Self checkout micro markets are the fastest growing format in automatic merchandising, so no one was surprised when a panel of micro market system providers and operators drew a huge turnout at the National Automatic Merchandising Association OneShow at the Sands Expo Center in Las Vegas last week.
The panel was organized to allow each of the five better established micro market providers to offer comments on their systems, followed by operators who have used the systems, followed by questions from the audience. The meeting drew a standing room only crowd and was among the best attended sessions during the OneShow.
Dominic DeFrancesco, corporate marketing director at Vistar Corp., served as moderator and introduced the session noting that his company supports micro markets and has two different sets of guidelines for operators based on their level of micro market experience.
First to speak was Jim Brinton, CEO of Avanti Markets, who noted his company has just less than 1,000 markets on location in the U.S. He said the company recently introduced an ADA-compliant model and another model tailored to smaller locations.
Brinton said his company has 15 employees. The company also has an operator advisory panel.
Joe Hessling, CEO of 365 Retail Markets, noted his company provides both hardware and software for the micro markets.
Jim Mitchell, president of Company Kitchen, said operators need to consider four issues: 1) Success is not about the equipment; in the future, there will be a lot of equipment available; 2) Success requires having a unique selling proposition; 3) Exclusive market territory, which his company provides is important; 4) A good level of aftermarket support from the system provider. He said his company offers 24/7 support.
Terri Starnes Bryant, president of MicrotronicUS, noted her company allows operators to use the same stored value card for its kiosks as for its vending machine card readers. This makes it easier to have a micro market in one area and cashless vending machines in another.
Aaron Speagle, CEO of Breakroom Provisions, noted that he launched the first micro market 10 years ago, Freedom Shopping, and also helped launched Avanti Markets. He said Breakroom Provisions allows micro market operators to own all the data generated by the kiosks they operate.
He noted his company has three different kiosk models.
Kevin Van Hazel, a partner in Ace Vending in Tempe, Ariz., uses Avanti Markets and said he is now placing one per week. He said a micro market generates double the revenue of a vending bank in locations and has better profit margins. He said he seeks locations with 150 to 200 employees minimum for a micro market.
The micro market works well for employee wellness programs, Van Hazel said, since it allows more variety than vending.
Van Hazel also noted later in the meeting that he can raise prices faster at the micro market than in vending machines, and unlike vending, with micro markets it is easier to charge a sales tax and raise prices in whatever increments he wants.
Steve Luccia, chief financial officer for Canteen Vending Services Inc., noted his company is using 365 Retail Markets. Like Van Hazel, Luccia said the micro market generates twice the sales of a vending bank. Another important advantage he noted is the micro market’s ability to win new customers.
Luccia compared the micro market to his company’s 2bU vending machine, which offers at least 30 percent local products and features organic, vegan, gluten-free and kosher products, as well as other options. When these machines are placed in a location, there is no cannibalization of other vending machines since the 2bU machine attracts a different customer.
Luccia praised the micro market as a way for vending operators to regain many of the customers they have lost over the years.
Luccia said the micro market attracts a higher percentage of customers than a vending bank. Where 10 percent of the people at a location use the vending machines, 20 percent to 30 percent use the micro market.