Getting a good return on investment is critical, and operators often ask me what will generate the best ROI for a location. As I look to answer this question, there are several answers that come to mind. Is it a hot or cold food case or a carbonated soft drink dispenser? Is it video poker, which might be a great option but it isn’t available to everyone?
My answer is an ATM. Do you own your ATM? Let’s look at the benefits.
The cost to purchase and install an ATM at your location is about $2,600. This figure does not include any signage, which is also highly recommended.
Placement of this profit maker deserves a prominent location within your store. Some larger locations have two ATMs strategically placed within their business. I would recommend placing your ATM in a high-traffic area within your store near the main entrance(s).
There are several things you should know about owning your own ATM. ATMs today are very sophisticated and also very reliable, and partnering with the right processor can make owning one simple.
Through a mobile app, you can:
- See the balance inside.
- Look at dozens of different reports.
- Set the ATM to alert you or your staff almost instantly when the machine is getting low on cash or has an error code such as a bill jam or another issue you want to know about.
Most issues can be resolved with a phone call without the need for a service tech to visit your location. When you do need service, having a reliable nationwide service provider is important for your customers.
Many times, you can help a customer out while he or she is still standing at your machine.
Today’s ATM’s also sell gift cards, process cardless transactions and pre-paid cellular.
How much an ATM can earn depends on usage. Many locations pay for their machine within the first year with some paying for their machine in two to three months or less.
That would give you an annual ROI of 100 percent on the low end and up to 300 percent to 400 percent on the high end.
Let’s break that down to help give you more insight to your earning opportunity. You should be receiving 100 percent of the on-screen surcharge. Some states do limit this amount.
The average location has 275 transactions a month. If you are on the very low end of that figure, say 135 per month, here is what your revenue looks like:
- 135 Transactions @ $3.00 per = $405 per month, $4,860 per year or 153 percent ROI
- 275 Transactions @ $3.00 = $825 per month, $9,900 per year or 380 percent ROI
Depending on how you choose to manage the ATM there will likely be some additional costs.
You may choose to have the cash delivered into your machine by armored courier, which depending on where you are located can range from $75 per delivery to much more if you are in a rural location. You can contract with armored car services to deliver your cash and even have them load it into your machine. Most major retailers such as Walmart and Target utiliize this service as it is dangerous to haul large sums of cash to and from the bank. Just call and tell them who you are and ask who services their account. If you can take delivery the same day(s), chances are you will get a low rate.
Additional revenue opportunities include 1 percent of foreign transactions. So, if you are located where there are transactions from Canadian bank customers, Mexican bank customers or other foreign bank card customers, you can receive 1 percent if your machine/processor does the currency conversion.
You should also receive next-day funding into your bank account.
There are several other things you need to consider when owning your own ATM. You’ll need to manage security, and remember that it is your cash inside the ATM. Fewer hands = fewer problems! So, you’ll want to limit the number of people accessing the cash. ATM machines allow access to internal parts while keepig access to cash as a separate secure process.
Just like your point-of-sale technology, you must reconcile your ATM. This is a fairly simple straightforward process with the robust reporting available to you. Good accounting procedures separate the reconciliation from the person responsible for cash handling.
NATSO allied member Premier Merchants Group provides all of the services mentioned in this blog post and can provide sales, service and support nationwide. I would encourage you to contact them for a free analysis. You can reach Seth Blank at Seth@PMGCOM.com or (855) 764-2867.
// Want more advice to grow your travel center business? Through NATSO's consulting program, Travel Center Profit Drivers, NATSO provides access to specialized, experienced consultants and the tools they’ve created to help travel centers thrive. These services include assistance on areas such as new construction, payment processing, branded and unbranded contracts and much more. Travel Center Profit Drivers is led by Darren Schulte and myself. Combined we have over 60 years of experience in the truckstop and travel center industry. Our goal is to assist and we are not driven to sell you something. This allows us to have your best interest at heart!
Please contact me at firstname.lastname@example.org or (703) 739-8572 to discuss how our team can assist you. Learn more about a Travel Center Profit Toolbox here.
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