Biz opp magazines — the right way

You may have run across business opportunity (“biz opp”) magazines in your travels. These magazines have a lot of advertisements for turn-key businesses like vending routes, personalized mugs, windshield repair, etc., and a few articles here and there ranging in quality from generic to okay. But it's mostly advertisements for buying startup kits for businesses, and if you read the magazine from month to month you start to memorize some of the ads.

I remember reading a post somewhere (sorry I can't remember where!) saying that vending routes are basically scams. Vending routes can, and do, make money, and quite a bit of it. They're not scams. But companies that advertise these routes in biz opp magazines will want to sell you packages of vending machines “starting at $9,999” or whatever. This is a few dozen brand-new machines at retail price, plus shipping, which can be another few hundred if they do freight. They may also “help you place” the machines by giving you a list of local businesses. This has marginal value.

So it's not the business itself that's a rip-off, but it's the fact that these companies are encouraging you to make a sizable equipment investment with them up front. I don't care how good a salesperson you are — several dozen machines take a long time to place, and they don't make any money for you until you place them, and they take up a lot of space in storage until they're placed.

Here's how to use these magazines effectively if you're looking to start a side business:

• Read the articles, and get what you can out of them. Some of them are okay.
• Look at the ads, but only for ideas. Let's take the vending machine route again. You see ads for this, hadn't given it much thought but might want to try it. Great — you got the idea for a vending route. Just resist the the temptation to get started to the tune of $9,999!
• Hedge your bets. Seek out a business owner who might want a machine. Approach the owner about bringing in your own machine and servicing it for them.
• If you get “yes,” buy what you need used, and in quantities you can manage. Go to eBay and get one vending machine ($100-$150) to place in that business. Buy it used — the seller is probably someone who bought 40 machines for $9,999 and could only place seven of them, and is selling off the other 33!
• Also remember to get any permits and licenses you might need for this business you're starting up.
• Build as you need and buy as you need.
  

(Note: You just read post #400!)