These days vending machines can accommodate almost any type of product you can imagine. Advanced technology makes it easier than ever to check their condition and stock. On top of that, they make your product more visible and accessible. Such novelty and innovation also help you stand out from the competition. The best thing… you can always pack your vending machine and change the location in just half a day.
Get inspired by the types of vending machines suitable, not only, for fresh food. Where to place them and what to be aware of before you start your low-cost direct sales channel. A bit of creativity can help farmers and other food producers raise their profits and maybe even expand their businesses.
What type of vending machine would you choose for your products? Where would you place such a goodie bag?
Should I Invest In A Vending Machine?
Vending machines provide convenience for your customers by making your products accessible without the limitations of traditional shops’ opening hours. Your brand can use them in various strategies, not only to make a profit. With how many Ps can you pair it in a 7Ps marketing mix theory, the essential tool for every business?
Consumers these days live more busy lives and most of them are willing to pay a higher price for time-saving solutions. That comes in handy when selling perishable products like fresh food. Making it available 24/7 extends the window of opportunity to sell it.
New technology makes vending machines able to sell almost anything. Whether you should or shouldn’t invest in one depends on your business goals. Did you notice a location with high traffic and no option to buy a drink? Do you want to supplement your main sales channel? Or do you think more strategically and want to focus on building your brand?
Food producer or a farmer can increase profits by placing their products in the high traffic area. But sole high traffic doesn’t always mean high sales. The products need to be offered to the right type of passing by people. The more they know about their customers the easier it is to choose the location. Understanding customer’s needs and behaviour is important in every business and developing a buyer’s persona is a great step forward.
A well placed vending machine can deliver the right product to the right customer at the right time.
After you’ve decided on a business strategy and found a location, it is time to figure out how you can sell your product through a vending machine. It may require adding some packaging or adjusting portions.
Benefits Of Investing In A Vending Machine
- Always Available
Your products are always ready for purchase. As long as you keep your vending machine well-stocked.
- Easy To Start
If you have your location figured out already and calculated profitability, all you need to do is just buy the machine and install it. It can be done in a day.
- Lower Operating Costs
You save a lot of money on paying staff and rent. Compared to running a brick-and-mortar shop.
- Easy To Move
When your location doesn’t work, you can always put it on a truck and move somewhere else.
- Consistent Temperature
Most food vending machines are like fridges or freezers. They keep a consistent temperature retaining the freshness of the food inventory.
- Builds Brand Awareness
Making a profit may be the main reason to invest in a vending machine. Alternatively, it can be used to promote your brand. Especially when it is loaded with products that people don’t expect to find in a vending machine. Like this banana machine. Novelty always gets people's attention.
Disadvantages Of Investing In A Vending Machine
- Maintenance
Like every piece of equipment, vending machines also need check-ups and occasional maintenance. Having some technical background may save you a lot of money if you can do it by yourself.
- Attention
Vending Machines are not a set-it forget-it type of thing. It needs to be restocked and regularly cleaned. That doesn’t take much time, however, and having one placed on your supply route will not make much of a hassle.
- Costs
No business goes without costs. Although they are relatively smaller than other forms of retail they have to be considered. Your main fixed costs will be rental space and electricity. Even selling big volumes but with small margins may not compensate for the fixed costs. Always do your calculation upfront.
- Robbery And Vandalism
Because it can be placed in remote areas with no traffic at some point, there is always a chance that someone will try to break into it or tag it with spray paint. You need to be prepared for emergencies.
Things Farmers Should Consider Before Investing In A Vending Machine
Your Customers’ Demand
Understanding your customer's needs should be your first step. If you have an active social media account consider throwing a few questions into the feed asking about your followers' habits.
Social media usually collects some information about your followers. Have a look into your profile. It may give you some clues at least about the general description of the users that are interested in your brand.
You may discover that most of them are living in some remote suburban area with no near shop to buy fresh eggs.
Location
Because the vending machine is a type of self-pickup distribution channel, their success depends highly on the location. Ideally, it will be with high traffic of people interested in your products.
A vending machine filled with fresh fruit in front of a gym will be more efficient than in a bar or a club.
You should also consider the security of your vending machine. See if there are any CCTVs in your picked location and if the angle covers your machine as well. This may be handy if there are any disputes in the future.
Research your customers first. Then pinpoint a few relevant locations. Remember, you need traffic. That may be difficult to measure. The proven method is visiting the potential location at peak hour and literally counting how many people pass through. If you are considering placing it in a shop or a commuting station, the management should be able to tell you approximately how many people will see your machine.
Alternatively, if you are playing with the idea of opening a shop on your own farm you can set up a vending machine first to test the market before making a bigger investment in building the shop. This farmer can sell around 30 gallons of fresh milk a day on his farm directly. Without spending time or money on running a traditional shop.
Unless you have a farm located near a frequent road, you will need to invest in marketing and advertising so people will know what can they buy from you.
Running a vending machine on your own property chops down the expenses by big chunks.
Fixed Costs
Like every business, vending machines have fixed costs that you need to bear in mind. On top of that their storage capacity is limited so you cannot rely on selling big volumes.
Electricity comes to mind first. But it can be calculated fairly easily. New machines are more energy-efficient and they may not consume as much electricity as you may expect.
Rental space is another fixed cost to include in your calculations. If your negotiation skills are good enough, try to strike a deal with the owner of the premises to give him part of the profits. Lowering risks will help you in the first months to test if you chose the right location for your products.
Don’t forget that you need to regularly visit the machine to clean it and restock it. It will cost you time and gasoline.
Break down the fixed costs by days. How much does it cost you to have the machine on that spot per day? Then figure out how many products you’ll need to sell to cover the fixed costs and when it will be profitable. Is it possible to sell that many products in a day at that location? How about on the weekends or holidays? Will the traffic volume change?
Marketing
Keep your customers informed once you’ll set up your first vending machine. Tell them, at least, where it is and what they can buy from it. Even the best product won’t sell if people don’t know they can buy it.
Some people may assume that the food inside is not fresh because it stays there for a long time. You need to build trust with the consumers and educate them on novelties.
Share videos or photos on your social media and Farmlovers.org showing how you take care of the machine or your products.
What Type Of A Vending Machine To Buy?
Vending machines are very versatile and capable of holding almost anything. Some may have more advanced features. It is up to your creativity, and budget, to pick the best type for your product.
The first thing to decide is whether to buy a brand new vending machine with the latest technology or go for a second-hand option.
New technology is always more energy-efficient, reducing the daily electricity costs. Innovative features like contactless payment or other options give your customers more convenience. The downside? Your initial investment, and therefore risk, will be much higher.
Second-hand options cost less. Your risk will be lower because you don’t have to invest a lot of money at the beginning. If it doesn’t work you can re-sell it and get back part of your investment.
Older machines usually consume more electricity and have fewer features. Cashless payment is becoming the norm around the world now.
Consider buying a second-hand machine first to test your idea and when you see it being feasible, sell it and buy the new energy-efficient model.
Types Of Food Vending Machines
Vending machines perform types of functions and may be designed for a specific type of product. Let’s divide it into two main categories, liquid dispensing machines and packaged goods.
Liquid Dispenser Vending Machine
These types dispense liquid either in a cup or directly into the customers' canister. It is a great way to reduce packaging waste and may be attractive to environmentally conscious consumers.
The vending machine making drinks to order has been here for some time already. The most common types are those on train stations or gas pumps. You’ll throw in a few coins and get an instant coffee mixed with hot water poured into the paper cup.
Consumers’ preferences keep evolving, they are better informed and demand a higher quality of products. They want to choose the sweetness level and the type of beans of their coffee. Choose what fruit goes into their Cold-pressed juice, or have a vast selection of custom made drinks.
How To Sell Farm Products Through A Vending Machine
Get inspired with a few ideas. Can you picture your product in one of these vending machines?
Fresh Fruit And Vegetable
Use snack vending machines to sell a healthy alternative to processed food. Fruit will stay chilled inside the machine however you will need to keep an eye on the quality more often.
Can you make fresh juice? Use a juice vending machine to offer the passing by commuters the option to refresh themselves with a fresh and healthy juice full of vitamins.
Pastry
Can you make beautiful looking and delicious pastries? Buy a vending machine that can keep food warm and stuff it with fresh croissants or baguettes.
Target people commuting in the morning or a housing area that doesn’t have any freshly baked products so people can enjoy breakfast with a crunch and handful of breadcrumbs.
Milk & Yogurt
Raw milk dispensers are wildly popular in countries like Croatia, France and Italy. Some others strictly regulate the sale of raw milk or even prohibit it entirely.
Fresh milk has much more nutrients than pasteurised milk. Placing a milk dispenser in a housing area will bring convenience to the residents who can seamlessly buy high-quality milk.
Frozen Meat
Butchers can prepare beautiful cuts ready for the grill and portion them into trays or boxes. Freeze them and put them in a vending machine that can keep them frozen. According to the FDA, you can store frozen meat for up to 4 months.
Are backyard grill parties and BBQs popular in your area?
Lunchboxes
Chefs and cooks can use their skills to craft delicious dishes and offer them in a vending machine that can keep them warm, ready to be savoured or cold. Some vending machines even feature a microwave.
This is a great alternative to processed fast food. People do not always have time to spend their lunch break in restaurants. They also may prefer cooked food over a sandwich.
Conclusion
Conclusion paragraph: Vending machines can be a great way to boost your sales, but only if you use them in the right way. They’re not a one-size-fits-all solution for every business, so it’s important to think about what you want to get out of them before you invest. If you’re looking for a new way to test your product on the market, expand your sales channels, or promote your brand, vending machines could be a great option for you. What was the last thing you bought in a vending machine? And why did you buy it? Chances are, convenience played a role.
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