“In Europe, what are the latest trends in the vending market, and are snacks still popular?”
International Business Day – Vending Paris 2014
Wednesday 5th February
Summary
Participants
Erwin Wetzel, the Director-General of the EVA, welcomed all participants to the Conference, and
asked them to briefly introduce themselves:
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Boris Belotserkovsky introduced himself as the President of the Russian Vending Association
(RNVA), representing the fastest growing market in Europe.
Jonathan Hilder explained that he is the CEO of the UK Association (AVA), which has been
established for 80 years, has 186 Members representing 80% of the UK market. The UK
market is worth £1.5bn and employs 15,000 people directly.
Aris Kaschefi is the Director of the German Association (BDV), which was established 40
years ago and based in Cologne. The aim of the Association is to defend and promote
vending in Germany.
Hubert Boyer is a French vending operator, who is representing the French Association
(NAVSA) at the conference. He explained that NAVSA is made up of 300 Members, of which
200 are operators. He explained that French politicians are currently very concerned with
nutrition and promotion of healthy foods. As a response NAVSA have created a label to
encourage healthy eating, which helps smooth the relationship with politicians.
Erwin Wetzel explained that the European Vending Association (EVA) has been established in
Brussels since 1994. Brussels is the ideal location for the Association as it enables close links to be
established and maintained with European Union officials, so that the vending Industry in Europe
can be best represented through lobbying.
What are the latest trends in Europe?
As people have a very busy lifestyle in Europe today, there is a huge demand for food and drink on
the go - and the demand is growing. As more and more people are ‘skipping’ breakfast and even
lunch, the demand for snacking is particularly evident for those who need to eat both during their
commute to work and at various times during the working day.
While vending is not fully harmonised in Europe and there are regional variations to what is
demanded by customers, there are still a number of general trends we can see across the continent.
One trend is that hot drinks machines are increasing in vending, and is especially true for table-top
coffee machines.
The panel will later explore the following questions:
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If coffee in vending is becoming more relevant, what are the implications for snacking in
vending today, particularly for traditional snack machines and products?
Is traditional food snacking not so important now?
Erwin Wetzel explained to the audience the various types of vending machines that are found. He
explained that the most relevant for today’s topic is the glass fronted machine. This machine is
widely recognised as the typical snack machines that are commonly seen in a range of locations.
In terms of key metrics of the European vending market, it was outlined that:
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Vending across Europe has a turnover of €11.1 billion annually
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There are approximately 3.7 million vending machines in Europe
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The machines are typically run by SMEs and family businesses, with 69% operators running
less than 100 machines
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There are 295 million consumers who use machines at least once a week
As shown, the average snack percentage in Europe is 20%. As the graph highlighted, snacking is
much more important in some European countries compared to others. For example, snacking is
important in Russia.
The graph above also clearly illustrates that over 60% of vending machines are hot drinks machines.
Erwin Wetzel explained that while can and bottle vending machines are decreasing in number, Glass
fronted machines (snack machine) on the other hand are increasing in quantity. For example in
Russia, Ukraine and Turkey, glass fronted machines have increased between 200% and 400% over
recent years.
In terms of the location of vending machines, 60-70% of machines are located in the workplace, with
the remainder placed in transport hubs, universities, leisure facilities and other public areas.
What are the benefits of snack machines?
 Snack machines offer convenience, speed and 24/7 opening
 They are versatile and can sell almost any product
 Increasing interaction with the consumer
 Hygienic and safe manner to deliver quality food and drinks
 They offer social benefits as they are located where colleagues/friends meet
 Good solution for meal-time fragmentation
It is important to recognise that vending machines are not just a ‘box’ anymore. New machines have
large touchscreen displays that are more interactive and can provide a link between the machine
and the customer.
As outlined earlier, with a significant number of people skipping breakfast and/or lunch, a snack
vending machine can be seen as the natural and convenient choice for many people – they will go to
a vending machine to satisfy their needs. This is especially the case if the machine stocks a wide
range of products.
Following this outline of snacking and vending, several questions framed the discussion for the
conference:
 Can vending adapt to snacking?
 What are the challenges that face the industry?
 How important are regional variations for snacking?
Vending in Germany
Dr. Aris Kaschefi
Aris Kaschefi began by explaining that while it can be easier for people to understand vending by
showing a ‘typical’ vending machine (e.g. at a train station), the reality is actually that coffee forms
the core of the vending industry in Germany
In terms of a breakdown of vending machines:
 80% are located in the workplace
 20% located in public areas
The German market consists of approximately 520,000 machines, of which:
 321,000 are hot drinks machines
 88,200 are snack machines
 109,000 are cold drinks machines
In Germany, the most dispensed snack products are always the very well-known brands. For
example, from year to year Twix and Mars change between place one and two as the most
dispensed vending machine snack product.
It can therefore be concluded that consumers in Germany stay with the products and brands that
they already know and are comfortable with.
The vending turnover in Germany is €2.436 bn, with snack machines making up approximately
€500m of this, and €1.014bn on hot drinks.
Such is the importance of snacking, a word has actually been created in German for a “mobile
eater.”
German operators have determined the best methodology (“Category Management”) for stocking a
glass fronted vending machine, in order to ensure the maximum visibility and income.
Fresh products
It is recognised in Germany that vending machines need to stock more fresh products.
A trend towards offering more fresh food can be observed, as the breakdown of products in snack
machines show a significant proportion of fresh sandwiches being supplied in Germany. 2,000
sandwiches are prepared for vending machines in Germany every day.
Snack machine breakdown:
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30% fresh sandwiches
10% salads
18% cold drinks
45% traditional snacks
Other machine types
Menu machines
Germany has tried to use Menu Machines, which are designed to replace a canteen with a vending
machine. These machines offer 10 different menus, with the products having a 28 day use-by-date,
and the machine stores the food between 5-7 degrees centigrade.
Outdoor vending machines
Outdoor vending machines have proved quite successful in Germany, especially the outdoor
machines that stock regional products, such as eggs and milk.
These machines are mostly found in the countryside, for example to replace a farm shop when it is
closed etc.
Outdoor vending machines in the suburbs
German vending companies have also tried to place vending machines in suburban locations, but as
yet have not proved that successful. However, companies are still continuing to try this location,
and the BDV is quite confident that this could be a positive development for the future.
Vending in France
Hubert Boyer
Hubert Boyer explained that while France is the second largest overall vending market in Europe, it
has the largest market in terms of snacks with 16m food and snack items sold every day.
In terms of numbers:
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14m hot drinks dispensed
1m cold drinks
1m food products
The turnover is €2bn per year and the French market supports:
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1,000 companies
12,000 employees
637,000 machines
Again like Germany, the vast majority of machines are located in workplaces, and not public areas.
Snacking habits
Statistics
An important statistic is that 70% of French consumers eat a snack at least once per day.
50% are regular snack customers. Of these:
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70% are employed;
53% are women; and
75% are less than 25 years old
When?
The two most important times in the day for French consumers to buy a snack are mid-morning
(around 10:00), and mid-afternoon (between 16:00 and 17:00). The majority of snacks dispensed at
this time are chocolate bars.
Why snack?
The three reasons French customers eat a snack are:
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To feed – 45%
For pleasure – 45%
To boost – 15%
Trends
Two main trends are observed in French snacking:
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Consumers are demanding healthier snacks such as smoothies, fresh fruit etc
In the workplace, employees desire to have a quality break with quality foods.
FeelGood Label
The ‘feelGood’ label was launched in March 2011 in France, with the aim to:
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meet consumers’ expectations for healthier products
meet the vending companies’ social corporate responsibility commitment (the wellbeing of
employees)
promote the supply of a variety of products in vending machines : fruits and vegetable,
cereal products, sugar free drinks
There are currently 50 vending operators in France using the feelGood label on 1500 vending
machines
To demonstrate how the demand for healthier products in vending machines has evolved, Hubert
Boyer used the example that as an operator 5 years ago his company sold zero apples in his vending
machines. Last year he sold 160,000 apples.
An apple is now the 3rd most sold product dispensed in feelGood machines.
An office building is a perfect environment for a feelGood machine, and it is important to note that
products sold through a feelGood machine sell nearly as well as those traditional vending products.
French consumers suggest that both the quality of the product and service is important, as well at
the atmosphere of the place where the product is purchased.
Finally, 77% of French employees say that a coffee break is a must, with 65% of employees saying
that the coffee break is an important opportunity to and chat with colleagues.
Vending machines can fulfil both these criteria desired by employees.
Vending in Russia
Boris Belotserkovsky
Boris Belotserkovsky is the President of the Russian Association (RNVA), whose membership includes
60 vending companies in Russia making up 50% of the Russian market.
Statistics
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Number of Vending machines in Russia: 115,500
Market penetration: 1242 people per machine
Turnover: €400m per year
The top 5 operators in Russia account for only 20% of the market, so unlike some other European
countries, the Russian market can be seen as quite fragmented.
It was highlighted that 25% of snack machines and coffee machines are manufactured in Russia.
In terms of a breakdown of the machines used in Russia today:
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30% are snack machines
24% are cold drink machines
28% are free standing hot machines;
18% are table top
This breakdown therefore demonstrates that glass front (snack) machines are much more important
in Russia than in other European counties. Furthermore of Russian glass fronted machines, 99% are
stocked with cold beverages in addition to snacks. However, due to the sometimes extreme climate
in Russia, the beverage share in the machines varies from 17% to 90% depending on the season. For
example, the machines are stocked with more sandwiches in the winter and more cold drinks in the
summer.
What is special or different in Russian vending?
Sandwiches are one of the best sellers in Russian snack machines, and generate up to 50% of the
turnover.
In terms of prices, the products are usually slightly higher than in a shop, but as almost all Russian
snack machines accept notes (90%) as well as coins, the machines are very convenient for the
consumer.
Marketing aspect of Russian vending is also quite unique, with sales of “cells” and advertising
options producing approximately 10% of turnover.
Street vending is also quite popular in Russia, but the machines have to be adapted to cope with the
extreme temperatures, which can range from -30 degrees in the winter to +40 degrees in the
summer.
Online telemetry is used in Russian machines to measure and control stock planning, and allows an
operator to follow and analyse the machine performance in real time.
As most Russians use cash (notes and coins), cashless processing is not that widespread.
Trends
The offering of healthier snacks is becoming more widespread, with 10-25% machine share of
healthy products.
However, while this is increasing compared to previous years, it must be noted that there is still not
a widespread desire by Russians for healthier products.
Vending in the United Kingdom
Jonathan Hilder
Jonathan Hilder began by outlining some key facts about the UK Vending Association (AVA):
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The AVA has been in operation for 80 years
It consists of 186 Members
Its membership represents 80% of the UK vending market
Market
Certain parts of the UK has had some issues with glass fronted machines over the last number of
years, as in 2008 new legislation meant that snack machines had to be removed from schools.
Recently the sales volume per machine has remained constant for cans and snacks, but a fall has
been reported in terms of coffee sales. This has resulted in the income from coffee sales also falling
recently.
While the 2013 figures are not yet available, it is expected that there will be an increase in sales of
cold beverages (cans), primarily as a result there being a warm summer in the UK last year.
Snacking
Snack vending machines in the UK are traditionally based on sweets and crisps, with a 60%/40% split
between them.
The AVA is working hard to promote the opportunity that snack machines and coffee machines can
replace restaurants that are closed.
Issues facing UK vending industry
At the moment, there is substantial debate over excess sugar in the UK diet. For example, the UK
Media regularly mention the negative health impact sugary drinks and unhealthy snacks can have,
and commonly view the vending industry as something general negative. This negative perception,
especially among the ‘sugar lobby’ is something that AVA is working to improve.
Snacking represents 1% of the calorie intake of a British diet. Vending machines represent 5% of this
1%. Therefore, strong action/ban on vending machines will still leave 99.95% of the problem not
dealt with.
The demands of customers are focused on the following:
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A clean machine
A working machine
A full machine
The inclusion of healthy products, while important, is not the main demand of British consumers.
While they say they want healthier products, the reality is that they don’t buy these products in
large enough qualities from a vending machine. Therefore, it is impossible for operators to maintain
a good mix of healthy and more traditional products, and still fully meet customer demands.
The price of healthier products may discourage some people from purchasing these items. For
example, recently the sale of healthier products increased by 42% in Scotland, which was solely
attributed to the Scottish government lowering food prices for healthy products.
The AVA is also actively working with the Welsh government to help them fully understand snacking
and vending.
Question and Answer session
Regional Variations
There are regional disparities across Europe - why this is the case? In particular between France and
the UK.
Hubert Boyer (HB) responded that it takes some time to change the attitudes of the consumer. This
can be done through advertisements and good communication for example. After a while, we will
see healthier products becoming more and more widespread and consequently, more profitable.
Jonathan Hilder (JH) pointed out that the problem in the UK is that there has been several attempts
at offering a healthier alternative in vending machines, but there is still not the same public
acceptance in the UK as in France.
HB acknowledged that in France the public are much more aware and concerned over the obesity
debate. JH explained he was hopeful the UK would catch up with the French health education in the
future.
Aris Kaschefi (AH) added that Germany is quite similar to France in terms of healthier options in
vending machines, and the education of the general public to be aware of the need for a balanced
diet. He suggested that regional variations may be as a result of the difference between what a
government wants in a vending machine, and the desire of an operator to do this as it may cost him
money.
Healthier products
10-25% of snacks are healthier options in Russia – how well do you think these have sold?
Boris Belotserkovsky (BB) explained that vending machines only sell the products that customers
want. The more important issue is about changing customer behaviour, and not necessarily just
stocking vending machines with a certain number of healthier products.
Erwin Wetzel (EW) added to this by saying that what people can buy in supermarkets should be the
same as what they can purchase at a vending machine. If products are attractive, studies show that
they will use vending machines more.
AK agreed with this statement. It is about communicating to the customer about what products he
can get in a vending machine. It is important for the vending industry to get rid of the negative
perception around vending.
HB explained that as an operator, there is a good potential to glass fronted snack machines, and it
allows you to offer more items to the customer. More offers allows more sales.
JH said that the confidence of customers is key. The industry has a responsibility to ensure the
machines are clean and full, and this will also improve the public perception.
EW added that perhaps this is why that in transportation hubs for example, customers prefer to go
to a shop, rather than use a vending machine.
Vending machine range and technology
50% of vending machine users would use them more often if there was a greater range of products.
Why is there not a greater range?
JH felt that there is a need for a wider range of products, but it is important that the range is made
up of top sellers. In other words, the range cannot be too wide.
EW explained that in Belgium some machines sell bread late at night when bakeries are closed, and
so it is important to offer something to make vending machines be more attractive for customers.
AK stated that the whole industry needs to develop, including using new machines with new
marketing opportunities. He used the example that he know of operator who refurbishes his 15/20
year old machines in Germany, rather than see the benefits that new machines and new technology
can bring such as cashless, LCD displays. These new advanced machines need to become more
widespread in order to attract new customers.
JH announced that Transport for London (TfL) had launched a tender to 60 vending machines at their
stations. All machines must have video capacity.
HB agreed that new machines can be attractive, but the problem in France with public vending
machines is vandalism. Operators are therefore not going to spend the extra cost for a sophisticated
machine if it is going to get damaged.
JH highlighted that vending machines can also be used for things you can’t get at supermarkets.
Furthermore in some motorway service stations in the UK, vending machines are located at the
entrance, so a customer does not even need to go fully into the shop to get what they need. These
benefits needs to be communicated more to the public.
Erwin Wetzel concluded by thanking all participants for a very informative discussion and summed
up the presentations by reiterating that:
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Vending machines are attractive for snacking in the workplace and on the go
There is a variation in different regions and countries in Europe
The vending industry can and is adapting to consumers’ expectations.