35 years of growth

April 1, 2013

J&J Vending of Union City, Calif. turns 35 this year. The Canteen franchise, started by father and son Joel C. (Senior) and Joel E. (Big Joe) Skidmore in 1978, had four accounts. Now there are more than 1,300 machines and eight routes. With the addition of the third generation, Joel E. Skidmore's daughter Jennifer, the company expanded its business into office coffee and pantry service at a time when vending was feeling the recession, and the operation continues to innovate. J&J's latest addition, micro markets, has brought the company a number of new locations.

Partners from the start

In 1978, Skidmore Senior was working as a manager for Canteen of Burlingame when they approached him with a franchise opportunity. They would take larger accounts, but send smaller locations to him for vending service. He agreed and asked his son, only 17 at the time, to become a full partner in the new business - J&J Vending. They ran it out of their home garage.

Now J&J vending resides in a 12,500 square-foot facility. The operation serves businesses making up to $40,000 in vending revenue throughout the San Francisco Bay area.

Through the years, Skidmore found it both a pleasure and struggle to work with his father. Skidmore Senior was resistant to new technology, like the handhelds and vending management software the operation added in 2003 in order to increase the cash accountability and inventory control.

"When I was the young one and worked with my father, he resisted a lot of things," said Skidmore. "I always said if I had a child working here, I would never say no." Skidmore's declaration would be put to the test in 2009 when his daughter started working full time at J&J Vending.

Skidmore senior retired in 2004. He passed away in 2010. That year Skidmore and his wife, Brenda, bought the outstanding company portions and become sole owners of the franchise.

Third generation expands business

Four years ago, after graduating college, Jennifer Skidmore was looking for a job. Her father suggested she work at J&J on a temporary basis. She agreed, but soon realized it was something she really enjoyed. "It's fun," Jennifer said. "And I really do enjoy working with my parents. They're my best friends."

Almost immediately Jennifer added an office coffee service (OCS) division to J&J. She got the idea from attending a NAMA show where coffee was featured as a sales growth strategy during the recession. "It seemed OCS was where the money was," said Jennifer. J&J has been successful using mostly drip brewers. It doesn't have a private label, but offers brand names and local coffees. "It's kind of a trend to go local in this area," said Jennifer. The company offers some single-cup options as well such as Keurig and Newco pod brewers.  

Along with OCS came pantry service, where a location pays for free food and beverages to be provided to employees. J&J provides the coolers and snack racks, often branded with the location name and logo, as well as delivery of the refreshments. "It's really resulted in big growth for us in the last year," said Jennifer about pantry service.  

Jennifer's other contribution to J&J was more philanthropic. One percent of J&J's OCS sales go to Planting Justice, an Oakland, Calif. based non-profit which is dedicated to food justice, economic justice and sustainable local food systems. Also, this year Jennifer is planning to start an apple orchard on the company's property. Dedicated to her maternal grandfather, the fruit from "Papa's Garden" will be donated to local food banks.

"Who would have thought my third generation would have brought so much to the company," said Skidmore. He also credits his wife and partner in the business. "Brenda, my wife, is a huge part of our company," said Skidmore. "She runs the office and keeps Jennifer and me in check." She will ride with route drivers or make deliveries - whatever is needed.

Technology will bring new efficiencies

While Jennifer is the newest family member to work at J&J, she remains dedicated to the business and services it provides. She is excited about the next 5 to 10 years and how technology will better the operation. "Vending could be a lot more efficient," she said. The company is planning to add prekitting in the next year and a warehouse product picking system.

Already, J&J has added micro markets. "We started with Avanti in 2011," said Skidmore. "But have since changed to Company Kitchen systems." Company Kitchen allowed J&J an exclusive territory and Skidmore preferred the high-end look of the shelving and furniture. "It's more like office equipment," he said.

Local fresh food

J&J uses a local foodservice provider to supply fresh food to the markets. The micro market driver delivers food on Mondays and Thursdays. "We sell a lot of salads," said Skidmore. Other popular fresh food products include yogurt parfaits and fresh fruit. On the frozen side, J&J has had success with frozen meal replacements like Weight Watchers and Lean Cuisines.

Micro markets increased J&J sales 70 percent in the first location Skidmore tried. Part of that was likely due to the fact a food machine was not previously offered, but the concept has been successful elsewhere as well. J&J converted one existing account, but has gained two new locations just for the micro market segment.  

Shrinkage hasn't been a problem in J&J markets. Skidmore finds the flat screen television showing people in the market is a deterrent. Locations also police themselves. He'll get notifications from a customer that a certain employee might have taken an item without paying. Skidmore checks the account and will let the location know the situation, such as if there was a credit on the account. He thinks his shrinkage averages 2 to 5 percent, depending on the market.

Investments in vending too

Micro markets aren't the only place J&J has invested in technology, however. The company has added LED lights to vending machines and a retrofitted touchscreen door on a machine at a hospital. J&J is also advancing its cashless payment program -- already, about 5 percent of the machines except credit and debit cards. "All the new installs have cashless," said Skidmore. "The workforce has changed. People, myself included, never carry cash. Everything is on credit cards."

Thirty-five years is a longtime to be in business. Skidmore keeps the momentum going by embracing, instead of resisting, new technologies and business lines including new ideas from the third generation - his daughter. With new revenue streams and giving back to the community, J&J Vending is poised to be successful in the future.


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