OQuinnVending Posted February 24, 2017 Share Posted February 24, 2017 Hi there! We are new to the vending business and have an opportunity to take over a full-line location within an office building. The location is a high traffic mail room that currently has 1 soda and 1 snack machine. The owners of the nearby cafe in the basement sell similar items to whats in the machines. The competition for customers has caused some price complaints by the cafe owners because they ( vending operators) price their items lower than the cafe. We have never placed in a corporate building before so we are unsure of how the original agreement between the building owner, management , cafe owners or vending company originally was. From what we understand, the cafe owners came into the picture after the vending machines operators. The offer that the cafe owners have given was to match the price of the snacks within the machine and request a commission (amount unknown). They also requested that we contact the building owners ourselves and inform them of the issue, get the old vendors kicked out and get the okay to move ourselves in. Firstly , we feel the vending machine operators are justified in lowering their prices from the cafe owners due to the convenience of the snacks they sell. Though the cafe is only open from 8am- 3pm Monday through Friday, how many people on a given day will walk into a mail room versus those that will likely walk into a cafe each day. While the snack machine is available 24-7 - there will not be many as many people in the building from 3 pm to 12 midnight each day as most often leave early and are not there on the weekends ( except the cleaning crew and security ). The question we have for you guys is would this be worth it to pursue or not ? If it is, how should we go about getting it resolved? Also, if no advice, please share a story of something similar that happened to you. Thanks and Happy Vending! Link to comment Share on other sites More sharing options...
CapitalCityVendingLLC Posted February 25, 2017 Share Posted February 25, 2017 How big is this place? AKA, how many people do you honestly think will step foot in front of your machine each day? If someone could buy the same thing, at the same price, from either a machine or person, I think most people are going to go to the cafe. The lose the risk of something getting hung up, machine taking their money, they get to interact with a human being, etc. The fewer amount of limitations you can put on yourself the better. If the cafe can't match your prices, or the other vendor's company, that's their problem. You gotta look after number 1, which is you. A lot of leg work to potentially lose the bulk of your business to the cafe due to their restrictions. Switch the situation up. You think if you went to them asking for them to change their prices, that they would? I don't think they would, nor should you. Economics 101. If you can beat their price, and it's still worth your time and effort, then that's their problem. Now the only good thing is that they are asking you to raise your prices which isn't the worst thing for your bottom line and profit margin. I just fear that if you say yes to this, next month, there will be a new issue that they want you to give in on and if you don't, they will want you gone, like they want the current company gone now. I know jumping through these hoops might get you in the door, but there are other doors out there. Now if this will be a monster account, doing hundreds a week, then maybe you could bend over a little bit and play by their rules, but I don't see this being a big huge account. Let us know what you end up doing. Link to comment Share on other sites More sharing options...
PHX1 Posted February 25, 2017 Share Posted February 25, 2017 I've done similar type situations in gyms where there is a juice bar. 9 out 10 times the people would choose to buy from a person rather then a machine. Only time they used it was when the juice bar was closed. Link to comment Share on other sites More sharing options...
Southeast Treats Posted February 25, 2017 Share Posted February 25, 2017 Who are you dealing with? It sounds like the cafe owner is trying to get you to do his dirty work to knock a hole in the vending sales. Be careful that you don't get left holding the (empty) bag... Link to comment Share on other sites More sharing options...
AZVendor Posted February 25, 2017 Share Posted February 25, 2017 It also sounds like the Cafe is trying to get you to pay a commission to them though they aren't responsible for the vending, the building owner might be. Don't let yourself get pushed around. Vendors don't need to cowtow to anyone's ideas of pricing. Price your machine where you want it to be to make a GOOD profit. Otherwise you're just wasting time and money. Link to comment Share on other sites More sharing options...
EddieMac Posted February 25, 2017 Share Posted February 25, 2017 The whole thing sounds shady to me. Link to comment Share on other sites More sharing options...
OQuinnVending Posted February 27, 2017 Author Share Posted February 27, 2017 On 2/24/2017 at 7:11 PM, CapitalCityVendingLLC said: How big is this place? AKA, how many people do you honestly think will step foot in front of your machine each day? If someone could buy the same thing, at the same price, from either a machine or person, I think most people are going to go to the cafe. The lose the risk of something getting hung up, machine taking their money, they get to interact with a human being, etc. The fewer amount of limitations you can put on yourself the better. If the cafe can't match your prices, or the other vendor's company, that's their problem. You gotta look after number 1, which is you. A lot of leg work to potentially lose the bulk of your business to the cafe due to their restrictions. Switch the situation up. You think if you went to them asking for them to change their prices, that they would? I don't think they would, nor should you. Economics 101. If you can beat their price, and it's still worth your time and effort, then that's their problem. Now the only good thing is that they are asking you to raise your prices which isn't the worst thing for your bottom line and profit margin. I just fear that if you say yes to this, next month, there will be a new issue that they want you to give in on and if you don't, they will want you gone, like they want the current company gone now. I know jumping through these hoops might get you in the door, but there are other doors out there. Now if this will be a monster account, doing hundreds a week, then maybe you could bend over a little bit and play by their rules, but I don't see this being a big huge account. Let us know what you end up doing. Thank you for responding to this topic. We believe what your saying is very true and have decided not to pursue it. Since this was one of the first times we were reached out to by a perspective location for a full line account, we were very eager to jump at it. We are hoping to secure at least one or two locations this year. It is definitely harder to place these larger machines than it is smaller bulk candy. Link to comment Share on other sites More sharing options...
OQuinnVending Posted February 27, 2017 Author Share Posted February 27, 2017 On 2/25/2017 at 7:02 AM, EddieMac said: The whole thing sounds shady to me. We agree, Once we heard all the details, we felt very uneasy about pursuing it. Thanks for you response! Link to comment Share on other sites More sharing options...
OQuinnVending Posted February 27, 2017 Author Share Posted February 27, 2017 On 2/25/2017 at 6:20 AM, AZVendor said: It also sounds like the Cafe is trying to get you to pay a commission to them though they aren't responsible for the vending, the building owner might be. Don't let yourself get pushed around. Vendors don't need to cowtow to anyone's ideas of pricing. Price your machine where you want it to be to make a GOOD profit. Otherwise you're just wasting time and money. We thought so as well. That's why we were hesitant in pursuing it on our own. Truly, they aren't missing out on much money. It just seems like they want the cake and want to eat it too. Thanks for posting! Link to comment Share on other sites More sharing options...
OQuinnVending Posted February 27, 2017 Author Share Posted February 27, 2017 On 2/24/2017 at 10:37 PM, Southeast Treats said: Who are you dealing with? It sounds like the cafe owner is trying to get you to do his dirty work to knock a hole in the vending sales. Be careful that you don't get left holding the (empty) bag... We didn't even think about that. The gap in between the other vendors leaving and the new vendors moving in- how much they could make on snacks.....You would think with a building full of people and only one cafe they couldn't be missing out on that much extra cash. Thanks for your response, each tidbit of advice we were given from the forum community proved our doubts and we surely wont be pursuing it! Link to comment Share on other sites More sharing options...
OQuinnVending Posted February 27, 2017 Author Share Posted February 27, 2017 On 2/24/2017 at 8:08 PM, PHX1 said: I've done similar type situations in gyms where there is a juice bar. 9 out 10 times the people would choose to buy from a person rather then a machine. Only time they used it was when the juice bar was closed. Yup! That's what we believed also. Even the convenience of just buying a candy bar with lunch or breakfast versus walking to the mail room to purchase separately made us double back and think twice about this opportunity. Thank you for responding ! Link to comment Share on other sites More sharing options...
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