20 Best Practices
for Vending Success
Copyright © 2013 by Gale Media, Inc. All rights reserved. Modern Distribution Management® and mdm® are registered trademarks of Gale Media, Inc. Material may not be reproduced in whole or in part in any form whatsoever
without permission from the publisher. To request permission to copy, republish, or quote material, please call 303-443-5060.
1
#1
Use the software component of most vending solutions to
document the value you are providing to customers with
vending.
“We need to prove to the customer on the documentation that
it’s not costing them money to do business with us.”
- Randy Bergstrom, implementation manager, Deco Tool Supply
Copyright © 2013 by Gale Media, Inc. All rights reserved.
2
#2
Partner with customers to develop the right solution for their
needs – they will notice if the system isn’t working for them.
“If you do a good job, the customers know it. If you’re doing a
bad job, they’re going to know it. There’s no hiding these
errors.”
- Scott Nadler, University of Central Arkansas’ College of Business
Copyright © 2013 by Gale Media, Inc. All rights reserved.
3
#3
Understand the unique requirements of your customers.
“From a higher level, ultimately it’s all the same. You have a
customer that consumes goods. They want them in an
automated vending process. But what really makes a program
successful is being able to sit with a customer to understand
any unique requirements they may have in the plant,
understand from a historical perspective how a plant has
evolved, its tribal knowledge.”
- George Ponce, president, Machine Tools Supply
Copyright © 2013 by Gale Media, Inc. All rights reserved.
4
#4
Understand your customer’s processes.
“If you understand processes, you can build something that
solves the problem for your customers.”
- Susan Hebrank, marketing services coordinator, Cribmaster,
vending & software solutions provider
Copyright © 2013 by Gale Media, Inc. All rights reserved.
5
#5
Be proactive in your approach to vending services.
“If you’re just trying to defend your top three accounts, in the
long run, you’re going to lose, because your heart’s not in it,
you’re not going to put the resources in it, you’re not going to
spend the time to really get your people trained and ingrain it
into your organization.”
– Steve Pixley, founder, Autocrib, vending and software solutions provider
Copyright © 2013 by Gale Media, Inc. All rights reserved.
6
#6
Make sure expectations are clear from the start. When
customers are hit with unexpected restocking fees or
surcharges, or products are swapped without the customer’s
knowledge, it can cause conflict. Build transparency into the
vending agreement.
- Cari Palmer, chief relationship officer, SupplyPro,
vending & software solutions provider
Copyright © 2013 by Gale Media, Inc. All rights reserved.
7
#7
Consider whether your product types are well-suited to
vending.
“The thing I think we’ve discovered is that the most natural
product for this type of distribution is things that people use in
mass, like gloves, personal protective gear, safety glasses,
things like that.”
- Will Oberton, CEO, Fastenal
Copyright © 2013 by Gale Media, Inc. All rights reserved.
8
#8
Refine your product packaging to fit the vending machines.
“Think about breaking quantity packs and putting them into
French fry packages or different packaging to make sure it
dispenses properly.”
- Brian Norris, vice president, inventory management, Grainger
Copyright © 2013 by Gale Media, Inc. All rights reserved.
9
#9
Work with customers to find the right product mix.
“Typically when we start the process, we are fine with a long
list of various types of products and equipment that they want
to manage because we have other solutions and offerings that
may be a good system for the other things that they are trying
to achieve. We'll take that long list of products, refine and
define the right solution and see where vending fits in and
where other options might be a better, more effective solution.”
- Doug Osborne, vice president, Motion Services, Motion Industries
Copyright © 2013 by Gale Media, Inc. All rights reserved.
10
#10
Recognize that “one machine doesn’t fit all for vending.”
- Bill Welch, director of vending solutions, MSC Industrial Direct Co.
Copyright © 2013 by Gale Media, Inc. All rights reserved.
11
#11
Consider product resets when examining underperforming
accounts.
"We can break it down based on what type of a business they
are. Are they a truck shop, or a manufacturer or a small
contractor? We can look at our data and do a comparative
analysis and say 'Here are the top 20 items or 30 items that sell
on a broad scale. We believe you may use the same ones.'”
- Will Oberton, CEO, Fastenal
Copyright © 2013 by Gale Media, Inc. All rights reserved.
12
#12
Figure out “how much of what how often” customers need.
“If you go into an installation not knowing that, that can create
a need to then circle back to them and reconfigure, and it’s a lot
more time consuming than if you knew how to approach those
in the beginning.“
- Brent Scott, technical solutions manager & vending program manager,
Martin Industrial Supply
Copyright © 2013 by Gale Media, Inc. All rights reserved.
13
#13
Don't be intimidated by vending technology.
“If you’re not used to using technology, the advice is you get
used to using it because your competitors are using it against
you. Get educated, get up to date and recognize that using the
technology can save your customer money.”
- Cal Bauer, vice president, marketing, Vendnovation, vending software provider
Copyright © 2013 by Gale Media, Inc. All rights reserved.
14
#14
Retrain your sales team to help a customer see the inventory
management problems that already exist and how vending can
solve them.
“When you're selling a cutting tool, you know that that person
has a need for that tool. With vending, you have to show them
that they have a need for that sometimes.”
- Greg Losey, general manager, Rocket Supply
Copyright © 2013 by Gale Media, Inc. All rights reserved.
15
#15
Don't look at a customer's vending sales in isolation. A
significant portion of indirect spend for every industrial
customer is spot buys.
“At the end of the day, whoever has a vending solution is going
to get a preferred look on spot buys and one-offs where there
are higher margins.”
- Mark Higgins, vice president & managing director, Affiliated Distributors,
Industrial Supply Division
Copyright © 2013 by Gale Media, Inc. All rights reserved.
16
#16
Don't look at a customer's vending sales in isolation. The
conversation about vending may open the door to other
opportunities.
“Use it as a tool to gain the customer's business for all of the
customer's consumption, not just what they've deemed
convenient to put in a vending machine.”
- George Ponce, president, Machine Tools Supply
Copyright © 2013 by Gale Media, Inc. All rights reserved.
17
#17
Don't limit the products you provide to the products you
already provide.
“Customers are always pushing us to look at MRO and other
product lines that they might have. Although we're focused on
core products, we continue to have discussions with our key
customers on other products that we might be able to supply
through our supply chain management program.”
- Ken McDowell, vice president, supply chain management, Airgas
Copyright © 2013 by Gale Media, Inc. All rights reserved.
18
#18
Don't focus on vending; focus on the total solution.
“If customers care about driving cost out of their business of
managing their inventory, they don't really care if it's a vending
machine or if we're managing that for them. All the data and
the research that we have done, the customer cares most about
having the right product when and where they need it.”
- Brian Norris, vice president, inventory management, Grainger
Copyright © 2013 by Gale Media, Inc. All rights reserved.
19
#19
Customers and distributors both have to be committed to the
process for success.
“We're not going to come in and wave a magic wand and all of
the inventory management problems are going to go away. It
requires a customer that's committed to the process, committed
to the execution and the implementation of the process and the
ongoing support of the process as items change, requirements
change – it takes the customer and the distributor working
together to make the program successful.”
- George Ponce, president, Machine Tools Supply
Copyright © 2013 by Gale Media, Inc. All rights reserved.
20
#20
Embrace the vending revolution before it's too late.
“The small distributors that quickly jump on board and get
educated and buy into this program, the less impact they will
feel from the Fastenals, MSCs and Graingers. The small guy
needs to realize that the world has changed, and vending is a
permanent part of that. Those who make that shift will be far
more competitive than those that don’t.”
- Cal Bauer, vice president, marketing, Vendnovation, vending software provider
Copyright © 2013 by Gale Media, Inc. All rights reserved.
21
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Copyright © 2013 by Gale Media, Inc. All rights reserved. Modern
Distribution Management® and mdm® are registered trademarks of Gale
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whatsoever without permission from the publisher. To request permission
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