The item level reports have helped supervisors analyze sales better. “We actually use MEI to figure out where we need to get price increases,” he said.
With the item level reports, Hemp has been able to track the success of new products faster and more accurately. Because customers are asking for healthier options in the machines, he reasoned that he could offer these options with the understanding that he would remove them if they did not sell well.
Healthy vending finds success
In 2007, Coca-Cola Vending began offering the National Automatic Merchandising Association (NAMA) Fit Pick program in schools, and eventually to business and industrial accounts as well.
Some accounts offered to subsidize the Fit Pick items. Hemp said some Fit Pick items carry a 20 percent discount. The company uses the stricter of the two Fit Pick standards, which includes caps on sodium, trans-fat, and calories.
One industrial account wanted to offer an incentive to employees to buy the healthier options. The account required Coca-Cola Vending to provide item level sales reports to send along to their parent company. This particular account follows standards from the National Institutes of Health.
The DEX reports alerted Hemp to the advantages of new technology. He attended trade conventions and went to as many technology seminars as possible.
Hemp attended the NAMA executive development program at Michigan State University in 2005. Some of his employees attended NAMA supervisory training held at NAMA expos, all of which he finds extremely valuable.
While he has kept an open mind about new technology, Hemp has always tested new tools before making major investments.
The company has DEXed its cold drink machines but not other machines. Drivers are required to enter sales from snack and food machines manually into their handhelds. Hemp is still considering DEXing the snack machines.
Nor has Hemp been sold on the benefits of remote machine monitoring (RMM).
In 2007, a vending management company required him to install RMM devices in a few accounts.
Hemp said he believes RMM provides benefits to operators in certain situations. “It didn’t fit us,” he said.
Cashless proves successful
One technology that has proven successful for Hemp has been cashless readers. He became interested in cashless after hearing the experiences of other vending operators.
In 2008, he began testing an MEI card reader in cold beverage machines with USA Technologies Inc. processing and settlement service. USA Technologies combines the processing charges with the credit/debit card issuer’s transaction charges in one monthly fee.
The USA Technologies Website allows Hemp to compare the cashless sales to cash sales.
He installed the first card reader in a college, and the students immediately began using it. He then began adding card readers to snack and beverage machines in work sites, call centers and shopping malls.
In comparing the sales in a machine with a card reader to a machine without a card reader at locations of similar size, he found the card reader delivered 20 percent more sales.
At shopping malls, as much as 30 percent of the sales are credit purchases, Hemp said. “At one particular account, 70 percent of the sales are credit,” he noted.
In public locations, customers start using card readers immediately, Hemp said. In captive locations, it takes a month or two for customers to begin using them. “It takes 30 to 60 days for people to realize the machine will take a credit card,” he said.
More recently, he has added cashless readers to some hot beverage machines. “It’s really doing well,” Hemp said. He expects that cashless will eventually become the dominant form of payment in vending.
The company has 150 cashless readers and is adding more.
Hemp said the cashless option has been especially helpful in raising prices. He is currently charging up to $1.25 for large size confection candy and some pastries, up to $1.75 for some bottle beverages, up to $3.00 for fresh food and $6.00 for frozen TV dinners.