Operators Call for Uniform DEX Data Standards

Operators are quick to blame the equipment manufacturers for not doing enough to standardize their DEX hardware and software. The manufacturers did not adopt a set of standards, which some now think are too broad. When NAMA said that people needed to send XYZ information, different manufacturers had different understandings of how to do it.

As a result, a handful of operators including Antares operators want to see NAMA adopt, more stringent DEX standards. Even some equipment manufactures agree that standards can do with some improvement. There are some operators that that have had problems when they first tried to utilize DEX.

In some cases, the DEX standards have been too broad. The more stringent ones may be able to solve the problems that some Antares operators are having. Manufacturers point out that not all machines require the same type of data. In addition, not all customers want the same information from the machine. Excessive standardization carries the risk of extra cost without additional benefit.

Will standards fix things?

This is the big question. Standardization will not always assure Antares operators that manufacturers will abide by new protocols. Some manufacturers claim that competitors have not supported existing DEX standards. Such a claim in itself is a judgment based on technical interpretation. Equipment manufactures have further pointed out that the task of gathering data in a useable format is one that should be handheld by the software company.

Even if NAMA adopts additional standards, as it is considering, manufacturers will add to that list for specific equipment needs. Whether minimum standards are necessary to begin with is open to question, since many protocols are already being followed for simplicity’s sake.

There are some DEX data items that tend to be standard in all vending machines, including Antares machines. These include: coin mechanical fields, coin to tube, coin to coin box, coin from tubes, total coins, total cash from validator, total vends and total cash. Machines that report less standard data, such as sales per column, sometimes require extra memory, which not every machine will have. The standardization of DEX data is an issue that will improve with time. The immediate need is for operators to understand the benefits.

Small Accounts: The big challenge

Most operators cannot service accounts with fewer than 50 employees profitably. If you want to do this in your Antares operations, then you can develop a system to do that. To service your small accounts efficiently, service frequencies and sales-per-stop should be carefully reviewed.

With small accounts you don’t get much gross profit dollars to capitalize your investment, but the good thing is you don’t have nearly as much sales volume concentrated with one customer. Even with small accounts, you can exceed the NAMA operating ratio average.

Technology to the rescue

Over the past years, many operators have either given up on the small account market or have tried to use smaller machines and infrequent servicing. Through efficient route management, an Antares small account can serviced profitably through efficient route management. You can use a specially designed flexible route accountability system which would schedules routes based on historical sales data of each machine.

Leveraging labor effectively

Labor, not equipment, is the most critical cost in servicing vending locations. By leveraging labor productivity gains, we are able to capitalize equipment investments with smaller than “industry standard” account sales volume. The accounts are serviced according to sales volume. Sales are tracked for a period of six months to determine service frequency. The optimal time to service the account of closed front machines is at the 60 percent sell-off. This means only 40 percent of the machine needs to be filled at the time of service. A different sell-off ratio is assigned to glass front Antares vending machines, due to the negative consumer perception caused by empty spirals in these machines. Handheld computers are a great help with data tracking. Developing a data base to determine when the account needs service is the easy part; the hard part is route scheduling. You can use a grid map of the Antares service area to come up with the most efficient schedule. This will allow you to get your per-service selling margins up substantially.

Category management and computerized data collection would help you to succeed in the vending trade. In addition, you can utilize technology to profitably serve small. This will keep you competitive in your market.

Increase your Sales by Building a Website

Each day there are more than 625 million searches are conducted online. This means that there could be prospective customers searching everyday for products to fuel and energize their employee workforce, including your snacks and beverages. They’re using search engines to find exactly what they’re looking for. They can type in words such as “vending and Boston” to help them.

The name of your Antares vending company needs to appear on the first page of the results from these targeted searches. If you do not have a website, then you would need to build one.

The internet replaces phone directory

Your website would be your online pitch for Internet users. Customers are Internet users and the first stop for a consumer in need of a product or a service is an Internet search engine, not the phone book. As is the case with all marketing communication tools, websites should be oriented first and foremost to serve the need and interests of your current customers and your potential customers.

By having a website for your Antares operations, it means that you will increase your chances of obtaining more business. In other words this is just another form of promoting your Antares business. Potential customers can view your website at any time, and that means you can gain a number of new accounts using the website.

In this competitive environment for winning new vending businesses, your website needs to stand out from the crowd and at the same time it needs to be sophisticated and professional. It should attract potential customers and reflect your business.

How a site is designed, developed, written and managed can have a big impact on how easy your company lands first among search engine results and how easy it is to succeed through online advertising. Your web presence would be your home base for your Antares business. It is a critical component of your marketing and communications strategy.

You would be directing visitors to your website as the follow up to offline promotions, and it must effectively handle visitors coming there from traditional marketing sources such as your business cards, cold calling and brochures.

Technology Advances for Theft Prevention

The control of cash in equipment has been one of our daily tasks since the vending business began. Virtually every week, there have been reports on an occurrence of someone breaking into a vending machine. There have also been steps taken to control the cash from internal theft. Attempts are being made to minimize internal theft to guarantee that all the money made in your Antares operations comes back to the money room.

Fortunately, technology has helped Antares vending operators to control the products and cash on an everyday basis. The refinement of the DEX standards for machines is now enabling us to utilize this technology in any manufactured machine of any age. Technological advances have and will continue to help us get a better handle on where the cash and products are at any time of the day and night.

Today, dollar bills make up the majority of cash versus the coins of the past years. Thieves are now able to obtain a large amount of cash and discreetly walk out the door. Unfortunately the internet has given the thieves valuable information of the equipment and locking systems.

As much as technology has helped Antares operators with internal theft, technology is also helping with external theft. Electronic locks are becoming more and more popular as a method of curbing both external and internal theft.

Minimally secure your bill acceptors

Most Antares machines have easy access to the dollar bill acceptor and stacker by simply prying on the door to gain access to the back bill acceptor bezel and stacker by crashing the front bezel with a hammer. Kits are available that will secure the Antares bill acceptor bezel and stacker to make access impossible. Reinforced steel covers can cover the bill acceptor bezel.

Avoid theft and vandalism

A least costly action you can take against theft and vandalism for your Antares vending machines may be to determine if the machine is at a proper location within your location. If the machine is hidden in a back hallway rather than in a position near the front door, your chances for theft and vandalism will probably increase. Place the machine in a visible area.

Security issues will never go away. Unlike other retail establishments, the vending business is such that both internal and external security issues will remain with us for the long term. To keep your losses to a minimum you can invest in technology, which will really pay off in the long run.

Large Size Candy Bars

King size bars are costlier than large size confections (LSC), and at the same time, there is less consumer acceptance. LSC are well received in all types of accounts. Antares operators have reported having good sales with them. LSC and king size candy bars have boosted candy sales for a number of operators. You shouldn’t be reluctant to use higher priced offerings in your Antares operations; so far others have experienced success using these offerings.

Some operators not ready to upsize

There are some operators out there that have been reluctant to upsize, because the higher the price, the less people are going to buy. This is not always the case. Upsizing can really work for your operations, since people are willing to pay the higher prices. This all just depends on the location of your Antares operations. Upsizing has proven to be profitable for a large number of operators.

Several operators have noted that $1.00 is the ceiling they can charge for candy, this is the reason that LSC works. King size candy bars do not work, as consumers do not want giant candy bars. The dollar seems to be the right price.

A way to offer added value

LSC can provide a way for you to circumvent a price increase. You can have secondary name brand candy bars removed from your Antares vending machines in response to higher costs. There are some companies that are offering generous rebate programs and other candy manufacturers are developing products to fit the need for less expensive offerings.

The bigger question for most Antares operators is not where they will source candy, but what they will carry. Higher costs for certain national name brand products has forced many to consider upsizing to larger products, which will allow them to offer a greater value for a higher price point.

Will higher prices create place for premium candy?

With vending prices rising, some Antares operators think that there is more opportunity for machines to offer more premium priced products. This move could support a growing consumer demand for gourmet and premium candy. Premium candy remains a small part of the overall candy business. Premium chocolates have posted some growth, while general chocolate sales remained flat in comparison.

Nutrition Concerns Increase

More school districts imposed restrictions on vend products in 2004. While schools did not represent a major customer segment, concerns about nutrition have expanded to other accounts.

While public officials continued to blame poor diets for rising obesity, the aging of the baby boomers also contributed to a higher level of health awareness. In 2004, low carbohydrates diets in particular became more popular, and are still quite popular even today.

Antares vending operators responded to health and nutrition concerns in various ways. They took note of what the public wanted in terms of healthier vend products. Some Antares operators have opted to have healthy products in their vending machines so that they can cater to this growing section of the public.

Some Antares operators simply made customers aware of the fact that many of the products offered in the vending machines already fit into the various “health food” definitions.

Antares operators with state of the art computer systems were able to show account managers what products consumers were and were not buying in the machines. The nutrition issue was cited by many vending operators as an important reason for having the ability to track line item sales.

Operators offered mixed views on whether or not healthier items were actually selling better than they did in the past. In the past health products were not very popular with the public, but this has all changed in recent times. There has been a growing demand for health products mainly due to the health concerns that have come about because of the problem that America has with obesity.

Healthy vend products carry higher price points. This does not really affect the sales made in the Antares operations because the public that demand these products do not mind paying a higher price for these products.

There are some vending operators who have decided to have health products dedicated vending machines in their operations. Depending on the location that these machines are placed, the sales from these machines have been profitable. As an Antares operators, you can place some health vend products in your machine and wait to see how well they will sell.

Changes in the Vending Industry

The vending industry has changed over time, and that means that you as an Antares vending operator will need to change as well. The market place for vending is experiencing more change than most others. Today’s economic conditions and fierce competition have resulted in an environment that is markedly different from that experienced in past decades.

You need to align your Antares operations with the changes that are taking place. To do this, you need to have a strategy in place. In order to survive you will have to make money at smaller accounts, achieve higher per capita sales, open new markets, introduce new products, utilize technology, sell new locations, and most important of all, you must tenaciously hold on to your existing business.

Concurrently, you must operate as efficiently as you possibly can and become absolutely relentless in smoking out waste and inefficiency.

The demise of any business is an insidious process; it may seem you’re just in a slump or just going through a streak of temporary bad luck. However, when this condition continues unchecked, it robs the organization capital.

As an Antares operator, you will have the Natural Choice program to guide you in your vending operations. There are a number of changes that are taking place in the industry and you have to find strategies of coping with these changes. To cope with some of these changes, you will have to invest in certain technologies.

Future challenges for your Antares operations cannot be addressed without discussing profit drains. These days, theft and fraud know no bounds. If you think your business is immune, think again.

No vending business can afford to operate today without strong controls and preventative measures in place. Smaller businesses are more vulnerable because they typically lack the secondary controls and procedures that are in place in large corporations.

Software has given Antares vending operators the opportunity for more control over route and warehouse inventory than ever before. This has allowed the Antares operators to bring in more profits in their operations.

Does it pay to Buy Used Equipment?

Customer downsizing creates a bigger need for refurbished equipment. Antares operators should start by assessing and prioritizing their locations’ needs.

Given the high cost of new vending and OCS equipment, it is easy to see why operators consider installing used equipment, whenever they book a new location. After all, vending equipment is capital based equipment and real profits are measured as a return on capital investment made in the location. At any given level of profitability in the location, the return on investment (ROI) will be grater with lower cost equipment

In well managed operations, professionals work very hard to ensure that each location is equipped in a manner that allows the company to earn an appropriate ROI. This is the percentage derived when you divide the net profit by the capital investment required to earn that profit.

There is a place for good, used equipment in our industry. As our locations get smaller, it becomes more difficult to earn appropriate returns on the investment using all new equipment. In addition to lowering the capital investment, the use of older Antares equipment will actually increase the reported profitability of the location by virtue of lower depreciation costs.

Consider equipment capabilities

Newer equipment usually offers more product capacity then older refurbished equipment. If you go for a used Antares vending machine, you will find that it has large product capacity that can match any new equipment.

As a piece of equipment ages, it requires more mechanical maintenance. Antares operators can expect to pay more for parts and labor on older equipment than on new equipment.

Modern machines offer more product selections than older machines. Fewer product selections translate into lower dollar sales. The better a machine displays the product, the higher the sales. Both old and new Antares vending machines display the products for sale. They have been designed to invite the customer. The sales made from a closed front vending machine are usually lower than those made from glass front vending machines. Antares vending machines are glass front.

When buying used equipment, go for quality and at the same time save some money on the capital that will be required for the business.

New Technology Enables ‘Share of Market Strategies’

There are few strategic initiatives that are designed to increase the share of transactions in any retail trading area. This is the logic behind “share of market” marketing. In any given area, there are a limited number of retail transactions for away-from –home sales of food, snacks and beverages. All vending sites compete for those transactions.

Applying the tools of “share of market marketing” in your Antares vending business is necessary because the customer that you are serving has changed and will continue to change. Everyone is time starved and stressed, and they just want to be treated like individuals even as more and more retail businesses take on a homogenized look. You can build an action plan for your Antares business using the following steps.

1) Simplify the menu. Reduce the number of items in your Antares vending machine. After this you can double on big sellers to increase your sales. Most Antares vending operators that have applied category management have ended up reducing the number of SKU’s they warehouse, once they have identified the top sellers.

2) Promote aggressively. Make your Antares menu your best sales tool. Provide handouts for the regulars at your sites. This means that you’ll need to live by a planogram-so that the customer can find their favorite items easily. Put up posters with attractive machine planograms to promote the products before people get to the Antares machine.

3) Innovate and test new approaches. The younger people in the world today are digital. They are now and future customer base for your Antares business. You will need to keep them interested or they will patronize some other retail source that will make the experience better.

4) Execute “share of market marketing.” Keep a close watch on population changes at your existing accounts and jump on any chances to add to your existing vending bank. Opportunity for increased revenue can come from anywhere the vending bank is. This can cost more in machine investment capital, but this is how you will get a bigger share of the transaction in the area. If you make your services more convenient, you will get more sales for your Antares vending business.

Vending faces increasing challenges from powerful competitors. The convenience stores want to sell the snacks and cold drinks that you are selling. They can be successful in stealing business from you, if you let them.

Technology Unlocks Profit Potential

With a finite amount of space available to merchandise products, you can improve your Antares profitability in only three ways.

1) Sell more products.

2) Spend less money selling the same amount of product.

3) Sell the same amount of product and raise the price.

Of all these No.3 is the most difficult. Raising prices in your Antares business can affect total sales, but a successful operator is the one who will consistently excel at No. 1 and 2.

Productivity reaches a pinnacle

As a result of advances in technology, we are now the most productive society in the world. As people, we can take pride in what we have accomplished, but individually, there is still much to be done. The same can be said about the automatic merchandising industry.

Technology literacy no longer an option

Your ability to harness technology will allow you to sell more and spend less in your Antares business. You can end up saving up to two hours per day per route by employing this technology. In addition to this, you will enjoy 10 percent sales increases from the same machines through a better understanding of their location preferences. Shrinkage will be virtually eliminated by cash audit functionality.

Internet will revolutionize the industry

You should prepare to use internet in your Antares business, because sooner or later it will change vending operations. This medium will be revolutionary in the vending industry. You need to be well informed about the innovations that are changing the way we do business.

With the speed in which technology is driving our world, understanding technology and applying it to your Antares business may be the most important thing you ever do.

To view technology as a whole is daunting, even to the initiated. It can be overwhelming to someone who has yet to become comfortable with the most basic computer skills. If you want to succeed in your Antares business, then you will need an understanding, appreciation and working knowledge of what information management technology can do for your business.