Want to learn more about OCS...

[shepherdsflock]

Is there a good post on here that gives pros and cons to OCS and tells somebody who is thinking about trying it what to expect and what to be prepared for?

[loach33]

Wow, I am in this exact spot right now.  I had to send two people away in the past 2 weeks because I have no idea how to get started in this biz.

 

I couldn't find anything here.  Would love to hear from experience.

[shepherdsflock]

That makes two of us. There's a ton of information on here about bulk, soda, and snack, but finding stuff about OCS isn't as easy. I'd like to get into soda, too; but right at the moment I find OCS attractive.

[RJT]

What exactly do you want to know?

It is similar to vending in that you have to go and get the accounts. Many will already have OCS service so you will have to go through the process of making it appealing to the potential customer to do business with you.To be honest the market is very saturated imo.

You will need to have availability to professional brewers like Bunn, Newco, Kuerig, etc in many different configurations such as in-line, pour over, low boy models, etc. Then have availability to the entire product to carry like coffee, tea, cider, hot chocolate in a variety of brands and price points. You will need to carry brands like Eight O’clock, Folgers, K-cups, Green Mountain, Starbuck, Seattle’s Best, etc. along with cups, lids stir sticks, cream and sugar in packets and canisters, filters, cleaning solution, pot brushes, airpots, etc. I personally don’t like offering airpots unless they ask for them and require them. Without airpots they use more coffee because they are constantly brewing a “fresh” pot because they let it sit on the burner to long. Airpots do away with this and your sales go down.

Markup varies depending on different markets so that is going to depend on you market. A starting point should be around 30% markup atleast in my area that seems to be the norm. Some items you can make a little more on and some less.

Once you establish these things and go out and get accounts plan on putting most accounts on net 30 terms and have the cash to float that time. Also, plan on some accounts to be slow at paying getting into sometimes 45 days.

Figure out their needed service schedule intervals and when you service the accounts do small things like clean all their pots for them, throw out any old case boxes that are empty or close to empty, clean and wipe the brewer, check lines, fittings, filters,etc.

If they are a coffee only account try and boost sales by dropping free samples off of other items you carry like the tea, cider, etc.

If you are already in vending OCS is a good way to get new vending accounts by offering them free coffee to do their vending for the. Keep in mind this is only done if it makes sense to offer it based on your projections. You obviously set a limit of how much free coffee product they get like two cases a month or something similar. If they run low they actually may end up doing OCS with you buying more products. If they already have OCS they may give you both the vending and OCS because of your offer. Keep in mind this is NOT in addition to commissions and other freebies UNLESS the account justifies such. It is another option to offer them to gain their business.

Does this help?

[RJT]

I will touch on markup a little more. On small account you may push to get 40 to 42% markup but high volume accounts you may need to be in the 30 to 35%. Products like cups, stir sticks, sugar, etc you can get even higher on markup. An example of variations on this would be selling cups by the case the markup would be less than selling them a few sleeves at a time.

In the end you will have to gauge what your competitors and the market is in your area. While coffee is big business companies are also cutting back on these types of perks the offer to their employees. It is really going to depend greatly on your market area.

Also another thing OCS people offer is cases drinks and water. I have had many that bought cases of drinks on a fairly regular schedule from me for corporate meetings, corporate events and visitors, etc. Some had a standing order every week/month just like OCS. An example of what the markup looks like on office drink service $0.50 a can price and $0.80 for bottle water. Keep in mind this is case price. So a case of can drinks would be sold for $12.00.

I have seen OCS people even get into office supplies like paper products, toilet paper, paper towels, etc.

[snack dude]

RJT

I also do OCS and bulk drinks for corporate meetings and I just wanted to say 

Nice Explanation, No really you did a nice job on that I mean it

The only thing I would add is on the bulk drinks I have a couple of those round red bull coolers like you see in the C-stores

and what a lot of our customers do is call me and tell me when they need the drinks and I will bring in the coolers ahead of time and stock the drinks in the coolers for free of charge. All I charge for is the drinks. Next week I have a customer who is having a employee christmas breakfast in which we will bring an extra coffee maker no charge because they are going to buy the coffee from me.

[RJT]

RJT

I also do OCS and bulk drinks for corporate meetings and I just wanted to say 

Nice Explanation, No really you did a nice job on that I mean it

The only thing I would add is on the bulk drinks I have a couple of those round red bull coolers like you see in the C-stores

and what a lot of our customers do is call me and tell me when they need the drinks and I will bring in the coolers ahead of time and stock the drinks in the coolers for free of charge. All I charge for is the drinks. Next week I have a customer who is having a employee christmas breakfast in which we will bring an extra coffee maker no charge because they are going to buy the coffee from me.

Thanks!! I think???

 

Did I mention you can add some snake oil and voodo pills to your line up and really get rich in a hurry, 

 

 

 

 

 

 

 

 

J/K

 

 

 

 

 

Serious, the cooler idea is good and if they are buying from a botter they may even give them the coolers if they explain how they are going to use them. Then again bottlers are getting pretty stingy with stuff anymore.

 

One thing I forgot to add is if you shop at a place that does the variety pack snacks packs offer them on the OCS sheet also. Price these double what you pay for them. People ask for snacks for some of these meeting they have when the order drinks so we started listing these 100ct variety packs.

 

Thanks

[dogcow]

What exactly do you want to know?

It is similar to vending in that you have to go and get the accounts. Many will already have OCS service so you will have to go through the process of making it appealing to the potential customer to do business with you.To be honest the market is very saturated imo.

You will need to have availability to professional brewers like Bunn, Newco, Kuerig, etc in many different configurations such as in-line, pour over, low boy models, etc. Then have availability to the entire product to carry like coffee, tea, cider, hot chocolate in a variety of brands and price points. You will need to carry brands like Eight O’clock, Folgers, K-cups, Green Mountain, Starbuck, Seattle’s Best, etc. along with cups, lids stir sticks, cream and sugar in packets and canisters, filters, cleaning solution, pot brushes, airpots, etc. I personally don’t like offering airpots unless they ask for them and require them. Without airpots they use more coffee because they are constantly brewing a “fresh” pot because they let it sit on the burner to long. Airpots do away with this and your sales go down.

Markup varies depending on different markets so that is going to depend on you market. A starting point should be around 30% markup atleast in my area that seems to be the norm. Some items you can make a little more on and some less.

Once you establish these things and go out and get accounts plan on putting most accounts on net 30 terms and have the cash to float that time. Also, plan on some accounts to be slow at paying getting into sometimes 45 days.

Figure out their needed service schedule intervals and when you service the accounts do small things like clean all their pots for them, throw out any old case boxes that are empty or close to empty, clean and wipe the brewer, check lines, fittings, filters,etc.

If they are a coffee only account try and boost sales by dropping free samples off of other items you carry like the tea, cider, etc.

If you are already in vending OCS is a good way to get new vending accounts by offering them free coffee to do their vending for the. Keep in mind this is only done if it makes sense to offer it based on your projections. You obviously set a limit of how much free coffee product they get like two cases a month or something similar. If they run low they actually may end up doing OCS with you buying more products. If they already have OCS they may give you both the vending and OCS because of your offer. Keep in mind this is NOT in addition to commissions and other freebies UNLESS the account justifies such. It is another option to offer them to gain their business.

Does this help?

I would add I've got a few in room coffee hotel accts , ocs is very hard because a lot of places are mail ordering ocs from the distribution companies. If you do a big hotel pitch in room coffee they will already have the coffee makers it is the only place I ever got traction with ocs.

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[snack dude]

i dont sell voodoo pills, i take them for myself. And i have never had much luck selling snake oil.........

[shepherdsflock]

Thanks!! I think???

 

Did I mention you can add some snake oil and voodo pills to your line up and really get rich in a hurry, 

 

 

 

 

 

 

 

 

J/K

 

 

 

 

 

Serious, the cooler idea is good and if they are buying from a botter they may even give them the coolers if they explain how they are going to use them. Then again bottlers are getting pretty stingy with stuff anymore.

 

One thing I forgot to add is if you shop at a place that does the variety pack snacks packs offer them on the OCS sheet also. Price these double what you pay for them. People ask for snacks for some of these meeting they have when the order drinks so we started listing these 100ct variety packs.

 

Thanks

 

RJT,

What would you think of focusing on a specific type of OCS? I was thinking about starting with single cup systems like a Keurig or Tassimo. Do you think this sounds like a feasible way to start or would I be in for a lot of disappointment if I go this route?

[RJT]

RJT,

What would you think of focusing on a specific type of OCS? I was thinking about starting with single cup systems like a Keurig or Tassimo. Do you think this sounds like a feasible way to start or would I be in for a lot of disappointment if I go this route

 

Why limit yourself? If possible offer both. That would be like getting in the soft drink business and doing bottles only.

[engineer1984]

I assumed that you needed to already have your foot in the door in order to be involved with the coffee aspect.  I wouldn't think many companies would have a separate supplier for each: soda / snack, coffee... I guess I'm wrong?

[shepherdsflock]

 

RJT,

What would you think of focusing on a specific type of OCS? I was thinking about starting with single cup systems like a Keurig or Tassimo. Do you think this sounds like a feasible way to start or would I be in for a lot of disappointment if I go this route

 

Why limit yourself? If possible offer both. That would be like getting in the soft drink business and doing bottles only.

 

 

It's not that I necessarily want to limit myself, I'm just not sure I could commit the money up front to approach the industry from such a wide angle. I'd like to start out buying just a few units of one machine and get them placed. Stick with that one machine long enough to learn it's ins and outs and get a feel for the industry. I know that sounds like I'm limiting my opportunities, but I also want to limit my liabilities.

[RJT]

Why buy anything up front? Just have an outlet to buy the brewers and supplies and only buy once you secure the accounts. That way you have no money tied up and you buy them as you need them only.