Advantage Vending: Using VMS to Grow Vending Operations
Based in Searcy, Arkansas, Advantage Vending and Coffee Services is a growing operation that has big aspirations. Owner Mike Kever runs this family business, and in 2012, he set upon a long-term growth strategy for Advantage. The first step in his journey occurred in 2013 when he doubled their operation by acquiring a similarly sized company. Once Kever coordinated the integration of the two, he immediately recognized the critical need for a vending management system that would not only help him run the now larger operation, but would also help him grow vending capabilities.
Kever had experimented with different methods for managing inventory, forecasting, and route management over time, but had not found a solution that fit his business. From his research on various VMS platforms, he concluded that most were not cost effective for a company their size, and the complexity of installing and using them was enough to deter him.
“I am not an IT expert, and I didn’t have the ability to hire someone just to implement and manage a VMS. I know that even if I made the initial investment, if it was going to be a chore to use the system, I would never take the time to actually get the most benefit from it,” said Kever.
Prior to implementing a VMS, Advantage’s route drivers were responsible for servicing between 85 and 90 machines per week. Product selection and stocking levels were estimated based on gut feel and manual analysis of sales. Kever knew that he could streamline the process if he could have access to better machine data.
“Just like a lot of operators, I had to deal with bringing back outdated products, and carrying more inventory than I really needed – both of which cost me money,” continued Kever. “We were at a point where we recognized the need to invest in a technology such as a VMS to keep the business profitable and growing. Efficiency and control were the two critical attributes I needed to address. I went to the NAMA OneShow to find a VMS. After looking at several offerings, I came across Parlevel. Their approach to VMS seemed game changing, easy to use, and it could be a good asset for my company. The Parlevel team really understood the challenges that an operator my size faces every day.”
Parlevel’s VMS platform is a cloud-based solution that provides vending operators with real-time reporting and accountability of vending machine inventory, performance, and route management without the need to purchase or install any computer or network equipment just for the VMS. The system also provides robust pre-kitting and merchandising functions that give the operator unmatched insights at the row and column level to help them capture actual sales data and stocking needs. The VMS also includes an Office Coffee Service (OCS) module to facilitate the management and tracking of coffee products and equipment.
After several discussions with the Parlevel team, Kever made the decision to put the business online with the Parlevel VMS. Parlevel worked with Kever to create a game plan to make sure all the features and tools would work seamlessly when the system went live. The first step in the deployment process was to get the machines connected to the Parlevel platform.
“The Parlevel team was invaluable in helping me understand what was needed to ensure a smooth deployment,” noted Kever. “From start to finish, the implementation took just a few days with the most time consuming part being installing telemetry to the machines. However, this work and expense is ultimately an investment in the business. We recognized this process as both adding immediate value for Advantage, as well as getting us set up for future growth.”
With the telemeters installed, Advantage’s machines could communicate through a secure connection to the Parlevel VMS mobile platform. Once the telemetry installation was complete, Advantage was ready to go online with the Parlevel VMS. Kever and Parlevel collaborated to create routes and implement pre-kitting as well as setting up his OCS business within the platform. Kever was ready to grow vending business opportunities in the area.
Advantage did not need to purchase any new computer equipment to move its business online. The Parlevel VMS allows users to access everything that they need to run their business from the standard web browsers available on any desktop or mobile device.
Parlevel’s support team worked hand-in-hand with Kever to create routes, import inventory data and machine plans, and establish initial par levels for every item in every machine. Once the data was input and verified, Advantage was online.
“From day one, I was able to see more operational data than I had ever had access to before. And, it was very easy to get into the system and play with the analytical tools to see what products were selling – and acting on immediate sales opportunities that presented themselves in each location,” continued Kever.
Impacts to Business – 140% Route Efficiency Increase
According to Kever, the two immediate and most significant impacts to the business were route efficiency and changes in warehouse procedures.
“Our route service efficiency improved over 140% overnight,” said Kever. “It took some getting used to, because we were so accustomed to visiting the same sites on the same days. But with the VMS, we’ve been able to implement dynamic routing that is based on inventory needs, not a fixed routine. It has made us much more efficient & effective in tending to our customers’ needs.”
During the first six months after implementation, Advantage was able to reduce machine service visits by fifteen percent, and during the same period saw an increase in gross sales. Kever noted that these changes are primarily due to the efficiencies enabled by the VMS. In addition, Advantage saw a nine percent increase in collection per service since deployment. Increasing efficiency decreases potential costs that inhibit many vendors looking to grow vending operations.
“Visiting machines less and collecting more on each visit definitely are two positive outcomes of making the move to the Parlevel VMS,” noted Kever. “The savings in time, fuel, and inventory due to the optimization we were able to do with the VMS has made a tremendous impact on the bottom line.”
One of the most prominent benefits of VMS is the efficiency achieved through pre-kitting. Among the impacts often cited are the significant reduction in the time spent at each machine, and enhanced inventory management.
“We reorganized the warehouse and changed up the way we prepared for daily routes when we implemented pre-kitting,” said Kever. “Once again, we had to change our thinking about what it takes to service a route, but the Parlevel team gave us excellent guidance and recommendations for making a smooth transition.”
Kever also noted that this immediate increase in route management and warehouse efficiency enabled Advantage to compete with much larger operators, while delivering better customer service.
The Parlevel VMS provides Advantage with real-time access to detailed planograms for machines, automatically displays sales performance per item, and creates a pre-kit list. The operator has full control to adjust quantities as necessary before the pre-kit order is issued.
“The visual planograms of every machine are a tremendous feature,” continued Kever. “I can dive into any connected machine and at a glance know what’s selling and what is not selling. I regularly use this capability to tweak the pre-kit lists.”
Parlevel’s Hero Support teams are available all hours of the day and week to address any issues or questions raised by its customers. Kever reported that he has received an immediate response every time he has reached out for help.
“With technology, there are those hiccups that occasionally come up, and Parlevel has always delivered an immediate remedy,” said Kever. “And I’ve also used the Hero Support line to discuss new features and capabilities that would help me run my operation. Parlevel has even implemented some of the new features that I requested. I can’t ask for any more than that.”
With its VMS firmly in place to provide a single management and control portal for vending and OCS operations, Advantage is in the midst a plan to grow vending operations efficiently and profitably. Kever stated that he could never envision returning to the manual methods that he used before.
“I don’t have to be an IT expert to use the Parlevel system,” said Kever. “I know exactly what is going on with my business from anywhere, and I didn’t have to invest in expensive equipment or IT consulting to make it happen.”
“I couldn’t ask for a more professional or responsive partner than Parlevel,” continued Kever. “Their tremendous support, industry knowledge and customer-oriented philosophy has cemented me as a life-long customer.”
Headquartered out of historic San Antonio, Texas; Parlevel Systems is the fastest growing provider of Vending Management Solutions (VMS) for vending operators and coffee, tea, and water service providers. Founded by a team of successful vending and technology professionals, Parlevel is dedicated to delivering powerful yet easy to use technology that provides operators with complete control and accountability of their business anywhere, anytime. In addition, Parlevel has a dedicated team of customer and technical support to ensure seamless implementation and a transformative return on investment. For additional information, please visit: www.parlevelsystems.com.