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C O VE R ST O R Y :
S M A R T VE N D I N G
bill has not changed since 1963 — almost 50 years! Every other denom- ination of U.S. currency has changed multiple times in just the past 10 years. This isn't going to change any time soon for to political reasons. Less than half of people today
will have $2 cash in their pocket. Hence, every operator who installs a vending machine that only accepts bills and change can sell to only about half the people. The Gen X and Gen Y population with dollar bills is even lower, and these are often the targeted users of vending machines.
Nutrition display at the point of sale is one aspect of smart vending.
sider is the extent to which demand for an item can be substituted for another item. In some offi ce accounts, if all the customer wants is Diet Coke, it is unlikely they will buy another drink. A lost sale will result. But at a school, if one item is sold out, it is likely the students will take an alternate item.
Shift to focus on sales
As operators migrate to "smart vending," the focus shifts from minimizing costs to increasing sales. This shift will not only be magnifi cent, but also imperative to save the industry. Without change, the industry cannot survive in an environment where consumers are shifting to cashless payments, demanding more information, and desiring choices. The single biggest issue is the problem of the $1 bill. Cashless is changing the indus-
try. Many of us realize this. What many of us don't realize is that in order to allow this new tool to work to its full potential, we must stop thinking about our product offerings within the old cash domi- nated mindset. When a cashless reader is placed on a machine, the operator must understand that he
April 2012 VendingMarketWatch.com Automatic Merchandiser 35
is no longer restricted by the same rules that cash imposed on him. This industry and some other industries are so dependent on the $1 bill that the design for the $1
The dollar bill also limits items
we put in the machines. There is a longstanding $1 price point barrier. But once we start accepting cashless forms of payment, we can get really creative of what we stock C ONT INUED ▶
