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Customers appreciate new machines Daurora said many of the bars, restaurants and bowling alleys he serves are willing to give up something, namely some of their commissions, in exchange for an attractive, reliable cigarette machine. Daurora is less complacent than some operators about the reliability of mechanical machines with an electronic money acceptance control box attached. The operator has to consider more than the cost of the control box, he noted; older machines require more service. In replacing his busiest mechanical venders with the Wurlitzer, Daurora noticed higher sales and fewer service calls. He averages one service call a week on his used machines. If a machine goes down on a Friday night, that can mean a hefty sales hit. The electronic programming features of the Wurlitzer machine allows for multi pricing, which enables Daurora to offer the less expensive "off brands" in addition to name-brand products. His Wurlitzer machines typically carry six generic selections priced at $3.75, compared to $5.00 for branded products. The Wurlitzer machine also allows him to link columns together, so that when a selection sells out, it automatically switches to another column with the same product. "You can link like columns together electronically," he explained. "It'll go to the column that has inventory and it will vend it. You can't do things like that with a mechanical vending machine." MDB technology gives the machine numerous advantages over mechanical venders. The machine can be fitted with a credit or debit card reader. It can also offer discounts for multiple purchases. Frank Wolfe, director of vending sales at USA Technologies Inc., which produces the e-PortÂ? credit card device, thinks credit card readers could rejuvenate cigarette vending. USA Technologies, a leader in cashless vending solutions, has focused a lot of its attention on higher ticket purchases since consumers are more inclined to pay for these purchases with credit cards.

Credit cards make sense for cigarettes "With prices of cigarettes at $5, $6 and $7 a pack, it's a natural," Wolfe said. "Somebody would rather put it on their credit card than shove all those bills in a vending machine." USA Technologies handles all of the administrative work associated with e-PortÂ? credit card transactions. The operator doesn't have to sign a contract with the credit card company. USA Technologies electronically transfers the funds to the operator's account, which the operator can view on the Internet. Authorizations average 10 to 12 seconds, just as in a retail setting. The machine does, however, need to have a telemetry connection to USA Technology's servers. There is a 5 percent processing fee for transactions up to $7.50, Wolfe said. The percentage decreases for higher ticket transactions.

New machines find place in Las Vegas Meanwhile, the Wurlitzer machine's reliability and ease of use have proven popular in the booming gambling mecca of Las Vegas, Nev., according to Lloyd Ball, a partner in Desert Amusement Co. Ball, who started out placing amusement machines six years ago in bars, was looking for a better cigarette machine when he came across the Wurlitzer. His customers were constantly complaining about their cigarette machines breaking down. "If it hadn't been for the Wurlitzer, I probably wouldn't be in the cigarette business," Ball said. In the last year, he placed 25 Wurlitzers, and they now comprise about a third of his business. He uses the larger of the two U.S. models, which has 35 selections. Being in Las Vegas, Ball isn't terribly concerned about being regulated out of business. "The casinos have a lot of control in the state of Nevada," he said. B & L Amusements Inc., based in Hanrahan, La., a New Orleans suburb, reported a similar experience. After being asked by many tavern owners for cigarette machines, the company tried working with mechanical machines two years ago, but found them unworkable. "We couldn't even get them working properly to get them out on the street," said Kurt Gourgues, general manager. The Wurlitzer machines provided the answer. The machine's electronics also allow it to accept a "waiter's key" that activates a vend and creates a credit. This saves waiters serving casino patrons the hassle of handling cash.

Marketing support disappears Operators noted that as cigarette machines have disappeared, so has the marketing support that cigarette companies once lavished on their channel. Marc Almore, manager for Jofemar USA, said he has been unsuccessful finding support from tobacco companies for cigarette machines in exchange for advertising on the machines. With the new technology, he said, the machines could provide virtual reality advertising to consumers. Almore said the number of cigarette machines could double or triple if such a program were successful. The problem, according to Almore, is twofold: 1) The cigarette manufacturers aren't interested in the vending channel, and 2) increasing regulations are diminishing opportunities for cigarette machines. "I think it's a big opportunity, but everything seems to be against you to get it going," he said. "The indoor smoking ban is a hard thing to work around," Almore said. He is particularly troubled by reports that smokeless environments result in better business. Some operators claim the cigarette manufacturers' antipathy for them takes the form of over-the-counter cigarette display cases that directly compete against cigarette machines. Most operators, however, said this hasn't been a significant problem. What the manufacturer reps never tell the bar owner is how much he's going to lose in pilferage and what a hassle it is keeping track of sales.

For now, eyes on New York lawsuit Many cigarette machine operators, meanwhile, await the outcome of the lawsuit against the New York law prohibiting smoking in establishments that serve food. Suits could be filed in other states that have similar laws, such as California, Florida, Alaska and Delaware. Frank Calland, who operates E & S Music Corp. in Hollbrook, N.Y. and is vice president of the New York Amusement Machine Operators Association, is hopeful. He said the ban has devastated much of the restaurant and bar industry. He claimed crowds of people have been milling about outside of bars to smoke, and many were leaving without paying their tabs. Calland hates to think what will happen if his cigarette sales take another hit. A 33-year cigarette vending veteran, his one-time 30-case-per-week cigarette business now averages one or two cases per week. "It was once the backbone of this (vending) industry," he said.