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Asking The Right Question

Posted On: 2/23/2012

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Tim Sanford, Vending Times, full line vending, snack vending machine, vending, vending machine, vending industry, vending machine operator, 10th vending product, automatic retailing, postmix vending machine, vending machine technology, coffee break, break room

Our earliest experiences with the vending industry included several interviews with executives of leading machine manufacturers, back in the late 1960s. One of them raised a question that we have pondered ever since: "What is the '10th vending product?"

The rationale for this question was that the full-line vending industry, as it had developed over the preceding decade or so, had found ways to deliver an increasing number of popular consumable items: chewing gum, confections, cigarettes, milk, ice cream, soft drinks, hot beverages, hot canned soups and entrees, and refrigerated food.

As the product mix widened, vending's market did, too, as it added the ability to provide anything from a snack through a coffee break to a complete meal, at any hour of the day or night. The question, then, seemed to be: what else does almost every adult consume regularly that could be sold through vending machines, but wasn't?

The next three decades demonstrated that there certainly were popular products that could be sold through vending machines: pantyhose, motor oil and prepaid telephone cards, to mention only a few. It might be argued that bagged snacks, which were very difficult to vend until the end of the decade, were the "tenth product" -- but, of course, cigarettes were lost, postmix soft drinks have dwindled away and hot canned food has become a subcategory. However, we've added frozen foods and a tremendous variety of packaged cold beverages.

Over the decades, the real story has not been the emergence of a whole new vendible product category, but rather the emergence of machine designs capable of dispensing an ever-wider variety of items that consumers want. When the search for the "tenth product" was under way, most of the nine core products were sold through purpose-built machines. Candy machines offered a few columns of cookies and crackers, and cold-food machines could be stocked with some packaged cold beverages, but that was about it.

Vending's move into the retailing mainstream is worth thinking about, because it is not yet complete. From one perspective, the evolution of today's versatile combination venders paralleled the shift from the variety of retail outlets common at the start of the 20th Century to today's supermarkets and "big-box" discount department stores. From another, the turning-point came when the glassfront snack machine became available to full-line operators in the early 1970s. But both of those developments were responses to shifts in consumer demand, as well as advances in food processing and distribution.

This also was true in vending. Glassfront machine designs date back to the 1950s (at least). The type did not find favor with the pioneers of the full-line revolution, because they served a clientele that was satisfied with a few national brands and a few regional ones. And there was no real demand for single-serve bags of chips until the late '60s.

The standard vending model also envisioned a location in which hundreds of people would hit the vending area during defined break periods. Having a variety of machines served to sort out that crowd of customers by their specific desires, and thus saved time. As workforces became smaller and less regimented, however, fewer and more versatile machines were wanted.

So the challenge, as it turned out, was not to find something new to vend, but to find ways of vending a fast-evolving variety of products in packages of different sizes and shapes, at different prices. Meeting that challenge called not only for machines that were more "intelligent" than their mechanical predecessors, but also for the extension of that "intelligence" to the operator's office. The process of equipping machines to keep track of individual item sales, and of tying them into information networks, has been ongoing since the mid-1970s. It shows no signs of slowing down.

A difficulty about new technology is that it often is put to use by experienced, skillful people who (naturally enough) regard it as a replacement for a familiar tool. It takes time to perceive the new things that can be done with it, and even its developers may not be able to predict what they will be.

The "intelligence" in vending machines has evolved from simple mechanical logic distributed throughout the apparatus through logic consolidated into the pricing system to logic residing on a circuit board controlled by a microprocessor. It now seems to be migrating still farther, to a remote server (or the "cloud" about which we are hearing so much). Some operators already are asking why they can't adjust a machine's price settings remotely, or change the combination of its lock. And the potential of a vending machine as a vehicle for actively engaging individual customers is receiving informed and imaginative study.

The question of what else we might be selling thus has become, over five decades, what else might we be doing? The vending machine can be more than a point of sale, and can find wider applications. We're sure it will, and we look forward to finding out what they will be.