As with any business, becoming an airtime vendor requires capital investment before things start becoming profitable. With airtime vending however, you can usually begin reaping the benefits of your investment relatively quickly in comparison to other start-up businesses.
You can even start your business by paying cash for airtime vouchers in bulk and selling them to friend, family and your community at a profitable rate.
What does an airtime vendor sell?
Airtime vendors predominantly sell vouchers for people to recharge money on their cellular phones. However, vendors can extend their business to add other services such as cellphone repairs, selling electricity vouchers for prepaid electricity systems, and selling new and used cellphones.
How can I get started?
If you would like to become an airtime vendor, you can contact any of the major cellular service providers (MTN, Vodacom, Cell C or Virgin Mobile) or become an agent for one of the many companies around the company that facilitate pre-paid airtime and electricity vendors.
There are a number of ways you can become an airtime vendor:
Through your personal computer
There are a number of software programmes that can be installed on a PC that allow you to sell pre-paid airtime without having to place orders for stock and purchase it.
This kind of system works on a pre-paid basis, crediting your virtual account as soon as you deposit funds into the bank account of the airtime supplier. You can then use these credit to purchase and resale virtual airtime.
Usually you will make a profit of 5%-10% on your sales, the amount varying according to the online voucher provider you use.
To get started with the software system, simply search online for a suitable company, create an account with them (with your own password for airtime transactions), and start selling.
When you log on to your account you will be able to see how much credits you have, the deposits you have made, the commission you have been paid for airtime sales , as well as the cellphone numbers and names of your clients. For each client listed, you can see all the deposits they have made and the commission you will make from them.
Through your cellphone
Selling airtime using your cellphone is an accessible way of selling pre-paid airtime by sending an SMS message to a server. The airtime supplier will then send you a pin number that the customer can use as a virtual voucher to upload airtime to their account.
One of the best-known airtime suppliers that offers this service is Smartcall, who have been in the business since 1998. With a package from Smartcall, you will be able to recharge both you and your customers with airtime at a 9% discount.
This means that you can charge your customer the full airtime price and still make a profit of 9% for yourself. To get started with Smartcall, you will need to pay a deposit of at least R100 before you can begin selling airtime for Cell C, MTN, or Vodacom.
You will also be able to sell PrepaidFone credit for Telkom.
Through a vending machine
You can also choose to invest in a prepaid airtime vending machine through which to sell prepaid airtime to your community. This is the most expensive start-up cost for airtime vending option, but also allows you to take the most profits from your airtime vending.
Vending machines are good for use in community environments such as apartment blocks, rural areas, universities and schools. A prepaid airtime vending machine is basically a small electronic device and is a portable and convenient option for airtime vending.
What about tax?
When you start an airtime vending business, it is important to open a bank account. Not only is this a safer way of keeping your money than having cash on hand, but it also allows you to build a credit record in case you would like to borrow money to expand your business.
For example, if you start off by selling airtime form your PC or cellphone but would like to invest in an airtime vending machine, you may not have enough money and will need to borrow money from the bank or another such institution. Before lending you money, the lending institution will need some assurance that you will pay them back, and having a good credit record will work in your favour.
If your business does grow, it is important to register your business with the South African Revenue Services (SARS) and declare your income earned.