The Keys to Success in Vending
I have been very happy working in the vending industry. At first, when I set out to write blog articles for the industry, I was afraid that at some point, I was going to run out of ideas because I originally thought that vending had such a small scope. However, the more I got into the industry and read about what people were doing and saying about it, I realized that there is so much depth and opportunity for growth.
In my blogs, I try to reach out to vendors and ask them questions about their businesses to gain a broader view of the industry. I translate those insights into blog posts from which I hope people may benefit. Something that I have looked over is what are the fundamentals necessary to be successful in the vending industry. If you boil down a successful vendor, what core beliefs and practices would be revealed?
After thinking about this and talking with my close friend, the owner of Chow Time Vending, I came up with a list of four things that make a vending business successful.
This should be a given, but it is worth mentioning. A lot of people get into the business without knowing too much about it, and they make “rookie” mistakes along the way. For example, I spoke with a new vendor who was placing his machines in a location while another vendor was taking his machines out. The new vendor had only been in vending for six months, but he was putting his machines in a bad account. There were not many employees there, and the previous vendor who was taking his vending machines out felt that the location was bringing him a loss. Vending at that location would not add much to the business. If the new vendor understood that low foot traffic would result in lower sales, that location would not be serviced. Understanding the vending industry and different markets around different towns is essential for having a successful vending business. “Knowledge is power,” and in the case of vending, “Knowledge brings profit.”
2. A Good Team
Employees that steal, are reckless with product, or ignore protocol are costly. We wrote a blog about company culture with reference to an article about the high cost of hiring a bad employee. We also wrote a blog about things to look for in vending route drivers. A business is more than a solo effort; it takes a team of people with the same goal of seeing the business grow and be successful, whatever that might mean for vendors. Losing money because of theft and product loss is always bad for business, but poor management decisions or administrative workers not on task can cause a lot of headaches and potentially lost accounts. For example, if you have a secretary that only answers phone calls when he or she feels like it or a manager who does not listen to his or her employees, these are things that can bring down a business. A good team is necessary for success in vending.
3. Reliable Equipment
Machines breaking down often? Trucks won’t start in the morning? Totes keep breaking apart? Dollies not holding the weight they say they can hold? Without proper, reliable equipment, a vending business is bound to fail. It is more than just buying good vending machines; those vending machines need trucks to take them to locations and to take product to refill the machines. Drivers need totes and dollies to move product around efficiently without having to make multiple trips back to the truck. The slower the driver moves in vending, the less money is going to be made by the end of the day. I remember when I was as a vending route driver, working within a reasonable time frame to stock as many machines as possible during the day was incredibly difficult. Veteran route drivers work much more quickly than I ever could, but without reliable equipment, nothing can get accomplished.
There is a lot of guesswork in vending. Without the proper tools and technology, vendors cannot track sales, control inventory efficiently, or even know when machines break down. With a solution like one from ParLevel Systems, one can significantly decrease excess spending and increase profits from pre-kitting, optimum merchandising, and dynamic scheduling. For example, with pre-kitting, one can turn 13 routes into 10 routes, and drivers can service significantly more machines in a route per day, increasing revenue. These benefits take all of the guesswork out of vending, and when one is able to measure something, one can control it. Without proper technology in a vending business, vending becomes much more difficult and less efficient. The great thing about the solution from ParLevel Systems is that there is no upfront cost for the hardware, and the monthly fee per machine is quite affordable. Check the ParLevel Systems website to learn more.
These are four things that successful vendors have in their businesses. None of these are mutually exclusive, either. One would need all four in order to have a successful vending business and experience growth. Profit margins are small in vending, but when you have a large operation, the money can come rolling in. Vending is an exciting business, and with these four things, it can be a lot of fun to run and grow.
Share your stories with us in the comments below or send me an email (email@example.com) if you’re interested in ParLevel Systems’ technology solution. What do you think are things necessary for success in vending?