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Issue Date: Vol. 52, No. 12, December 2012, Posted On: 12/26/2012


Renewal


Marcus Webb
TAGS: Amusement and Music Operators Association, AMOA, Andy Shaffer, coin machine industry, coin-op news, tavern business, video games, amusement operator, jukebox, arcade games, small business, vending, vending machine, vending operating, Marcus Webb, Vending Times editorial


Association leaders usually attempt to sound upbeat about the music and games industry. Even when conditions are terrible, they understandably feel it's their job to put the best possible face on things.

Despite expecting to hear positive spin from trade chiefs, we are still pleasantly surprised by the optimistic outlook that is being voiced these days by the Amusement and Music Operators Association's president.

"I'm excited about this renewal that is going on," AMOA president Andy Shaffer, Shaffer Services (Columbus, OH), told VT in an interview published last month.

To support his evaluation, Shaffer pointed to several key facts and trends that he has seen during his travels this year. Among them: improved cashbox earnings in many states. A slowdown of route consolidation. A small -- but significant -- influx of new operators into the coin machine and vending industry. And, the growing success of operators in many markets in learning how to cope with smoking bans, which have curtailed customer traffic in bars and taverns.

The amusement and jukebox machine trade has been down so long, and kicked so hard by so many, that in some circles any good news and positive outlooks are regarded with suspicion, if not outright scorn. "Too good to be true." "Can't last." "A meaningless exception to the big picture, which is basically awful."

Well, it's always easy to point to bad news and trouble. And it's easy to sound like a "realist" by claiming today is "gloom" and forecasting that tomorrow will be "doom." In fact, quite a few financial analysts make fortunes by doing just that. (As the old joke goes, the "bears" on Wall Street have forecast nine out of the past six recessions.)

So optimism may be out of style, and many industry members may be out of practice feeling it, but we believe that Andy Shaffer's upbeat observations deserve respectful attention and careful thought. They come from a man who has spent his life in the amusement vending industry, who has been elected to lead the national operator association (and the regional group in Ohio, his home state). They come from an industry pro who has been "on the ground" in about a dozen states, talking to operators, distributors and manufacturers about the day-to-day realities of their businesses.

It's worth noting that the word Shaffer used to describe what's happening in the industry today is renewal -- and we think he has it exactly right. To renew is to begin again, to restore or replenish, to revive and reestablish -- to bring back to a condition of original freshness and vigor.

Is renewal in this sense happening in the industry today? It likely is, and not just in isolated instances. True, sometimes these developments are small, or in their early stages. They may be a bit like spring plants putting up their first green shoots after a long, cold winter -- it's not a forest yet, but it's a good start. That's what renewal means.

By the way, notice what the AMOA president did not say. He did not say the industry was seeing a cyclical rebound and that as a result, the trade's gross revenue will soon be growing by a robust 5% or 10% a year. He did not say that everything was fine or that the industry had solved all its problems. He did not say that the bust is over so we're automatically heading toward the next boom.

Instead, AMOA president Shaffer looked at the tough side of today's market with a calm and steady eye.

Yes, consolidation is slowing, but not eradicated. It will still continue, to some degree, he said.

Direct sales are sometimes a sign of desperation (and operators hate them), he said. But it is also inevitable that more companies are going to try this tactic, he admitted.

The more operators focus on video poker or other risk-reward games, he said, the less they tend to buy traditional amusements. He acknowledged frankly that operator interest in VLTs is as strong as ever.

Cashbox revenues are trending back up in some states, he said. But he also recognized that the industry's fate is tied to that of the larger economy, which is hardly in wonderful shape.

The industry can learn something extremely useful from Andy Shaffer's bracing mix of optimism and realism. It's possible to have a genuine renewal going on, even while many conditions remain challenging. The question is, what do you focus on -- the problems or the possibilities? Andy Shaffer knows the right answer is both.


Topic: Editorial: Music and Games

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