Selling vending and coffee service in a saturated market is tough. How can a company stand out and really offer a location something different? That’s where added value comes in. For a location, it means getting something they are unable to get on their own, whether it’s reliable access to the right product mix, help with sustainability, or versatile payment options. For operators, added value allows them to increase profit margins, lower commissions or simply win an account. Often, the right added value can give operators leverage in a contract that will benefit them. But adding value isn’t business as usual.
Intangibles add value
The fact that operators can offer snacks and soda doesn’t add value for locations because the products are available in many different places, explained Randy Munn, director of sales and marketing for C.L. Swanson Corp., in Madison, Wis. A machine that is clean, filled and working is the bare minimum level of service. Munn believes vending operators need to find a way to add more value to the product they’re selling than the product at the convenience store. “If you can’t add value to that can of (soda), the only thing that matters to the customer is price,” Munn said.
For Munn, adding value is all about intangibles. “One of the ways you can add value is developing a relationship with the general manager or the location contact,” said Munn. This is specific communication outside the job of the route driver. It’s also imperative to periodically sit down with the client and get a feel for how the company is doing, like a service report card.
Focusing on the fresh food that operators bring to an account is also a must for added value, explained Munn. The quality, variety, selection and price are paramount. On any day, customers should be able to trust there’s something in the machine they’ll want to eat, it’s good quality, and the price point makes it a value to them.
The only way to know if customers feel this way about the food offerings is to seek their feedback, which is another way Munn provides added value. “We have an organized program called ‘We Want To Know,’” Munn said. There are cards to fill out at vending machines, online surveys and even boards for notes for the route drivers. Munn admits he was leery of this last idea, but it has worked with significantly fewer issues than he’d feared. “That’s because so few customers get to comment on what they’re forced to buy,” said Munn.
Munn favors added value that benefits both the location as well as the end users, such as putting a coffee brewer on winner mode, where every 50th cup is free. It also includes health and wellness programs, where end users are requesting healthier products; locations want a healthier workforce. “We have an organized program called ‘Better For You’ overseen by a registered dietician,” said Munn. “It’s added value because the average operator doesn’t do that.”
While Munn offers energy saving features on his machine, such as LED lights, he finds it’s more valuable to the location than to the end user, so it’s not one of his top added value options.
Added value allows Munn to charge a premium price for his products, maybe 5 cents more than competitors’ prices, but there’s a limit to what locations and end users will pay.
Tailor value added options
Richard Harvey, president of A & R Services in Monument, Colo., believes added value is always important in selling service, and deciding what to offer takes some digging. “You have to look at each client,” he said. “You ask ‘What do you want?’ and then ask, ‘how can I help you achieve it?’”
In locations that crave more up-to-date payment options, Harvey offers cashless payment systems, bill recyclers and self checkout micro markets (SCMM). These systems usually warrant a price increase/commission negotiation, but they are good for locations willing to pay for it.