Why are vending machines so hot?

As early as the end of 2016, a new batch of vending equipment entered the capital's field of vision. Why are these vending sales so popular? Why do investors favor these projects? What kind of economy is there behind such vending machines?

Vending machines are not new items. It was traced back to the device that sold the holy water by the Greek Hilo in the 1st century AD. In 1925, the United States developed a vending machine for cigarettes. Since then, various modern vending machines selling stamps and tickets have appeared. In Japan, the most developed country for unmanned retail equipment, there are 5.5 million vending machines of all kinds in the country (selling drinks, selling cigarettes, selling coffee, selling vegetables, selling dolls, selling beauty products, selling hot noodles). ...), an average of 23 people own one; in the United States this number is 35.

In China, when it comes to vending machines, many people respond first to the Cookeryaki machine, which is everywhere in the subway station office building. This company, which was founded in 2004 and sells juice vending machines, has 30,000 in the first half of 2016. Taiwan's direct equipment plus 15,000 franchise equipment recorded 8.7 billion operating income, gross margin of 40.49%, listed on the new three board.

At the end of 2016, a new batch of automatic sales equipment entered the field of capital. Automatic orange juice machine, automatic coffee machine, automatic snack machine, automatic mask machine, and mini KTV (friend singing, microphone) and mini gym (super orangutan) that sell products without selling products. Our vending machine, the question that needs to be answered should not be just why, but why now (why is now)? Three trends point to vending equipment:

Scale of infrastructure: Reduced hardware costs for IoT, networking of all devices and inventory.

Mobile payment popularity: Enhance user experience compared to previous coin-operated methods, and payment itself can precipitate user purchase data and device ID/WeChat Open Id, making offline hardware a viable device.

Capital support: ofo and Mobai educated investors, offline equipment/hardware is not completely unable to invest, if the hardware itself is profitable, the account can be understood, but also investable; Moreover, by the media, the block screen Or the QR code scan code entry, then there is a story of advertising cash flow / traffic entry.

Automated equipment, essentially replaced by machines, is the artificial part of the delivery of goods and services; but it seems that no one is definitely the end, but the result. At least in China, the annual salary of labor is not several times that of a set of fully intelligent device depreciation with visually recognized voice interaction data analysis (a set of NCR equipment hardware and software costs 300,000, depreciated by 5 years) and hidden costs such as loss prevention. The core of vending is the deconstruction of functions and the deconstruction of traffic.

Functional deconstruction

There is a very interesting phenomenon in offline retailing. The rent usually grows linearly with the area, but the sales volume does not increase linearly with the area. For example, the 160-square-meter Starbucks store usually does not sell twice as much as the Starbucks store in the same location of 80 square meters.

To improve profitability is to understand the drivers of revenue and the composition of costs, which requires the dismantling of a coffee shop. For example, a Starbucks can be roughly divided into three functional areas: production, sales, and experience. Unlike coffee shops that sell mainly experience, Starbucks disposable cups, high stools, and hard tables seem to have no desire for consumers to stay too long. It is best to buy them (to go), and a large proportion of Starbucks. The order should be to go.

Let's talk about the sales sector. The important role of the store (or the more accurate face) is to undertake the natural flow of the environment to make sales conversion. Sales is like a window. To carry out traffic more effectively, it should be as much as possible. Lay this "window" in the scene. The last piece is production, and the production plate is actually a simple space, such as centralized production (weekly black duck, one copy) or automatic production (new orange pie, Lai Cup coffee).

Deconstruction of traffic

Students who watch restaurant chains or retail chains should be especially touched. In many cases, the scale of such projects is subject to the speed of taking the storefront, the traditional offline business format, the tens of hundred square meters of venues, and hundreds of thousands of one-time renovation investment. It is not an easy task to add the period of previous site selection negotiations and pre-opening recruitment training. It is not too easy for the store to open up. The headquarters may use a term called “Ping Effect” (revenue per square meter of output, usually divided by the store's monthly water flow by the store area) to measure the performance of each store.

As in the case of the coffee shop, if you dismantle the proceeds to each functional section, you will find that the most efficient way is to “retain only the smallest unit of product or service delivery, and lay more contacts with a limited budget”. The teacher said unbundling the facilities.

If I can open a 50-square-meter beverage store, I would prefer to open 10 five-square-meter mini-drink shops to reach more traffic. Moreover, a 50-square-meter shop may be difficult to find, but a 5-square-meter shop is in school. Office buildings, subway stations, and community businesses can be found anywhere, lighter and closer to users. The area of ​​a vending machine may not be as good as one.

Vending machines seem to be a good business, but what kind of vending can make money? The core logic of vending equipment is to lay as many of the smallest units of deliverables or services as possible into the right scenes and users. Efficient access to natural/passive traffic, in other words, the essence of vending is to supply demand (to promote shared bicycles, whether it is to place search ads or bus stop ads, it is better to put a user in front of the user) It is precisely because of this that it requires a large-scale supply in a short period of time. This is a matter of capital that can help.

Juice vending machine

The “Fresh Artificial Juice Big Data Platform” of “Artificial Intelligence (AI) + New Retail” is devoted to the field of smart health. With its unique advantages, it has become popular after entering the market!