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What is a
realistic ATM
income?
A big question! Clearly, high
quality locations can earn significant amounts of money. The reports
on our website are great locations. Slower locations can certainly
be profitable and earn steady income.
One thing that we want all potential
entrepreneurs to realize is that the ATM business is competitive and
to assess what realistic return on investment is reasonable for you.
Consider alternative investment choices:
Consider the hypothetical case
below:
A person has $12,000 that he is interested in using for a
business or investments. What are some choices that are available to
him and what are reasonable rates of return:
| Investment |
Risks |
Rates of return |
Value after 5 years |
| Bank account, money
market account |
Almost no risk |
3%-6% per year |
@3%: about $13,900
@5%: about $15,300 |
| Stocks |
risk of loss |
long term: 7-8% per
year |
@8%: about $17,600 |
| (3) ATMs |
risk of loss |
Using the following
assumptions:
cash loading by ATM owner
$2.50 surcharge
$0.50
back to location per transaction
100 transactions per month
200
transactions per month |
see below |
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At the very low level of 100
transactions per month, $2.50 surcharge, $0.50 back to location.
100
transactions per month is our low limit for transaction volume. We
recommend moving machines at this level to better performing
locations. This example is shown as a basis of comparison. |
| Year |
Value of (3)
ATMs (used, estimate) |
Annual Net
Income |
Value (ATM
value + net income) |
| 1 |
$7500 |
12 x 100 x
$2.00 =$2400 |
$9,900 |
| 2 |
$7000 |
$2400 |
$11,800 |
| 3 |
$6500 |
$2400 |
$13,700 |
| 4 |
$6000 |
$2400 |
$15,600 |
| 5 |
$6000 |
$2400 |
$18,000 |
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At a level of 200 transactions per month,
$2.50 surcharge, $0.50 back to location. Tax effects not included.
|
| Year |
Value of (3)
ATMs (used, estimate) |
Annual Net
Income |
Value (ATM value
+ net income) |
| 1 |
$7500 |
12 x 200 x $2.00
=$4800 |
$12,300 |
| 2 |
$7000 |
$4800 |
$16,600 |
| 3 |
$6500 |
$4800 |
$20,900 |
| 4 |
$6000 |
$4800 |
$25,200 |
| 5 |
$6000 |
$4800 |
$30,000 |
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At a level of 300 transactions per month,
$2.50 surcharge, $0.50 back to location. Tax effects not included.
|
| Year |
Value of (3)
ATMs (used, estimate) |
Annual Net
Income |
Value (ATM value
+ net income) |
| 1 |
$7500 |
12 x 300 x $2.00
=$7200 |
$14,700 |
| 2 |
$7000 |
$7200 |
$21,400 |
| 3 |
$6500 |
$7200 |
$28,100 |
| 4 |
$6000 |
$7200 |
$34,800 |
| 5 |
$6000 |
$7200 |
$42,000 |
Note that tax effects can be
significant for an independent business as compared to an investment. As an
independent business, you are considered to be actively involved in operating
the business and have business expenses that can be deducted from your operating
profit. Car expenses, home office expenses, cell phone, internet access and
other expenses are commonly listed as business expenses. Contact your tax
advisor for the proper use and documentation of these expenses.
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