Choosing where to invest your money is important. Let’s compare two options: investing in a vending machine versus putting the same amount into a bank Fixed Deposit (FD).
Vending Machine Investment
- Initial Cost: ₹1,80,000
- Lifespan: 10 years (can go up to 14 years with good maintenance)
- Monthly Sales Goal: ₹35,000 to ₹45,000, depending on location and products
- Profit Margins: 20-30% or higher, depending on product selection
- Payback Period: 1.5 to 2 years to recover initial investment
- Total Earnings Over 10 Years: ₹9,00,000
- Annualized ROI: 17.46%
A vending machine can pay for itself in about 2 years, leaving 8 years of potential profit. With good location and product choices, the returns can be significantly higher than many traditional investments.
Fixed Deposit (FD) Investment
- Initial Amount: ₹1,80,000
- Interest Rate: 7.5% per year
- Duration: 10 years
- Total Amount After 10 Years: ₹3,80,171
After 10 years, an FD would grow to ₹3,80,171, resulting in ₹2,00,171 in earnings—much less than what a vending machine could earn in the same time frame.
Key Advantages of Vending Machines
- Higher Returns: Vending machines can potentially offer over twice the returns of a Fixed Deposit (FD) over 10 years, thanks to consistent sales and good profit margins.
- Quick Payback: You can recoup your initial investment in just 1.5 to 2 years, unlike an FD, which takes the full 10 years to yield its returns.
- Flexibility: With vending machines, you can change products, adjust prices, and relocate to maximize profits—flexibility that a fixed-rate FD doesn’t offer.
Considerations
- Costs and Maintenance: Factor in expenses for restocking, maintenance, and occasional repairs.
- Location is Key: The success of a vending machine depends heavily on placing it in a high-traffic area with the right audience.
- Risks: Vending machines carry risks like changing customer preferences and the possibility of theft or damage, unlike the security of an FD.
If you’re looking for higher returns and are willing to put in a bit more effort, a vending machine can be a more lucrative investment than a bank FD. With quicker payback and the potential for greater earnings, it’s a solid choice for those who want to grow their money more aggressively.
