Most machines require at least $2,000 in cash per week. Cash should be loaded into the system on a rotating basis. Depending on the contract, many banks will charge your business a surcharge, and merchants will charge a monthly rent fee or commission. New business owners are encouraged to conduct extensive market research so that margins are correctly set from the start. This will help to ensure that your ATM business has higher profit margins.
Who is the intended audience?
Your ATM service is available to anyone who requires quick access to cash. Restaurants, bars, strip malls, convenience stores, and shopping malls are all excellent places to begin.
How does an ATM company make money?
When a customer withdraws money from their account, the ATM company charges them a fee.
How much money can you charge your customers?
The standard transaction fee is $2.50 to $3.00.
How much money can an ATM company make?
It is critical to select high-traffic areas for your terminal locations. Successful business owners report an average monthly cost of $500 per ATM machine.
How can you increase the profitability of your company?
The more strategically placed machines you have, the higher your profits. Investing in franchises provides comfort for many new business owners. Once you’ve figured out the intricacies of this business, think about passing that knowledge on to new entrepreneurs by offering franchise opportunities.
What will you call your company?
Choosing the right name is both important and difficult. If you run a sole proprietorship, you may want to use a business name other than your own.
When registering a business name, we recommend doing the following research:
The business records of your state
Federal and state trademark registrations
Platforms for social media
Availability of web domains.
It is critical to register your domain name before someone else does.
STEP 2: Establish a legal entity
Sole proprietorships, partnerships, limited liability companies (LLCs), and corporations are the most common types of business structures.
Establishing a legal business entity, such as an LLC or corporation, protects you from personal liability if your ATM business is sued.
STEP 3: File your taxes.
Before you can open for business, you must register for a number of state and federal taxes.
In order to register for taxes, you must first obtain an EIN. It’s very simple and completely free!
Taxes on Small Businesses
Depending on the business structure you select, you may have different options for how your company is taxed. Some LLCs, for example, may benefit from being taxed as a S corporation (S corp).
STEP 4: Establish a business bank account and credit card
Personal asset protection requires the use of dedicated business banking and credit accounts.
When you mix your personal and business accounts, your personal assets (your home, car, and other valuables) are at risk if your company is sued. This is referred to as piercing your corporate veil in business law.
Furthermore, learning how to build business credit can help you obtain credit cards and other financing in your company’s name (rather than your own), better interest rates, larger lines of credit, and other benefits.
Establish a business bank account.
This separates your personal assets from the assets of your company, which is required for personal asset protection.
It also simplifies accounting and tax filing.
Apply for a business credit card.
This allows you to separate personal and business expenses by consolidating all of your business’s expenses in one place.
It also establishes your company’s credit history, which can be used to raise funds and attract investment in the future.
STEP 5: Establish business accounting.
Recording your various expenses and sources of income is critical to understanding your company’s financial performance. Keeping accurate and detailed accounts also makes annual tax filing much easier.
STEP 6: Obtain all required permits and licenses.
Failure to obtain necessary permits and licenses can result in hefty fines or even the closure of your business.
Requirements for State and Local Business Licensing
To operate an ATM business, certain state permits and licenses may be required. Visit the SBA’s reference to state licenses and permits to learn more about licensing requirements in your state.
Before installing a new machine, ATM companies should consider requiring clients to sign a services agreement. By defining payment terms and conditions, service level expectations, and so on, this agreement should clarify client expectations and reduce the risk of legal disputes.
STEP 7: Obtain commercial insurance.
Insurance, like licenses and permits, is required for your business to operate safely and legally. In the event of a covered loss, business insurance protects your company’s financial well-being.
There are various types of insurance policies designed for various types of businesses with varying risks. If you’re not sure what kinds of risks your company might face, start with General Liability Insurance. This is the most common type of coverage required by small businesses, so it’s a good place to start for yours.
STEP 8: Establish your brand
Your company’s brand is what it stands for, as well as how the public perceives it. A strong brand will help your company stand out from the crowd.
How to Market and Promote an ATM Business
Unlike most businesses, an ATM operation requires little to no marketing. While you will not be directly interacting with your customers, you will communicate with your merchants on a regular basis. Make strong connections with them in order to maintain a long-term, mutually beneficial relationship. Networking with local business owners is a great way to get your name out there. When an entrepreneur starts a new business, your customers will spread the word about you, which will help to solidify your company’s good reputation.
How to Keep Customers Returning
It’s critical to remember that every customer comes to you out of convenience. Don’t get a reputation for having machines that are always out of money or broken. Strive to provide what they require, when they require it, at all times.
STEP 9: Create your company’s website.
After you’ve defined your brand and designed your logo, the next step is to build a website for your company.
While creating a website is an important step, some may be concerned that it is out of their reach due to a lack of website-building experience. While this was a reasonable concern in 2015, web technology has made significant advances in recent years, making the lives of small business owners much easier.
The following are the main reasons why you should not put off building your website:
Every legitimate business has a website, period. When it comes to getting your business online, it doesn’t matter what size or industry it is.
Social media accounts, such as Facebook pages or LinkedIn business profiles, are not a replacement for your own business website.
Website builder tools, such as the GoDaddy Website Builder, have made it extremely simple to create a basic website. You don’t need to hire a web developer or designer to make a website you’re proud of.
STEP 10: Install your business phone system.
Getting a phone for your business is one of the best ways to keep your personal and professional lives separate and private. That isn’t the only advantage; it also helps you automate your business, gives it legitimacy, and makes it easier for potential customers to find and contact you.
Entrepreneurs who want to set up a business phone system can choose from a variety of services.
Now get out there and start earning that passive income!