Vending IQ: License Issues

Setting up a vending business involves more than just buying a vending machine and installing it in a good location. Even though it is essential to buy a reliable, good quality machine from reputable vending machine providers like Planet Antares, there are other important elements for the success of your business.

Most of the time, people ignore the legal aspects of this business which may create problems for their business later. There is not much awareness about such issues but it is important for you to be familiar with every factor involved in the vending business before you actually start one.
You must know the license and permit requirements of your state or region. If your business is spread across different states, these provisions may differ accordingly.

Licenses are available at different levels such as:

Town
If you are operating in your local area, you will need a local business license. Moreover, every machine in different towns may be charged an annual fee. This is a legal provision for the food and service industry.

This may be quite expensive for you and it is better to take this expense into consideration before starting the business rather than paying for unforeseen and avoidable expenses later on. For small businesses, it is very difficult to pay charges on every machine and so, they should cover a small area initially.

State
As a state resident, you may have to pay sales tax on a portion or the entire vending income earned by you. Moreover, you will have to pay:
1. fees for locating your machine with an entity in the form of corporate tax
2. Income tax on revenue generated (if levied by your state)

These charges, especially the income tax may vary from state to state and with time also.

Federal
At this level, you won’t have to pay anything to the government in form of taxes. You just need to disclose your vending income. If you open a savvy account, you can even save your profits by showing losses or setting them off against taxable income.

After taking these factors into consideration, you can select the vending locations for your vending machines. You also have the option of hiring a vending locator or taking the location services provided by good vending machine suppliers like Planet Antares Inc. ask them about the various licensing fees in different regions before deciding to install your machines.

Remember that a little more prudence will help you save a lot of money and effort later on.