Companies and their leaders are oftentimes faced with opportunities masked as challenges. For Jack Brown of Northwest Indiana-based ReFresh Facility Services, one of those moments came in 2011 when he debated adding vending to his janitorial-service company. Investing into a new service would mean changing the face of ReFresh and bringing in vending would mean adding food to a primarily soap and cleaner product base. At the same time, the economy was just barely recovering from the Great Recession and generations-old vending companies were divesting.
Despite the challenges ahead, Brown and ReFresh jumped headfirst into the industry with a new perspective and desire to create a unique vending experience for customers — and they haven’t looked back.
Since the company’s expansion in 2011, ReFresh has become tough competition in the Indiana market. The company introduces only new vending machines and was one of the first in its area to go 100 percent cashless. It has grown to more than $2 million in annual revenue by focusing on the customer, making strategic investments and always being open to change.
Expand with vending
ReFresh Facility Services, Inc., formerly EAGLE USA, began in Portage, IN, in 1994, focusing solely on janitorial services such as daily sanitation, floor and window cleaning and restroom supplies. While providing janitorial service at several locations, Brown, CEO of ReFresh, began noticing the vending machines and coffee service in the breakrooms. He believed it was a service he could also provide. “I read an article about the process of entering the vending business and I just knew it would be a great addition to our company,” said Brown. “But I didn’t just want to be another vending operation.”
In his janitorial service, Brown made a point to always provide reasonable expectations and then overdeliver to his clients on that promise — and that is the mentality he brought to vending, too. This meant investing in new vending machines, to give his customers a seamless, hassle-free interaction when purchasing product. He traveled with Gary Joyner, an industry consultant, to Des Moines, IA, to visit vending machine manufacturer Federal Machine Corp. (a division of the Wittern Group.) “When it came to entering another segment, I wanted to do it right,” said Brown. “I wanted to make sure that my customer was buying from the most upto-date machines.” Brown’s goal was to create a unique vending experience for his customers, and his locations responded positively. It wasn’t long before he placed his first machines.
Trim costs with technology
When Brown entered the vending industry, he noticed that while the majority of consumers were carrying credit and debit cards, many vending operations were not offering a cashless solution. Early on in the process, Brown made the decision to integrate new vending machines with the latest technology, including cashless readers, in order to give the customer the best purchasing experience. Cashless means less errors and service calls, less monetary mistakes and a smaller amount of cash handling. It also creates a better customer experience, Brown believes. “As vending operators, we make a promise to our customers that they are going to be able to get product from our machines,” he said. “If you don’t have reliable machines or payment methods and the customer leaves empty-handed, we are breaking that promise we made to them.”
All ReFresh USI vending machines come equipped with a cashless reader, and in the first quarter of 2017 the company will also begin launching USA Technologies’ MORE. loyalty rewards program, tying it into both the vending program and into the company’s two micro markets. “This technology just makes the experience that much better for the customer and gives us a leg up on the competition,” said Brown. The company has not only been able to create efficiencies with cashless, it hopes to use technology to trim other costs as well. In 2017 ReFresh is integrating a vending management system (VMS) with VendSys, which will allow them to ultimately eliminate their rolling warehouse. “We hope to get new trucks — more economical ones — and begin prekitting,” said Brown.
“This should cut down on gasoline costs and time spent at locations.” Brown likes that he can use gathered data to make decisions that will benefit his company and his customers. “Information is key and data is everything in this business,” said Brown. “It helps us understand what our customers want and what they are buying.”
A focus on product
ReFresh guarantees that its machines not only are the cleanest, newest and most technologically savvy, but that they are also stocked with the best product. Brown includes more than 100 SKUs in his snack machines, using data from across the region to find the best-selling products. “I tell my customers that product will rarely be stale or expired because I place the items that customers want to buy, and I can prove that’s what they purchase,” he said. “I never want our customers to say ‘It’s always the same thing’ — I want them to have variety.”
This means that while Brown offers healthy items, he doesn’t make a vending machine 100 percent healthy. “I offer them the choice, and they can make the decision,” he continued. In 2017, Brown will offer 20 percent health-focused items in his machines.
Brown consistently analyzes the business and isn’t afraid of making changes when he believes them to be better for the long haul. When he launched into vending, he wanted to jump headfirst, so that meant also launching OCS and water service as well. “If you’re going to do it, you’ve got to do it right,” he said.
ReFresh launched OCS and water simultaneously, offering ION Natural Choice Water, as well as a 5-gallon option. And when it came to coffee, Brown wanted to do it well. “I traveled to half a dozen roasters across the U.S. because I didn’t want to settle on a less-than-great product.” He began using Wallingford Coffee and has expanded to offer Starbucks, Peet’s and Keurig Green Mountain, as well as PodPack and private label. “We led with pods because no one else had them,” he said. Now he is offering primarily Keurig Green Mountain K-Cups and the MARS DRINK Flavia program.
ReFresh offers three different price points to fit the coffee service needs of all customers. “We offer Bunn brewers and Cafection bean-to-cup brewers,” he said. “Each OCS customer is different in their budget and wants — we accommodate to their needs.”
In 2012, the company made one more segment expansion, and that was an investment into micro markets with Avanti. ReFresh currently has two micro market locations, a bluecollar plant and large bank corporate office. “Both accounts are successful,” Brown said. “And while I would like to grow in micro markets, vending has been our focus for growth and that has paid off — it’s our company’s fastest-growing segment.” For those customers who aren’t large enough for micro markets or vending machines, Brown is developing a concept where he will sell customers various “baskets” or “trays” of snacks for one set, monthly price.
Changing the process and overcoming challenges
Despite ReFresh’s success, the transition into the vending arena had its early obstacles. Once ReFresh began adding vending, the way the company operated changed drastically, recalls Brown. The company went from a warehouse with hand soap, glass cleaner and paper towels to a space full of fresh pastries, soda and food. “There was a learning curve and a need for seriousness,” said Brown. “We had to honestly consider the fact that we had a lot of different things in the same building.” The company moved to a larger space to accommodate the increased and varied SKUs and the way the company received and stored product was analyzed carefully to maintain safety and product quality.
The biggest change came in the way that ReFresh ordered items. “You have to order almost just-in-time plus 10 percent,” said Brown. “We get semi trucks five days per week and we had to learn to order so that we have a flow.” The company learned to organize and move 35 pallets of product (weekly) within minimal space, efficiently.
Not only was space an issue, but ReFresh had kickback from employees when it launched into vending. “They [employees] thought that by adding a new service, we were going to get rid of janitorial. There was a lot of worry, but that wasn’t the case at all,” said Brown. “I wanted to keep growing our company and expanding services was a way to do it. We didn’t get rid of janitorial and we won’t — it’s the foundation on which our company was built.”
Though the learning curve was steep, Brown continued to push forward, keeping his customer at the center of the operation.
The personal touch
ReFresh strives to ensure that each consumer experience at the vending machine point of sale is rewarding. To meet that goal, Brown and his team created ‘My Support.’ “My Support is a program where customers who experience issues at the machine can text or call our ‘My Support’ program number listed on the vending machine and get connected with a representative right away,” said Brown. This program not only improves the customer experience, but it helps ReFresh improve as a company as well.
A focused and dedicated customer experience isn’t the only thing that sets ReFresh apart; a good employee experience is important to the organization, too. The ReFresh team is the backbone of the company, says Brown, whose wife, Victoria, operates the company as president and COO. “You have to interact with your people,” he said. “Helping your employees out with a task or even giving them a firm handshake is important.” Brown places a lot of emphasis on hiring people with varying skills. “That’s how you build a good team,” he said, “by hiring well, providing continuous training and empowering your employees.”
ReFresh has a lot of improvements planned for the coming year — and its ability to adapt with the changing market has led to its current growth. “We will always look at new ways of doing things and we will always see how we can trim costs to stay competitive, but that will never affect our promise that our food will be reasonably priced, our machines will be new and clean and our service will be exemplary,” finished Brown.