Choosing ATM Equipment: Pros and Cons of an Outdoor ATM

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Should you operate an indoor or outdoor ATM? If you’re thinking about purchasing an ATM machine, one of the first things you have to determine is where you’re going to put the machine. 

You’ve probably seen and even used an ATM both indoors and outdoors. But what are the major differences when it comes to owning an ATM? We’ve got your answers.

Here we’ve outlined the major pros and cons of operating an outdoor ATM, but it essentially comes down to availability. What spaces are even options for you? Let’s start there.

Choosing a Location

Choosing a location, or a place to put your machine, is one of the very first things you have to do before you even order your machine. Our article Choosing an ATM Location goes in-depth on where to look for locations, the best ATM locations, and how to negotiate with location owners to develop a partnership.

It’s a great place to start when it comes to scouting for locations. If you already have a location picked out and you have the option to place an ATM machine either indoors or outdoors at that location, then skip on down to the pros and cons of an outdoor ATM.

If you have not settled on a location yet, here are some things you need to consider:

First, do you already own a business where you plan to use the ATM? Do you think you might lease a plot or property where you’ll install the ATM? Or do you think you’ll approach local business owners to gauge their need for an ATM machine and potentially start a partnership?

Whatever your answer is (or ends up being) might determine for you whether you need an indoor or outdoor ATM. Once you settle on a location, you might find that there isn’t room indoors for the ATM. Or the opposite might be true. The location might not be able to facilitate an outdoor ATM machine. 

If you end up working with a site location owner, his or her preference might affect the decision as well. Maybe there’s room indoors for the ATM but the location owner doesn’t want to give up that space. Or alternatively, maybe the site location owner would rather the ATM be inside to get customers into the store.

Next are some pros and cons of outdoor ATM machines.

Pros of Choosing an Outdoor ATM

There are some clear benefits of operating an outdoor ATM. First, you have the potential to earn more revenue. Second, you potentially have more flexible access to your machine. And third, they can be space savers.

Save Space

If you own a retail store or business, or if you are partnering with a site location owner and you want to add an ATM to the business, there’s a chance the space isn’t available inside the store. 

Maybe there’s too much inventory and to get rid of something will just cause you to break even with ATM revenue. Or maybe the only space available isn’t visible enough or convenient for customers.

If this is the case, you might want to consider putting an ATM outside of the store. It can be close to the front door, in view of the register or desk so that it can still be monitored during business hours even though it’s not inside. 

That way you don’t have to get rid of anything else inside of the store to make room. And you don’t have to worry about owning a machine that no one sees or uses. The more visible and easier to access the machine, the more users and therefore more revenue for you.

Earn More Revenue

There’s a good chance an outdoor ATM could warrant more users than an indoor ATM. It depends on your specific location, of course, but an indoor ATM might be seen more by people who are already customers while an outdoor ATM is available to all passers by.

Additionally, and this is the biggest benefit, you have the ability to offer 24-hour access to an outdoor ATM. An indoor ATM is really only “in business” during the hours of operation of the store or business where it’s housed. So you increase the opportunities for transactions and therefore earn more revenue that way.

Not only do users have 24-hour access to an outdoor ATM, but you do too.

More Flexibility

Unless the site location owner gives you a key or access to the store after hours, you really only have access to your machine while the store is open. If you have to refill cash or receipt paper or conduct any maintenance or cleaning on the machine, you have a window in which to do so. 

This might not be so convenient for you if you have a day job or other obligations which overlap with the store hours. If the ATM is outdoors, though, you can access the machine when it’s most convenient for you regardless of whether or not the store is open for business.

You could of course coordinate with the site location owner to perform certain routine tasks or maintenance in your absence. But it might just be more convenient to house the ATM outside if you have the option. 

Plus, the more responsibilities you put on the site location owner, the more revenue you have to spit. You’ll have to make that deal in your site location agreement (SLA). So it might be more cost effective for you to handle those responsibilities on an outdoor ATM rather than leave yourself at the mercy of the site location owner.

Although there are plenty of great reasons to operate an outdoor ATM when you have the option, there are unfortunately some risks as well.

Cons of Choosing an Outdoor ATM

An outdoor ATM is not always the best option. It’s perfectly fine to operate an outdoor ATM if that is your only option. But if you are deciding between indoor and outdoor you might want to consider some of the downfalls associated with operating an outdoor ATM.

First, they can be more expensive to set up and maintain. Second, you could lose out on revenue depending on where you’re located. Last, you have to compete with the weather.

Weather Constraints

On particularly hot or cold days, or days when it’s raining, snowing, or particularly windy, users will probably prefer to use an indoor ATM rather than an outdoor ATM. However, if you are the only ATM for blocks, you might retain those users by default. But if your neighbor has an indoor ATM, you might lose business to him or her on days when the weather isn’t great.

Loss of Revenue

Besides losing customers due to weather, you could also lose customers who prefer to use indoor ATMs for safety reasons. Indoor ATMs are less accessible to vandals which makes it less likely that a user’s information will be compromised on an indoor ATM. 

Indoor ATMs are also under the watchful eye of the store or business owner as well as other patrons. So this could encourage users to use an indoor ATM as well. But again, if you’re in a location where ATMs are scarce, you might still get a lot of business on an outdoor ATM regardless of these safety concerns.

But you still have to make sure customers feel safe using your outdoor ATM.

Additional Expenses

An outdoor ATM is available to users 24 hours 7 days a week. But it’s also available then to vandals and thieves. To prevent damage and tampering on your outdoor ATM, you’ll want to invest in a quality security system. You might also need to provide your own lighting if your ATM is located in a dim area.

You might even be required to provide certain security measures based on the safety and security laws of your state and municipality. 

Outdoor ATMs are also vulnerable to the weather. Exposure to the elements could cause you to get less life out of your ATM if it’s outside rather than inside. To extend the life of your machine, you should invest in a cover or awning for your outdoor ATM.

Most ATMs are weather protected which can help prevent unnecessary damage, but exposure can still affect the lifespan of your ATM. Weatherproof and weatherized ATMs are both made to withstand harsh weather conditions. 

A weather resistant ATM, however, is not going to be as resilient as a weatherproof ATM. So you’ll definitely need some sort of cover for a weather resistant ATM. And all outdoor ATMs should be temperature protected for the best results.

Other Outdoor ATM Options

If you’re still unsure whether to go with an indoor or outdoor ATM, you could look into a through-the-wall (TTW) ATM. Or, if you are considering purchasing an ATM for outdoor events, a mobile ATM could be the way to go.

Through-the-Wall (TTW) ATM Machines

Through-the-wall (TTW) ATM machines can be set up to have the chassis (front) facing outside while the interface (back) remains inside the building. TTW ATMs are heavier and bulkier than other ATMs because the interface has to be inserted into the wall extending into another room. 

You might see a TTW ATM in an office building or lobby where the front or screen faces out toward the customers and the interface extends into the next room that is locked and only accessible to authorized personnel. But to facilitate this, you have to have the hole cut in the wall for installation.

So this might not be the best option if you are considering an outdoor ATM due to space concerns. However, if you have indoor space but want the 24-hour access of an outdoor machine, consider a TTW ATM where customers can use the ATM outside but you can safely load cash from inside the store either during business hours or behind locked doors.

If that’s the case, a TTW ATM is more accessible to users while also offering better security.

Mobile ATM Machines

Mobile ATM machines are pretty much intended for outdoor use. They are great options for fairs, farmers markets, concerts, etc. Any major event where attendees have the option to purchase merchandise or make donations is the perfect place for an ATM.

Rather than carry an excess amount of cash on them, patrons can withdraw the exact amount they need for their purchases when it’s necessary and minimize the risk of extra cash being lost or stolen.

Since mobile ATMs are intended for temporary, pop-up, outdoor events, they are often equipped with overhead lights and security cameras since the location will vary. But of course your placement should be secure as well. You want the ATM in an area with a lot of foot traffic, not isolated. This is better for increasing transactions but also for security.

Make sure the location is well-lit, under watchful eye, and protected by a tent in the case of inclement weather. However, mobile ATMs are built to withstand the worst weather conditions. They are typically water-resistant and include advanced temperature control systems to heat them up or cool them down depending on the season.

When to Choose an Outdoor ATM

There are just as many pros as cons to choosing an outdoor ATM machine. So there’s a chance you might still be on the fence. In summary, then, remember these main points:

  • The safety concerns associated with outdoor ATMs need to be offset by adequate lighting, lots of foot traffic, and a first-rate security system.
  • Although outdoor ATMs can be more expensive to maintain, they typically receive more transactions—enough to justify the expense. Just calculate your investment and set your surcharge accordingly to reach your ROI as soon as possible.

If you can meet these requirements with an outdoor location, you have the opportunity to make more of a profit than you would with an indoor ATM. Weigh your options carefully and contact us if you have any questions!

Choosing an ATM Location: 9 Best Locations for ATM Machines

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Based on our experience in the ATM business, we’ve developed a list of the 9 best locations for ATM machines. The list is ordered from locations that see the most transactions monthly to the locations that see less but that are still lucrative.

Let’s look at some numbers:

An ATM placed at a slow location could make a minimum of $180 a month. It would require that at least two people use it every day for a $3 surcharge. On average, you should expect your ATM to process 150-180 transactions a month. That’s 5 or 6 a day.

The point is, it’s very easy to run a successful ATM business. You just need to choose the right location. We can help.

The Importance of Choosing a Good Location

The bottom line is that your ATM machine only makes money if people use it. So think about where people need access to ATMs and what locations people frequent the most consistently.

Don’t give up right away if the locations you’re considering already have machines. A new machine is almost always preferred over an old one. Do some investigating and see if existing machines are in working order, outdated, and compliant. 

If you find a poorly maintained ATM taking up prime real estate, see if you can swoop in with a better offer. 

Choosing a “bad” location doesn’t necessarily mean your business won’t be profitable. It just means you might not be making as much as you could. It will take you longer to meet your ROI and you’ll make less revenue in the long run. 

A poor location sees, in our experience, 2 or less transactions a day. That translates into a 25-30% annual return. That’s still a profit. If, after a while, you aren’t seeing the revenue you want, you can move the ATM to another location! 

You’re looking, ideally, for an ATM location that sees 80-100 transactions a month. That equals about 40-70% ROI annually. If you find a location that earns more, great!

There’s no problem with trial and error when it comes to choosing a location. You can also consult with the ATM company or processing provider you work with. Someone who has been in the business a long time and personally operates ATMs on a daily business is the best advisor when it comes to discussing potential locations.

What Makes the Best Locations for ATM Machines?

Cash Only

Top performing ATM machines can be found where people spend large amounts of cash. Cash only establishments kind of encourage this behavior and therefore are perfect locations for ATM machines.

High Traffic

ATM machines are there for customer convenience. So you want to make sure your machine is clearly visible, easy to access, and safe to use. Locations with heavy foot traffic encourage more ATM transactions because of the number of people who see the ATM regularly. 

The more people who pass by your machine, the more opportunities there are for transactions. And high traffic areas can make customers feel safer accessing their accounts because they are surrounded by witnesses.

Good Reviews

Again, you want your machine to be where the people are. If you arrange to have your machine placed in a business that doesn’t get many consistent customers or has poor reviews, you’re missing out on revenue. Businesses that people enjoy patronizing and that get good reviews are where you want your machine. Because that’s where everyone is at!

Liquor License

Liquor stores and other locations where liquor is served are good locations for ATMs. Similar to convenience and grocery stores, liquor stores are one-stop-shops, if you will. Rather than have to make one more stop to get cash, it’s convenient to be able to do so from the place the customer is already shopping. 

ATMs in liquor stores also typically have higher surcharges. So not only is the ATM market cornered in a liquor store increasing transactions, but you make more per transaction too.

Proximity to Other Machines

The closer your ATM is to other machines, the more competition you have. Will customers use your machine or the one down or across the street? You basically have to split customers.

There are only three instances where it would be advantageous for you to place your ATM in close proximity to another:

a. You offer a lower surcharge that gives users an incentive to choose your ATM over others

b. There’s just that much foot traffic that more than one ATM is necessary to avoid lines and overcrowding

c. The ATMs nearby are old, outdated, and/or frequently out of order

Again, when it comes to choosing a location for your ATM, consider the users’ needs. The biggest selling point of your ATM should be convenience.

Close to Your Home or Work

If you want to make the most profit from your ATM business, you need to minimize costs where possible. Traveling to and from your ATM is one place to start. If you place your ATM close to places you already go, you save time and money having to access it. Make sure your ATM is convenient for you, too. Otherwise, you don’t pocket as much revenue as you should.

You’ll need to regularly access your ATM to load cash, add receipt paper, clean the machine, and address any technical errors. Customers can’t use your machine and you can’t make money if your ATM isn’t in working order.

If you have a little experience running an ATM business already, it’s okay to venture out and maybe install an ATM farther away if you find a really good location. You might even hire someone to visit and load the machine for you if your ATM does really well and you can afford to do so.

9 Best Locations for ATM Machines

The numbers provided in this section are based on ATM Depot’s experience in the ATM business. There are many factors that contribute to a location’s success, most of which we covered above. However, there are seasonal and geographic factors as well. 

Keep in mind that these numbers are averages. The best rule of thumb is to gauge a business’s popularity and success. If a business is busy, regularly draws in customers, and has a good chance of staying around for a while, your numbers are going to be higher than a location with minimal success.

In terms of revenue, the following locations have the highest profit potential. However, they are usually supplied with ATMs from the beginning, so it’s difficult to get started in these locations unless you know someone and have an in.

1. Casinos

ATMs in large casinos see around 1,500-3,000 transactions monthly. And we’ve seen casino ATMs with upwards of 3,000 transactions monthly. Small casinos see around 30-800 transactions monthly. 

Not only do these ATMs get a lot of traffic, surcharge fees are also typically quite high. High traffic plus high surcharge equals great profit.

While casino ATMs get the most transactions of any other location, they are difficult to obtain. You’ll often see bank-controlled ATMs in casinos, but that isn’t always the case. The best way to get access to this money-making location is to rely on preexisting relationships.

Is there a service you already offer a casino? Do you know someone in charge at a casino? Is there another service you could add to your ATM machine pitch that would incentivize a casino owner to partner with you?

Because casino ATMs are so necessary and lucrative, you’ll rarely find a location in want of one. You might, however, be able to negotiate a better deal than the current ATM owner. Keep in mind that all of this is easier to navigate if you already know someone in the casino business.

2. Gentlemen’s Clubs

We offer the same advice for seeking out a gentlemen’s club as a location for your ATM machine. Gentlemen’s club ATMs see around 300-800 transactions monthly but are so coveted that competition to get in is high. Unless you know the owner of a club, you’d have to be a pretty good salesperson to get the attention of someone who’s already set up with ATMs.

But again, it’s not impossible or unheard of. If you’ve been in the ATM game for a while, you might be ready to pursue these high-demand locations. If you’re new to the business, though, check out the rest of our list.

The following venues are more easily attainable. So, rather than expend all of your effort trying to get started in the hard-to-get locations, you could already be making money by aiming for an easier target.

3. Hotels

Traffic to hotel ATMs depend on hotel occupancy, of course. The more people staying at a hotel, the more potential for ATM transactions. So while small hotel ATMs see around 100-150 transactions monthly, medium hotels 100-200, and large hotels over 200, these numbers might depend on the success of the hotel itself. 

A medium, non-branded hotel with great reviews might bring in more guests and get more ATM traffic than a large, well-known hotel that people don’t enjoy staying at. 

And it depends on the geographic location, too. What hotels do people have to choose from in your area? What’s the competition look like? Where do people like to stay when they come to your town? Are hotels downtown busier? 

These are all things to keep in mind when gauging which locations have the potential for the most revenue.

4. Nightclubs and Bars

Nightclubs and bars are typically cash-heavy locations. They see around 250-500 transactions monthly. Patrons don’t want to risk losing their cards or having them stolen, so they might opt to use cash instead. Many clubs and bars require cash-only cover charges, too. 

And then there’s tipping. It’s quicker and easier to slide your favorite bartender a few bills than having it charged to the card. Cash tips are more profitable for bartenders as well since card charge fees aren’t taken out of cash tips.

5. Convenience Stores and Gas Stations

Convenience stores and gas stations should provide customers with as many goods and services as possible. That’s what makes them convenient. Customers want to stop at these locations for as much of their needs as they can because it’s quick and easy. 

C-stores and gas stations are easy to find and small enough that customers don’t have to spend a lot of time looking for what they need. ATMs at these locations are also preferred by customers because they offer a greater sense of security. There’s almost always an attendant monitoring the activity.

You can expect your ATM to get 200-400 transactions monthly in a convenience store or gas station.

6. Restaurants

Here again we have the tipping factor. Charge tips are automatically recorded and reported for taxes while cash tips can be estimated and sometimes unreported altogether making them more profitable. Therefore, servers and bartenders typically prefer cash tips.

There is also a charge to run a card. Sometimes, this charge is taken out of the servers’ tips. They leave at the end of their shifts with the tips they earned minus the fees for the number of customers who paid with a card.

Smaller restaurants might be cash-only for this reason or charge the fee to the customer’s transaction. In these cases, it ends up being cheaper for the customer to pay in cash.

ATMs in and around fast food restaurants see around 75-150 transactions a month. Quick service restaurant ATMs see around 100-150 transactions a month. And you can expect 150-200 transactions a month from an ATM in close proximity to cafes, diners, and luncheonettes.

So consider the type of restaurant you’re looking at and determine whether or not it gets enough patrons to earn you as many transactions and revenue as possible.

7. Barbershops and Hair/Nail Salons

Similar to bars and restaurants, barbershops and salons are tip-heavy locations and usually charge customers extra to pay with a card because of the charge fee. 

These locations typically pass the fee on to the customer rather than taking it out of employee wages, so it ends up being cheaper for the customer to pay in cash. Without the fee, customers are more likely to tip more, so these locations strongly encourage cash payments.

Barbershop and salon ATMs see around 250-300 transactions a month. 

8. Microbreweries

This category kind of encompasses any new or trendy location. They bring in a lot of customers because of the novelty. People want to check out shiny, new locations especially if they’re bored with their previous options. These are also places people like to hang out. 

If a location draws a lot of people, you want all those people to pass by and use your ATM.

9. Parking Lots

Parking lots and parking garages are common in densely populated areas. That means that many people will be around regularly to see and use your ATM. Downtown areas and locations with a variety of shops and activities bring tourists and locals alike to spend cash all year round.

What all of these locations have in common is that they are places where people prefer to pay with cash and they are places many people like to go on a regular basis. The combination of traffic and need make ATM businesses successful in these areas.

Of course, your experience will vary. You know your town better than anyone else, so use our list of What Makes the Best Locations for ATM Machines to guide your search.

Site Location Agreement (SLA) and Revenue Split

Each of the 9 locations on our list of best locations for ATM machines will likely be owned by someone other than you. This means that you’ll have to talk to business owners to create a partnership for running the ATM.

Convenience stores get about 23% more in sales from ATM users. But while an ATM machine in itself can bring more sales to the location therefore benefiting the store, location owners will be most likely to let you use their space for a share of the ATM revenue.

So when choosing the best location for your ATM, make sure the contract between you and the site location owner is a win-win. You want to make as much profit as possible, so you’ll have to weigh the number of transactions you expect against the percent of revenue split between both parties.

Other Locations to Consider

A Retail Store You Own

If you own a retail store and are considering adding an ATM machine, you can add to your monthly profits. As long as you advertise it and make it visible to passers-by, an ATM machine could bring in more customers or at least more foot traffic in and past your store.

Encouraging cash payments could lower your credit card fees, and you can offer coupons on ATM receipts to push sales. Additionally, about 30% of the cash withdrawn from an ATM in a store is spent in that store. At the very least it encourages impulse buys.

So adding an ATM service to your existing business could be very profitable for you.

The Office Where You Work

This only works if your office meets the following criteria:

a. There are 100s of employees

b. There is a cafeteria or someplace to spend cash

The more employees there are, the more opportunities there are for ATM transactions. Before placing an ATM in your office, make sure there’s a good balance between the amount of traffic and need for the service.

Commercial Building

Large shopping centers are typically supplied with ATMs by banks, but smaller ones might not be. If you already know the owner of a commercial building, see who if anyone is providing them with ATM service. There might be an opportunity for you.

Condo Complex

Here again you have to consider the amount of traffic in addition to the need for ATM service. If there is a condo complex with many units and nearby locations to spend money, you might consider placing an ATM in a condo complex. Keep in mind that you will need to speak with HOA to get approval.

The Best Locations for ATM Machines

When scouting locations, look for high-traffic areas, cash-only locations or locations with a high rate of cash paying customers, and locations where other ATMs are scarce. You also want to look for places customers will feel safe using the ATM such as locations with lots of foot traffic.

Be aware of new businesses that might not have ATMs yet and locations where ATMs are old, outdated, and frequently out of order. These all make for great opportunities to get your foot in the door and ask about starting a partnership to run your ATM.

You can check out liquor stores, bars, restaurants, convenience stores, shopping centers, and parking lots. For your first ATM, it’s a good idea to choose a location close to home or work until you get used to the process. You can even look into setting up your ATM in the office or building where you work if there is enough of a demand for it.

If you haven’t set up a location yet and are nervous about approaching businesses, check out our article How to Get Your First ATM Placement. It covers how to borrow authority to give yourself credibility and what to say so that you can get other business owners to trust you and convince them to join a partnership with you.

Remember, the location of your ATM could make or break your success.