The past year has been a difficult one in many respects. Persistent economic sluggishness has demanded increased effort without promising increased reward, and has slowed the pace of equipment upgrading. The year also was marked by far too many deaths, including the unexpected passing of two pioneers who made an incalculable impact on the industry, Victor H. Lavay and Morris (Tiny) Weintraub. Members of the "greatest generation" that emerged from World War II to create the modern world, they founded VENDING TIMES in 1962, as the full-line vending revolution was developing a full head of steam.
The passing of that generation casts a pall that is not lifted by our recognition of its inevitability, and that is deepened by reminding us of our own mortality.
However, life goes on. A poet of an earlier great generation, fighting in World War I, wrote: To you from failing hands we throw The torch; be yours to hold it high. We are confident that the current generation is developing a greatness of its own, and is equal to the task that lies ahead.
We think that 2004 will be a fine year to start tackling that task. The workplace service industries, always affected by economic difficulty, always have responded by tightening management controls and finding ways to improve productivity. These advances become visible to outsiders only after the situation improves and industry growth resumes.
This cycle of challenge and innovation produced machine-level accountability and a professional approach to security in the early 1970s, computer management systems in the '80s, and microprocessor controls and the beginning of automated data collection and analysis in the '90s.
All the elements are in place for the next advance, in which the best available data communications technology will be applied to machines in suitable locations, converting them into retail sales network nodes. The feasibility of this has been demonstrated, and most operators can see the advantages of it in high-volume sites.
Of course, economic recovery is the necessary precondition for this development, and we believe it is at hand. In fact, the picture has been brightening month by month since midyear. We suspect that the lag in business response has been caused more by the demoralization of the financial community than anything else. There always are dangers when specialists start treating their specialty, like stock valuation, as though it existed in isolation from everything else, like the efficient production and profitable sale of things people actually want to buy. We think that lesson now has been learned, at least temporarily.
Today's vending industry, like most businesses dealing primarily with people, is not very susceptible to blinders of that sort. While smaller operations, three decades ago, often could get by with product mixes chosen on the basis of margin rather than patron demand, it has become almost impossible for operators to do that today. Vendors have developed extreme sensitivity to their customers' desires, and extraordinary skill and tenacity in finding products that meet those desires. They sometimes need all the tenacity they can muster to persuade a supplier without a "vending" product line to sell them the things they want to buy.
The profound change in retailing that has taken place over the past quarter-century has been driven by information. Much ink has been expended on the technology underlying this transformation. Equally important is the impact of all this information on consumers. In the old days, local shopkeepers exercised real, if limited, control over the purchasing patterns of the people in their localities. Nearly every geographic area constituted one or several niches.
Today's market is "efficient," as the economists say: all buyers know what's available and how much it should cost. Sellers simply must meet this informed demand.Vendors have known how to do this for a long time, and are well-positioned to prosper as economic growth resumes. The vending industry can be a tremendous resource for identifying demand and obtaining trial of new products. Cooperation between operators and suppliers in improving communications and responding flexibly can be enormously valuable to both, and to the consuming public. We think the new year will offer very favorable conditions for initiating that process, and for reaping the early rewards.