The cost of a pack of soda, and its relative price per can, is something consumers do bring up. In response, Harvey argues there is a great advantage to the location for having a vending machine. A vending machine is a “refrigerated, inventory controlled beverage dispenser,” he said. Location managers don’t have to worry about employees pilfering cold beverages out of the fridge.
Variety addresses price sensitivity
Harvey has found glassfront machines allow him to increase variety. In traditional stackers, he was limited to seven or eight cans. A glassfront can hold a lot more variety.
Adding more variety also takes attention away from price increases, Harvey said, thanks to the higher price points many of these drinks carry.
Non-carbonated offerings allow Harvey to meet the growing demand for health oriented products.
“Customers aren’t necessarily asking for them (more non-carbonated beverages),” said Harvey, “but they’re happy it’s there.” Many customers tell him they really like a new non-carbonated beverage they tried from his machine.
“(Non-carbonated beverages) don’t merchandise well in stackers,” he said. Glassfronts, while requiring more maintenance and taking up more space, sell 20 to 25 percent more products. “It’s a better way of doing things,” added Harvey.
Glassfronts Help vendors compete with c-stores
“This company has always been strong in glassfronts,” said Steve Hall Jr., operations manager, Firelands Food Systems in Sandusky, Ohio. Hall believes glassfronts are necessary to offer the customer sufficient variety in order to compete with convenience stores. He estimates 70 to 75 percent of Firelands Foods Systems’ accounts have glassfronts.
Many of these machines have “healthy products” asked for by the clients. Over the past six months, Hall reports more accounts looking for these types of products due to employee wellness programs. The healthy products are almost exclusively in 20-ounce bottles, and while some are the same price as carbonated beverages, many are 25 to 50 cents more.
Energy drinks are even more expensive. Hall has been surprised because even though the economy in his area hasn’t really improved, Firelands Food Systems is selling more and more energy drinks.
The variety requested by customers is definitely a trend Hall has noticed. Five years ago, he remembers the company warehoused 80 to 90 different cold beverages. Now they have more than 200. “We continue to see an increase in different varieties,” said Hall. “That’s why we have so many glassfronts, to meet that demand.”
Schools provide opportunities in some areas
Some vending operators believe there is a new opportunity in school accounts as new nutrition requirements have caused some bottlers to retreat from this customer base.
In southern Florida, most bottlers have left the schools, noted Thornburg of Family Vending Co. With new beverage restrictions in these locations, sales have dropped, making the locations less profitable.
Thornburg believes his company can offer more beverage variety to schools than bottlers can. “We offer the variety and flavors that kids want,” he said. “We’re not held to corporate standards.”
In Thornburg’s area, schools allow the selling of soda as long as there is water and juice available in every machine. While soda is the top seller, Thornburg indicates students do buy a lot of water. He thinks it’s due to water being priced cheaper than juice at $1, rather than $1.75.
“Schools are an opportunity, but the phone’s not ringing off the hook,” said Glimpse with Camelback Vending. In the Phoenix area, bottlers are not voluntarily pulling out of schools. They are trying to hang on to their beverage contracts any way they can. Glimpse hears about the frustrations of new beverage regulations from her contacts at schools. The administrators report the kids still get the products they want, even if they aren’t available in the vending machines. “They (the school administrators) see it as revenue being taken away from them,” Glimpse said.