One Hand Cannot Wash Itself

In this issue, we share the success story of Ken Frohlich, an operator who runs Pristine Springs Water Co. in Kingsport, TN. Last year, he took his vending, office coffee and pure-water business to the next level when he purchased a natural spring and bottling plant. Pristine provides water and coffee service to some 2,200 businesses and homes throughout northeast Tennessee, southeast Kentucky and southwest Virginia.

One of the things that struck me about Frohlich's narrative is that he credits much of his success to the many industry veterans who have helped him along the way. He also emphasizes the need for everyone to continue to work together as an open, sharing team, in order to attract and encourage younger people to recognize the opportunities and become involved.

"I was a confident businessman, but our vending, coffee and water businesses never would have been nearly as successful without the tools and information provided to us by other industry members," Frohlich said. "From operators I met at trade shows to sales reps on the street, so many people shared their wisdom. Some of the smartest operators were willing to accept phone calls and help by sharing information on how they ran their businesses. They didn't have to, but they were just great, generous people."

We must all hang together, or surely we will all hang separately. We must all work well together and devote our complementary skills toward our common goal of prosperity. Why, then, is it that so many organizations (our present government included) do a poor job of fostering cooperation? I have seen too many companies in which open conflict existed, not only among individuals, but also between departments. Imagine working for a company where different teams do their best to sabotage each other's efforts. How long can a business (or a government, for that matter) stay viable when people refuse to work together toward the common goal?

Some operators feel that helping a newcomer just creates more competition, and so it's better to ignore them and hope they disappear. The more statesmanlike view is that you are going to have new competitors anyway, and it makes better sense to educate them so they do not make costly mistakes that hurt everyone in the market.

I've been in this business long enough to have witnessed a few bad apples spoiling the bunch: blue-sky companies that come in with grand plans that delude gullible investors and hang them out to dry. Others had some great ideas and the best of intentions, but without proper financing, were unable to get into production. Some suppliers didn't get the right patents and/or trademarks and had to shut up shop due to the threat of litigation by companies with deeper pockets. The apparent ubiquity and universal appeal of vending creates the recurrent problem of get-rich-quick schemes, but also has fostered an environment in which entry into the business is easier than it ever has been.

In fact, our featured water operator got his start in business when his partner saw an ad for a "get rich quick in vending" presentation at a nearby hotel. He was skeptical, but he'd had a neighbor in Virginia Beach who made a decent living as a vending operator, so he decided to attend. After doing his homework, he "dipped his toe" into vending by purchasing a business from a local operator with 18 machines.

The ingenuity and imagination of small operators always has been one of our great strengths. The vending, coffee service, and coin-operated music and amusement businesses are fascinating because they offer such a range of opportunities to creative people. There aren't many retailing methods that can succeed in so many ways.

Small operators can find a voice by joining trade associations like the National Automatic Merchandising Association, Amusement and Music Operators Association and National Bulk Vendors Association. Over the decades, strong independent vending companies have formed cooperatives to gain economies of scale, simplify supplier communications and facilitate cooperative marketing. Several years ago, a group of music and games operators got together to form Club Lucky to cooperate in tournament sponsorship, purchasing and bidding on national business. Collectively, they represent substantial volume; individually, they fly beneath suppliers' (and large clients') radars.

Frohlich served on the boards of the Better Vendors Association and Unified Strategies Group, both purchasing cooperatives, which introduced him to some of the most successful operators in the country. "Some of them really paved way for guys like me by being open to share," he said. "They learned the hard way. Without them, I would have struggled more."

So let's heed his advice, pave the way for the "newbies" and find ways to bring in the younger generation. Vending is a business with tremendous opportunity.