How Much Does It Cost to Start an ATM Business

   How Much Does It Cost to Start an ATM Business

       Introduction 

   

Starting an ATM business is a lucrative venture

 to have as an entrepreneur with the objective of

 passive income. 

However, just like other businesses, there are

 start-up costs and some continuing ones that one

 must put into consideration. 

Below, find a breakdown of major costs

 associated with the initiation of an ATM business

 and some of the factors that influence the

 overall cost.

#### 1. **Cost of an ATM Machine**

The biggest upfront investment in an ATM

 business comes with the machine itself. 

The price does vary depending on the type and

 some other features you opt for:

- **New ATMs**: Costs range from $2,000 to

 $8,000. Basic machines are at the lower end of

 this spectrum; higher-end machines come with

 touchscreens and/or enhanced security.

- **Refurbished or used ATMs** have prices

 starting from $1,200 to $4,000. They will lack

 some of the newest features; however, they will

 still be respectable money earners.

#### 2. **Installation and Setup Costs**

You are going to install your ATM upon purchase

 at a location you will have chosen. 

The costs might be:

- **Installation costs**: $200 to $500, with the

 prices depending on the complexity of the setup.

- **Software setup:** The machines must be set

 up with processing networks. 

Some of the providers will charge a one-time fee

 for setup and it can range from $50 up to $200.

#### 3. **Cash to Stock the ATM**

One of the peculiarities of operating an ATM

 business is that you will have to provide it with

 cash. This is a consumable and will be required

 on a continuing basis, depending on the

 withdrawal activity underlying the location. 

In general, most ATMs require from $1,000 to

 $5,000 in cash for the first load. 

You will also need to regularly replenish the cash

 supply as it gets withdrawn.

Sometimes you are able to negotiate an

 agreement with the companies at which you

 place your ATMs to also help share the burden of

 loading cash in those machines and, therefore,

 further reduce your upfront investment and

 recurring costs.

#### 4. **Processing Fees**

Every transaction processed through your ATM is

 going to need to go through a network, and most

 of the processors charge per transaction.

 This can vary but it ranges between $0.15 to

 $0.50 per transaction. It is crucial that you find

 favorable rates with the processors to maintain

 your margin.

#### 5. **Location Lease or Revenue Sharing**

If you're placing your ATM in a business you

 don't own, then you'll likely have to negotiate an

 agreement with the owner. 

This can be either a lease agreement or a

 revenue-sharing arrangement. Common

 arrangements include:

Flat lease payments: You pay the business owner

 a fixed monthly fee for letting you keep your

 ATM in their store. This is often anything

 between $50 and $300 per month.

- **Revenue sharing**: Most business owners

 would want a share in the profits of the ATM

 rather than a fixed amount.

 This often translates to revenue splitting on the

 surcharge, that is, the fee customers pay to use

 the ATM, with the location owner at a common

 range between 20% to 50%.

#### 6. **Insurance**

You will want to properly look after the

 protection of your ATM and the cash inside.

 Insurance, depending on your location and

 perceived risks, might run anywhere from $200

 to $1,000 annually. Policies usually provide theft,

 vandalism, and liability coverage.

## 7. **Maintenance and Supplies**

ATMs need regular maintenance to work

 properly.

 Again, depending on your particular model,

 you'll incur costs of:
**Repairs and technical support**: anywhere

 from $100 to $500 annually depending on how

 often you'll require either.

**Receipts**: This is an ongoing cost, but

 relatively small, about $50 to $100 per year.

**Software updates**: Machines do have

 operating software which requires periodic

 upgrading.

#### 8. **Marketing and Signage**

It is very important to attract users to your ATM.

 You may want to budget some money for signs

 and posters to do some marketing. 

This may be a one-time cost of about $100 to

 $500, depending on the level of advertising you

 want to achieve.

### Total Estimated Cost Breakdown

Here's a rough estimate of what you might

 expect your initial start-up costs to run for an

 ATM business:

| **Expense** | **Estimated Cost** |

|  | |
| ATM Machine | $2,000 – $8,000

| Installation and Setup | $250 – $700

| Cash to Stock ATM | $1,000 – $5,000

| Processing Fees | $0.15 – $0.50 per transaction

| Location Lease or Revenue Sharing | $50 –

 $300 monthly

| Insurance | $200 – $1,000 per year

| Maintenance and Supplies | $150 – $600

 annually

| Marketing and Signage | $100 – $500 |

### Initial Investment Summary

The cost for entering an ATM Business can range

 from **$ 3,500 to $ 10,000** depending on which

 chosen ATM among other things. Monthly

 operational costs differ and, aside from your

 upfront investment, ongoing overheads are

 remarkably low.

### Residual Income

ATMs make money by charging a surcharge for

 every transaction made, averaging $2-$4. For

 instance, if your machine does 200 transactions

 a month, and your surcharge is $3, you would

 receive $600 a month in profit. From this profit,

 you would subtract the costs involved: revenue

 sharing with your sponsor, insurance, and

 maintenance to get your active profit amount.

 These form passive income streams that will

 grow over time as you grow a network of ATMs.

### Conclusion

Carefully planning and investment in an ATM

 business means consistent passive income with

 the right location and a well-maintained

 machine. 

You will be able to identify different costs that

 you may incur, which are essential in helping

 you budget appropriately without surprises as

 you set up and build your business.