Many vending operators still rely on manual methods for collecting data from their machines and payment systems.
However, things are changing rapidly.
Back in 2023, 44% of global vending machines were connected to the Internet.
By 2028, that number is expected to reach 77%, according to Kiosk Industry data.
Thanks to the breakthroughs in IoT in vending, operators across the globe have been consistently transitioning from offline to online-first operations with digital back offices.
Some vending businesses are still in the early stages of setting up their logistics and don’t see the benefits of connecting their fleet with real-time telemetry.
However, they might ask these questions in their day-to-day tasks:
- Was the machine visit worth the fuel costs, or could I have waited a day more?
- Is there a better way to arrange products in the vending machine?
- Should I have a system for customers to report machine problems?
- How much money will this vending machine earn me next month?
- Do I have enough products for my machines or have I ordered too much?
If this sounds familiar, this article is for you.
Let’s talk about the five main reasons why your operation needs real-time vending monitoring.
1) Downtime Monitoring and Machine Error Detection
Just like any hardware with lots of mechanical parts, vending machines are prone to downtime.
In fact, NeuroShop reports that traditional vending machines have between 24 and 60 hours of downtime per year, with incidents lasting 3-5 hours.
Worse yet, it can be a couple of days until you notice something’s wrong with your vending machine, meaning:
- You lost revenue from potential sales.
- The location’s owner will be dissatisfied.
- You’ll have to spend additional resources to service the machine.
When a vending machine has a telemetry box installed, it transmits performance data back to the operator’s cloud and allows them to see the machine status in real-time.
From there, operators can see every single error, incident description, its timestamp, and the last time the machine was maintained.
More importantly, operators can initiate a remote restart, which resolves most issues without ever having to commit to a visit.
This is particularly useful, especially when customers report failed vends and ask for their funds to be sent back. You can also show performance data to the location’s owner to prove your efforts in providing an excellent service.
2) Real-Time Sales Monitoring
One of the first benefits of real-time data is the ability to know how each machine is selling at any point in time.
Some locations might be more successful than others, and some seasons might be more fruitful than others.
Sometimes there are unexpected situations, like the COVID-19 pandemic, which completely changed user behavior and made planning unpredictable.
With real-time monitoring, excellent vending management systems can actually accumulate sales data and predict future sales trends.
Besides understanding how much revenue you can expect in the coming period, you can adjust product procurement and optimize your refill schedule so that machines that are selling fast are moved to the top of your refill schedule.
Similarly, you can easily access figures for low-performing vending machines and troubleshoot whether the problem is the location, product mix, or the planogram.
Not only will this contribute to more sales and revenue, but it will also lower your monthly recurring costs.
3) Alarms on Low Machine Stock
Without real-time vending monitoring, your best-selling machines will experience frequent stock-outs.
This will cause several problems for your operation.
First, you’ll notice a stock-out too late.
It could be days before you restock your top-performing vending machine, which means you’ll lose potential sales as your regular customers walk past your empty machine.
Also, nobody likes coming to an empty vending machine, especially the location’s owner who sees it as a valuable amenity for their site.
Second, you’ll never know which exact products have sold out, leaving you to guess how much items you’ll need to take with you on a refill run.
For instance, you have 3 spirals dedicated to Cola, but your filler only has enough for one spiral, and the rest will be filled with Fanta, which costs the same.
If the wrong product that is filled is a product that sells, let’s say 40% less than the one you should be filling, the sales results will also be unmistakably lower.
Especially if this mistake is repeated on multiple machines.
Alarms on low machine stock are a powerful indicator of what people like, and products sell better compared to other things in your vending machine.
This insight is critically important because space is extremely limited, and when some spirals are emptied out and others are still stacked, it’s a clear-cut sign that one product should be swapped with other options.
And finally, if you know which machines will be emptied one week ahead of time, you can plan your refill trips ahead and make them as fuel-effective as possible.
This is the foundation for smart stock control.
4) Better Visibility in Unexpected Situations
There are many situations in which real-time monitoring saves you money and enables you to react quickly to a sudden emergency.
Back in 2019, nobody expected the COVID outbreak to shut down the global economy and have such a huge impact on vending.
Recently, because of the ongoing US-Iran conflict, fuel prices have increased between 30 and 40%, according to data.
For operators, this is a heavy blow, especially considering that the highest overhead cost in vending is associated with fuel.
A system with real-time data will give you instant visibility on this unusual behavior – to catch on to the positive, but also ride out the negative trends.
By knowing this information, you can easily adjust your planning and implement savings as things unfold.
So for example, if the prices of your top-selling candy bars have risen by 30% over the last 6 months and hurt your margins, you can replace them with better alternatives. With real-time monitoring, you know exactly how much of the same item you’re selling and how much procurement is costing you.
The only way to recession-proof your vending machine business is to implement real-time vending monitoring.
5) Dynamic and Cost-Effective Routing
The highest overhead cost in vending is fuel costs.
How you organize your refill runs will directly impact how much money your business makes every month.
Instead of static refill trips, where you visit your vending machines based on a strict schedule regardless of their current capacity, you can use real-time data to determine if the trip is worth it.
With real-time monitoring, your VMS tells you how much an empty machine will cost you in lost sales opportunities.
You’ll know whether it pays to visit the machine or wait a few days until you can group multiple vending machines to make the trip economically viable.
Fixed planning schedules are the biggest enemy of your business because they increase workload, allow wrong decisions, and subsequently lead to lost sales.
Live data allows you to transition to dynamic routing, automate it, and collect the benefits.
It also gives you real-time status updates about the stock you have in the warehouse, delivery vehicles, and the machines themselves:
- Warehouse workers will know what to pack in advance for every machine, considering the stock they have available and the products that are assigned to the vending machine.
- Fillers will have live data about the stock at the locations they are about to visit. Instead of bringing excessive amounts of products that add extra weight to the truck, every item is prepacked and relegated to a specific machine. They don’t have to go back and forth from their van, which makes restocking faster.
- The product flow is tracked from the moment it leaves the warehouse until it is resupplied in the machine, eliminating any administrative errors that come with manual product checkout.
Live data allows you to move to dynamic planning, automate it, and reap the benefits.
In doing so, you’ll eliminate any administrative errors or shrinkage that comes with moving products.
Administrative mistakes are responsible for 21% of all shrinkage in retail, as reported by the National Retail Association.
Miscounted stock, data-entry slip-ups, or mislabeled food and perishable items all create a gap between what’s actually in storage and what the records say is there.
6. AI-optimized Planograms
Vending machines have limited space, typically between 50 and 60 spirals.
The decision about what products to put in the machine, how many spirals to dedicate to each product, and the order of placing them is critical for sales.
After analyzing 27,000 vending transactions, data from the British Food Journal shows that machines with well-optimized planograms sell more products and generate purchases at a faster rate.
It’s impossible to have sales-optimized planograms without real-time monitoring that tracks product sales.
For operators, this will have a strong impact on their machine’s performance:
- Fewer out-of-stock situations on top-selling items; the products that sell fastest get more facings, which prevents them from selling out sooner and you won’t have to make as many visits.
- Better placements for impulse purchases; high-margin or trending items are placed at eye level so they’re more likely to get spotted and sold.
- Low-selling products are flagged for reduction so there’s no wasted space.
As you rotate new products in your vending machine, you need to track how they’re performing and keep your planogram fresh.
Real-time Data Makes a Difference in Vending
For a vending business to succeed, it needs to have its logistics in order.
This is where real-time data becomes invaluable:
- You’ll immediately notice machines experiencing downtime and can reset them remotely
- You’re able to identify slow-moving products and swap them for better sellers
- Prepare every item you need for specific machines so that there’s no excess of products being transported in your van
- More visibility and control over your entire machine fleet
Televend’s real-time telemetry solutions make a difference every day.
We’ve helped over 4500 operators around the world to use their real-time data and improve their daily operations, from cutting down inefficient restock routes to expanding their vending fleet without having to spend additional resources.
For instance, one UK-based operator managed to reduce unecessary visits by 30% thanks to Telvend’s Dynamic Routes.
Read their full success story here.
Smart vending machine software like Televend Cloud allows you to gather all this information and much more, whether you are a family-run business or a huge multinational corporation.
Our client portfolio includes a wide range of companies from both ends, so do not hesitate to contact our team today and see what we can do for your operation.