Micro Markets

[Georgia bulldog]

I am new to the forum and I do not know if this subject "micro markets" has been brought up. I have got the latest copy of the vending times and automatic merchandiser. The new rage is micro markets. What I can not figure out is how do you make money? The high cost of the machines, the time it takes to stock the shelves, inventory, every item each day stales and the cost of security cameras and you know people are going to steal. My personal opinion is this will be a very expensive fad for the large vending companies. 

[AZVendor]

Georgia - did you get my PM about the keypad for your Polyvend that I have in stock?

 

As to the micro markets, you would be surprised how successful they are.  In the right environment your profits are higher, stales are lower and theft is not an issue.  The investment is not much more than, and often less than, what it would be for a bank of machines.  You will need a contained room with one doorway.  The reason the profits are higher is partly due to penny pricing that you can apply and the increased volume you'll sell due to the ability of the customers to "feel" the products.  The main investment is in the payment kiosk which is typically the cost of a new cold food, frozen food or coffee machine.  Then you add shelving and a cooler or two for drinks and one for food that has a health safety on it.  This can be labor intensive but doesn't require service every day, in most cases.  You can service a busy micro market two or three days per week, rotating products, restocking and monitoring stales.  If you have purchased a kiosk from a reputable supplier and paid for item level data, you will be restocking from a report that you run before servicing the account.  This will tell you exactly how many of each item sold and what you need to replenish.  You'll also see what doesn't sell well so you can rotate items into the inventory.  My customers tell me, and other operators across the country confirm, that you will get a good sales lift over what had been selling from a bank of machines - all because of the ability to "shop" the room and pick and choose by sight and feel.

[rmorris1953]

Thats the competition now. I have had some of my customers lose their best accounts to these. I have heard they are putting them in some $200 a week accounts.

Reason being they can have Coke or Pepsi put a fountain in where the markup can be 700%. With concentrated bagged coffee they can have good profits.  Shelving is cheap. Coolers are supplied by Pepsi or Coke.  

 

I have 1 small vendor who is doing it and he says his theft is very small and he make more now so it doesn't hurt the bottom line. 

[SchligVend]

Who are some of the best suppliers to get the kiosks from?

[shepherdsflock]

How do you sell this concept to locations? Many places I have worked do not have the type of room that AZVendor describe. Most of the break rooms I have seen have two doors and frequently have no security cameras. If there are no security cameras, I assume the location would expect you to supply your own surveilance equipment?

[AZVendor]

For the marketing aspect of this you need to read up on the subject, look at webpages of the suppliers, read past articles from Automatic Merchandiser magazine and even attend seminars at the NAMA show.  The security cameras are part of the kiosk and it's software.  You can't expect the location to monitor the security for you.  All you need is  two or three cameras with one on the door and one on the kiosk and maybe one looking at the shelves with the smallest items.  The customers will police themselves when they realize they are being taped.  You could probably do this with two doors but you'd need a camera on each door.  It just makes the security more complicated and you lose some wall space for shelving and coolers.