How to Do Vending Machine Business in Malaysia (My Experience)
This article records my own personal experience in doing vending machine business in Malaysia, as a way to earn extra income. If all goes well, I will enjoy ~200% returns by the end of the fifth year.
But I’m getting ahead of myself. Let’s start from the beginning. This article covers the following sections:
- Part 1 – Learning how the vending machine business works
- Part 2 – Learning how to start vending machine business in Malaysia
- Part 3 – Price for vending machine in Malaysia
- Part 4 – Is vending machine a profitable business?
- Part 5 – My bad experience with the vending machine supplier company
- Part 6 – How much does a vending machine cost to rent under the Guaranteed Rental Return vending machine package?
- Part 7 – Vending machine Malaysia – is this business worth doing?
Part 1 – Learning how the vending machine business works
In September 2020, I was happily browsing through the Home & Living Fair Expo at Mid Valley (and mentally furnishing my future house) when I chanced upon the vending machine supplier’s booth. I have no idea what they were doing there, but I, too, have heard about the high income potential from doing the vending machine business in Malaysia.
So I inquired. A nice sales lady immediately assisted me.
She told me about the company, which specialises in manufacturing and supplying vending machines all over Malaysia, and the various types of vending machines they offer, including:
- Snacks vending machine (available in multiple configurations. The most high-tech one got touch screen and e-wallet payment option)
- Hot food vending machine
- Drinks vending machine
- Mystery box vending machine
- Custom vending machine
- Cashless vending machine
- Coffee vending machine
- And more
The price for vending machines ranges from around RM8000 to over RM20,000 each, excluding financing (if available).
Part 2 – Learning how to start vending machine business in Malaysia
My sales rep, who runs 2 vending machines herself, said they have been a profitable venture for her (to be fair, of course she would say that), and it is easy for individuals to start a vending machine business in Malaysia (that too).
If I want to start, all I have to do is:
- Choose (and pay for) a vending machine package
- Pick a location I want (locations are provided)
- Collect the sales profit every month
She showed me a list of 100 or so ‘hot’ locations with ‘ready’ customers, all approved and waiting for vending machines to be installed. Locations vary; some are at public places, some at offices/factories, some at residential areas.
She explained the benefits of starting vending machine business through the company, as they provide many types of assistance, including (some services are included in the price, some with extra charge):
- Finding suitable locations and negotiating rental with the property management
- Delivery of the machine
- Providing a variety of vending machine-friendly items
- Stocking the items
- Refilling the items
- Processing the payments
- Handling repairs
- And more
Part 3 – Price for vending machine in Malaysia
As for the price for vending machine, the company designed 3 types of business packages:
- Buy package – Buy a smart vending machine for RM20,000 in upfront capital + monthly cost of approx RM200-400 for location rental, possible Internet cost and refilling service (optional)
- Rent-to-own package – Put RM6000 downpayment for a smart vending machine + monthly cost of approx RM600-1000 for location rental, possible Internet cost and refilling service (optional)
- Guaranteed Rental Scheme package – more details on this in Part 6
Her sales pitch was very good and it’s obvious she is an experienced salesperson. The projected returns sound great (“most people break even by the second year, after that what you earn is pure profit”).
Part 4 – Is vending machine a profitable business?
The salesperson made it sound like vending machine business is the easiest thing in the world to profit from. But of course I have to do my research.
What I found out: It has potential, yes, but like all businesses, it’s not as ‘easy’ or ‘passive’ as the sales agent suggested.
Based on my research, I would be lucky if I broke even within 1.5-2 years; it really depends on the location. If you happen to pick a bad location, then you may not turn any profit at all! The risk of losing money is always there, because this is a business.
When I asked on social media, some people replied with their own experiences.
- Some made great profit (they got great locations, sourced own machines, etc).
- Some make a loss (horrible location, etc).
- Some bought/sold their vending machines from other buyers/sellers, bypassing companies like these altogether. You can find vending machines listed on Mudah.my.
- Some said they, too, have also heard and tempted by over-optimistic sales projection by agents.
I found out that there is also a type of vending machine scam in Singapore!
Despite that, I still wanted in. I checked and am satisfied with the legitimacy of the vending machine company. But mainly I was curious about the vending machine business. I figured, at the very least, I can write about it (and I did).
Part 5 – My bad experience with the vending machine supplier company
Initially, I picked the Rent-to-Own package (later, I switched to the Guaranteed Rental Return package – more info in Part 6) and paid RM6,000 to the vending machine supplier company back in September 2020. However, my personal experience with this package was not great.
First, I was told that all the locations shown to me during the expo were no longer available, they ‘ran out’ despite me paying the downpayment to book them. In short: they have pulled the classic overpromise and underdeliver tactic.
I was told to wait for new locations. Because it was the peak pandemic period and stay-home orders were given and everything, I (stupidly) accommodated and waited.
Finally, around January 2021, (a good 3 months after), a new sales agent contacted me. He introduced himself and told me he would contact me after they found new locations.
Around the same period, I received a letter via email, informing me of the delay of the vending machine (as if I didn’t notice). They blamed Covid-19 and offered a free month of rental as an apology. So I waited some more.
In March 2021, after about 6 months since I signed the contract, my sales agent finally contacted me with a location.
A location. One. That was a far cry from the list of ~100 over locations shown to me during the first sales pitch. I knew that location matters, so I asked as much details about the location as possible. After some prodding, I was given one more (just one more) possible location, which isn’t as good.
Was I annoyed? Yes. I wanted choice, and now it seems like I have to take whatever location is available. I had wanted to visit some locations before making my decision, to see the foot traffic and type of possible customers and safety of the location.
There were other things displeased me. I was told to attend a vending machine maintenance class, so I can learn basic troubleshooting of the machine in case it malfunctions. I was never told this, or if it was, only in passing.
I was also told to create a new company for the purpose of registering for e-wallet functionality. Reader, I signed the paperwork 6 months ago and was told everything was okay. Suddenly I was told to do additional work. How’d you feel?
Part 6 – How much does a vending machine cost to rent under the Guaranteed Rental Return vending machine business package?
After complaining to my agent, he informed me of a NEW package that is better suited for me: the Guaranteed Rental Return package. Essentially, I will earn rental income on the vending machine instead of profit from item sales.
How it works is:
- Pay RM22,000 in upfront capital, get the machine within 31 days
- Receive monthly rental payment for 3 years – RM300 per month in Year 1; RM350 per month in Year 2; RM400 per month in Year 3 (Totaling RM12,600)
After the 3 years, you have 3 options:
- (1) Take the vending machine for own business,
- (2) Renew and continue earning rental payment of RM400 per month for 2 more years (RM400 x 24 = RM9,600), or
- (3) Sell the vending machine back to the company for RM22,000 (your upfront capital)
It sounds good. The contract is better than the rent-to-own scheme, too (the cancellation penalty is ridiculous). And he’s right, this is a better package for me. I wanted minimal work for the next five years.
Under this package, I don’t have to worry about opening a new company, stocking the vending machine, maintaining the vending machine, and more. I will simply receive income every month, no other action necessary.
So I switched plans. It will give me less profit potential, but will give me more peace of mind. Easy decision to make.
My contract came into effect in April 2021. As of writing time, the plan is going well – I am receiving RM300 rental income every month. Like I said at the beginning of this article, *if* all goes well, I will enjoy ~200% returns by the end of the fifth year.
If you’re interested in the same plan, leave your contact details in the comments section (or you can DM me on my social media) and I’ll pass your contact to my agent. You’ll also get RM1,000 discount (RM21,000 instead of RM22,000)
Note: Nothing is risk-free in business. I will be so happy if this business works out, but I will also not depend on it. You’ll be advised to use the same approach as well – don’t use life savings or emergency funds or anything.
Note 2: The plan is subject to change at any time. Refer to the agent
Part 7 – Vending machine Malaysia: is this business worth doing?
So, is it worth doing vending machine business in Malaysia?
From this whole experience, I’ve concluded some general guidelines – here’s what I’ll do if I were to do vending machine business all over again:
Bypass vending machine supplier company IF: already have a location AND capital (ie upfront money) AND time to refill the machines AND technical capability to fix the machines (or know who to call when it breaks).
If I know what to do, I’ll simply buy the vending machines directly from whichever vending machine supplier with the best price or better yet, from previous owners (at Mudah.my, etc).
Go through a company IF: no experience at all. Going through company is probably the safest way to do it, they have the expertise. Be very sceptical of profit projection though – so far I am happy with the vending machine package I picked, but I need to remember that every business carries risk.
That is my experience in doing vending machine Malaysia business so far. If you are interested in it, what else do you want to know? If you have experience, how is your vending machine business doing and what did you wish you knew when you first started?
Let me know in the comments!
Hi Suraya, I have a similar experience. Me and my friend bought a vending machine together for RM57k. The sales agent was very convincing, saying how she has more than 10 machines, and how her daughter is helping to manage her machines. We were also told how fat the profit margin is.
Before purchasing the machines, we were told that there are a lot of great locations available, such as at popular hospitals. After paying for the machine, it took 3 months to arrive, and we were given bad location options to operate it. After much complaining to the company, we managed to get a decent location outside a shop in a busy street.
Our machine requires a lot of maintenance, for example refilling cocoa, tea, soya powders, creamers and sugar. We also have to regularly refilling the water tank inside the machine. If we are late for refilling and the water runs out, the ice-making machine will malfunction.
After paying for the ingredients (powders, sugar) and rental, we hardly make a profit, let alone thinking of breaking even. There were also instances of vandalism or customers throwing their cups/pouring their drinks into our machine
The worst thing is, the company removed the computer inside the vending machine which helps to regulate the mixture of powders in the correct proportion. As a result, we cannot alter the taste or change to other types of beverages. It was a brilliant way for the company to keep making money from us via “regular maintenance”. Besides, we are also not able to sell the machine as no buyer would like to have a machine without the computer inside.
This is really an experience where I finally realise the wisdom of “do not invest in things that you do not understand”.
Thank you so much WC for your experience sharing, highly appreciated! That machine was RM57k?? I’m so surprised, I thought even the top range one is RM30k.
Unfortunately, I have heard about vandalism being main issue in vending machine business in Malaysia. It’s sad that we’re not as civic minded as Japan 🙁
Any machine business is profitable but it really depends on location and exposure of the machines.
I invested a lot in toy claw machines early last year, but sadly wrong timing as the pandemic hit and ended up paying a lot for empty rent due to mco.
Early this year, I cannot tahan and decided to just bail out, let the rent deposit burn and brought home all the machines.
Currently thinking of whether to open new shop (need capital for renovation) or to just sell off my machines.
Either way, good thing these machines and toys have *no* expiry date, still can afford to think masak2 on my next move haha
Thanks Lloyd for your experience sharing! Yes it really depends on foot traffic. In the vending machine communities, I can see people berebit for good locations..
Hope you’ll be able to find use for your machines in the future. I have a soft spot for them, reminds me of Japan
Hey Suraya,
I was thinking about vending machine business and I came across your article which was an eye opener, proving it is not an easy ride. But I will like to know based on your experience:
A) How profitable is the vending machine business?. I am actually asking on return of investment (ROI).
B) As you have said, you have a done a market research on what people are keen on buying in a vending machine. Mind sharing some info please?
C) Based on your experience, for a rookie . Which one would you suggest, Going through a company or buying an own machine and getting a location by themselves ?.
D) Do we need to register a company under SSM, to start this business ?. Sorry I am clueless regarding this.
Thank you for sharing.
Hello Suraya,
Very happy to come across your sharing on Vending machine business.
I also keen to know what’s your reply on Kavilan’s questions.
Mind if I have a bite of the information. >.<
Many thanks for sharing.
Hi Kavilan,
(A) Profitability depends on many factors. I took the guaranteed rental returns scheme, which assured me ~200% return in 5 years. You can get better profits (and expose yourself to more risk) via operating your own machine(s). See Part 7 – Vending machine Malaysia: is this business worth doing?
(B) See Part 1-3
(C) See part 7
(D) Unless you took the same package I did, then yes. generally speaking it’s practical to open a company if you have business, even side or small business. You can do sole prop (the cheapest option), and if when you grow the biz, you can upgrade to llp or sdn bhd
All the best
Hye Suraiya. Your story was mind opener but I still have some doubts on the vending machine business and I hope you can share me your experience on the vending machine business. My questions are, which do you advice for a rookie, getting a vending machine by themselves and sourcing for a location or going through a company?. Second, how long did you take to cover back your initial investment (Return of investment)?. Lastly, could you give us a glimpse in what we should look at before purchasing a vending machine?.
Your help will be much appreciated. Thank you
Im trying to get into the vending machine. Could you give some advise?
What would you like to know Dennis?
Good evening Suraya,
I’m interested to get into the vending machine business and did a lot of research but most of the info are for foreigner(USA, Japan, Taiwan) rarely to see article about Malaysia.
As a fresh graduate I don’t really understand about the law in Malaysia. Hence, I got few question atm, hope you can help me 😀
Do I need to register a company under any government department? Is it really necessary to have a company even I only own a vending machine? Or I can register afterward when the business grown bigger?
Your help will be much appreciated!
Btw hope to see some update about your vending machine business in the future. Wish you have a great day! 🙂
Hi Yu,
Its great that you are interested in this business. Tbh your questions are outside my area of expertise, so you’ll have to find others to give better advice.
What I do know though, is it’s always practical to open a company if you have business, even side or small business. You can do sole prop (the cheapest option), and if when you grow the biz, you can upgrade to llp or sdn bhd
all the best!
Company tat overpromise n under delivery is already an alarm,might want to reconsider giving them more money n subscribe to another package all together? Any black and white or document to secure your investment?
Yeah this was classic sunk cost fallacy move. I paid RM6k, didn’t want to go through the hassle of ‘wasting’ the time (and additional time for refund, if possible, didn’t ask), so went for the other package.
On the plus side, the legal and contract side is all good
Hi Suraya
Interesting read, however i’m not sure how you come up with 216% return..
if you make 12.6k+9.6k over 5 years that’s a return of 4.44k per year. So the yield is 4.44k/22k = 20.5% per year and overall 100% over the 5 year plan you suggest. That’s very decent return but nothing like 216%. Where did I get it wrong.. can you explain ?
Hi Nico,
Great guestion. I edited from a precise 216% to ~200% returns in 5 years. The number is taken from their proposal document, given to interested investors
How has the returns been since September 2021?
Consistent and received as per schedule (as of March 2022)
Hi Suraya
just want to find out how you get 200% in 5 years?
you paid 22k. your total return after 5 years is 22.2k. your profit after 5 years is rm200. thats a 5 year ROI. isnt it 100% in 5 years?
any income after 5 years is your profit.
hope im mistaken
Hi Jeremy, the cost of the machine itself is refunded and taken into consideration. Hope that helps
Hi Suraya, That’s a very important information which you did not share on amount of RM22k, that is returned after 5 years. Is there no depreciation calculation on the VM/assets?
I am curious to know if anyone has ever couped such amount after the 5 years. This was brought to you after the first option failed with location suggestion (could be also as a marketing gimmick).
If your contract started April 2021, it would technically end in March 2026. How do you secure the repayment of VM in 2026? Curious to know and would love to speak to your agent for more clarification.
Hi Mar,
I read my contract carefully – no depreciation cost in 5 years
I don’t know how the actually repayment will be made in 5 years. Guess I’ll find out in 2026. Have a feeling they might sweet talk me into renewing. Either way, I have the legal B&W
Hi Suraya,
I am interested, although of course I will do my research. Maybe you could pass me your agent’s number?
Done 🙂
Hai Suraya, such a motivating and mind-opener story on vending machine business. Can I have your agent’s contact number as I plan to start my vending machine business in the future? By the way, wish you all the best for your business.
done sent 🙂
Hi, thanks for sharing this! I’d like to ask, is it up to you to chose what to sell in the vending machine? Is there a specific standard or rules in what can/cannot sell vis vending machine? Thanks
Hi Lizzie,
If you take your own machine (not the rental package), you can pick yourself what you want to sell, yes 🙂 I’m sure there are guidelines in terms of what cannot sell (for example, firearms) but my agent did mention consultation will be given based, on sales data, so that’s cool
Hi Suraya,
I am interested in the vending machine business. Could you please send me the agent’s contact.
Thank you.
done sent 🙂
Hi. May i know how much monthly profit the company offered to you?
Ive found one company that offer 65% profit, while 35% will goes to company.
Thanks
Hi Suraya,
I’m a big fan of vending machine myself, its always a pleasure buying things from it. I was thinking of doing this, mind to share the name of the company you are with?
Also, what are your thoughts on alcoholic drinks is it legal to do in malaysia?
BR,
Joe
Hi Joe,
Check your email 🙂
Re – selling alcoholic drinks in vending machine in Malaysia. You know, I have no idea. Here’s hoping someone who knows can reply and answer
Selling alcohol beverages requires licence. The seller must follow strict guideline on how to sell it. Among the requirement is not to sell to anyone less than 18 years old and only to non Muslim. Hence i think the selling alcohol beverages via vending machine would be most likely prohibited.
That makes sense, thanks Farid
Hi Ms.Suraya,
Thanks for your sharing on the vending machine business, glad that i read your article when browsing through internet for information. Can you share me your agent contact? I would like to know more in detail.
Wish everyone is safe during this pandemic, have a nice day.
Done, check your email 🙂
Dear Suraya,
curious, what happens after year 5? do you still get to sell the machine back to them for rm22k?
Hi Davin,
Yes, that’s the idea. You can sell it back OR continue getting the rental income
Hi Suraya,
Interesting read. I wonder what’s the logic behind the company buying back the machine from you after 5 years? When you rent the machine, they will offer the same machine to someone who wants to sell things with vending machine but without any commitment to the VM? That’s how the company make money- VM rental from you, food from another client, 5 years later they buy it back and the cycle repeats? Sorry I’m just trying to get into how the VM company is benefitting from this. Meaning to say, the VM you rented could be a second hand VM, right?
Apologize for many question. I am also interested in the agent’s contact number. Thank you so much :)))
Hi Evan,
I have a feeling they might try to convince me to continue another 5 years, before offering to another customer. Lower cost of customer acquisition and all. Of course, in order to do this, they have to make sure I have a good experience overall and so far, the payments have been coming in as promised.
Re: how they make money – for each location, the sales can be over RM1-3k, maybe even more, but of course comes with a lot of work, research and luck.
Re: agent – check your email 🙂
Dear Suraya,
Thanks for sharing experience. I get a new knowledge while research about vending machine business. Mind to share your agent contact number? I want to know in details. 🙂
Sent 🙂
Hi Suraya
Wow this is a very good read! As a salaryman, I’m keen to investment opportunities that requires minimal effort
Could you please share the contact detail of the company/agent as I’m interested as what you have ventured into?
Best regards
Zafran
sent 🙂
Hi, Ms. Suraya.
I learnt a lot from your sharing and grateful for that. Can you please share your agent information to me? Thank you so much. Wishing you all the best 😀
sent 🙂
Thank you for your experience and this is what I am looking for before investing in it.
Like you say, no such business is risk free and profit-guaranteed, or else many people would have been rich and less poorer.
The reason I look into vending machine business is because it does not need manpower (which I hate dealing with people especially comes to work ). Less human error and basic cash in and cash out concept. However, location selection is the utmost important. I read some one actually put the machine at Masjid and complaining it was not earning any profit. Like it’s such a no brainer location.
If I were to start this business, I would survey the desired locations prior to engaging with the contractors. Do not rely on those salesperson who keep telling you about the hot spots. Mostly are all occupied and highly competitive since those hot spots are scarvaged by most vending machine companies.
Tbh, their payment plan is very confusing based on what you wrote here. I would rather own the machine independently than contractually bonded to them, so that I can bring the machine to whichever spot I deem fit for the machine to run.
I am thinking to own a simple beverages vending machine. Somehow I gotta survey along and get to know the mechanism of a vending machine. I want to buy from supplier instead with company.
I would say vending machine business is a steady source of income but don’t expect high ROI. You can rely on it as a main source of income if you have 2 or more machines in the running.
Thanks Izach for your commentary, looks like you have put a lot of thought into it 🙂 All the best in your ventures!
Hi,
I plan to put a vending machine in my homestay. I want to make something different. My target is the customer who checked in at my homestay as normally they were families with kids and teenagers. What do you think. And from your experience which type of vending machine suitable for my plan?
Hi Fathil,
Just take this as an opinion ya – for vending machines, foot traffic aka exposure to lots of people, preferably hundreds or thousands on a daily basis is best to make the investment in machine worth it. If you can get the machine for cheap, and if the location is far from other amenities, perhaps
Thanks for sharing this insightful article. A long time ago, I invested in a water vending machine business. It was a case of overpromising and underdelivering. I should have done more research before I dived in and burned RM18K but…we learn don’t we?
I’m interested in snacks, ice vending machines in the future.
Thanks again for sharing your experience!
Thanks Vernon for sharing your experience. Overpromising and underdelivering is common, not just in vending machines, but also in all sales sector. Like you said, all we can do is learn from it.
All the best in yoiur future ventures!
I read with interest the emails here. I am in the vending machine biz, self-installed and OEM Corporate sales (in the pipeline) and maintaining them. No, I am not selling my services here but to share with you what does the biz involved. The good parts of the biz, is that its 24/7 and cost less on rental of space, and is movable if not selling well. The other factors are; 1) Vending machines are aplenty as its the new concept of convenience but you need a good location aka buying traffic and not any busy area. You need to know the proximity of your peers (other similar biz including small outlets. 2) yr products must be unique; don’t sell what others are already offering. Drinks/Snacks/Toys? Who is yr consumer? 3) Cashless or Cash? The former is popular nowadays but you need to register with the provider for the service, and that comes with some costs. The latter attracts vandalism and it’s expensive to repair or replace the parts. 4) Machine Maintenance; this is a mechanical/electrical construct. It need proper maintenance. That comes from the vendor. What is your assurance and at what cost? 5) Guaranteed Return? No comments.
Thanks for sharing your experience here Jimmy. Lots of business strategy questions there
Hi Suraya, I know this article is like 1 year old, but it is still a fantastic read! Also, do you mind sharing your agent’s contact detail with me as I would like to learn more about the whole vending machine business. Many thanks in advance and All the best in your future endeavors!
Done sent email 🙂
Seems interesting… How long you have been in this?
Hi Suraya,
Great read, thank you for sharing! This Guaranteed Rental Return seems interesting (although the main risk probably is risk of default by the company). Would be very keen to read the documentation/contracts and find the structure of how the funds are kept, I would think holding the capital in a trust would mitigate a lot of the risk. Could you pls share your agent’s contact details, pls?
Emailed you 🙂
hi suraya, how are you doing 🙂 i found your great sharing whilst doing some research regarding this business. could please share your agent’s contact details please. thank you in advanve!
Sent 🙂
Hi Suraya,
I’m interested in exploring more into this VM business. Possible to share your supplier contact number with me?
Sent email 🙂
Hi Suraya,
Thank you for sharing, very good insight!
In my humble opinion,
it’s like you lend them Rm22k then they pay you back Rm300 per month.
They’ll get all the profit from net profit above Rm300.
Sounds like you just helped them to reduce their risk.
Please send me the agent’s contact as well I would like to know more about their business plan. =)
Exactly. And they help me to reduce my risk (and work related to vending machine business) as well
Sent you email 🙂
A word of thought.
If the rental income is RM300, and it takes approximately around 6 years to get full ROI
What if the vending company closes down in the mid way.. say 3rd year?
that’s a risk that you take. this is a business after all
Er.. extending from 3 years to 5 years, the CAGR or compounded returns pa is about 0.34%pa
VS
taking the buyback of RM22,000 on the end of 3rd year or beginning of 4th year, the CAGR or compounded returns pa is about 20%pa BUT how sure are we the company will be around to honor the contract and/or honor the contract “properly” is another Q. Just thinking ya, unsure.
BOTH are assuming maintenance & whatnot covered.
https://docs.google.com/spreadsheets/d/15rFfxb9pqrPOvRwOIf_wR6Gy1RongNXE6sgYnhS6QZ8/edit?usp=sharing
Have U reached the 5th year or sold back yet?
Hi MK,
Thanks for the commentary 🙂 I have not reached 5th year or sold back yet
Assalamualaikum Suraya
Really appreciate your experience. I m interested in this business too… Just one question, if we want to install the vending machine somewhere, we just have to ask the owner of the building / place for example, right? Is there any specific law for this business? TQ a lot…
Hi Zura,
As I understand it, you just need permission from the owner of the property. Others with experience can chip in
Hi Suraya, it is a nice writing and thanks for sharing this. I’m interested to do something for a side income but I m totally no idea of the paper work, I got the idea of buy the machine on my own and setup location on my own, but maybe you could share some input or advice ?
Hi Hafizah,
Refer to section #7 – is vending machine business is worth doing (both DIY or through company)
Finding good locations to put the vending machine is always the hard part
Please DM details. Thank you.