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Day 1: Government Mandates, Micromarkets And Technology Theme 2012 Atlantic Coast Exposition

Posted On: 10/5/2012

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TAGS: vending, vending machine, micromarket, automated retail, Atlantic Coast Exposition, U-Select-It, Heidi Chico, Americans with Disabilities Act, Department of Justice, Equal Employment Opportunity Commission, epartment of Energy rules for vending machines, vending machine power consumption, Gaye Tankersley, Food Service Inc. USA Technologies, LightSpeed Automation, Randy Smith, MEI, Chuck Reed, Vendors Exchange International Inc., cashless vending

Heidi Chico, U-Select-It, vending machine MYRTLE BEACH, SC -- The 2012 Atlantic Coast Exposition was highlighted by a business program that zeroed in on subjects of immediate concern to operators today, and a sold-out exhibit area that overflowed into the registration area. The confab opened today and closes tomorrow, Oct. 6.

The business sessions began with an update on legal and regulatory issues by U-Select-It president Heidi Chico. She reviewed the changes to the Americans with Disabilities Act that took effect on March 15; its enforcement is the responsibility of the Department of Justice. Chico warned that the Equal Employment Opportunity Commission also can file a complaint alleging discrimination against a disabled individual. She emphasized many things that operators need to know, such as the applicability of the new rules to office coffee equipment and micromarkets and the precise assignment of liability to the location and to the operator; and she urged operators to get in touch with their elected officials to push for clarification, and to advocate enactment of a specific time period during which the complaint can be rectified before legal action proceeds.

Chico also explained that the exact requirements for compliance with the caloric-content disclosure mandate in the Affordable Healthcare Act have not been specified, and are not likely to be until after the November elections. Here again, she said, it is important for operators to speak with those who represent them in Congress, to urge that these requirements be reasonable, and that provision be made for a grace period during which the operator can correct a deficiency (a product inadvertently loaded into the wrong slot, for example) before penalties are assessed.

She concluded by reporting that new Department of Energy rules for maximum power consumption by vending machines took effect on Aug. 12 of this year. These rules apply only to new cold beverage machines, not to combination venders nor remanufactured cold-drink equipment, although the subject will be revisited by the department in the future. "The bigger issue for your clients is that they're interested in reducing their 'carbon footprint' through improved energy efficiency," she said.

The second session was an operator panel discussion of actual experience with micromarkets. The moderator was Scott Denhard, Compass Group/Canteen (Charlotte, NC). Panelists were Canteen's Mike Coffey; Terry Durling, Vendable Systems Inc. (Rock Hill, SC); Scott Halloran, Trolley House Refreshments (Richmond, VA); Carl Moser, Cardinal Canteen (Ashland, VA); and Zed Bradley, Piedmont Vending (Charlotte, NC). All agreed that micromarkets in locations suitable for their deployment outperform full-line vending machines in terms of sales, chiefly because they can display a wider variety of desirable merchandise, including food and beverage items perceived as "healthier" or otherwise higher quality, which attracts wider participation by employees in the account and commands higher prices.

Panelists noted that the lift in sales and profits is especially marked with fresh food. This shows the potential of the new concept for justifying a whole new look at food by vending operators, but also requires rigorous attention to datecodes -- and extended shelf-life items do not do well in micromarkets. Because of the wider variety and the short shelf-life, food waste is a bit higher, but the panelists agreed that the greater volume and profitability more than offsets it. And frequent rotation of new products through the micromarket is essential to keeping it "fresh" and so maintaining customer interest.

The panel concurred that early concerns over pilferage, bottlenecks at checkout and excessive spoilage have turned out to be unfounded, since these have been lower than feared, and more than compensated for by the ability to collect sales tax, the increased participation, the ability to offer attractive merchandise at higher prices and the increased sales volume.

The final business session dealt with technology, and was moderated by Gaye Tankersley of Food Service Inc. (Lexington, SC). USA Technologies' Mike Lawlor, LightSpeed Automation's Randy Smith, MEI's Chuck Reed, and Vendors Exchange International Inc.'s Chris Goumas offered overviews of new tools available to operators.

Lawlor provided the latest statistics on the adoption of cashless payment technology, which demonstrate that the option increases sales, and this effect is more pronounced with higher vend prices. MEI's Reed observed that today's consumers are increasingly unlikely to carry large quantities of change and low-denomination bills, so the ability of modern bill validators to accommodate $5s, $10s and $20s can be valuable -- if the problem of "changer starvation" is addressed.

Bill recyclers do this, he said, making it easier for more customers to patronize the machines. VEII's Goumas explained that Intel is exhibiting strong interest in vending, recognizing this industry's potential for dramatic transformation and growth through adoption of a state-of-the-art operating platform. This can enable vastly more capable and versatile graphics, interaction with social media to increase consumer engagement, and new partnerships with suppliers for market research, advertising and sales promotion. LightSpeed's Smith, who has led the development of a popular warehouse automation tool that integrates with vending management systems, emphasized that the path to technological progress involves initial choices, and allows no turning back once it's embarked upon. Keys to a successful journey are good initial planning, budgeting, involving everyone who will be affected, and forging durable partnerships with reliable, capable suppliers who are committed to the industry and its future.

The 2012 Atlantic Coast Exposition was the 57th in a series that began as the Carolinas-Vending Convention in 1955. It is cosponsored by the North Carolina Vending Association, South Carolina Vending Association and Virginia Automatic Merchandising Association. Information about the three-state convention and trade show may be found online at