ATMs as a B2B Startup

In this tight economy, many small brick and mortar businesses find it difficult to justify the fees involved in accepting credit card transactions. This presents an opportunity to the savvy operator who can show the operator how to make money on each transaction rather than paying a fee. Often merchants will be unfamiliar with the idea of an ATM as a profit center, having regarded such devices as customer conveniences. By pointing out that merchants make money on each use of the cash machines on their premises, a good salesperson can turn independent convenience stores, restaurants and other small businesses into highly motivated prospects, needing only a little push to get the contract signed.

How turnkey ATMS work

For a small business, the simplest way to access this particular profit stream is a turnkey solution. This means the business operator need do nothing but sign the contract and clear a space on the sales floor for the machine. ATM processing companies retain ownership of their machines. They pay the merchant a reasonable percentage of the take, and retain the rest.


Requirements of a turnkey operation

This particular business has a relatively high barrier to entry, since the cost of the machines is not trivial and skilled labor is required to maintain them. Insurance costs will vary, but they will not be inconsequential. If employees of ATM processing companies load the machines with cash, they will have to be bonded, or else armored car companies will have to be hired to do it. The transactions also have to be processed, and that service is not free. In addition, the turnkey operator has to have the cash to load the machines with, and if a large number of locations is involved, that can add up.

The income stream

So why are ATM processing companies a business that an investor might consider? The profits are substantial. Every time someone sticks a card into the machine, the operator gets from $1.50 to $3.00 from the account accessed. In neighborhoods where the use of prepaid cards or directly deposited wages is common, a steady stream of customers will use a cash machine all day, every day. Those access fees add up, and after the merchant’s share is deducted and other expenses paid, the balance goes right into the profit column.

This is not a business for everyone, but an entrepreneur with a preference for the B2B sector, a bit of financial knowledge and a little capital could do worse than work up a business plan involving buying a number of machines and an assortment of spare parts from a supplier like, sourcing the required services and doing some market research in suitable communities. For the right investor in the right circumstances, ATM processing companies are among the best small businesses available.