Draft your contract

1What goes in it

Five things, and not much else.

Who supplies, installs, stocks, and services the machine. What the building provides — space, power, and access. What the building receives, whether that is commission or simply the amenity. How long the agreement runs. And how either side ends it. A first agreement that covers those five clearly is a better agreement than a long one nobody at the property will read.

• Your obligations: supply, install, stock, service, and repair
• Theirs: floor space, power, and reliable access during agreed hours
• What they get: a commission percentage, or the amenity at no cost
• Term length, renewal, and how either party terminates

2Commission

Lead with the amenity and you may not owe a percentage at all.

Property owners sometimes take 5% to 25% of gross. Many amenity placements ask for nothing, because the building is getting a service its people wanted and it costs them nothing to provide. That range is wide enough to be the difference between a profitable location and a busy one, so it is worth negotiating properly rather than conceding early to close faster.

• Commission commonly runs 5% to 25% of gross where it applies at all
• Many amenity placements carry no commission — ask before you offer
• Quote commission on gross and say so explicitly, so there's no dispute later
• A high commission on a great location can still beat a free slow one — run the numbers

Of gross, where commission applies

5–25%Of gross, where commission applies

Amenity placements that ask for nothing

ManyAmenity placements that ask for nothing

3The term

The clause you will wish you had is the one that lets you leave.

Some locations are duds and no amount of product tuning fixes them. An operator locked into a year on a machine grossing under $100 a month is paying for that mistake every month until the term runs out, and cannot put the machine somewhere it would earn. Keep first terms short, or write in a performance clause that lets you relocate below an agreed threshold.

• Keep first-location terms short until the location has proven itself
• Consider a performance clause tied to an agreed monthly minimum
• Make sure you can remove the machine without penalty at term end
• Get it in writing that the machine remains your property throughout