Don't Give Up On Vending

April 18, 2013

Fact of life No. 71: everyone likes new and exciting. Because of that fact, we hear (or in my case report) a lot on the new stuff in the industry. Lately, it has been micro markets, and don't get me wrong -- they are terrific. In the right location with the right service, they can really increase revenues. And they are nothing but new and exciting for operators and locations alike. But in my opinion, micro markets will never take over the quintessential vending machine -- the hero of the late night cramming college student or starving office worker who has 10 minutes before the next meeting.

Why won't vending machines fade to be some obscure piece of equipment we see in reruns – like the rotary landline telephone? First and foremost, automatic merchandisers still meet a need. Not every location will work for a micro market. At some locations, the theft is too high. At some, the local health department is treating micro markets as cafeterias, so providers would be forced to take extensive food safety training and get regular inspections. For some operators, the spoilage rate for food is just too high, especially as consumers pick through products to take the freshest sandwich and leave the one that will expire tomorrow. These are challenges a vending machine can overcome. 

Markets aren't taking over the world

I think it's telling that a number of the vending operators who have launched micro markets (including those who are now major micro market manufacturers) haven't sold off their vending operations. Also, in a recent conversation I had with a professional foodservice provider, I learned that while food for micro markets is a new line of revenue, it hasn't come close to the quantity the company produces for vending. This foodservice provider makes about 10,000 fresh food units for micro markets each week. I thought that was a lot, until I heard it makes more than 600,000 units for vending -- and fresh food is a vending loss leader.

Micro markets are the new and exciting trend, and locations do love them. But that's no reason to give up on vending machines. There are lots of interesting ways to renovate a vending machine so it has a similar appeal to the consumer. One is offering multiple payment options, from credit cards to large bills. Another is adding video screens that engage the consumer, provide additional nutritional information and allow for multiple purchases in one transaction. In fact, in the May issue of Automatic Merchandiser we'll be discussing the benefits of retrofitting, so watch for that upcoming article.

New technology always brings a wave of renewed energy into an industry, and vending is no exception, but the machines that have provided the bread and butter of the business model will continue to be part of the operation. They deserve some TLC as well.