Reducing the COGS

[pdavid]

I had a location owner put a "Capsule Recycler" box next to the rack I have in her location, and a surprising number of people have used it. I'm wondering if I should try to do that at more locations because you can save 2 or 3 cents per unit at A&A when you order product uncapsuled.

Any thoughts?

[Quarter Master]

I have thought about this idea for quite some time.Have a plastic bag hung on one of my racks to collect capsules.I'm going to see how it works because I've heard the capsules are only good for one time use and may start falling apart if reused over and over.Don't need any misvends due to capsules coming apart.We'll see what happens.

[guile]

I already do that next to one of my racks:) I stole the idea from a Skating rink that my kid went to for a birthday party. Simple, but effective. Anything to perserve/enhance margins is a good thing imo.

g

[BudLeiser]

No offense intended. But you guys don't think sitting around stuffing toys into capsules to save 2c each is a waste of time? I mean if you have kids willing to do it for allowance $ it's all good. How many can you stuff in an hour?

[havending]

Bud,

When I cap my self the savings is about 5.5% which flows to the bottom line. Think companies like Walmart or Target woulod like to put 5.5 to the bottom line by doing one simple task. Vending is only for the people willing to go the extra mile.

[nam]

havending,

Are you reusing your acorn or round capsules? My round 1" capsules have a thin plastic band wrapped around the seam to prevent them from coming apart. You'd never ever get a mis-vend with one of these but don't think they could be reused?

nam

[sbishop]

I think it goes back to the induvial situation. If you have the free time and want to re cap them go for it. Some people will want the time and not worry about the .02 per vend that they can save.

It is interesting the things you find out if you anlize your business. My friend took a look at his comuter biz and realized that his rent and utilities cost more than the inhouse work he did. He also had to staff the store front.

He closed the store front rented a cheaper office and works entirly on site. He figured that if he lost all of the in house business, he would still be close to $1k per month ahead of the game. Now he has more free time and better cashflow

[havending]

I buy fresh caps from A&A. The only cap you cant reuse is a pre packed round cap like the one with the plastic.

[nam]

Thanks havending!

nam

[antoniocinisi]

imo if you do it in volumes it is worth it.I am very very conservative.I save all caps that I find at work and even some in the parking lot.I have invested thousands in this business and need my money back,even if it is 2 cents at a time.

I  ordered a bunch of stuff includeing empty capsules and bouncy balls (weight-volume)and had them shipped to my father in laws vacation  home in arizona.since he drove out there he was able to bring home my items and I saved a lot in shipping.

you will save a lot in shipping too when you order the toys in bulk and not already capped,since the box is smaller and may weigh less.

make sure you compare the prices before you buy.

[pdavid]

antonio,

if your father-in-law lives in Arizona, you could have him just pick up the balls,stickers,etc., from Brand or SSM and then you'd have no shipping. I'm pretty sure Brand, for example, sells the balls as cheap as A&A.

[dperry]

If you buy toys in bulk and then have to buy the empty caps, doesn't the cost equal out? You may save $0.02 per toy, but doesn't it cost like $0.03 per cap? I have to wonder how many matched caps (top and bottom) you can relclaim from your locations. Is it enough to cap a whole bag of toys? More than one bag?

I've never investigated this so maybe those in the know can comment.

[Jax Snacks]

Recovering and recycling capsules is generally a good idea. However, I think you need to have a "civilized" clientele. I can see in some of my locations where people would just throw all kings of garbage (used gum, cigarette butts, etc.) in the recycle bin and create a nasty mess. Hey if it works for you, then keep doing it!

Jax

[antoniocinisi]

antonio,

if your father-in-law lives in Arizona, you could have him just pick up the balls,stickers,etc., from Brand or SSM and then you'd have no shipping. I'm pretty sure Brand, for example, sells the balls as cheap as A&A.

I think he is an hour or more away from him and I didnt want to ask him to do that.he only lives there in the winter.I did order a full case of bouncy to maximize saveings.

[nepavend]

Here are some of the things I am doing to control my COGS:

1.  Reduce candy usage - I have very few candy heads out there compared with most vendors.

2.  Mix in more superballs with the 1" toy mixes - mix in more .03 cent items with the .04-.06 items to drag down the average cost.

3.  Recycle caps - I try to save caps when I can, I have a bagful going and when it gets full I will make an order of toys uncapped and fill them while watching TV.

4.  Mix in low cost items with 2" toy mixes - bring down the average cost again here as well.

5.  Stickers/Tattoos - Buy on sale whenever possible, I have found VSI deals for $15/box a few times.

[BudLeiser]

Anyone capped for 1/2 or a full hour straight? How many did you do without pushing yourself?

[antoniocinisi]

I always race my wife for who can do more.we have never timed ourselves but with this system we get it done pretty quickly.

[sharleeruby]

oh boy what does the winner get maybe we dont want to know

[antoniocinisi]

:shock:

[nam]

I think we just saw the prize!  

nam

[antoniocinisi]

aww come on guys!till now there really hasn`t been a prize,we just do it to see who`s the better capsule filler.next time we get toys to cap I may suggest something.good idea!

[havending]

With all the talk about cogs I was wondering if everyone would like to share there prifit after product and rent. I keep my cost of product including displays and freight under 21% Most months I profit 46 to 52% after product and rent. Was wondering where everyone else is