The risks of investing in a display rack business are greatly magnified if you don’t ask the correct questions.
Individual losses of 20, 30, or even $80,000 are not uncommon. One major problem is not in the racks themselves, but in getting them placed in desirable, high traffic areas where they will be seen and used by a large number of people.
Before you invest any money, insist on a written list of places where the racks will be placed. If the company makes vague claims, don’t invest. If you are given a locations list, visit the sites and talk with the business owners or mall managers to find out whether your rack can actually be placed there.
Finally, ask another question: what percentage of your earnings will you have to pay to the site owner?