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Issue Date: Vol. 50, No. 5, May 2010, Posted On: 5/19/2010


Just Before The Dawn


Tim Sanford
Editor@vendingtimes.net
vending, vending machine, vending industry, vending business, vending machine business, vending machine technology, vending route, vending operator, vender, vendor, Vending Times, Tim Sanford, automatic retailing, foodservice, food service, office coffee service, OCS, refreshment services

Anyone considering the history of the modern vending and office refreshments industry is likely to be struck by the correlation between economic difficulties and substantial advances in technology. The emergence of full-line vending, able to serve hot and cold beverages, food, candy and snacks, ice cream and cigarettes to large numbers of people around the clock coincided with the first postwar economic contraction during the second Eisenhower administration (that contraction was diagnosed as a "recession," and the term has stuck). The widespread acceptance of glassfront multiproduct machines, bill validators and microprocessor-based controllers occurred during the turmoil of "stagflation" and the downturn that succeeded it, on either side of 1980. The economic surprises of the late '80s and early '90s were accompanied by the development of practical glassfront cold drink machines and frozen-food venders.

Similarly, the emergence of coffee service as a distinct industry can be seen as another response to the cooling off of the postwar United States economy. Locations that could be served by daily route delivery of prebrewed coffee and various early forms of small-site vending became submarginal as costs increased while consumer expectations of price stability remained strong. Providing a brewer, pricing coffee by the brewed cup and letting the patron brew it, was an elegant solution.

From another viewpoint, the "learning curve" leading to the adoption of improved management information systems can be seen as proceeding through three stages. In the first, business is booming and operators are working diligently to meet demand. They hear about new technology, but do not have the time to devote to exploring it, nor do they see the need. Then business turns down, and everyone plainly recognizes the benefits of tightening control, streamlining inventory and improving efficiency. As soon as the economic climate starts to improve, they move rapidly to implement the new and better ways.

All of this is worth keeping in mind as we consider the present situation. Following closely on the heels of the cataclysm of 2007-08, cashless vending and remote machine monitoring are emerging from the niches in which they have been perfected, and finding mainstream acceptance. We suspect this acceptance will accelerate as the economy recovers.

Other things are happening, too, and it's important that we keep an eye on them. For one thing, improvements to infrastructure that are making wireless data communications increasingly reliable and affordable have set the stage for vending's rapid expansion into cashless vending and telemetry. But these developments also offer real opportunities for a coffee service to equip its route drivers to accept credit-card payments, authenticated in real time, and for a mobile caterer to offer its patrons the cashless convenience they enjoy at fast-food restaurants and convenience stores.

Two elements must be present for a new concept to win widespread acceptance: It must be practical, given the prevailing state of the art, and it must meet a need. Most of the breakthrough technologies in vending were demonstrated in prototype many years before being successfully commercialized.

The continued strong demand for wireless services is making them more available and more reliable. The pressing need to compete against other retailing channels and to operate more efficiently and productively has impelled the development of cashless payment systems and telemetry, but we don't think the process will end there.

As vending machines become equipped with displays that can be remotely programmed and updated, the applications for these surely will extend beyond advertising to a wide range of customer communication tasks. And it doesn't require much imagination to envision applying simple text-messaging capability to customer surveys. Alert operators always have known the value of these, and that value would be even greater if the process were faster and accompanied by immediate reward. Online surveying already is being done through networked jukeboxes. Electronic signage also might remind patrons of the benefits that vending brings them – a message that needs to be amplified in the present political climate.

We think that tying single-cup coffee brewers together in networks will become mainstream, too. This has been done, mostly in Europe, to allow a central station to keep track of machine activity and functional status. Operators who can offer clients automatic response to maintenance issues give those clients a reason to do business with our professional service providers. And a brewer on a network can be equipped to communicate with customers, and perhaps to interact with them.

There has been a good deal of talk about a "tipping point" at which our industry (and others) suddenly will be different. Historically, it hasn't happened that way. While we can appear slow to change, there have been dramatic transformations over a seven- to 10-year cycle. The next one is in progress, and well worth waiting for.


Topic: Editorial: Vending

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