WEST CHESTER, PA- February 4, 2011-
As our economy has changed, so have snack prices. Many snack items are now priced over $1 and $2, and more and more consumers now want to pay with large notes – especially the $20s that they most commonly have in their wallets from ATM withdrawls. If vending machines don’t accept large notes, their customers will turn to the convenience stores and drive-thru chains that do.
The problem is not getting note acceptors that can accept large notes; those have been available for years. The problem is that most machines are only able to dispense change in coins, which is problematic for customers paying with $20s. Not only would people be annoyed at receiving $18 in quarters for a $2 purchase, but these transactions would soon wipe out the machine’s change repository. Today’s savvy operators are using recycling technology to solve this problem and gain a competitive advantage. Cotton Candy Vending of Denver, Colo., is one such vendor that has successfully built their business model to accommodate today’s consumer payment preferences. Cotton Candy vending machines, which allow consumers to get a freshly made wand of cotton candy for $2, are currently deployed in more than 500 retail and high traffic locations in 25 different countries, including the U.S., Canada, Italy, France, Spain, Australia, Ireland and the U.K. These locations belong to retail giants like big-box retailers, movie cinemas, and quick-serve restaurants that deploy the machines chain-wide or in select locations.
Cotton Candy Vending recently equipped 50 of its vending machines with MEI CASHFLOW ® VNR note recyclers. As a modular add-on to the existing note validators, cash recyclers enable the Cotton Candy machines to accept $20, $10, $5 and $1 notes and to dispense previously accepted notes – $5s or $1s – as change. “We were already using the MEI Series 2000 note validators that proved to be extremely reliable,” said Davy Clements, VP/Americas for Cotton Candy Vending. “So when it came to adding a recycler we naturally turned to MEI.”
Clements initially explored VNR technology as a cost-effective means to lift sales and improve customer satisfaction. The cotton candy sold in their machines costs $2, so they knew many people would need to use large-denomination notes to make the purchase.
A Sweet Payback
So far the results have been extremely promising since providing customers with more payment options. Although Cotton Candy is not the operator of the machines and so is not privy to specific sales data, feedback has been that the VNR-equipped machines generate a sales uplift and increased consumer satisfaction.
Vern Vine of Inland Empire Video Games in Colton, Calif. operates six Cotton Candy vending machines throughout malls, amusement parks and theaters. “My aim was to increase customer satisfaction by allowing anyone interested to make the purchase,” said Vine. “I’ve had a very positive experience with the recycling technology. I am very pleased.”
At one mall location, Cotton Candy Vending recorded an initial return on investment (ROI) in as little as 11 weeks, a significant achievement given that these units have a life expectancy of 12+ years. Canadian distributor Starburst recently installed machines throughout various Walmart and shopping mall locations, a perfect testing ground for the VNR. In addition, Clements reports that the majority of his retail clients, particularly national accounts, are choosing the VNR version. “Eighty percent of Cotton Candy Vending’s product going forward will have the MEI VNR,” said Clements.
A major contributor to the successful deployment of recycling technology was partnering with a stable payment system technology provider with many years of experience in the vending industry. MEI’s products have been field-tested in vending environments for over 40 years. “We have been really happy with MEI’s support role throughout this whole process. “Whenever we have needed input or advice, MEI has been there for us, and we will continue to integrate recyclers into our vending machines,” said Clements.
An Eye Towards the Future
Cotton Candy Vending continually looks at integrating new technology that will enhance its machines. “Our next step is to trial the addition of cashless payment options to our machines, which we can accomplish by changing the bezel and adding an MEI telemeter,” said Clements. “This will provide the ultimate in payment choice.”