6 Common Mistakes When Starting an ATM Business

Starting any business is challenging - but starting an ATM business presents a set of highly unique challenges.

Having been in your shoes before, we know what it’s like to make mistakes, and want to help you avoid them. 

Avoid these 6 common mistakes when launching your ATM business to grow quickly, operate efficiently, and profit exponentially: 

1 - Buying used ATM’s

When Dash ATM Services was founded we were on a shoestring budget, trying to bootstrap our business with no external investment. 

We were faced with a tough decision: buy one new ATM, or 2 used ATM’s? 

We chose buying used for obvious reasons - doing so allowed us to scale our business quicker as we were able to buy multiple used machines for the same price as a new ATM. Let me be very clear here - in many cases, buying used ATM’s is a GREAT decision. However, what we so often see (and did ourselves), is ATM owners underestimating the headaches that buying used will cause. Used machines with no warranty break down often and are more prone to setbacks such as bill jams. I would go so far as to argue you should expect this when buying used. If you aren’t going to pay now, you can expect to pay later when you are out in the field replacing keypads, dispensers, and card readers. 

Disregarding the (often very high) cost of replacing these parts, the time itself spent repairing machines and the lost profit while they are down is extremely inefficient. Additionally, a downed machine causes the location to lose trust and often become frustrated. 

While we understand buying used at Dash, we recommend upgrading to new machines as soon as you are able. 

2 - Underestimating the Power of Marketing

Many young ATM operators get locations the hard way: going door to door and cold calling locations nearby. 

Don’t get me wrong, this is a great strategy when starting out as it generates immediate results. In the short term, we recommend doing just this.

However, finding success in this business means planning ahead, and one great way to do that is to beef up marketing efforts. 

The Internet should be any ATM operator's best friend. 

We recommend all new operators invest the necessary time and resources into effective digital marketing. At Dash ATM Services, we were able to automate lead generation and grow without the “sweat equity” that traditional sales methods required. Crucial to our growth was making posts on Facebook Marketplace to generate leads. This is one of the easiest ways to get leads! A website is the logical next step, and we were able to source a location from our website form just 3 weeks after creating it! Needless to say - start beefing up your digital marketing efforts. 

Instead of chasing leads, let them come to you! 

3 - Not setting up a business bank account 

Believe it or not, setting up a business bank account was one of the most challenging barriers Dash ATM faced when launching. 

In 2013 the US Justice Department launched Operation Choke Point, which investigated banks “believed to be at a high risk for fraud and money laundering”. The FDIC created a list of high-risk activity merchants, and woe to all of us, ATM operators were included in this list. 

As a result, opening a business bank account as an ATM operator is VERY challenging. 

Setting up a relationship with a willing bank (or more likely a credit union) prior to launching your ATM business is crucial. Doing so will save you more serious troubles later. 

Pro tip: save time by asking other local ATM operators who they bank with. 

4 - Lack of commitment 

We get many messages from individuals interested in starting an ATM business. We get it. The allure is enticing. After all, who doesn’t want to earn residual income while they sleep? 

Unfortunately, the vast majority of individuals who inquire about starting an ATM business are what we refer to as “want-trepenerus”. They want the benefit of an ATM side hustle, but are less than willing to pay the upfront costs and significant amount of time it takes to launch. Let there be no mistake, starting a successful ATM business requires a high level of commitment and dedication to reap the rewards. 

While it isn’t easy, it is well worth it! 

5 - Employing yourself 

If you want to make truly passive income with ATM’s, it is important to not create a job for yourself. 

A good rule of thumb for this is to determine how much time you spend in the field with your ATM’s filling them with cash and repairing broken machines. In our opinion, the more time you spend outside of your office, the worse. 

The fastest way to grow an ATM business is to outsource all manual labor, and devote your time and efforts to sales and marketing. Doing so allows your business to rapidly scale. 

Your time is important, so use it in a way that is most effective! 

6 - Not having a mentor

Starting our ATM business would have been impossible without our mentor. 

This is a particularly tricky industry and navigating it requires a holistic ability to write contracts, close sales, understand the ATM technology, and forecast location earnings. The single most efficient way to shortcut these barriers is to find a well established mentor willing to teach you the ropes. 

While this likely won’t be free, it is common practice to receive mentorship from your processor who will not only provide advice, but also handle all the necessary paperwork to become compliant. In return, most processors receive the interchange fee and a small percentage of your surcharges.