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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C O V E R S T O RY market: Honor boxes costs and an unsaturated marketplace make honor boxes a strategic add-on. with no heat or air conditioning. "They were some cold winters," Legler remembered. In 2008, he bought the current building from his brother in law and sectioned off a 2,500-square- foot space for his warehouse, adding climate control. He plans to rent out the rest of the 12,000-square-foot building. RECESSION: VENDING TURNS TO HONOR BOXES One trend Legler has noticed is dur- ing the current recession, companies have been reducing staff. Some of his small vending accounts became honor box accounts because of the shrinking employee numbers. And some honor box accounts closed completely. "We have to be adding accounts constantly because they're closing," he said. Mark Legler bought an exist- ing honor box business in Sep- tember 2000 and renamed it V.E.N. Enterprises using the initials of his children's names.. Legler charges two prices in his honor boxes, $.75 for snacks and a dollar for candy. "I had gone away from candy because it cost more," said Legler, "but people argued and fussed." He agreed to put candy back in, but at a higher price point. Customers didn't complain. They pay the premium price. "I don't think I could put more candy bars in than they would buy," said Legler. An interesting difference Legler sees between honor boxes and vending machines is what people buy. Honor box patrons are more likely to buy a granola bar, for instance. The granola bar doesn't sell as well in the vending machine. Other items Legler sells more via honor boxes than vend- ing machines are the cracker and cheese combos as well as certain snacks like Combos and Snack- wells. Legler doesn't have a reason for this. He guessed that it might be what customers buy after the candy bars are gone. Legler has a retired couple come in three days a week to pack the boxes. Before them, he hired vari- ous people from the town to pack boxes, including his own kids on Friday nights when he fi rst bought the business. C ONT INUED ▶ V.E.N. custom builds its honor boxes V.E.N. owns the dye for the specially designed honor boxes it uses, which includes a fold-out money holder. The original owner designed the box and Mark Legler, the current owner of V.E.N., gets them professionally cut every few years. He punches them out and constructs the boxes himself and adds the labels. If handled gently by the customers, the boxes can last fi ve or six years. Legler charges different prices for snack and can- dy based on wholesale costs. Customers pay the premium for candy without complaint. While Legler accepts the term "honor box," he will often refer to them as snack boxes with customers. He feels it has a better connotation. "Honor box implies that you may not pay me," he said. October 2011 VendingMarketWatch.com Automatic Merchandiser 27

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