(Topic ID: 253741)

Getting started on location

By opalevening

4 years ago


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    #1 4 years ago

    Hey all, I have a couple questions about placing a machine on location.

    There is a bar near me that could really benefit from having a machine or two and am wondering (assuming I’ve already talked to them and agreed to terms of revenue share and whatnot) what the best way to go about this would be?

    How much do you generally share? Do you need to rent the space? Do you need an amusement/gaming permit? Are contracts involved? Maintenance? Is it good to set up an LLC? Etc.

    Mostly looking to cover all bases if I want to make this a reality in case I decide to purchase a few machines for this purpose.

    Thanks!

    #2 4 years ago

    I know a guy that told me he got 50% of money dropped in his machines, Said it wasn't worth it.

    #3 4 years ago

    Try talking to any local operators! They usually don’t part with their knowledge but it’s a good start

    #4 4 years ago

    There's a lot of good discussions in the operating/routing sub-forum. I'd suggest going through some of the threads in there.

    Quoted from opalevening:

    How much do you generally share?

    From what I understand, it's hard to do a 50/50 split these days. Some folks have said 60/40 in favor of the operator.

    Quoted from opalevening:

    Do you need to rent the space?

    For the most part, no. Small rooms like the ones you find in walmart or theaters *might* have some rent involved.

    Quoted from opalevening:

    Do you need an amusement/gaming permit?

    You need to get a county tax permit for each machine. It's usually a yearly fee. Some counties it's reasonable, but others still have their laws on the books from when coin-op was hot, and it can be quite expensive.

    Quoted from opalevening:

    Are contracts involved?

    Sometimes. It's probably best to have at least a 1 page agreement written up stating who is responsible for what, and what the split is.

    Always the operator. You don't want unknowledgeable staff messing with your game, and staff don't typically have time to mess with it anyway. A lot of times when there's a problem, they'll just turn the game off, sometimes without notifying you, so you will have to check on the game constantly.

    Quoted from opalevening:

    Is it good to set up an LLC?

    YES. And get insurance. DO NOT take the owner's word that you will be included under the insurance for the establishment. If the situation arises that you actually need to make a claim, you'll find that you won't actually be covered.

    Operating costs for routing can get expensive, which is why most people don't bother with it for just one or two games. You really need a larger fleet to make it worthwhile.

    Costs:
    Maintenance
    LLC setup; possibly hiring a lawyer to help; public notice costs; registered agent costs (if you don't want to use your home address), additional permits/licenses depending on your state/county.
    Insurance
    Income tax on earnings
    County game tax permit; there might also be additional permits and licenses needed, depending on your state/county.
    Earnings split
    Possibly hiring a CPA to help with tax accounting

    #5 4 years ago

    If you're trying to make money I wouldn't bother. If there was money to be made another established operator would already be there.

    #6 4 years ago
    Quoted from Deez:

    If you're trying to make money I wouldn't bother. If there was money to be made another established operator would already be there.

    I hate to sound like a downer, but I totally agree here. Unless you are very confident in the foot traffic at the bar and the amount of plays you would get...you may not find it worthwhile.

    Through a buddy of mine, I got talked in to placing a few machines in a local bar. I didn't scout it out ahead of time, so shame on me. For the past few months I'm averaging about $25 a machine after a 50/50 split. Definitely not worth the wear and tear in my opinion. A few weeks ago I was there on a weekend, and the outside was packed with kids and parents. Thinking I was going to have a good weekend, I checked inside and no one was playing! I can't figure it out. Just not a good spot for the demographics I guess.

    I told the owner I would be pulling the machines. He asked if he could buy them from me, and would I be available for maintenance and repair. I'll probably sell two of them. In my opinion, I'll be in much better shape just doing that maintenance.

    I've seen other threads where machines are killing it, so I know it's possible. Just need to make sure you have a location that works!

    #7 4 years ago

    Like others indicated above. Don’t do this thinking you will make money. If you do everything right, including your own service and don’t pay yourself for your time you could break even over time, probably several years or more to get back to even.

    If you look at 2 newer pins you can have $10k initial investment, depending on the location you could bring home anywhere between $50 and $500 per month gross. Thinking you will bring home more just won’t happen. Probably need to talk with the location on split, should be more favorable to you than the 50/50, that was back 20 years ago when pins were a lot cheaper. Can’t go 50/50 today.

    Make sure you have bill validator and keep up with maintenance.

    #8 4 years ago

    I can help! I have 3 machines at a my buddy's small neighborhood dive bar. Its only open at night and 21+.

    They have been there for about a year. We split everything 50/50. I only charge 50 cents and each machine makes about $150 per month. So roughly about $200 in my pocket each month. I haven't had any major issues. Only stuck balls and loose screws and 1 switch that broke and was an easy fix. I really enjoy having a few beers and counting quarters once a month.

    I'm not making much money at all but I also don't have room in my house for the machines so if they weren't at his bar they would be in storage. It's nice to have somewhere to go play them when I want to. Let me know if you have any other questions. My games on location are MMR, MBR and Metallica.

    #9 4 years ago
    Quoted from athens95:

    Can’t go 50/50 today.

    The one saving grace is the resale value, even on a route pin. If I tried to sell anything else for even 50% of what I bought (pool table, dart board, etc..) it for it'd be sitting on the market for years. I bought some new pool tables for 4500 a piece,(2 years later) I couldn't even let one go for 1500... after 2 months I finally decided to keep it.

    #10 4 years ago

    I should clarify. If you're going to do it, it better be for the love of sharing pinball with the public because you most likely won't make a profit. Buy a claw machine instead.

    #11 4 years ago
    Quoted from Deez:

    I should clarify. If you're going to do it, it better be for the love of sharing pinball with the public because you most likely won't make a profit. Buy a claw machine instead.

    100% this, I'm considering a claw machine to go next to my 3 pins lol.

    #12 4 years ago
    Quoted from Deez:

    I should clarify. If you're going to do it, it better be for the love of sharing pinball with the public because you most likely won't make a profit. Buy a claw machine instead.

    I was shocked to hear how much claw machines can earn. It's crazy.

    #13 4 years ago

    Considering your avatar is George Costanza from Seinfeld I would suggest just staying on the couch.

    #14 4 years ago
    Quoted from Pinballmike217:

    Considering your avatar is George Costanza from Seinfeld I would suggest just staying on the couch.

    Well read! Bwahahahaha!

    #15 4 years ago

    Thanks for all the thoughtful replies! Definitely have some things to consider but if I do decide to go down this route it wouldn’t be for the earning potential, it’s mainly be because I love pinball and selfishly want a machine or two in the bar that I hang out at.

    #16 4 years ago
    Quoted from opalevening:

    Thanks for all the thoughtful replies! Definitely have some things to consider but if I do decide to go down this route it wouldn’t be for the earning potential, it’s mainly be because I love pinball and selfishly want a machine or two in the bar that I hang out at.

    Then go for it!!

    #17 4 years ago

    I won't put anything out for less than 75% coming my way. It's not about the money because there isn't much to be made. But, there's no point in giving more away than needed.

    #18 4 years ago

    I would be terrible at it. Just the thought of my 4 legged buddy, all alone, gettin beat to hell would drive me nuts.

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