Startup Finds A Promising Future in San Antonio

Dave Stevenson never imagined he would be running his own business when he moved to the U.S. from Canada 11 years ago to live with his sister. He didn't have a lot of formal education and was only hoping to find a job that would allow him to pay his bills and help out his sister, a newly-divorced mother.

Today, as the operator of Mission City Vending in San Antonio, Texas, the 34-year-old Stevenson is not only a business owner, but a homeowner and the father of three. In the last 11 years, he has undergone a crash course in vending and is well on his way to meeting his financial goals.

Stevenson still has a lot to learn about the business, working out of his home and 800 square feet of space he rents in an industrial warehouse. But his willingness to learn and not be afraid to make mistakes have served him well to date.

Stevenson presently services about 75 machines; just enough to require some additional help and better operational support. He recently acquired his first liftgate vehicle and is looking at an automated coin counter and industry specific management software.

Stevenson's experience demonstrates that vending still offers a viable opportunity for someone willing to work hard.

He came to the U.S. with limited finances, but strong work ethic. Shortly after his arrival in the U.S., his brother-in-law offered him a job as a vending service technician in San Antonio, Texas. His brother-in-in law was a partner in a vending locator service that also placed vending machines. The company bought machines sold by Perfect Break Systems, which is affiliated with The Wittern Group, the Des Moines, Iowa equipment manufacturer.

Stevenson did have one thing going for him; he is mechanical by nature. After joining his brother-in-law's company, he further honed his equipment repair skills by attending a three-day training seminar at the equipment manufacturer's headquarters in Des Moines, Iowa.

Beginning as a service tech

The company installed vending machines and repaired them on behalf of its operator customers. "I'd go around fixing machines sold by Sam's Club to customers," he said. "I really like working on machines. I don't think I was born for paper work. I like the physical work."

In two years, however, the company dissolved because of some disputes among the owners. Stevenson was able to utilize his relationships with operators to earn a living moving and repairing vending equipment.

Within a few months, one of the vending operators he worked with offered him the chance to buy a stake in his company in exchange for "sweat equity." The operator had 20 locations.

Stevenson and his new partner spent their days knocking on doors and servicing machines. They moved equipment themselves using a truck, a ramp and a dolly.

They continued to use Perfect Break Systems' locator service to find new accounts. They placed and serviced snack, soda, coffee and food machines. "He and I had unbelievable work ethics," Stevenson recalled. "We did janitorial work on the side to make ends meet."

The partners sought locations that could generate a minimum of $600 per month in sales. The locator was oftentimes able to get them locations by offering a food and/or hot beverage machine in addition to snacks and soda. "They had a really good sales staff," he said.

Early challenge: matching equipment to locations

In some situations, the location could not justify this additional equipment. But the location usually agreed to let them "right size" the equipment if they were satisfied with the service they were getting. Stevenson said they were able to keep most of their accounts by providing better service than the competition.

The Sept. 11, 2001 terror attacks brought a difficult period for the company. Many customers stopped buying product for a couple of months. In addition, there were several instances in which people called the police about their truck since it did not have any type of commercial identification. (The partners chose not to identify the truck in order to minimize vehicle break-ins.) "It was paranoia," Stevenson said.