Automatic Merchandiser

OCT 2011

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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Page 21 of 39

SEL F C H E C K O U T Considering self checkout? By Allen Weintraub, Contributing Editor Operators must be retail merchandisers to make kiosks work S Variety and quality are paramount elf checkout vending markets (SCVMs) continue to grow at a rapid rate. As challenged as our industry's operating environment has become, these SCVMs are pop- ping up nationwide and delivering outstanding sales. Change is never easy. To offer a SCVM, the vending operator must invest in new equipment, learn how it works, invest in new products, and establish a new delivery system. But progressive operators are fi nding these SCVMs allow them to provide consumers the values they want. What do installations of SCVMs to date teach us? The most dramatic difference over vending is the number of stock keeping units (SKUs) available to the consumers through SCVMs as compared to vending. Patrick Hagerty, president of Vistar Corp., told Automatic Merchandiser that when a SCVM replaced vending at Vistar's headquarters, the SCVM offered about 300 SKUs, which is far more that the vending machines did. My research indicated that a 20 SCVM carries an average of 272 SKUs. However, just as important as the number is the quality of the SKUs available. From my vantage point, opera- tors are learning they must become true retail merchandisers to be suc- cessful with SCVMs. This isn't to say the same thing isn't true about vending. But with SCVMs, the stakes (and the potential benefi ts) are much higher. THE FACTS DEFINE THE TREND According to BCC Research in Denver, Colo., in the next fi ve years, sales volume through self checkout will grow at a compound annual growth rate of 9.3 percent compared to vending's 3.2 percent. This 9.3 percent refers to all types of self checkout, including the Automatic Merchandiser October 2011 systems used by traditional retail- ers. It's safe to assume that the vending self checkout growth will be much faster. If kiosk operators do not expand their product lines and merely replicate vend items, the consum- ers at the SCVM locations will soon become dissatisfi ed. Recently I visited a location with multiple kiosks. The location manager was seeking to replace the SCVM operator because the product selection was merely replicating vending machines. The location manager eventually selected another C ONT INUED ▶

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