IT Experts, Seasoned Vendors Say Careful Planning And Sharp Focus On Basics Eases Technology Upgrade

Posted On: 12/9/2019

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LAS VEGAS —The challenge of adopting fast-evolving information technology in an existing vending business was addressed by a panel of IT experts and experienced operators at the 2019 NAMA Show. The session, which led off the education program, was moderated by Hannah Davies, Greenhithe Software Solutions. Her panelists were Bill Lockett, Vend Sys/Nayax; Larry Greenwall, Greenwall Vending (Poplar Bluff, MO); Mike Ferguson, VMAC Solutions (Houston, TX); Steve Crosby, Company Kitchen (Merriam, KS); and Johh Hickey, Tech 2 Success.

Davies introduced the panelists and asked Lockett to lead off with an overview of the reasons an operator might have for switching from traditional inventory control, accountability and route planning techniques to a contemporary system built on automating the flow of information.

Lockett, whose lengthy career began when direct-store distribution businesses began to adopt the original DEX (Direct Exchange) system, explained that today’s vending management systems have proven their ability to increase the capacity of a vending or micromarket route by as much as 30%. These gains, however, are only attainable in an operation that has set up the appropriate procedures, and that requires “buy-in” by the route drivers.

“The upgrade should be presented as a real benefit to the drivers, whose sales will increase because they’re working more productively,” he said.

Lockett advised operators to look at the available route management solutions, keeping in mind that micromarkets represent a growing segment of the business. “Get references before you buy,” he recommended.

The next step is to make sure that everyone in the organization has an email address, and anyone who works in the field has a GPS address. Methodical implementation of a new system that everyone has accepted and looks forward to using makes the transition much smoother and decreases the time required to get up to speed and begin realizing the full benefits.

Larry Greenwall of Greenwall Vending described his experience with the upgrade process. “We’re a small operation,” he explained. “I was using paper route tickets, and I looked around for a better way.”

He decided to use a “hosted” system, which frees him from dealing with software installation and maintenance. “And I wanted a complete solution that can handle routes and the warehouse, and is upgradable,” he added. The cheaper packages of this sort are simple, designed primarily for street routes serving basic machines like gumball venders; Greenwall wanted a comprehensive, flexible program.

“I did all the initial data entry myself, in order to learn the system,” he reported. “Once we went to handheld computers, we began to see the benefits.”

COMMON LANGUAGE

“I say: ‘surrender to the system,’” the Missouri operator said. Suppliers have their own nomenclatures for tasks and procedures, and it’s easier all around when the operator adopts the terminology of the chosen supplier.

The VMS provides machine-level sales forecasts based on the data captured and returned by DEX-capable venders. “We began to pre-kit the routes, which really increased the benefits of automation,” Greenwall reported.

The next step was the addition of telemetry in locations that were the most problematic to forecast. This enabled the machine to provide frequent inventory, audit and status reports; at present, Greenwall is getting two DEX uploads per day.

“We integrated the vending and micromarket reports, and we began to pre-kit for both,” he continued. “What’s next? Going from handheld computers to smartphones – everyone has a smartphone today. We’ll use the phones’ Bluetooth transceivers for DEX readings.

“The object is to make it simple for the driver,” Greenwall emphasized. “We’re now looking for an app that will allow our customers to buy snacks without using the micromarket terminal.

“I want that ‘next level,’” he concluded. “As a small operator, it’s well worth having.” Moderator Davies then introduced Steve Crosby of Company Kitchen, which had become well-known as Treat America.

“We all have preferences,” Crosby said. “How do I want to run my business? How do you want to run yours? Choose the technology that suits your model.

“We had been Treat America,” he recalled. “Then we went all in with micromarkets.”

It’s sensible for an operator to compare vending management systems, Crosby observed. “And what do you do when you have one and want to replace it with something different? It’s very tough, like replacing an aircraft engine while the plane is flying.” Close study and careful planning are essential, he said; “then choose the one that feels right to you.”

Similarly, pre-kitting – assembling route orders in the warehouse for each location on a machine-by-machine basis – has real advantages, but comes with a learning curve. “Decide what you want from it,” the panelist advised. “Determine the quantities that you will round off to: the case? The carton? And if you maintain commissaries, they will have their own logistical needs."

Company Kitchen’s increased emphasis on micromarkets also conditioned its search for an up-do-date VMS. The best available sales forecasting is necessary for efficient prekitting, and the quick availability of detailed information is very valuable in determining the best route structure: is it better to organize a separate route for food? Is it better to set up separate micromarket and vending routes? Is a “static” or a “dynamic” scheduling system preferable? The answers may be different for rural and for suburban routes.

The operator also should consider capabilities that may not be required right away, but will be desirable as the operation expands. “You might want to add security cameras,” he instanced.

“Know what you want,” Crosby advised. “ And put the right processes in place.” Repeating a recommendation that software  suppliers have made to their operator prospects for half a century, he observed that everyone he spoke with during the upgrade process said: “If you had implemented effective processes, your previous system would have worked.

While every client is different, there are common variables that an operator can control, like waste and staleage. Putting a good warehouse picking process in place – which involves supervision, monitoring and training – can allow the manager to determing how often the warehouse inventory turns, and how much product is returned.

The next speaker was Mike Ferguson of VMAC, who recommended that operators planning to upgrade their technology start out by making sure that their route vehicles are equipped with decent shelving. “And look at your warehouse layout, whether or not you’re presently pre-kitting,” he urged.

Inventory represents cash, Ferguson emphasized, and making sure it’s handled efficiently is an important first step in adding automation. The object is to remember that stock-picking is done by service cycle, not by product.

“Carton flow” warehouse shelving, in which product is stored on shelves that are filled from the back and accessed by the pickers from the front, has been available for a while, and remains a very good idea. Among other virtues, Ferguson said, first in, first-out carton flow is self-rotating – the item picked always is the one that has been on the shelf for the longest time.

Picking efficiency is enhanced by working from lighter items (like bagged snacks) to heavier ones (like pastries), he continued. With efficient warehouse (and truck) product storage and access in place, it’s time to pay close attention to the workflow. “Don’t thoughtlessly keep adding pickers,” Ferguson advised. “And look for flexibility in route ordering.”

A “pick-to-light” system, in which pickers move sequentially from one shelf to the next, guided by lights that are turned on to show the location of the next item in the order, can save a great deal of time for an operator who has detailed product information. “You can use carts or dollies instead of roller conveyors,” the speaker said. “Select tools that work your way.” And it’s helpful to draw floorplans that show the workflow, he concluded.

INTERNET TOOLS

The last to speak was John Hickey of Tech2Success, who led off by warning: “Amazon is coming for you!” The best defense is to use Internet skills and tools to improve communication, he advised.

“Today, you want ‘mobile-ready,’” he emphasized. “And you want ‘live chat,’ for quick interaction.”

It’s become axiomatic in vendng that there’s real benefit in permitting patrons to pay by whatever means they wish, from cash to the various mobile payment services. Ferguson pointed that this is equally advantageous to operations that bill clients for quantity shipments, like coffee service.

EXPANDING LINE: On display at the 2019 NAMA Show was the growing variety of Vendors Exchange International Café Curve update door kits for legacy “full-house” hot beverage machines. Here, VEI’s Stephanie Kull describes the line to Josh Volturo, Blue World Inc. (New York City). The VEI kits include ultramodern design and styling, with decorative aluminum trim, bright LED accent illumination, a backlit advertising panel and custom graphics options. Kits are supplied with a customizable 21.5” touchscreen customer interface. They comply with the requirements of the Americans with Disabilities Act and feature the VEII Universal Control Board, fully compatible with DEX and MDB, remote pricing, operator programming and service screens, and enhanced product management. Kits are now available for National 673, 653, 633 and APi 213 machines. The 213 kit includes a redesigned mixing-bowl.

“Be sure that customers can pay with their chosen method,” he urged. “When you can give them the payment terms on the purchase order, it’s helpful – you can include options like Amazon Pay.” This is an Amazon service that makes use of the e-commerce giant’s very large consumer base to allow those users to pay with their Amazon accounts on other merchant sites.

“And you can offer ‘bundling,’ – a customer who buys this often buys that,” Hickey added. “This is very helpful for cross-selling: ‘You ordered cups; do you need lids?’” This is a classic “bridging” technique long used by OCS route sales drivers, and it can be employed more easily and on a larger scale through a website.

“Coupons drive behavior,” the speaker added. “You can communicate with your customers through your e-commerce store.”

Today’s buyers are often younger, and they make greater use of online resources like Google reviews to select suppliers,” Hickey pointed out. “And they expect more from us.

“Today, text messaging is the most preferred communications medium, but we don’t use it much. There are text-messaging systems, like Slick Text, that support a variety of interactions with customers, and also gets text-message addresses,” the speaker observed. “Another useful one is Twilio. It’s important to focus on communications; good communications can solve – and sometimes prevent – problems.” Business communication services worth exploring include Slack, Microsoft Teams (with Microsoft’s Office 365 suite) and Facebook’s Workplace. All of these solutions are very useful for communiction among members of a team.

“What I hear most often from operators today is, ‘ I just don’t have the time to get out and talk to customers,” the speaker concluded. “Tools available to help improve matters here include LinkedIn, Constant Contact and Mailchimp.” A key to benefiting from a technology upgrade is becoming familiar with the growing variety of tools available to make life easier for managers.