October 4, 2012 |

In House ATM

By Jeremy White

Recently, I had a conversation with a small business owner who had purchased an ATM to put in his store. Though he hadn’t had the machine long, his early results were glowing. “The thing’s a cash cow,” he quipped. “I’ve got four grand in it, but it won’t take me long to get all that back, and then some.”

A few days later I had lunch at a CiCi’s Pizza store in Indiana. Before I go any further, however, a short aside is necessary: Since my paycheck is directly deposited into my checking and savings accounts, I hardly ever have cash in my wallet. Instead, I use a debit card for virtually every purchase I make. As such, I had no cash on me when I entered the franchised CiCi’s location. “No biggie,” I told myself. “This place will take a debit card.”

Wrong. Wisely, debit and credit cards were not accepted at this location – but there was an ATM sitting on the front counter, right next to the cash register. When I asked the cashier about using a debit card, she politely pointed to the ATM and told me I’d have to use it and then pay for my order with cash.

Genius, I thought. I knew I was going to have to pay a nominal fee for the ATM service, and I knew that particular CiCi’s store was going to lay claim to all or part of that fee (depending on whether it owned or leased the ATM). I can’t recall off the top of my head the exact amount of the fee. I think it was $1.50 or $2. At any rate, it wasn’t enough to make most cashless customers turn around and walk out. At the same time – based on the large percentage of restaurant guests who now pay for their orders with credit and debit cards – I knew it was enough to make a noticeable difference on the bottom line of that CiCi’s location.

Perhaps the biggest benefit I see to purchasing or leasing an ATM is the fact that, like the CiCi’s store I recently visited, the machine enables operators to stop taking credit cards (and therefore eliminates the need to send a percentage of your sales to the credit company).

Of course, there are cons as well. Purchasing an ATM will cost thousands. If you decide to lease, you run the risk of getting stuck with a machine for an extended period of time, even if it doesn’t work out as anticipated. And though the footprint of ATMs have grown considerably smaller over the years, you still have to find room for them.

Still, despite these drawbacks, an ATM can be very beneficial in the right setting. As one operator put it to me not long ago, the machines could potentially become “cash cows.”