Vending machine technology in club operations.The potential impact of automatic merchandising (i.e. vending) on the club industry may be significant. Innovative, "smart" vending machines vending machine, coin-operated, automatic device for selling goods. Many vending machines are capable of making change, and some of the more sophisticated ones accept paper money or credit cards. , seamlessly integrated with club management systems, possess the capability to enhance member services, reduce labor costs, and increase profitability. Given the technological advancements in automatic merchandising and vending information systems(v-commerce), club management should consider using vending equipment in innovative ways to meet or exceed member expectations. Why not allow cashless vending with transactions be settled to a club member account rather than cash? How about stocking club signature snack items in machine spirals at several locations throughout the club? What about refrigerated re·frig·er·ate tr.v. re·frig·er·at·ed, re·frig·er·at·ing, re·frig·er·ates 1. To cool or chill (a substance). 2. To preserve (food) by chilling. machines stocked with Adj. 1. stocked with - furnished with more than enough; "rivers well stocked with fish"; "a well-stocked store" stocked furnished, equipped - provided with whatever is necessary for a purpose (as furniture or equipment or authority); "a furnished apartment"; a variety of freshly made sandwiches available anywhere, anytime (e.g. clubhouse, locker room, card room, poolside pool·side n. The area next to or around a swimming pool. , etc.)? Vending Operators Advances in equipment technology and computer software are giving vending operators more control of their business. These tools are providing benefits on several fronts: routing, service scheduling, accountability, and product selection. For most operators, accountability at the route and/or machine level is a top priority in choosing application software. The ability to choose a more profitable product mix may be further down the list of most operators' priorities. What input does club management have in determining the plan-o-gram (product mix) of on-premises vending machines? The long-term impact on an operator's profitability and commissionable sales to clubs can be significant. Although only a small percentage of vending operators are utilizing available vending machine technology, change is occurring on two parallel fronts: product accountability and product merchandising. Cashless Club Vending Vending technology (V-commerce) advancements make possible an increased number of unattended points of sales with online transaction processing See transaction processing and OLCP. capability to improve club operations. Such developments represent a significant cost-containment strategy for the historically labor-intensive club industry. For decades, vending equipment has been a hidden or auxiliary operation Noun 1. auxiliary operation - a operation performed by off-line equipment not under the control of the central processing unit off-line operation operation - (computer science) data processing in which the result is completely specified by a rule (especially in the club environment. Few club managers have noticed vending machine reliability, efficiency, or opportunity. Why shouldn't a club member be able to insert a membership card or enter a member number on a machine keypad A small keyboard or supplementary keyboard keys; for example, the keys on a calculator or the number/cursor cluster on a computer keyboard. See programmable keypad. into a vending machine so that transactions can be posted to the proper member account? What about delivery of upscale snacks, quality food products, logo wear, equipment, and the like via machine? Why not dispense towels and/or market skin and health care products at various recreational venues without requiring an attendant? How about breakfast items, newspapers, coffee, etc. for slow service intervals? Decisions concerning machine content and fulfillment reside with development of a club plan-o-gram--a database-driven machine stocking plan that incorporates a number of variables. Plan-o-grams Initially, product manufacturers introduced sample plan-o-grams as a means of providing a simplistic sim·plism n. The tendency to oversimplify an issue or a problem by ignoring complexities or complications. [French simplisme, from simple, simple, from Old French; see simple way for sorting category databases into product selections. Software companies now offer plan-o-gram modules and sales analysis tools as an aid to better, more informed product selections. To fully implement plan-o-gram mapping, the club should plan its product offerings based on known member preferences. Plan-o-grams are typically organized according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. location type (club poolside, golf course, card room, meeting rooms, etc.) and/or machine configuration (32-select or 45-select). The amount of support work required will depend on how frequently and to what degree the plan-o-gram changes (weekly, monthly, quarterly). Most plan-o-gram maps are composed to account for two types of products: core products and cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. products. Core products are those products that the club would like to always maintain in the machine. Items that move on and off the plan are labelled "cyclical" and may or may not be included in successive plan-o-grams. A plan-o-gram analysis enables projections based on item-level financial data to determine product rotation groupings. Plan-o-grams provide a tool to ensure better selling items are in all machines. When product accountability is added to a plan-o-gram, the club manager or vending operator becomes capable of managing product categories--a macro-level practice known as category management. Category Management Like some club operations, vending operators tend to select machine products (menu items) based on sales, not profitability. In the mid-1990s, companies such as Nabisco Inc., Frito-Lay Inc., Hershey Foods, and M&M/MARS began educating operators about category management (CM). The goal of CM is to increase sales and profitability through coordinated efficiency at both stocking and pricing levels while assisting with space optimization (most dollars from priority spaces), while satisfying member demand. Historically, club vending machine product offerings have been selected by the route driver--based on personal experience or gut feeling gut feeling Intuition, visceral sensation , rather than by systematic, fact-based information. In other words--product selection decisions tend to be limited by vending machine space allocation, not member satisfaction or club profitability. CM is an important concept because it provides a basis for improvement in overall contribution margin by focusing on member behavior. Understanding member behavior allows operators' to make decisions that include a sound product mix (e.g. candy, snacks, beverages, coffees, golf balls, suntan products, shoe spikes, etc.) as well as a planned item rotation to enhance revenue opportunities. Category management is critical to vending since machines have limited space compared to other retail channels. Club managers would be wise to consider becoming their own vending operators. Automating Category Management Category management is essentially a four-step process: 1) category identification; 2) space allocation to categories; 3) product selection; and 4) menu cycle rotation. Category identification simply involves delineating available item categories (e.g. snacks, beverages, candy, etc.) across all possible choices. A determination is then made as to which product categories will be represented in a specific vending machine. Advanced Technologies While some vending operators have migrated to a cabled, network-centric system, the advancement of wireless technology has emerged as an attractive alternative. Wireless applications possess tremendous potential. DEX is an acronym acronym: see abbreviation. A word typically made up of the first letters of two or more words; for example, BASIC stands for "Beginners All purpose Symbolic Instruction Code. for Data Exchange and is the abbreviation abbreviation, in writing, arbitrary shortening of a word, usually by cutting off letters from the end, as in U.S. and Gen. (General). Contraction serves the same purpose but is understood strictly to be the shortening of a word by cutting out letters in the middle, for DEX/UCS DEX/UCS Direct Exchange Universal Communication Standards which stands for Data Exchange Uniform Code Standard. DEX is the key to technological advancements in the vending industry worldwide. For example, common data set elements in the DEX standard are number of bills held in the bill stacker, quantity and denomination Denomination The stated value found on financial instruments. Notes: This term applies to most financial instruments with monetary values. The denomination for bonds and securities would be face value or par value. of coins stored in the coin box Noun 1. coin box - the part of a slot machine that serves as a receptacle for the coins receptacle - a container that is used to put or keep things in coin machine, slot machine - a machine that is operated by the insertion of a coin in a slot , machine inventory, and product sales tracking. The National Automatic Merchandising Association The National Automatic Merchandising Association, or NAMA, is the American national trade association of the food and refreshment vending, coffee service and foodservice management industries. Public relations is an important part of its mandate. (NAMA Na·ma n. pl. Nama or Na·mas 1. A member of a people of southwest Africa. 2. The Khoikhoin language of the Nama. ) has established a communication protocol for the electronic retrieval of machine-level information. As a consequence, vending machines are now manufactured as DEX-enabled and are often labeled as DEX-compliant. Basic DEX extraction includes sales, cash collections, product movement (sales mix sales mix See product mix. ), and related information. DEX data retrieval can be accomplished via three distinct polling modes: 1.) local polling; 2.) dial-up polling or; 3.) wireless polling. Local polling incorporates a hand-held device (or pocket probe) designed to plug-connect to a machine-based DEX-port. Once the connection is established, the device is used to download transactional data. Dial-up polling (telephone line), and wireless polling enables remote access to DEX data without requiring a physical presence at the point of transaction. While most information deals with sales, there are several important elements of auditing. For example, how much cash should be in a machine at the close of a sales period? A route driver, unable to view the DEX electronic record, will have cash collections compared against the machine-level electronic record. A DEXBuzzBox system operates through a wireless transmitter installed in a DEX-equipped vending machine that transmits machine-level data to a receiver (BuzzBox) in the route driver's truck. The BuzzBox may be equipped with a portable printer and a hand-held computer Noun 1. hand-held computer - a portable battery-powered computer small enough to be carried in your pocket hand-held microcomputer portable computer - a personal computer that can easily be carried by hand . The BuzzBox can be used to determine which machines at the location require service (and which do not) and generate a detailed pick list for machine service personnel to restock re·stock tr.v. re·stocked, re·stock·ing, re·stocks To furnish new stock for; stock again. Verb 1. restock - stock again; "He restocked his land with pheasants" the machines prior to actually entering the facility. A club staffer's productivity can also be enhanced, as there is only one trip into the building required. Cashless Vending Members appreciate convenience, and cashless vending offers convenience. Options likely include membership card (magnetic stripe A small length of magnetic tape adhered to credit cards, badges, permits, passes and tokens. The tape is read by magnetic stripe readers incorporated into ATMs, identification readers and payment terminals. ), account number keypad entry, or member credit or debit card debit card, card that allows the cost of goods or services that are purchased to be deducted directly from the purchaser's checking account. They can also be used at automated teller machines for withdrawing cash from the user's checking account. , and cell-phone based m-commerce solutions. Convenience translates into higher sales, while improved efficiencies result in more profitable operations. Some cashless vending machines are also equipped with an innovative feature called e-Port. E-Port is an interactive media screen that can project advertisements or online news content as an enticing draw for consumers. Card system providers report field tests (commercial market, not clubs) have shown that card readers boost sales by 20 to 30 percentage points. In addition, card purchases create an electronic trail of what was purchased, when and by whom. The club industry faces a challenging labor market labor market A place where labor is exchanged for wages; an LM is defined by geography, education and technical expertise, occupation, licensure or certification requirements, and job experience . A popular but seldom considered mainstream opportunity exists in the application of unattended points of sale. Advanced electronic capabilities that enable remote machine monitoring, mobile phone activated purchases, and other forms of cashless member transactions, should be considered for adoption. Now that cashless transactions are beginning to alter the vending landscape, club management would be wise to investigate the potential benefits of controlling their own vended operations. RELATED ARTICLE: Vending Technology Websites Trade Journal www.amonline.com www.vending.org www.vendingtimes.com Software www.aes-intellinet.com www.auditsystems.com www.compuvend.com www.emssi.com www.isochron.com www.marconi-online.com www.meiglobal.com www.msa.com ruthsx.com streamware.com televend.com validata.com vendonline.com vendscape.com vendmaster.com Hardware www.automaticproducts.com www.cramems.com www.nationalvendors.com DEX Software Vendors www.auditsystems.com www.compuvend.com www.compuvend.com www.emssi.com www.meiasytrax.com www.rutherford.com www.streamware.com www.validata.com www.vendware.com Michael L. Kasavana, Ph.D., CHTP CHTP Certified Healing Touch Practitioner CHTP Certified Hospitality Technology Professional NAMA Professor in Hospitality Business The School of Hospitality Business, Michigan State University Michigan State University, at East Lansing; land-grant and state supported; coeducational; chartered 1855. It opened in 1857 as Michigan Agricultural College, the first state agricultural college. |
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