What You Need Before Placing a Machine

Vending is one of the simpler retail businesses to start — but it is still a business.

Before placing your first machine, you should understand the basic legal and compliance requirements.

Requirements vary by state, county, and product type, but this guide covers the most common U.S. standards.

1. Business Entity (LLC or Sole Proprietor)

You are not required to form an LLC to operate a vending machine.

However, many operators choose to form an LLC for:

• Liability protection
• Tax organization
• Professional credibility

Typical LLC Cost

$50 – $300 depending on state

A sole proprietorship is simpler but does not separate personal and business liability.

2. Sales Tax Registration

If you sell taxable goods (which most vending products are), you will need:

• A Sales Tax Permit
• A way to collect and remit sales tax to your state

Most states require vendors to register before operating.

Registration is usually free or low-cost.

Sales tax rules vary by state.

Some states include tax in the vending price.

Others require it to be calculated separately.

Always verify your state’s vending-specific rules.

3. Local Vending Permits

Many cities and counties require:

• A vending machine license
• A local business tax receipt
• An annual machine registration sticker

Typical cost:

$50 – $250 per year per machine (location dependent)

Some areas do not require machine-level permits.

Others require annual renewals.

Check your city and county website before deployment.

4. Health Department Requirements (Food & Fresh Items)

If you sell:

• Fresh food
• Refrigerated meals
• Prepared food items

You may need:

• Health department approval
• Food handling certification
• Temperature compliance documentation

For standard sealed snacks and beverages, requirements are usually minimal.

Fresh food vending requires more oversight.

5. Tobacco, Vape & Age-Restricted Products

If you plan to sell:

• Tobacco products
• Nicotine pouches
• Vape products
• Alcohol

You must:

• Obtain proper licensing
• Use age verification systems
• Comply with federal, state, and local regulations

These categories have strict compliance rules.

Not all locations or states permit them.

Always verify before investing in these product categories.

6. Insurance

While not always required, insurance is strongly recommended.

Typical coverage:

• General liability insurance
• Product liability coverage

Annual cost:

$300 – $800 depending on coverage

Many commercial locations require proof of insurance before approving placement.

7. Revenue Share Agreements

If you agree to share revenue with a location:

• Get it in writing
• Clarify percentage
• Define payment schedule
• Define maintenance responsibilities

A simple written agreement protects both parties.

8. ADA & Accessibility Considerations

Machines should:

• Be placed in accessible areas
• Not block emergency exits
• Comply with reasonable accessibility guidelines

While most vending machines are compliant by design, placement matters.

9. Zoning Considerations

Outdoor machines may require:

• Zoning approval
• Special permits
• Utility approval
• Weatherproof compliance

Indoor placements are usually simpler.

10. Record Keeping

You should track:

• Revenue
• Inventory costs
• Sales tax collected
• Location payments
• Maintenance logs

Good record keeping protects you during audits and improves your business decisions.

11. What New Operators Often Overlook

• Forgetting to register for sales tax
• Not verifying local permit requirements
• Installing without insurance
• Selling restricted products without licensing

Vending is simple — but only when operated correctly.

12. Final Reminder

Laws vary by:

• State
• County
• Product type

This guide is educational, not legal advice.

Always verify requirements in your operating area before placing a machine.