U.S.A. - When speaking with operators, suppliers and manufacturers about ball gum and confections, several things become apparent almost immediately. Ball gum and confections are either doing "great," "terrific" and "amazing," or they are "so-so," "leveling off" or being edged out of key locations by high-bounce balls, capsuled items and flat vendibles.
Oddly, the dichotomy of these two assessments does not make them mutually exclusive. In a marketplace that has experienced expansion into new venues with ever-swelling demographics it is not unusual , or even unexpected , that a certain degree of market turmoil exists. The gumball or confectionary vender displaced from the bowling alley in favor of more capsuled merchandise may very well find a welcome home in the car dealership, hip clothing boutique or comic book store. And, too, ball gum and confections continue to open doors for operators seeking to expand routes. After all, there is nothing so familiar as a gumball machine.
If this expansion is not apparent to all operators, it has certainly been noticed by manufacturers and suppliers. Never before has such a wide range of product offerings in the ball gum and confectionary market segment been available. Just as capsuled merchandise has expanded into the teen, young adult and ethnic demographics over recent years, so too have ball gum and confectionary offerings. The appeal of these new products extends far beyond the traditional bulk marketplace. From the well-known branded items to so-called "house brands," it is now possible to find products appropriate for virtually any demographic.
And with ball gum and confections offering the highest profit margins in the industry, this is good news indeed. VT recently polled a few industry experts for their observations, and not surprisingly, those views are as diverse as the marketplace itself.
John Masanotti, Oak Leaf Confections: Excuse the pun, but gumballs are rolling along. Seriously, gumballs are doing fine. We are launching new products every year and people are excited about that part of the market. We have new flavors and concepts, like the "Gourmet" line, which has become quite popular. And we have "Bubble King Classic" that we're launching at this show, which is a nice gumball with superior taste. It's also a softer chew, because we use a combination of gum bases. So we're expecting a lot from that product.
We've also expanded our candy line dramatically during the last couple of years. We've been launching a product a month for the last year; new shapes, new colors and new flavors. There are locations where gum is not permitted, so candy and jawbreakers are a good alternative. I hope it continues to expand.
Michael Seelig, Willy Wonka Candy Factory: Branded products continue to sell well. Without the brand, the product would just be another product on the shelf. The brand is the message that we use to get the consumer familiar with the product. It helps pull it out of the machine and off the shelf.
We see [bulk vending] as a growing piece of our business. We bring well-known branded products that lend credibility. In a bank of bulk machines there's hopefully a branded product along with a non-branded product, and the branded product lends credibility to that whole bank of machines.
Steve Kovens, A&A Global Industries: The candy industry is going well. As far as vending machines, in a rack of machines you used to have five or six bulk heads devoted to candy or bubble gum. The industry changed and a lot of those heads have been converted to capsules. The reason some operators are turning to capsules is that capsules sell a lot faster, and you can get a lot more turns. We've seen a trend with operators converting to capsuled toys.
Yet the profit margins on candy and gumballs remain the highest in the business. Plus you don't have to change product as often as capsules. Today you're seeing a lot of creative candy with different shapes and different characters. And, there are a lot of new and exotic confections out there. So I would advise operators not to neglect their gum and confections.
Phil Kalbaugh, Concord Confections: It's going good. The fact that we've changed everything and have gone into printing all of our gums has been the biggest change for us. It's all going to be printed with "Dubble Bubble." For instance, our "Cry Baby Tears" will still be "Cry Baby Tears," but they will be branded with "Dubble Bubble." We previously did it on our vend cards, but now we're actually going to be printing the gumballs.
We feel our brand is strong enough. If you look at what's going on in branding, it makes sense. Why does Coca-Cola put its name on vending machines? We feel as if we're doing the same thing for bulk vending. Most of the operators I'm familiar with are actually expanding their gum and candy because that has the highest profit margin and the lowest cost per vend. So they have actually increased their edibles instead of decreasing their edibles. Branding is going to play a more and more significant role in the future.