Sowing The Seeds Of Automation

Posted On: 5/9/2017

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TAGS: Vending Times, Vending Times editorial, vending industry, coin-op, vending machine, coin machine business, office coffee service, vending machine operator, micro markets, Alicia Lavay, cashierless convenience, Amazon Go, robotic stores

Alicia Lavay, vending, Vending Times

I have been receiving more calls than usual from companies inquiring about the vending industry, and how they might adapt a product or service to meet the needs of today's operator.

"Cashierless convenience" seems to be a trend, and a lot of savvy businesspeople want to get in on it. Amazon especially wants a piece of this market. The online retail giant unveiled its first small-format robotic grocery store, Amazon Go, late last December, and it's one of at least three formats for brick-and-mortar food stores it is exploring (can you say "micromarket?")

Clearly, to those of us in the vending business, automatic retailing (or robotic retailing or electronic retailing) is not at all new. If it's a trend, it's one that has been going on for a long time now. And if the trend is technology, there is nothing new about that either. Vending has always been a technology-based enterprise, and this industry prompted (or, at least, catalyzed) the development of many commonplace items -- replaceable-cartridge water filters, microwave ovens, single-serve packaging -- that we take for granted, but that hardly existed six decades ago. Finding and applying the best technology is essential, and the real (but often elusive) object of the search is something that will be of benefit to the customer and the operator alike.

Here at Vending Times, we've always seen new equipment designs and contemporary merchandising ideas cross our desks. What makes things different now, and what does this mean for our business? What has changed over the past decade? The key is that anything that offers new capabilities impels imaginative people to find novel applications for it, and when a number of such things appear in quick succession, imaginative people start finding ways to combine them to create a new set of capabilities. This process takes time.

Many innovations have become commonplace in our modern world as they have become less expensive, and they have found application in vending. This offers great benefits to established players, but also challenges them to deal with legacy equipment and processes. But those same developments can also be an advantage to a newcomer with a good grasp of computers and telecommunications and, of course, some mechanical flair -- and good selling skills (some things never change). And you don't have to be a merchandising giant like Amazon or invent a self-driving car to enter the robotic retailing market.

Just this past month, I've spoken with a company that sells a vending machine that dispenses rollable flat-shoes, an online retailer that wants to market its automated massage chair to arcades and a former jukebox executive who now represents a company that will buy back your old cellphones and other personal consumer electronic devices through a [reverse] vending machine. Many such businesses already advertise in the pages of Vending Times, and some are exhibiting at the National Automatic Merchandising Association's 2017 OneShow in Las Vegas, April 19-21.

Most of these ideas are not new, but aside from access to technology software that makes vending machines "intelligent," they all have another thing in common: they are adapting their offerings to meet the changing needs and expectations of the locations they serve.

For a long time, the retailing industry has explored vending -- or unattended points of sale -- tentatively, as a possible method for handling transactions that do not require the services of a clerk. Until recently, these experiments have not caught on because the technology could not provide sufficient capacity, selectivity, pricing flexibility and customer interactivity But now it does, and there is a huge opportunity for a much wider range of unattended retailing innovations based on vending.

From traditional vending and office coffee service to an upgraded beverage and snack experience in an enhanced breakroom environment, cutting-edge operators know they must offer both value and convenience to their clients and patrons if they want to succeed. Much of the recent growth in our industry has come from convenience-driven opportunities such as micromarkets and single-cup brewing systems (both of which employ technology originally developed for vending machines), and operators are in a prime position to be the "go-to" retailers in a varied location types.

The vending industry has sown the seeds for this development by accustoming the public to round-the-clock convenience, and perfecting payment systems for unattended points of sale. The integration of appropriate micromarket or pantry, vending, entertainment and "virtual store" systems into a satisfying and engaging experience provides benefits to everyone involved. Networked machines, affordable consumer-responsive displays and pricing systems of unprecedented flexibility and sophistication have accelerated opportunities for our business.