automatic vending association
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If you are looking to vending as a way to meet your refreshment needs, you will have many questions to ask. Which equipment should you choose? How do you know which operator to trust? What sort of finance package is most suitable for you?
Here, we tackle all these questions - and many more - to help you make informed choices. For more information, please contact an AVA Member (just look for the AVA logo) or contact AVA direct (click on Contact Us).
About the Industry
(please see publications page)
Vending (or "automatic retailing" as it is increasingly known) has a long history. The Greek mathematician Hero seems to have got the ball rolling in 215BC, when he invented a machine to vend holy water in Egyptian temples.
Consumers in Britain annually spend some £1.5 billion through the slots of more than 418,000 refreshment vending machines. Every day, 8 million cups of coffee and 2 million cups of tea are vended.
Almost anything can be automatically vended, but the principal food and drink products are:
There are a number of obvious advantages to vending:
Convenience Vended goods are available 24 hours a day and machines can be sited just where you want them.
Time Saving Vending machines are not only convenient they are time saving too. Research conducted by NOP showed that an average size business with 50 staff could be spending more than £85,000 of its annual wages bill in time spent by employees making their own tea and coffee.
Hygiene With vending you get a clean cup every time and avoid the chore of washing up china cups or worse still having dirty crockery hanging around all day.
Recycling The Save a Cup scheme provides a ready way to recyle used vending cups into durable items for the office.
Variety Vending machines offer a whole range of different products. Drinks vending machines can offer not just black and white coffee and tea but can also make the drink weak or strong according to taste. Fresh brew, cappuccino and chocolate drinks are also available.
The AVA has set up a Quality System on the same lines as ISO 9000 to ensure consistency of service and operation by member companies. In order to be in membership operators must have achieved AVA Quality Assured Status, which means that they have demonstrated to the satisfaction of professional quality assessors that they consistently provide services which conform to the contractual requirements of their customers and all regulatory authorities.
To ensure that they maintain this standard member companies are subject to annual inspection and recertification. These inspections are not limited to the paperwork. They extend to accompanying service engineers, merchandisers and operators on their rounds to make sure that day on day they consistently deliver what their company has promised.
The areas covered by the Quality System are all customer focused: customer care, contract, document control, corrective action, operation control, purchasing of stock, depot hygiene control and training.
Vending Operator The vending operating company will source and site the machine for you and be able to provide a service/maintenance contract for cleaning, filling and cash collecting as well as any necessary maintenance.
Vending operators who are members of the AVA will have AVA Quality Assured Status and run their businesses in accordance with the AVA Quality System.
The individuals who attend to the cleaning and filling of the machines are also called operators or sometimes merchandisers. Those who maintain and repair the machines are field service engineers. Machine and Service Providers distribute machines and offer a maintenance and repair service but do not operate machines.
Machine Manufacturers Those who design and build the machines. As well as a strong UK manufacturing base machines are also imported into the UK principally from other members of the European Union and America.
Machine manufacturers normally sell only to vending operators or distributors but some do sell direct to vending users.
Product Suppliers Those (for example confectionery and snack manufacturers and in-cup businesses – where the ingredients are ready packed in the cup) who supply machines that vend their products. These are generally run on a DIY basis with the individual site owner taking responsibility for machine filling and cleaning. Maintenance will normally be organised by the product supplier.
Finance House The Finance House (sometimes referred to as the leasing company) provides the finance for the purchase of many vending machines. It is advised that you only take out a lease with a Finance House which is a member of the Finance & Leasing Association.
Questions to consider include:
Prior to making your selection you will no doubt investigate the options and maybe visit the industry's exhibition, AVEX, the international vending exhibition, which is held in the Spring of odd-numbered years. Machine manufacturers, operators and product suppliers will be happy to talk to you about the machines on offer and recommend those which best suit your needs. One of the options you will be offered is new or used machines. Should you decide not to opt for a new machine you need to be aware of what is being offered. The alternatives as defined by the AVA are:
Refurbished Machine A used vending machine, which having been refurbished, retains materially unchanged the design and function contained in the original manufacturer’s specification. Work to be undertaken in accordance with the AVA Code of Practice.
Remanufactured Machine Any used vending machine which has its original design or function significantly changed is classified as a remanufactured machine.Whether new, refurbished or remanufactured machines offered for sale, lease rent or otherwise should be safe, hygienic, reliable and fit for the purpose for which they are offered.
The products and ingredients you want to offer also need discussion and again there is a wide choice with both specialist vending ingredient suppliers and major international brands offering their product.
Maintaining and servicing your vending machines efficiently and cost-effectively is vital. There are two main options to consider:
Contract operation is a popular option. Taking this route with an AVA operator removes all day-to-day concerns about the vending operation.
Machines are normally supplied and installed by the operator, who then maintains and services them under contract. All ingredients and products are supplied by the operator, who fills and cleans the machine and collects and accounts for the cash takings.
The prices to be charged for vended products will be decided jointly by the vending specifier and the operator, and will depend on whether the operator is to be paid entirely from the cash proceeds of sales or by means of a separate service charge.
The level of service required will vary depending on type of machine, types of products, consumption patterns, etc. AVA has produced a Guidance Document to assist members in determining the minimum number of visits.
An organisation may decide to fill, cash and service its own vending machines. This option is often chosen by those using an in-cup machine (ie where the ingredients are pre-packed into the cup and mixed with water at the time of dispense).
The DIY option may also be suitable for an organisation that has catering staff, or one that has enough machines to warrant employing someone direct to control ordering and storage, cleaning and servicing, as well as accounting for and banking the cash takings. It is important to remember that the Food Hygiene Regulations set out strict requirements for the hygienic operation of food and drink machines.
Everything that is sold through a vending machine is subject to Value Added Tax (VAT) at standard rate and this applies whether or not the product would attract VAT when sold through any other route.
Make quite sure when you are discussing pricing and the cost of vended products whether you or the vending operator will be responsible for collecting the VAT and paying it over to the Revenue.
nb. Special rules apply for some educational sites.
Cost per cup plans amalgamate the capital and running costs of a beverage vending service into a single charge per cup. The cost per cup will include a lease element to cover the capital costs of the vending machine together with the service and consumable elements for the cost of ingredients, cups, cleaning and maintenance. Some users prefer schemes such as these, which base the financial relationship totally on the cup usage.
Buyers should, however, take care to understand and evaluate cost per cup proposals. When the value of a proposal is only stated in pence per cup, the full contractual commitment can be misunderstood .
A full breakdown of the elements of the cost that make up the cost per cup will allow you to make valid comparisons. The cost element includes the lease costs, ingredient and cup costs and the costs for filling, cleaning and maintenance.
The minimum number of cups to which you are asked to commit should relate to the circumstances on the particular site during the contract term. Proposals based on drinks consumed per person per day should allow for holidays, shutdowns and staff sickness.
Industry experience suggests that consumers will normally buy an average of 2 drinks per day, but will consume 4 if they are provided free. Taking into account holidays and sickness, each staff member is likely to be at work only 42 weeks per year.
Most cost per cup plans make provision for inflation during the contract term. The proposal should state how this is to be handled. Inflation should not be applied to the equipment element of the cup cost and inflation increases should be judged in the light of what is reasonable.
AVA members abide by a Code of Conduct which ensures that you will be provided with full details if you prefer a cup plan. Dealing with an AVA member also gives you the security of a route for resolving disputes in the unlikely event of it being needed.
The vending industry was instrumental in setting up SaveaCup Recycling which collects used vending cups so that the reclaimed plastic can be used for a variety of durable products principally suitable for office use such as file trays, rulers etc.
AVA operators can help you be part of this scheme. With a SavaCup flaker you can shred your cups enabling them to be stored ready for collection by your AVA operator.
Vending provides you with the ideal means of having the drinks, food and products you need readily available whenever you want them day or night. We want you to enjoy the vending experience from the very beginning so to help you when discussing the detail of your vending provision the AVA have prepared a checklist.
AVA members will be keen to answer any other questions you may have.
Checklist for Lessees:
This checklist has been produced by the
& Leasing Association,
© Automatic Vending Association,1998
EXPLAINING VENDING - Produced by the AVA to assist vending specifiers.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electrical, mechanical, photocopying or otherwise without the prior permission of the AVA. Great care has been taken in its compilation and preparation to ensure accuracy. However, no liability can be accepted for any error or omission.
|Dry Goods Vending Machines|
|Inside the Machine - what happens to your money?|
|Operating the Vending Service|
|Vending Facts and Statistics|
Beverage dispensers were the first vending machines to enter the catering field in earnest. Although an automatic cup and water dispenser had been widely marketed as far back as 1908 the beverage machine as we now know it was essentially an American extension of the British-invented "dry-goods" machines which sold cigarettes, chocolate and chewing gum.
With 8 million cups of coffee and 2 million cups of tea being vended every day, beverage machines obviously constitute a significant part of the vending market. Beverage machines range from the large, high turnover machines which offer a wide range of hot and cold drinks to much smaller capacity table-top machines for the low-volume user. Modern machines have been designed to satisfy the refreshment demands of even the most discerning customer and in addition to ordinary tea and coffee they can now deliver fresh brew, cappuccino and chocolate drinks, with varying strengths according to customer demand.
The Beverage Vend Cycle for a hot drinks machine:
The Vend Cycle for a carbonated cold drinks machine:
Whatever the brand or blend of drink, it pays to follow the manufacturers recommendations as to the "throw" of ingredient required for best performance. Apart from good taste, there are several important features to look for in vended beverage ingredients:
Airtight packaging is needed to ensure that beverage ingredients, which are hygroscopic in character, do not begin to clog due to exposure to moisture in the air.
Vending machines left unattended for any time would clearly suffer hygiene problems if fresh liquid milk was stored in the canister. Commodity suppliers have therefore developed a range of "whiteners" in powder form which have a long shelf life and provide the necessary characteristics for lightening drinks.
Skimmed milks used in vending incorporate skimmed milk powder which is mixed with a flowing agent such as lactose (a natural milk sugar).
"Filled milks" are a blend of skimmed milk and non-dairy whitener. Non-dairy whiteners consist of dried glucose syrup or corn syrup solids as a "carrier" plus vegetable fat and sodium caseinate, a natural milk protein. To these are added emulsifiers to hold the product in solution (without separating out) and flowing agents to assist the product in its movement from the canister to the mixing bowl.
Until 1939, the vending industry was mainly composed of "column and drawer" type machines. These could be found in shop doorways as well as on railway and bus stations. Their operation was entirely mechanical, with no electrical component. An example of this type of machine was the Nestle "Penny Red" machine, in which chocolate bars were stacked on top of each other. When a penny was inserted, a lock on the drawer was released so that the drawer could be pulled open and a bar of chocolate removed. The rest of the chocolate would move down by gravity, making the next bar ready to vend. This type of machine is still in use today but with a more sophisticated coin mechanism to reduce tampering.
When food is being vended it is vital that the machine maintains its contents at a holding temperature which prevents bacterial contamination and does not affect the taste or appearance of the food. Examples of the ways in which food should be stored are outlined below:
The microwave heating process must penetrate the food evenly and it is therefore necessary to plate the food to a uniform height to ensure every part of the meal is heated.
In vending systems, microwave oven timing can be related to meals vended in four different ways according to the oven in use:
The speed of microwave cooking means that fresh food can be completely cooked in a microwave in addition to pre-cooked food merely being re-heated.
Vending machines are available which will measure, cook and dispense a single portion of deep-fried chips on demand. Filters are fitted to inhibit the escape of cooking smells while thermostats prevent over-heating of the cooking oil used in the system.
The denominations of coins available to the consumer must be somehow matched to the wide variety of product prices found in the modern vending market. Coin mechanisms must therefore be adaptable to handle whatever coinage pricing levels are currently popular in addition to allowing the machine operator to alter prices, and consequently coin acceptance, as and when market forces dictate. Of course, total reliability is required throughout these adaptations if the machine is to continue to function efficiently after every change is made.
Electronic systems eliminate the susceptibility to jamming due to deformed or foreign coins. For full electronic validation the coin inserted in the slot rolls down a ramp and through a sensing system. The process is as follows:
Many machines vend different products at different prices. These prices are set by the operator through inventory buttons on the validator switches inside the machine. Each price setting is wired to an appropriate selection button on the outside which, when pressed, generates a signal associated with the corresponding price line and compares it with the appropriate accumulated coin credit. When price required and credit achieved match, the machine will accept the command to vend and, at the same time, inhibit acceptance of further coins until the vend is complete.
The complications of coin operation have led to the development of the debit card. This card requires prior payment to give it value, entered either magnetically or electronically on the card. As the card is used in vending machines the amounts spent are debited against the built-in credit until the value is exhausted. The credit line of the existing card may then be revalidated or the card replaced.
The advantages of such cards are that the burdens of coin counting and the bagging and removal of heavy weights of mixed coins from the machines are avoided. It also means that customers do not need to carry the correct change and that operators avoid the expense of incorporating change-giving mechanisms.
Vending machines may be "self-operated" or placed in the hands of a specialist vending contract operating company. "Self-operators" make their own arrangements for machine acquisition, installation, maintenance and hygiene and deal directly with suppliers of vended products. The typical vending company, on the other hand, will do all of these things on behalf of the user under agreed contract terms. These companies are known as "Operators".
The Operators contract covers the date agreed for machine installation, the period of operation and the extent of product service to be provided. It also requires that the Operator ensures that machine hygiene is of a standard which is in accordance with the law and accepted standards.
The user prepares the site for machine installation, pays for power and water consumed during machine operation and permits access to the installation by the Operators personnel.
Operators who are AVA members hold Quality Assured Status and run their business in accordance with the AVA Quality System. This runs on the same lines as ISO 9000 and is designed to ensure consistency of service and operation. Quality Assured companies have demonstrated to the satisfaction of professional quality assessors that they consistently provide services which conform to the contractual requirements of their customers and all regulatory authorities. Member companies are subject to annual inspection and recertification to ensure this standard is maintained.
The prices charged for vended products depend on the aims of the user:
When prices are subsidised by the user, the Operator expects to recover from his client the difference between the "cash take" from the machines and the total income required in the provision of the service. The details of such dealings should be covered in the contract. In the case of "low-volume" usage, guaranteed minimum levels of monthly charge may be requested by the Operator to safeguard his investment in machinery and staff allocated to the contract.
Operator staff who call at the users premises to clean and fill the machines are known as "Route Operators". They are provided with vehicles which are supplied and maintained by the Operator company and are often fitted with a radio or telephone link to the dispatch office so that emergency calls can be relayed and service provided instantly to any user on the route.
Most operators divide the areas they serve into routes small enough to put every machine under contract within an hours drive. "Local" operators may maintain as few as 100 machines but "National" operators can be responsible for thousands over a large area. These machines are serviced via local offices or depots.
Hygiene is a vital aspect of the route operators job. Staff training should encompass:
The 2001 census on CDrom is now available from the AVA. Please click on Publications to order.