honor box pricing

[Jaimes]

Fellow entrepreneurs,

I've received my boxes yesterday and I am waiting for my locator to send me the couple of dozens of sites to commence this crazy adventure. I am undecided about pricing. I like to set up my boxes with snacks.Today I went to cash and carry and checked out their prices. I would like to include savory, sweet, and chocolaty items in my boxes. Most of the savory snacks cost me an average of $0.35 each, however M&Ms, Twix, Snickers on average $0.66 each. My boxes could hold up to 20 items. What price should I kick off with $1 or $1.25? The $1 price per item makes it easier for my accounting. However I am attracted to the idea of pricing each item @ $1.25 each or 2x$2.00. Please share your thoughts.

[flintflash]

Congrats on your new venture!  Either price point will work.  If you lean toward the $1.25, I would make sure that you provide more of the "higher end" items, such as the chocolates or premium chips.  Avoid too many crackers or cookies if you choose the higher price point.  And I, personally, would stay away from the 2/$2.00. because in reality, you're just asking for $1.00.  While, in theory, you would think that it encourages more volume, all you are really doing is offering your snacks for $1.00.  What's the difference if 10 people by 2 items each for $2.00 or 20 people by 1 snack each at $1.00.  You collect $20 and the end result is the same.  I always avoid the "quantity discounts".  Just my 2 cents.  Good luck to you!  I hope your business venture takes off for you and is a success!  

[Jaimes]

It makes sense. For accounting purposes I'll do $1 per item snack box. I'll stay away from the 2x$2. Will post my progress.

[bhumphrey829]

I made the mistake of starting out at $1.00 and the profit margin just  isn't enough once you consider your gas, time and shortages, I have been at $1.25 for about 8 months now and it works much better.  It just sucked having to increase the price on my boxes that were already $1.00.  I would definitely start out at $1.25.  People will  pay that price.   Just my opinion.  Good luck to you and your new business.

[Jaimes]

Got it bhumphrey829!

You probably already told me this, but where do you get $1.25 price labels?

[bhumphrey829]

I get them from vending-business-information.com

[Jaimes]

Thank you Sir.

[Jaimes]

I started my route this week with lollipops. I've placed them following the list provided by the locator. Today I received my snacks boxes from cameronpackaging. It is my intention to write about my progress and setbacks in this site weekly. I am still undecided about the snack box pricing (it could be due to my lack of experience in this field). I was looking at the snack boxes today and saw there is a compartment dividing the box in half, then I had an idea,how about pricing one side for $1 and the other side $1.25 that way I could have items a bit more expensive on one side and let the customer choose. Has anyone tried that option yet?

[bhumphrey829]

This is just me personally.  I do not use the dividers in my boxes, because with the dividers it would be hard for me to get 20 items in the boxes.  As far as the pricing goes, I would definitely go with everything for $1.25.  I band my crackers together so they get two packages of crackers for that price.  Just my opinion.  Good luck on your new business.  I don't know a lot about the lollipop side, but if you have any questions about the snack box side, I will be glad to try and answer them.  I give my weekly updates in another thread on here if you are interested.

[flintflash]

8 hours ago, Jaimes said:

I started my route this week with lollipops. I've placed them following the list provided by the locator. Today I received my snacks boxes from cameronpackaging. It is my intention to write about my progress and setbacks in this site weekly. I am still undecided about the snack box pricing (it could be due to my lack of experience in this field). I was looking at the snack boxes today and saw there is a compartment dividing the box in half, then I had an idea,how about pricing one side for $1 and the other side $1.25 that way I could have items a bit more expensive on one side and let the customer choose. Has anyone tried that option yet?

Multi-pricing a box may seem logical in theory, but will not necessarily give you the results you want.  The customers will typically only pay the lower amount.  Let's use your dual pricing as an example.  Let's say you pack 40 items in your box; 20 candy at $1.25 and 20 snacks at $1.00.  What some customers will do is take a candy item (1.25) and only pay a dollar.  When you point out the shortage, the next time they will take a candy item ($1.25), only pay a dollar and then move a snack item (1.00) into the candy section.  If you again bring up the shortage, they are going to argue that the item they purchased came out of the $1.00 section.  I've seen it happen many times when we dabbled with dual pricing.  The customer will almost always pay the lower price, just like quantity pricing (1 for $1.25 or 2/$1.00).  What you want to do is commit to a single price and then pack your snack trays accordingly.  If you choose to go with the $1.25 price point, be sure to have a good assortment of candy items and nothing smaller than LSS chips.  You want to make sure that there is value in your selections.  If you choose the $1.00 price point, you can get away with a little bit lower value, but you risk losing some profit margin on your higher-end items.  But which ever price you choose, COMMIT to that price and purchase inventory suitable for that price point.  Trust me, it will make life MUCH easier for you, especially just starting out.  Just my 2 cents!  

[Jaimes]

Thank you so much for your input bhumphrey829,flintflash.

I like the idea of one price @ $1 per item for simplicity reasons. I also like the idea about having a bit of profit margin in case my customers like a product with less profit, that way I could compensate the higher with the lower cost products.My hesitation about $1.25 per item comes about my own feelings about coins. I simply dislike coins. Any coin change I get from the store I dump it into my car center console, then they get used by my wife when she goes shopping. As a customer I get discouraged if the price of the product i want requires me to dig coins out of my pocket or having to get it out of my car.  I know, it sounds kind of crazy to think that way. Would potential customers avoid buying anything out of the snack box because they are out of coins? Have this happen to you before as a vendor or even as a customer?

 

 

[flintflash]

There is some validity to that argument.  Exact change can be a deterrent.  When we went from .85 to $1.00, way back when, that actually was the EASIEST price increase we ever implemented.  I do believe that the simplicity of the $1.00 price point made that transition run smooth.  Customers welcomed the easy price point.  However, keep in mind that at some point, $1.25 will be necessary.  If the candy companies (Mars, Hershey, Nestle) take a price increase (and they will), the $1.25 price will certainly be justified.  I, too, like the $1.00 price, but know that $1.25 is right around the corner.  Bryan (bhumphrey) was SMART to make the change to $1.25 now. Keep in mind, up until 2008 (when I went to $1.00), my customers were used to using pocket change (we were at 85 cents).  Just some food for thought.  

[Jaimes]

First week.

I placed 14 lollipops boxes from the locator and 4 of my own finding this week. These lollipops boxes are labeled with AAFLC charity.  It has been easy to find locations on my own. In fact it is easier for me to go cold than going of the list of locations provided. On my way to the address in my list, I see many placement opportunities; I usually find replacement locations for rejected boxes within the same neighborhood of my rejected box . Out of the 18 boxes placed, 2 were rejected via phone after placement.

Last week I ordered 25 lollipop boxes from Sheridian, they haven’t arrive yet. My 50 snack boxes from Cameron packaging arrived last week, I am putting them together to commence placement next week.

I started doing this as a challenge to myself. I have a good business in a different industry, which requires little time and attention. It basically runs itself. My business model has allowed me to travel the world in motorcycle while I earn a good living. So I am not planning on replacing my business with this activity, but to challenge myself in a different industry.

My approach to this activity is very relaxed; however I have a goal of 40 lollipops boxes and 40 snack boxes by the end of August.

I’ll keep my weekly updates as long as I have something interesting to write about.

 

[bhumphrey829]

Jaimes, I don't guess it really matters about  your price point since it sounds more or less like this pretty much like a hobby for you since you have your other business going well.  However, if at some point you plan to do this full time or you decide to add more than 40 snack boxes at some point, I really believe you will regret not starting off at $1.25.  I know I did.  My thinking at the time was the same as yours.  I didn't want to have to deal with coins, so instead of listening to the  advice of people on here and starting out at $1.25 I did the $1.00 but soon found out that chocolate is the most popular item I sell and also the most expensive, I had no choice but to go up to the $1.25.  I was really afraid to do that thinking no one would pay the difference or actually kick me out of the location for raising the price.  I did lose 6 accounts out of 133 that I upgraded to. 

I would not have even lost those  6 accounts had I just started out at $1.25 and like flint said earlier, at some point you are going to have to go up to $1.25 so why not just start there and save yourself the headache of having to change all your boxes over at some point.  Lesson learned on my part.

Also, I found that people actually do  pay the $1.25.  Yes, I have to deal with a lot more coins, but it's well worth it.  I actually bought a cheap coin counter for $100.00 at Sam's and it works great for sorting my coins.  And with your lollipop boxes I can guarantee you will be dealing with coins anyway.

As with everyone that posts on here, not trying to tell you how to run your business, just putting in my 2 cents.  Have a blessed day

Bryan

[Jaimes]

On 7/23/2017 at 11:41 AM, bhumphrey829 said:

Jaimes, I don't guess it really matters about  your price point since it sounds more or less like this pretty much like a hobby for you since you have your other business going well.  However, if at some point you plan to do this full time or you decide to add more than 40 snack boxes at some point, I really believe you will regret not starting off at $1.25.  I know I did.  My thinking at the time was the same as yours.  I didn't want to have to deal with coins, so instead of listening to the  advice of people on here and starting out at $1.25 I did the $1.00 but soon found out that chocolate is the most popular item I sell and also the most expensive, I had no choice but to go up to the $1.25.  I was really afraid to do that thinking no one would pay the difference or actually kick me out of the location for raising the price.  I did lose 6 accounts out of 133 that I upgraded to. 

I would not have even lost those  6 accounts had I just started out at $1.25 and like flint said earlier, at some point you are going to have to go up to $1.25 so why not just start there and save yourself the headache of having to change all your boxes over at some point.  Lesson learned on my part.

Also, I found that people actually do  pay the $1.25.  Yes, I have to deal with a lot more coins, but it's well worth it.  I actually bought a cheap coin counter for $100.00 at Sam's and it works great for sorting my coins.  And with your lollipop boxes I can guarantee you will be dealing with coins anyway.

As with everyone that posts on here, not trying to tell you how to run your business, just putting in my 2 cents.  Have a blessed day

Bryan

You are right about pricing Bryan. I won't try to reinvent the wheel, $1.25 it is. I have question, what is considered LSS chips? I've seen 1oz and a 3oz for sale. the 1oz is too light to price it @ $1.25 and the 3oz is too expensive for the snack box.

[bhumphrey829]

LSS stands for Large Single Serve chip.  They are between 1.5 oz and 1 3/8 oz.  Sam's or Costco's usually sell them in 30 count variety boxes.

 

[Jaimes]

3 hours ago, bhumphrey829 said:

LSS stands for Large Single Serve chip.  They are between 1.5 oz and 1 3/8 oz.  Sam's or Costco's usually sell them in 30 count variety boxes.

 

Great! I have Costco near by. I'll check there. Thank you.

[Jaimes]

The first candy box service is done here is the report:

Placed 25 boxes in 10 days.

Serviced: 11

Total collected: $128.00

I have 4 snack boxes placed right now, will service them this week. I've been delaying the placement of more snack boxes because I would like to know what items are most desirable out of the box, and also to learn about  shrinkage rate.

Candy boxes are easy to place. I usually find new placement no more than 1 block from rejected boxes.

I think the service frequency affects productivity. There were few boxes very accessible to the public, these boxes were doing so well that they run out of candy, then someone moved the box to a secluded area perhaps waiting for it to be picked up. I lost my spot to another candy vendor.

The first week was the most difficult getting calls asking to remove the boxes. I had a locator, it didn't workout for me. The rejected boxes I placed them myself (zero calls to remove to this date).

 

[bhumphrey829]

Congrats!  Off to a great start.  My advice is to keep placing them yourself.  You will have a lot more success doing it yourself than having a locator do it.  It's harder for them to say "no" when you are there in person with box in hand.  If you need any help with what to say on certain objections you do get, just let me know.

[flintflash]

EXCELLENT start, Jaimes!  You have the right idea by placing the boxes yourself.  Be sure to be thorough in all the areas you sell, by that I mean comb the area well and approach EVERY business.  Try not to "high spot" an area or be too picky on which businesses to call on.  You never know what GEMS of accounts can be hidden as small, little shops or stores.  While snack trays placed in public areas will typically have high volume, they will also typically have high shortages.  I generally try to keep our boxes in breakrooms and offices and not out in public areas due to high theft rate.  To answer your question about desirable items, CHOCOLATE is always the highest demanded products, but is also the most costly.  Chips are another high volume item, but tend to have shorter shelf-life.  Cookies and crackers are very hit-or-miss.  Some products sell well based on demographics and regional tastes.  What state are you in?  I would look for popular, local brands if available.  I could give you some suggestions on how to calculate your "Box Cost" and Menu selections if you would like.  Keep up the SUPER work!  

[Jaimes]

On 8/3/2017 at 2:43 AM, bhumphrey829 said:

Congrats!  Off to a great start.  My advice is to keep placing them yourself.  You will have a lot more success doing it yourself than having a locator do it.  It's harder for them to say "no" when you are there in person with box in hand.  If you need any help with what to say on certain objections you do get, just let me know.

Thank you Bryan! I do need help with objections. Candy boxes are easy for me, snack boxes are more challenging. They see me walking into their business, and their faces mutate like I came in to take their first born child or something haha. My snack box has the name of the charity. I walk into the business and say "I am placing these snacks boxes in the community, is an honor box, you deposit your contribution here (pointing at the box)for items you choose". In case they ask me to come back to talk to their boss about allowing the box there, I've made a little card addressed to the decision maker which I leave in the box. The card says :  "Thank you for the opportunity to place this honor box. It is intended for use by employees, visitors and clients. A portion of the receipts is donated to charity. You are not responsible for the box or its contents. The box will be monitored and refilled as needed. Call 000-000-0000 anytime if you want the box removed". I am always looking for more effective placement techniques, please share with me what works for you.

[Jaimes]

On 8/3/2017 at 5:46 AM, flintflash said:

EXCELLENT start, Jaimes!  You have the right idea by placing the boxes yourself.  Be sure to be thorough in all the areas you sell, by that I mean comb the area well and approach EVERY business.  Try not to "high spot" an area or be too picky on which businesses to call on.  You never know what GEMS of accounts can be hidden as small, little shops or stores.  While snack trays placed in public areas will typically have high volume, they will also typically have high shortages.  I generally try to keep our boxes in breakrooms and offices and not out in public areas due to high theft rate.  To answer your question about desirable items, CHOCOLATE is always the highest demanded products, but is also the most costly.  Chips are another high volume item, but tend to have shorter shelf-life.  Cookies and crackers are very hit-or-miss.  Some products sell well based on demographics and regional tastes.  What state are you in?  I would look for popular, local brands if available.  I could give you some suggestions on how to calculate your "Box Cost" and Menu selections if you would like.  Keep up the SUPER work!  

Thanks Flintflash, I've made a rookie mistake of selecting businesses within an area. I am in Washington State, so far chocolate and chips have been the winners in the few boxes I placed. I am open to learn about how to calculate menu/cost per box. Between candy and snack, candy produces less $ volume, however snack has greater shrinkage rate ( I have little experience with snack boxes). I am listening. Thank you for your input.

[bhumphrey829]

12 hours ago, Jaimes said:

Thank you Bryan! I do need help with objections. Candy boxes are easy for me, snack boxes are more challenging. They see me walking into their business, and their faces mutate like I came in to take their first born child or something haha. My snack box has the name of the charity. I walk into the business and say "I am placing these snacks boxes in the community, is an honor box, you deposit your contribution here (pointing at the box)for items you choose". In case they ask me to come back to talk to their boss about allowing the box there, I've made a little card addressed to the decision maker which I leave in the box. The card says :  "Thank you for the opportunity to place this honor box. It is intended for use by employees, visitors and clients. A portion of the receipts is donated to charity. You are not responsible for the box or its contents. The box will be monitored and refilled as needed. Call 000-000-0000 anytime if you want the box removed". I am always looking for more effective placement techniques, please share with me what works for you.

My "spiel" goes like this (first thing I do is ask for the  decision  maker.) Once I get them in front  of me, here's what I say:  "Hello, my name is Bryan Humphrey and I am with Gator snacks, but we also represent women's breast cancer, and what we do is we go around placing theses snack boxes  in small businesses like this one, and the way it works is a portion of the money we collect goes to women's breast cancer.  It is set up on the honor system and the price is already  marked on the box.  What we like to stress to you is that you have no responsibility to the box, if it comes up short if someone was to take something without paying for it, that is never your  problem.  All we as from you is somewhere to put it and we put it in on a trial basis just to see how it does and I was wondering if we could give it a shot  and see how it does."  And that's I let them talk.  I average getting into about 1 out 4 businesses right now sometimes more than that, just depends on the area I am.  I don't like giving percentages because I have had days where my first 5 businesses said yes and I have had days where the first 5 businesses have said no, but I can say I have never had more than 7 "no's" before placing a box.  It is really simple and successful.

One thing I don't do, and some people agree and some people disagree, but I don't go in there trying to be all professional, like a salesman, because I'm not selling them anything and it gets them to let their guard down if I just act in a casual conversation because you are right when they first see me with my box, they automatically think I am selling them something because as business decision they are constantly getting bombarded with "sales" people.

Another thing I do as I am walking in is I am already looking for a spot to place the box so if they say "well, we don't have room for it", I already know how to overcome that objection because I have found a place to put it.

The biggest objection, (or excuse) used to be "well, I can't make that decision and the decision maker won't be in until tomorrow, do you have a card you can I leave and I will be sure and give it to them and they will give you a call". So that's what I would leave a card, and in the 2 years I have been doing this, I had 2 people call me back wanting a box.  So obviously that wasn't working.  So what I started doing is I no longer carry a card in with me.  I have always had cards taped to my boxes, so now when they say this, here is what I say: "Okay, well what we like to do in cases where the decision maker isn't available is we like to leave the box here because my card is on the box.  Now they are not committing to the box in any way, but at least they see what it looks like instead of you having to try and explain it.  And if they don't want it, just call me and I will come pick up the  box" .  I can tell you, that at least 85%  of the time, they let me leave and I don't get a call back.  When I leave the business, I automatically go ahead and make up a card for them and if they call back I just tear up the card, but if I don't get a call back, I already their card made up and just add them to my schedule. 

Sorry this was so long winded, hope it helps.

[Jaimes]

On 8/5/2017 at 3:05 AM, bhumphrey829 said:

My "spiel" goes like this (first thing I do is ask for the  decision  maker.) Once I get them in front  of me, here's what I say:  "Hello, my name is Bryan Humphrey and I am with Gator snacks, but we also represent women's breast cancer, and what we do is we go around placing theses snack boxes  in small businesses like this one, and the way it works is a portion of the money we collect goes to women's breast cancer.  It is set up on the honor system and the price is already  marked on the box.  What we like to stress to you is that you have no responsibility to the box, if it comes up short if someone was to take something without paying for it, that is never your  problem.  All we as from you is somewhere to put it and we put it in on a trial basis just to see how it does and I was wondering if we could give it a shot  and see how it does."  And that's I let them talk.  I average getting into about 1 out 4 businesses right now sometimes more than that, just depends on the area I am.  I don't like giving percentages because I have had days where my first 5 businesses said yes and I have had days where the first 5 businesses have said no, but I can say I have never had more than 7 "no's" before placing a box.  It is really simple and successful.

One thing I don't do, and some people agree and some people disagree, but I don't go in there trying to be all professional, like a salesman, because I'm not selling them anything and it gets them to let their guard down if I just act in a casual conversation because you are right when they first see me with my box, they automatically think I am selling them something because as business decision they are constantly getting bombarded with "sales" people.

Another thing I do as I am walking in is I am already looking for a spot to place the box so if they say "well, we don't have room for it", I already know how to overcome that objection because I have found a place to put it.

The biggest objection, (or excuse) used to be "well, I can't make that decision and the decision maker won't be in until tomorrow, do you have a card you can I leave and I will be sure and give it to them and they will give you a call". So that's what I would leave a card, and in the 2 years I have been doing this, I had 2 people call me back wanting a box.  So obviously that wasn't working.  So what I started doing is I no longer carry a card in with me.  I have always had cards taped to my boxes, so now when they say this, here is what I say: "Okay, well what we like to do in cases where the decision maker isn't available is we like to leave the box here because my card is on the box.  Now they are not committing to the box in any way, but at least they see what it looks like instead of you having to try and explain it.  And if they don't want it, just call me and I will come pick up the  box" .  I can tell you, that at least 85%  of the time, they let me leave and I don't get a call back.  When I leave the business, I automatically go ahead and make up a card for them and if they call back I just tear up the card, but if I don't get a call back, I already their card made up and just add them to my schedule. 

Sorry this was so long winded, hope it helps.

Very good Bryan! I will incorporate some of the good techniques you showed here.  I think I overwhelmed myself by starting with candy box and adding snack boxes to the equation. I better cool it for a while and continue with the candy box until I gain more experience in managing route, profits, menu etc.

[AMD Snacks]

Hi Jaimes, where abouts in WA are you at? I'm also in WA closer to Tacoma. I don't do as many honor boxes anymore, but I still have a few out there.