Master's Coffee and Water Service, a family run coffee and water business in Hesperia, CA, isn't your typical office coffee service (OCS) provider. President Jerry Lyles owned Master’s Vending for 23 years, adding OCS and bottled water when the opportunities arose. In 2013, Lyles exited vending in favor of coffee and water services. Thanks to everything he learned from vending, he proved victory isn't about the number of services you offer, but how efficient you are at delivering them.
Trial by fire turns passion
Lyles added coffee service to his vending business after a serendipitous encounter at a car dealership. A BUNN representative was buying a car and saw Lyles’ card on a vending machine. He asked if Master’s did OCS. Lyles said he didn't even know what OCS was. As fate would have it, later that week a customer called, looking for vending. "The account was too small, so I asked about OCS," Lyles said. "The customer said 'that's my next call." Lyles took out his product catalog, started to quote the location some prices, and then called the BUNN representative. Three days later, Master’s was in the OCS business. "I remember reading the brewer manual in the parking lot of that first account to figure out how it worked and how to install it," Lyles recalled. Fast forward and OCS would become 40 percent of Master’s annual revenue.
"Coffee Service is based more on the strength of your service and your personality," explained Lyles. "It’s not about commissions and questionable money practices, which can happen in vending." Nearly all Master’s coffee business is traditional brewers and frac pack or bulk coffee. A small portion, 8 percent, is single cup. Master’s offers RealCup brewers and what Lyles calls I-Kups. "I love the RC400," said Lyles. "It's attractive and can be worked on." He prefers fixing, rather than disposing of equipment, which is the mentality of some manufacturers. He also likes that there are many brands of I-Kups that consumers recognize such as Donut Shop, Cake Boss, Guy Fieri, Skinny Girl and Wolfgang Puck. "I learned in vending, brand matters, and these names help sell the service," he said.
With water it's all in when you stop the truck
Master's Services bottles its own water in 5-gallon bottles which it sells with water coolers. In addition, it provides OCS and water filtration systems. Lyles added the segment in 2007, but quickly realized that the traditional delivery and revenue model used by other bottled water companies wasn't going to work for him.
"I saw no point in stopping the truck for a single bottle, maybe $6 in revenue," said Lyles. “We would never have stopped our vend truck for $6 from a vending machine.” Instead, he came up with a system that offered the water cooler for free and charged for a pack, or multiple bottles.
Residents can buy a 3 or 5 pack, 3 or 5 bottles. Workplaces can go as low as 5 or as high as they need. The benefit for Master’s is that locations buying multiple bottles mean the drivers can visit accounts monthly instead of bi-weekly. Plus, each time the driver stops the truck, Master’s is guaranteed at least $21 (the price of a 3 pack) compared to $6. They don't charge any other fees. "Here in California, other bottled water companies charge a delivery fee, a billing fee, deposits, etc. We charge just one flat rate," Lyles said.
Master’s plans to fill in its service area in the next few years with more OCS and filtration accounts. The company has sales reps in the field and is always on the lookout for an acquisition. By combining this aggressive approach with an independent, long tenured staff, Lyles has Master's Coffee and Water Service poised for years of Southern California success.
