FLORENCE, AL -- Equipment experimentation has become a necessity for many operators. A large percentage of longtime bulk vending professionals has found the process is not quite as easy as investing in new equipment and putting it out on location. But neither is it as daunting as starting from scratch.
As bulk operators across the country are discovering, diversifying their offerings often requires learning new strategies, along with adapting existing skill sets and resources. Even for long-held locations, operators may need to rethink how they can effectively market and maintain new types of equipment.
Those operators willing to take the time and make the effort are reaping rewards. Cranes and prize merchandisers are not only highly profitable, compared with basic bulk machine heads, but also save locations from encroachment by competitors. They also open doors to new locations previously closed to bulk vending.
Steve Schechner, Capital Vending (Florence, AL), recently learned a good many of these lessons firsthand when he took on LAI Games' Mini Stacker. A scaled-down version* of the highly successful prize merchandiser that awards minor and major prizes, the Mini Stacker seemed a complement to his bulk vending route, which already included a number of cranes, Schechner told VT.
Introduced in 2004, Stacker is a prize-vending device that builds on LAI's highly successful Lighthouse. Lighthouse introduced the concept of merchandising high-end prizes through a skill-based, coin-operated amusement machine; Stacker expands on the big prize concept with a progressive prize system that allows players to win smaller prizes before trying to earn more luxurious merchandise.
While the Stacker is a proven concept, there were no guarantees it would work on a bulk vending route.
According to Schechner and his team, there was a learning curve when it came to the new piece. "The first place we put it was a bingo hall on the Alabama-Tennessee border called the Miracle Mile," said Adam Butler, Capital's service manager. "Our plush crane does really well there, but nobody seemed interested in the Stacker."
After a few weeks of unimpressive results, Capital pulled the machine from the bingo hall. Even though the company's cranes had a following in the location, Butler theorizes the Stacker's sales fell flat because the demographic may have been too old for the new machine.
The next stop for the Stacker was a mom-and-pop truckstop. The results were marginally better, but not impressive. "The people at LAI said we should do about $200 a week with the unit, and that's what we were looking for," Schechner said. "So, we pulled the machine again."
Pulling the small unit out and moving it to a new location was not much of a problem because of its small size and handle positions. Capital typically removes underperforming equipment from locations.
"I've been preaching moving machines around for the last 10 years," Schechner said. "The fact is, bulk vending equipment [full racks] is heavy to move around and most guys don't want to do that. However, if they go into alternative areas of income, like a Stacker, it makes sense. It is lightweight and worth the effort if it does $120 a week in the right location."
THIRD TIME'S A CHARM
The next stop for Capital's lone Stacker was a movie theater. The machine's sales took off with movie patrons lured by prizes that include iPods and home videogame systems. Weekly earnings shot up to $180 a week.
Schechner and Butler credit factory support for the machine's eventual success. "I had some doubt about the machine," Butler said. "But LAI worked with us. I bet we talked to them three or four times a week."
These phone calls, according to Schechner, focused primarily on the types of prizes the machine should offer, as well as payout percentaging. Interestingly, Schechner found that traditional high-end bulk merchandise worked well for the minor prize offerings while stocking the unit with name-brand electronics drew in players for the major prizes.
"He did move it around and kept changing the product," said Chris Brady, LAI's new business development manager. "Every week we'd hear from them and the machine would be making more and more money. The thing about Steve and Adam is they were never discouraged. They realized from the start it was all about location and merchandising."
According to Brady, the skill set involved in bulk vending is not that far off from what it takes to successfully operate prize merchandisers. "If Capital Vending is any indication, then bulk vending operators clearly understand merchandising," he said. "But they have to learn how to use higher-end merchandise, which is new for them."
*SIZING UP STACKER: Standard Club = 78.75" H. x 28.6" W. x 30" D. (375 lbs.)
The Mini = 70" H. x 21.2" W. x 24" D. (198 lbs.). LAI also makes the 75" W. Giant Stacker