Be-all and vend-all
Stag beetles and fresh food might seem like unusual bedfellows but, thanks to a revolution in food vending, they are now forever linked. As might be expected, it is techno-savvy Japan that is leading the way in automatic vending - an industry that is becoming increasingly relevant to hard-pushed caterers everywhere.
Advances in the sophistication of vending machines means they are now able to dispense just about anything - including pet stag beetles. The Japanese company that came up with the idea, Mirai Seiko, says the idea of vending pet beetles came out of developing advanced machinery for the mainstay of its business - vending fresh vegetables.
Just about everything else is available through Japan's vending machines. The intensely urban landscape is home to six million vending machines - one for every 20 people - and they generate sales of £42b. That's more than sales in convenience stores and four times more than in coffee shops, according to 1997 figures.
All needs are met, from fizzy drinks and sushi to comic books and £450 bottles of bumblebee extract. Women can have their nails painted by a machine; plates of hot lunch can be served from a machine; and drinking water for thirsty pets is also just a button-press away.
Japan is not alone. The USA is bringing in new super-tough machines to counter vandals and unhappy customers. Even the king of convenience, McDonald's, is road-testing vending. US research labs and a McDonald's in Wyoming have teamed up to test self-serve machines for Big Macs, fries and apple pie.
This is both convenient for the customer and lucrative for McDonald's - tests have shown that the average consumer will spend up to $1.20 (84p) more for bigger portions of fries or a dessert when prompted by the machine.
In the UK, about 80,000 vending machines dispense food and snacks. They are part of the total of 400,000 machines that sell products worth close to £1b annually.
"The whole market for vended foods and snacks is growing in leaps and bounds," says Jan Podsiadly of the Automatic Vending Association of Britain.
The market for goods and services through the nation's vending machines climbed by 7.2% last year. The biggest increase came in the market for auto-dispensed snacks and food, which was up an astounding 17.7%, according to Podsiadly.
Taking the pressure off caterers
Manufacturers of automated merchandising stores, as the machines are known, predict that nightclubs, caf‚s and cinemas will be home to more vending machines in the future.
"The emergence of the third place - not home or work - where we might want be fed has put pressure on traditional catering, and it can't deliver," Podsiadly says. "The machines have stepped in to take the pressure off the caterers."
For caterers and retailers, the machines mean there are no worries about staff shortages or employment red tape. Vending machines don't sleep, gripe or threaten industrial action and can be moved from location to location.
As Podsiadly points out, vending machines are not the complete answer to the industry's problems, but they are worth serious consideration by caterers.
"Vending may not be a total solution but it should be high on caterers' list of how to make sites cost-effective," she says. "Not by just sticking a machine in the corner, but by using the most appropriate marketing techniques to provide good-quality products in an enticing environment and managing the machines."
Compass Group, with total sales of £2.7b, employs 80,000 people. But it still has a vending service that operates 25,000 vending machines across the UK and Ireland. These are mostly snack machines, with hot food accounting for only 3% of turnover, but Compass sees the area as ripe for more growth in the UK.
"Vending is the fastest-growing sector in the catering industry, and the UK is likely to follow the trends set in the well-established US and European market," says Angus Fraser, sales and marketing director of Compass's Eurest Vending Services.
Others agree. Operating exclusively using vending machines, the leader in the business-to-business catering/vending sector is 24-7 Vending. Last year the company, which employs 450, reported a turnover of £30m, and that was set to grow to £32m in 2001. More than 9,500 vending machines are operated by 24-7, and it has maintenance contracts for a further 11,500.
Marketing manager Simon Backwell sees short-term growth in terms of snacks, drinks and confectionery but believes it will be at least another two years before the UK comes anywhere near the USA or Japan in terms of vending more substantial fare.
"At the moment, most UK companies are reluctant to go down that particular avenue," Backwell says. "There is scope to develop the market but we have no plans as yet to offer more sophisticated services."
The eating trend is shifting to cold snacks on the go, and impulse buys. The catering industry may still be sceptical about the use of vending machines, but Backwell believes corporate belt-tightening will make it rethink.
"Organisations are tightening their budgets in terms of offering staff discounted meals. There will come a stage when such schemes will cease altogether and companies will just offer staff vending products," he says.
So, while it may not be long before we can get a hot plated meal from a machine at work, it looks as if we'll be facing a much longer wait for pet stag beetles.
Vending machines
UK total: 400,000, of which 80,000 are food- and snack-related
UK vending turnover: £1b annually
Leading UKoperators: Eurest Vending Services (25,000 vending machines); Quadrant Vending Services (3,600 machines); 24-7 Vending (9,500 machines)
Vending catering options
Hot/cold beverages.
Cold drinks in bottles/cans/cartons.
Confectionery/savoury snacks.
Sandwiches/snack foods.
Cook-chill dishes.
Plated meals.
Ice-cream.
Changing customer demand in the workplace
Traditional concentration of staff in canteens during breaks has been diluted by changing work patterns - late-night working, shifts.
More intensive work and longer hours means less time for lunch hours.
Break-out areas encourage snacking.
Staff tend to lunch at their desks.
Pros of vending
24-hour service.
Convenience.
Time-saving.
Space-saving.
Variety - wide range of drinks, snacks, etc.
Complements and adds value to existing food provision.
Reliable and low-maintenance.
