[Up in Smoke]

Looking for information on starting up a RYO Fillingstation store, can someone who has opened a store let what the costs they have encountered?

I was talking to a distributor about what percentage they wanted and I was shocked.....

I know the machines are $32,000 but what other fee's do the distributors charge? What percentage does RYO get?

[Snoopdog]

Friend,

I do Business Consulting for a living. A serious and wealthy Client asked me to look into this for him. I have Private Investigation assets that I use in large Merger/Acquisitions. What I determined is that the current models of the folks engaged in manufacture of RYO machines are simply in this for a quick buck. That is the "Simple"....now for some drill down on their Game.

First understand that my focus was for the Florida Market, but almost identical information can be used for ANY State.

You have probably identified the current "Players" in the equipment to use to be RYO Filling Station, Quick Draw, and if you dug a little further you found Freedom Filler, and the little $400 prox box on the West Coast.

First understand that RYO Filling Station and Quick Draw have same ownership and same legal council. They are for practical purposes the same folks. The Flagship product is indeed the $32K machine, that requires payment of Royalties of $3.50 Prox on every carton. Their latest venture is the Quick Draw at $7k (Or whatever the market will bear) to produce one cig at a time, Commercial Grade with similar $3 per Carton Royalty

The third entry into the frey is Freedom Filler which makes cartons at a time and is $12k with minimum 2 per location and $10K for the market (A Zip code prox), and same $3 per carton Royalty. Freedom Filler has had numerous false starts and are "Once Again" stating they can 'Now" deliver.

Before you enter this, understand to be successful you will have to mislead the retail customer, and/or Sell Each Customer on the Truth which is:

By rolling their own with PIPE TOBACCO rather than cigar or cigarette tobacco they can have "Cigarettes" for about half of the price of premium brand cigarettes. The Core to the Game is that rolling own avoids State and Federal Tax Manufacturing Taxes, AND using Pipe Tobacco rather than Cigarette Tobacco is far cheaper tobacco.

There "May" be room for a quick buck in this opportunity, but it will Close and is Closing VERY FAST. All three companies suggest you will be able to get in the $25 to $30 Retail Price per Carton, using this retail price for comparison to Premium Brand (eg Marlboro, Newport) at $60 per carton prox.

95% of the Retail Market are PRICE SHOPPERS.....the business is based upon lowering PRICE.....the other crap is just so much gibberish regarding better tobacco.....

While the Regs will ultimately close the tax loopholes....and that may take a year or two more...the real problem is the Business Plans of the Equipment Manufactureres themselves.....Not to mention questionable ethics regarding the hiding of co ownership of RYO and Quick Draw....it is even more shady.

I live in Florida. The major PRICE player for Cigs down here is Dosal Manufacturing out of Miami. They sell Cheap actual Cigarettes called 305's that are about $45 per Carton...already legal, already packed in 20 Unit Packs and/or Cartons. The RYO's made a dent in their business, so they reacted and WILL END THE GAME OF RYO MANUFACTURERS in Florida.

They are now selling a pack of 20 cigarette sized "cigars" for .99 per pack and $8.99 oer carton. What they are is nothing but same Pipe tobacco used in RYO machines (three flavors Lite, Full, and Menthol), in 100's. Soon to be just plain Kings. They are tearing up market with a carton of cigs for under $10 per Carton. This spells the doom of RYO in Florida.

The other problem that WILL be addressed soon has to do with RYO advertsing a Carton of "Cigarettes" for the price. They are Pipe Tobacco not Cigarette Tobacco...thus a question of "False and Misleading Marketing and Advertising" is just a matter of time. But the real problem is that the idiot who spend the bucks expecting a $25+ Retail price for the RYO is in for a rude awakening. Only a MORON price shopper will roll his own, when he can get same exact product for $10 per carton.....

Game Set Match....Hope this assists you.