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Vending 101

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The document provides information for operating a vending machine business, including an overview of the Wittern Group which manufactures vending equipment, descriptions of the basic components and costs involved, recommendations for hot locations and product positioning, and templates for estimating location revenue potential and expenses.

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Welcome to Vending 101 Vending the Right Way
Page 2Page 2 2 WITTERN GROUP Today The Wittern Group manufactures the most complete array of full-line vending merchandising equipment in the world. Our support staff are customer driven. Our products and facilities are modern and satisfy a growing global customer base. We provide a full circle of support to assist with your automatic merchandising needs: - Design service programs - State-of-the-art manufacturing facility - Re-manufacturing facility - Financing and leasing programs - International sales and marketing - National account management - Facilities planning services
3 EQUIPMENT Fawn Vendors offers a full range of products to meet all of your vending needs.
4 NICHE MARKET Identify Your Niche Market Target places of employment. Place machines in businesses with 40 - 160 plus employees.
5 VENDING OPPORTUNITIES Opportunities for New Business What locations are looking for: Quality Vend Products Fresh Products Healthy Products Variety of Products Quality Vend Equipment New, Attractive Equipment Dollar Bill Acceptance Consistent Performance Quality Service Machines Kept Filled Clean Vend Area Machine Repaired Promptly
6 BASIC COMPONENTS Basic Components of a Vending Business Merchandise Where to Purchase Your Vending Products Vending Service of America (VSA) Wholesale Clubs (SAMs, B.J.s) Local Vending Merchandise Suppliers Local Delicatessen Local Grocer Selecting & Purchasing Merchandise Name Brand Products Regionally Recognized Products Seasonal & Special Event Products Customer Knows Best Location Exceptional Target Accounts Manufacturing Fabrication Shops Nursing Homes Equipment The Right Equipment for the Location Always make sure that your equipment coincides with the number of employees or traffic for the location. Always keep equipment clean and in good working order.
7 HOT LOCATIONS HOT Location Hit List Automotive Dealerships Tire Stores Car Care Centers Recreational Health Clubs Skating Complex Personal Care Chain Hair Cutting Salons Beauty Parlor Laundromats Hospitality Hotels Motels Events Centers
8 BUSINESS POSITION Position Your Business for Maximum $ales Customer Customer spends $5.00 per day on convenience food. Demand Fill the demand: Vending is a convenience food business. Products Position product choices for all times of the day. If you dont supply it, the location will find a vendor that will. Breakfast Breaks Lunch Pastries Juice Coffee Salted Snack Items Chocolate Cold Drinks Cold Food Fruits Soups
Page 2Page 2 9 MERCHANDISE COSTS & MARGINS Vending Merchandise Costs & Margins Industry Standard Pricing Gross Profit Margin Goals (45% - 55%) Calculating GPM = Vend price - Cost of product sale price Adjusting price according to commission payout Wholesale cost of the product Vend $ale Price
10 MERCHANDISE COSTS & MARGINS These charts break down each vend product category and describes the industry suggested vend/cost prices and margins Product Unit Cost Vend Price Gross Profit GPM Salted Items .16-.28 .45-.50 .22-.34 44%-64% Frito Regular .16 Diamond Blue .28 Choc. Items .30-.32 .60 .28-.30 47%-50% Reeses PBC .30 Mounds .31 Snickers .325 Cookie Items .16-.26 .45-.50 .24-.39 48%-64% Frito Regular .16 Diamond Blue .28 Meat Items .26 .50-.60 .21-.35 48%-55% Frito Regular .26 Product Unit Cost Vend Price Gross Profit GPM Pastry Items .29-.40 .60-.75 .31-.46 47%-61% Reeses PB .29 Hostess Cakes .37 O.S. Muffins .40 Canned Bev. .26-.41 .55-.75 .29-.49 53%-65% 12 oz. Coke .16 12 oz. Pepsi .28 Bottled Bev. .50-.60 .90-1.00 .40-.50 33%-50% 20 oz. Pepsi .52 16.8 oz Evian .60 16 oz. Snapple .50
11 GROSS PROFIT & EXPENSES Gross Profit from Sale Calculation (vend price - cost of product) Gross profit contributes toward expenses Fixed Cost Rent Insurance Vehicle Variable Cost Equipment Interest Fuel Net Profit Salary Re-Investment
12 QUALIFYING LOCATONS FOR FULL-LINE VENDING Two Calculating Factors What is the revenue potential? Number of employees Product offering Average per cap sales What is the cost of business? Vending equipment Wholesale vending products Vehicle (transportation)
13 ESTIMATING LOCATION REVENUE SAMPLE CASH FLOW CHART Average Spent Per Working Group Keep these factors in mind when estimating the revenue of an employee site. Blue Collar Gray Collar White Collar Factors Total # of Employees ____________ Male _________ Plant Employees ________ Female _______ Office Employees _______ Peak Employment Periods (#emp.)__________ Low Employment Periods (#emps.)__________ Shifts: 1 2 3 Employee Site Evaluation

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Vending 101

  • 2. Page 2Page 2 2 WITTERN GROUP Today The Wittern Group manufactures the most complete array of full-line vending merchandising equipment in the world. Our support staff are customer driven. Our products and facilities are modern and satisfy a growing global customer base. We provide a full circle of support to assist with your automatic merchandising needs: - Design service programs - State-of-the-art manufacturing facility - Re-manufacturing facility - Financing and leasing programs - International sales and marketing - National account management - Facilities planning services
  • 3. 3 EQUIPMENT Fawn Vendors offers a full range of products to meet all of your vending needs.
  • 4. 4 NICHE MARKET Identify Your Niche Market Target places of employment. Place machines in businesses with 40 - 160 plus employees.
  • 5. 5 VENDING OPPORTUNITIES Opportunities for New Business What locations are looking for: Quality Vend Products Fresh Products Healthy Products Variety of Products Quality Vend Equipment New, Attractive Equipment Dollar Bill Acceptance Consistent Performance Quality Service Machines Kept Filled Clean Vend Area Machine Repaired Promptly
  • 6. 6 BASIC COMPONENTS Basic Components of a Vending Business Merchandise Where to Purchase Your Vending Products Vending Service of America (VSA) Wholesale Clubs (SAMs, B.J.s) Local Vending Merchandise Suppliers Local Delicatessen Local Grocer Selecting & Purchasing Merchandise Name Brand Products Regionally Recognized Products Seasonal & Special Event Products Customer Knows Best Location Exceptional Target Accounts Manufacturing Fabrication Shops Nursing Homes Equipment The Right Equipment for the Location Always make sure that your equipment coincides with the number of employees or traffic for the location. Always keep equipment clean and in good working order.
  • 7. 7 HOT LOCATIONS HOT Location Hit List Automotive Dealerships Tire Stores Car Care Centers Recreational Health Clubs Skating Complex Personal Care Chain Hair Cutting Salons Beauty Parlor Laundromats Hospitality Hotels Motels Events Centers
  • 8. 8 BUSINESS POSITION Position Your Business for Maximum $ales Customer Customer spends $5.00 per day on convenience food. Demand Fill the demand: Vending is a convenience food business. Products Position product choices for all times of the day. If you dont supply it, the location will find a vendor that will. Breakfast Breaks Lunch Pastries Juice Coffee Salted Snack Items Chocolate Cold Drinks Cold Food Fruits Soups
  • 9. Page 2Page 2 9 MERCHANDISE COSTS & MARGINS Vending Merchandise Costs & Margins Industry Standard Pricing Gross Profit Margin Goals (45% - 55%) Calculating GPM = Vend price - Cost of product sale price Adjusting price according to commission payout Wholesale cost of the product Vend $ale Price
  • 10. 10 MERCHANDISE COSTS & MARGINS These charts break down each vend product category and describes the industry suggested vend/cost prices and margins Product Unit Cost Vend Price Gross Profit GPM Salted Items .16-.28 .45-.50 .22-.34 44%-64% Frito Regular .16 Diamond Blue .28 Choc. Items .30-.32 .60 .28-.30 47%-50% Reeses PBC .30 Mounds .31 Snickers .325 Cookie Items .16-.26 .45-.50 .24-.39 48%-64% Frito Regular .16 Diamond Blue .28 Meat Items .26 .50-.60 .21-.35 48%-55% Frito Regular .26 Product Unit Cost Vend Price Gross Profit GPM Pastry Items .29-.40 .60-.75 .31-.46 47%-61% Reeses PB .29 Hostess Cakes .37 O.S. Muffins .40 Canned Bev. .26-.41 .55-.75 .29-.49 53%-65% 12 oz. Coke .16 12 oz. Pepsi .28 Bottled Bev. .50-.60 .90-1.00 .40-.50 33%-50% 20 oz. Pepsi .52 16.8 oz Evian .60 16 oz. Snapple .50
  • 11. 11 GROSS PROFIT & EXPENSES Gross Profit from Sale Calculation (vend price - cost of product) Gross profit contributes toward expenses Fixed Cost Rent Insurance Vehicle Variable Cost Equipment Interest Fuel Net Profit Salary Re-Investment
  • 12. 12 QUALIFYING LOCATONS FOR FULL-LINE VENDING Two Calculating Factors What is the revenue potential? Number of employees Product offering Average per cap sales What is the cost of business? Vending equipment Wholesale vending products Vehicle (transportation)
  • 13. 13 ESTIMATING LOCATION REVENUE SAMPLE CASH FLOW CHART Average Spent Per Working Group Keep these factors in mind when estimating the revenue of an employee site. Blue Collar Gray Collar White Collar Factors Total # of Employees ____________ Male _________ Plant Employees ________ Female _______ Office Employees _______ Peak Employment Periods (#emp.)__________ Low Employment Periods (#emps.)__________ Shifts: 1 2 3 Employee Site Evaluation