Automatic Merchandiser

SEP 2013

Automatic Merchandiser serves the business management, marketing, technology and product information needs of its readers including vending operators, coffee service operators, product brokers, and product and equipment distributors in print.

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OPERATION PROFILE New York-based U.S. Coffee employs 100 people. especially in defense against these types of companies adding coffee service. "We even hired an offce supply sales specialist," said Shindler. U.S Coffee currently offers 40,000 offce supply items in its catalog, something Shindler wants to add to the company Website. The biggest hurdle is getting preferred products to show up before other products in a search, Shindler explains. If a customer is searching for hot cups, Shindler wants the company's OCS vendor cups to show up ahead of the offce supply vendor hot cups, which cost him more. "It's a matter of prioritizing the correct vendor," he added. Internet offers B2C Despite the challenges, the partners believe the Internet will be the OCS battlefeld of the future. "It's becoming less and less a [physical] territory business," said Shindler. "It's certainly a different business than coffee service was." Trapani agrees. "If you're not on the Internet… you're falling behind." Since U.S. Coffee has no prescheduled routes, locations must submit their orders via phone, fax, or more recently, the Internet. Trapani has seen more and more location managers using the Internet, especially among the millennials, who rarely call to talk to a customer service representative. Having several robust Websites allows the operation to not only reach its OCS customers, but also sell directly to the consumer. U.S. Coffee commits a lot of marketing dollars to the Websites' SEO (search engine optimization) and Google AdWords. The company is also active on Facebook, Twitter and Pinterest. Once you start selling on the Internet you are no longer an OCS operator. You are an Internet retailer and that's a totally different game," said Shindler. It requires different skills and a large monetary investment. "Creating a Website is the easiest and cheapest part." Meeting customer requests U.S. Coffee has three vending routes, separate from its OCS business. The vending business was added because of OCS customer requests. However, despite being a relatively small part of their service, they have invested in a lot of vending technology. The operation uses handhelds, prekitting, credit card readers and the partners just added vending management software to better analyze product sales and track cash accountability. While Shindler and Trapani recognize the value in micro markets, they don't consider them a good ft 14 Automatic Merchandiser VendingMarketWatch.com September 2013

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