Thursday, April 10, 2008

The Challenge Of Making Small Vending Accounts Profitable

In most cases, vending operators cannot service accounts with less than 50 employees profitably. If you want to do this in your Planet Antares vending business, in you will have to develop a system to do that. To service your small accounts effectively, you need to review the service frequencies and sales-per-stop carefully.

Smaller accounts do not offer as much gross profit in dollars to capitalize your investment as the larger accounts but the good thing is that you don’t have nearly as much sales volume concentrated with one customer. Even with small accounts, you can exceed the NAM operating ratio average.

In recent years, many vending operators have either given up on the small account market or tried to use smaller machines and infrequent servicing for them. It is possible to service a Planet Antares small vending account profitably through efficient route management. You can use a specially designed flexible route accountability system which will schedule routes based on historical sales data of each vending machine.

A critical factor to be considered while servicing vending locations is labor and not equipment. By leveraging labor productivity gains, we are able to capitalize equipment investments with smaller than “industry standard” account sales volume. The account servicing depends on the sales volume. To determine the service frequency, sales are tracked for a period of six months.

The optimal time to service the account of closed front machines is at the 60 percent sell-off. This implies that only 40 percent of the machine needs to be filled at the time of service. Glass front vending machines like Planet Antares vending machines are assigned a different sell-off ratio due to the negative consumer perception caused by empty spirals in these machines.

To track data, handheld computers have proven to be great tools. It is easy to develop a data base for determining when the account needs service while the hard part includes route scheduling. You can use a grid map of the Planet Antares service area to come up with the most efficient schedule. This will allow you to get your pre-service selling margins up by a substantial amount.

To succeed in vending operations, it is recommendable to use category management and undertake computerized data collection. In addition, you can utilize technology to profitably serve the smaller accounts.

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