Passive Income with a Kiosk

Passive Income with a Kiosk

Many of us have aspirations of building up a passive income large enough to quit our jobs someday and retire like kings. The only problem is, I don’t think too many of us have a plan in place to make this a reality. If your plan is to work your day job until you’re 65, then you’ll most likely not even live like the King’s 3rd cousin. Budgeting will be a necessity and you’ll have to be very careful not to spend all of your money before you pass away.

This is obviously not what many of us dream about. “Boy, I wish that I could barely get by when I retire.” If you’re dreaming this dream, you may just want to stop reading now. This post is not for you.

If, however, you are looking to build streams of passive income, this might very well be the idea for you. Kiosks. That’s right, those kiosks in the mall. If you have the right product and a trustworthy employee, you could make some serious dough here.

Why Kiosks Are A Good Idea

If you’ve toyed around with the idea of opening a store, I would strongly encourage you to start out with a kiosk, and here are my reasons why:

  1. The contract terms are much less than if you would rent a regular store-front in the mall.
  2. You’ll see much more foot traffic in the middle of the mall
  3. It’s a cheaper start-up cost than a brick-and-mortar store
  4. It can be made passive quite easily

What Kind of Product Would You Sell?

Since many of the shoppers aren’t entering the mall to look at your kiosk, you’ll have to get their attention with something that they might purchase on the spur of the moment. In other words, you’ll need to sell something that costs $40 or less – with this low price, people are more willing to stop, look, and make that quick purchase. If your product is a high-end blender for $400, you will not have more than 10 lookers a day, and most likely will go without a sale.

This is why you often see chintzy jewelry and T-shirts – they are cheap, and people are willing to buy them without thinking twice.

Example Products

  • Ice cream
  • Snow cones
  • Clothing
  • Sunglasses
  • Jewelry
  • Stuffed Animals
  • Things for your Pet
  • Pictures

This list should help you get the ball rolling.

What Are The Costs of a Kiosk?

If you want to get started with a kiosk, you might be wondering what kind of costs are involved. Well, since your set-up will be smack-dab in the middle of the mall, there are some initial fees, as well as some fees based on your sales.

On average, you’ll have to dish out $1,500 before you even put your products out for sale, and then there’s a monthly fee of about $2,300 or 15% of your sales (the mall will collect the larger of the two amounts).

Then, if you’d like to create a passive income with your kiosk, you’ll need to find a dependable employee. Let’s say you’re paying them $10 a hour for 6 hours a day, 7 days a week.

Break Even

With these expenses, what should you shoot for in terms of sales? What will be your break-even point? If you can earn a 30% profit on each item, you’ll need to sell just over $20,000 of merchandise each month to start earning a profit.

  • Initial Expense: $1,500
  • Employee Expense: $1,800
  • Fees Based on Sales: 15% or $2,300 (take the higher of the two)

So, profits need to meet expenses, which totals to $5,600. If you can earn 30% on each product, then you’ll need to sell $18,666 to earn that profit of $5,600, which will allow you to break-even.

Once you break even though, your earnings could soar. What if you sell $50,000 worth of your product? After all expenses, you’ll have cleared $39,200 of pure profit!!

Making it Passive

Since this is such a small operation, all you need to do is find one trustworthy person to run your kiosk. Rather than pay them hourly, maybe it would be beneficial to pay them based on sales – it would be much more motivational for them to sell the product, instead of just sitting in the chair with their smart phone….

That’s it!

Have you ever thought about creating a passive income with a kiosk? What would you sell?

10 Responses to Passive Income with a Kiosk

  1. Jim Dasher says:

    You hit the proverbial “nail on the head” in the last paragraph.

    Make the employee take some “ownership”, so to speak, in your business. Although, the average person would be more comfortable with a base plus commission. With commission kicking in, once a certain amount of sales are realize, i.e.: enough sales to cover the employee’s base salary. Although, if one is lucky enough to find a motivated person to work strictly commission, great! In either case, regularly implemented, inventory controls are VERY important!

    Also, if the employee really works out, maybe a minority share of ownership in the business would be appropriate. This possibility should be brought up in the final interview with the potential employee. Nothing like a little incentive to kick things into high gear!!

    • Derek says:

      I always like the idea of having the employee take ownership. Even a punk kid understands a progressive income is dependant on sales. Sometimes, they can really surprise you too.

  2. Max says:

    I like the idea of the ice cream Kiosk. mmmmm Ice cream. LOL

    • Derek says:

      Lol! Yes sir ice cream! Sounds like you might eat all of your profits though! Maybe you want to sell….broccoli or something… ;)

  3. Jai Catalano says:

    Years ago I was going to open up a Kiosk in the Seaport. Life took over but I was going to have a souvenir themed kiosk. The problem with ice cream is I have too many temptations. :)

    • Derek says:

      I can see myself eating all of my ice cream profits away too! I can’t imagine having to scoop that out for everyone else, but not myself! It’d be more like, “One scoop for you, one for me, one scoop for you, and another for me….” LOL.

  4. Its good description for the kiosk and you shared it very well. The features you described are really helpful; this is clearly showing how much the kiosk is useful in different areas.

  5. Kioskwhat says:

    So silly… “What if you make $50,000? $39K of cleared profit” oh yeah?? WHAT IF YOU MAKE A MILLION? OR A ZILLION? Stop trying to get poor saps to start a kiosk and lose all their money. There’s a reason why you see a new set of kiosk owners every couple of months. They simply don’t work. Just like realestate investors think they can buy and sell houses and rent out rooms, turning a huge profit. You really think it hasn’t been tried more than you can possibly imagine? People are lazy, and this is the lazy way of thinking. You will not turn a meaningful profit running a kiosk, and if you do, you’ll be the only one running it, night and day, every single day of the year.

    • Yonice says:

      I agree, I started my first kiosk in October. The rent is $3,000 for the months of Jan-Oct and $6,000 for the months of Nov. and Dec. Plus taxes. Let’s just say that in October I did not even make enough money to pay for November’s rent. I work 73 hours a week. It is really not worth it.

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