Starting a home coin pick-up service. Best or worst idea of all time?

[jamesandsons]

I have to talk through this idea so someone can explain to me why it is a terrible idea.

Coinstar somehow makes money off of people willing to sell their change for 90 or 92 cents on the dollar or whatever their fee is. I'm assuming these people don't have bank accounts, or don't know that they can bring their change jars to the bank, or they are otherwise financially illiterate enough to pay a significant fee to get paper money for their change.

So obviously people like that are out there.

So the business model: buy a high-capacity (but still portable) change sorter, advertise on craigslist or on small-town grocery store bulletin boards, schedule appointments, go to people's homes, count their change, and buy it (for a small service charge).

Pros:

• Cuts the middle-man (banks) out of CRH
• Instant profit via fee percentage (although probably very modest, hopefully enough to cover expenses)
• Experience a unique slice of folksy American culture as you travel the countryside visiting people in their homes. Who knows what else you might run across? It'll be just like American Pickers!

Cons:

• Driving around in the middle of nowhere with large amounts of cash, meeting strangers. What could possibly go wrong?
• No one trusts this weird new service or wants to use it; you bought a $1000 coin machine that now serves no purpose.
• Where do you go for repair service on big honking coin sorting machines when they break down?
• Experience a horrifying slice of American culture as you travel the countryside visiting people in their homes. Who knows what else you might run across? It'll be just like Hoarders!

All kidding aside though - is there enough upside to this idea, once some of the kinks are worked out, to make it worth giving it a try? Or is it just an absolutely horrible idea, and that's why no one is doing it already?

You'd have to figure out the math and find a fee schedule that was enough to cover costs but low enough for people to feel okay paying it. And the "carrying lots of cash" part is rather concerning. Although presumably you'd be meeting people at their homes, and know their names before-hand. Seems less likely they'd rob you that way... but someone could easily ambush you after the fact, once they knew what you were driving.

I have lots more pros-and-cons bouncing around in my head, but the whole point of this post was to see what other people's thoughts were. So... proceed. This ought to be entertaining.

 

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[jeff of pa]

I thought about this too so obviously it's a Great idea

But you will most likely need to be Bonded. (to generate confidence & trust).

as for Whether or not your machine would need to be Inspected for accuracy ?

allot depends on who sees your ad & as per your Con:

No one trusts this weird new service or wants to use it; you bought a $1000 coin machine that now serves no purpose.

as for why people use Coinstar in stores, they are desperate for food, gas or smokes,
and it's closer then the Bank With less hassle at the moment.

 

[Gold Maven]

I love to see a unique business idea like this.

I say it has potential, go for it.

The thousand dollar machine will still have value if you fail, and can be sold.

Just imagine the silver possibilities.

I wouldn't quit my day job, but try it on week ends, days off and see what happens. Good Luck.

 

[jeff of pa]

as for Charging for service, I'd say no more then 5%
since you want to inspire confidence.

Plus as G.M. noted the silver possibilities could pay for it

 

[vpnavy]

Wow, just for the fun of it I checked EBay and Amazon for big coin sorters - and they have them!

 

[BuffaloBoy]

I wouldn't do it, seems a bit risky on both parts...

 

[agme]

I thought about this a few months ago also. Just one thought (at least in my case) I would have to have a different vehicle, pulling up to cash out someone's coin in my work truck (2 seater, not much room for the counter and coin) or my family station wagon, might not be the best idea. A white van with a name on the sides, non-coin related, like D & H Services or something would look a lot more professional but would increate start-up cost a ton, unless you already have one. Have business cards made up with the same name and colors, say red on white, and if someone calls from an ad, always tell them your business name and what kind of vehicle you will arrive in. Just some thoughts.
agme

 

[jeff of pa]

I thought about this a few months ago also. Just one thought (at least in my case) I would have to have a different vehicle, pulling up to cash out someone's coin in my work truck (2 seater, not much room for the counter and coin) or my family station wagon, might not be the best idea. A white van with a name on the sides, non-coin related, like D & H Services or something would look a lot more professional but would increate start-up cost a ton, unless you already have one. Have business cards made up with the same name and colors, say red on white, and if someone calls from an ad, always tell them your business name and what kind of vehicle you will arrive in. Just some thoughts.
agme

a second person at the Vehicle at all times may be called for in certain neighborhoods also,
since you could be handling large amounts of cash at several stops through out the day on occasion.

 

[RamsesII]

Biggest issue would be minimizing cost while ensuring regular customers. I've got it! A combination ice cream truck / mobile coin counting service. Blast ice cream jingle in neighborhoods, kiddies come running out, "sorry kids I only accept coins - go get your parents' coin jars (and Dad's coin collection)" (jk). But seriously, screaming kids can get their patents to do anything. And if you're nice, the parents might just say yeah, I've got coins I've been meaning to take in.

You'd also want to buy a used/retired armored truck if available and install a bank drawer so you would never have to leave the truck.

Lets run with this.

 

[agme]

Biggest issue would be minimizing cost while ensuring regular customers. I've got it! A combination ice cream truck / mobile coin counting service. Blast ice cream jingle in neighborhoods, kiddies come running out, "sorry kids I only accept coins - go get your parents' coin jars (and Dad's coin collection)" (jk). But seriously, screaming kids can get their patents to do anything. And if you're nice, the parents might just say yeah, I've got coins I've been meaning to take in.

You'd also want to buy a used/retired armored truck if available and install a bank drawer so you would never have to leave the truck.

Lets run with this.

That's an idea. But the food service licensing people might frown on a truck serving ice cream and handling large amounts of filthy coin at the same time. lol

 

[jamesandsons]

I love that this has generated so much discussion. And that others have had the similar idea. I'll post some detailed responses later, but keep the feedback coming!

 

[hokiemojo]

I hate to be the one to rain on someone's parade, but I'm quite certain that if your machinery isn't inspected/calibrate regularly, you are going to be shut down pretty quickly. Maybe you would fly under the radar for a little while, but it wouldn't be too long. I don't know if there would be fines to go with it as well.

 

[agme]

I love that this has generated so much discussion. And that others have had the similar idea. I'll post some detailed responses later, but keep the feedback coming!

I think I'm going to do it! Test the waters that is. On a shoe string with about $400 I can see if the demand is there (in this area anyway).#1 Simple as buying a C200 Cassida Coin sorter to start with ($200 shipped), runs on battery, has a carry handle and you don't have to separate denominations like with many more expensive counters. I might have to modify it to dump into coin-lok bags. #2 clean up the work truck and get some magnetic signs made, maybe $100, and I can put them on before I arrive and take them off after I leave or head home. #3 Advertise, run a few ads in the local papers, on C-list and have some business cards made up. That covers the basics. If it works out, upgrade, if not, I can use the counter/sorter myself and it and the rest will all be a tax deduction anyway. Just one good score could pay for everything. If I missed something, let me know.[h=1][/h]

 

[Digger2]

With the price of fuel as high as it is, it wouldn't work where I live. Sounds like a good Idea!

Good Luck in your venture!

Roy

 

[50cent]

Great idea IF you can secure a contract cheaply enough dawg

 

[agme]

I think I'm going to do it! Test the waters that is. On a shoe string with about $400 I can see if the demand is there (in this area anyway).#1 Simple as buying a C200 Cassida Coin sorter to start with ($200 shipped), runs on battery, has a carry handle and you don't have to separate denominations like with many more expensive counters. I might have to modify it to dump into coin-lok bags. #2 clean up the work truck and get some magnetic signs made, maybe $100, and I can put them on before I arrive and take them off after I leave or head home. #3 Advertise, run a few ads in the local papers, on C-list and have some business cards made up. That covers the basics. If it works out, upgrade, if not, I can use the counter/sorter myself and it and the rest will all be a tax deduction anyway. Just one good score could pay for everything. If I missed something, let me know.

I forgot #4 Apply for a concealed weapons permit. Haven't had one in years but been wanting one, this would be a good reason to have one and be packing and know how to use it.

 

[maipenrai]

I doubt if it would work. First of all, who wants strangers coming to their home, to collect a few dollars worth of coins. Then the question of how accurate is the coin counter, (in their opinion). I would be thinking that you are just casing the house, for a later visit. Getting bonded, some kind of license from the county or city, expenses driving your Truck around, all adds up.

I would rather spend a bit more, taking the coins to coin star, than letting someone into my home.

 

[maipenrai]

Oh yeah, exactly what I would want, someone caring a gun into my house! Of course you would have it concealed where not EVERYONE would see it! Maybe you could also buy a used armored car. Even with just coins, someone would like to take them.

 

[DizzyDigger]

I too think it's a cool idea, but unfortunately the financial math
doesn't work out.

At 5% profit, for every $100 in coin you process you get a whopping
$5.00, and if $5.00 isn't enough gas to get you to the next customer,
you just lost money. More importantly, how can you amortize the costs
of the machine, vehicle, insurance, etc. into that 5% when you are
barely making gas costs?

Quick math says you'll need to process (at min.) $5000 in coin each
day in order to have the potential for profit. Think you can do that?

Hate to be the Devil's Advocate, but always better to know upfront what
the challenges are.

Still, it's a cool idea..making it work....well, that might be a bigger challenge.

 

[agme]

I doubt if it would work. First of all, who wants strangers coming to their home, to collect a few dollars worth of coins. Then the question of how accurate is the coin counter, (in their opinion). I would be thinking that you are just casing the house, for a later visit. Getting bonded, some kind of license from the county or city, expenses driving your Truck around, all adds up.

I would rather spend a bit more, taking the coins to coin star, than letting someone into my home.

I see what you are saying and yeah being bonded might be a good idea. They do let the plumber, the electrician, the heat/AC guy, the cable guy etc... into there house. I know, dealing with money would be different. But nothing ventured, nothing gained.