Because the recession has forced vending operators to scrutinize their efficiencies, some have discovered the benefits of pre-kitting routes, which has resulted in higher profitability despite lower sales. And while pre-kitting — loading deliveries in the warehouse based on machine needs — is not new in automatic merchandising, many operators are learning that new technology can automate and streamline the process while providing a higher level of accuracy.
- Eliminating the “counting trip” for the driver, thus allowing him to service more machines. By carrying the right amount of product, the driver does not need to go to the machine, count what’s needed, and go back to the truck to get it. The trucks can leave the warehouse full in the morning and return empty at the end of the day.
- Lower truck inventories, meaning smaller trucks and lower fuel and maintenance costs.
- More efficient truck loading and machine filling processes.
While pre-kitting requires additional labor to load totes in the warehouse, warehouse labor is less expensive than route labor.
For the operator, this means 15 or 20 percent more machines can be serviced using existing routes, or the same percentage of trucks can be taken off the road.
Achieving significant gains through pre-kitting requires having accurate sales reporting at the machine level. This requires having machines capable of reporting DEX data. It also requires operators to closely manage warehouse and delivery functions, and to train employees accordingly.
While operators can pre-kit routes without using DEX data, par level accuracy will not be as high. Hence, the benefits that DEX-based systems offer cannot be expected without DEX.
The introduction of remote machine monitoring (RMM) in recent years has allowed for more timely reporting of DEX data, which further enhances par level accuracy. To achieve this higher level of accuracy, operators must install RMM hardware in their machines and have systems in place to utilize the RMM data.
Operators of all sizes have been able to pre-kit routes.
PRE-KITTING: ONE OF SEVERAL DEX BENEFITS
Pre-kitting is one of several benefits that DEX provides. Many operators install DEX for other reasons, such as better cash accounting and item-level product tracking, before considering pre-kitting. The amount of work needed to introduce DEX varies based on the age of the equipment, the way the operation is organized, and the capabilities of the staff.
PRE-KITTING IS NOT NEW
Warren Philips, president of Validata, traces pre-kitting back to the mid 1980s in a segment of the vending business in which it is rarely applied today — cold food machines. Philips developed a predictive ordering module for food preparation for food machines. An operator with 100 food machines could determine how much bulk food to order for a certain time period. Once the operator received the order, the food would be made, then sorted into tubs to be loaded onto trucks and delivered to locations.
“Fresh food was a very tough challenge for the vending work place,” Philips said.
The concept soon evolved to the snack and soda sides of the business.
What’s different today, Philips said, is the ability to determine more accurate par levels, thanks to innovations like handheld computers and RMM. He said there are still operators pre-kitting using data based on paper route slips, in addition to handhelds and RMM. “The more scientific you are, the more accurate you are,” he said.
Philips said vending management software systems such as his are interfacing with different order entry points, such as a handheld computer, an RMM device, a desktop computer or an Internet Website.
Premier Food Service in North English, Ia. began pre-kitting snack machines with route tickets 12 years ago, noted Carl Miller, company owner. He had no vending management software at the time. Miller found it saved him time to pre-pack his snack bins.