Vending Machines

The presence of a vending machine(s) in a school dining area can be a very controversial topic for some school food service programs.  We call them Child Nutrition Programs, and the words "vending machine" can seem contradictory at times.  Unfortunately in these days of "wellness", many districts have removed vending machines from the cafeteria dining area, but have allowed them to remain in teacher lounges, near the gymnasium, or out side in the area of the sport fields.  Often vending machines that are located outside the cafeteria are justified because the "team" needs the money, or the senior class needs the money to fund their class trip.  In one district, the justification was that the money goes to a principal's fund that is used to treat well behaved students to a "pizza lunch" or it's put toward the senior class trip.

Essentially vending machines are money makers.  They will always be pushed by a management company, and most companies will want the revenue from the vending machines to be outside their contract with the district to provide meals.  Districts cannot and should not allow this to happen.

With all that said, vending machines make money, and all of my clients and most self supporting programs need the revenues that vending generates.  Consider that even if you program serves 60% or 70% of a building's enrollment, there remains 1/3 of the enrollment that doesn't eat your lunch.  Each of these students will have money to spend and without vending, where will they spend it?  At the convenient mart on the way home from school?

I think that when program revenues are dropping, and expenses are increasing, or participation is declining, you have no choice but to seek new sources of revenue.  In these instances, I recommend a snack vending machine, a beverage/water vending machine, and a milk vending machine.  Remember we can have a healthy line of snack foods, and beverages that are allowed by program regulations.  In some instances your wellness plan may have to be modified, but that may be better than putting staff out of  work or cutting their hours.  

I must point out here that there is a contradiction in a district, and its wellness plan, when a program is asked to operate on a self-supporting basis then has large “arrears” attached to its “bottom line”, or asked to pay for their share of indirect costs.  then to make matters worse, the ability to generate vending revenue is curtailed because others (athletic teams, teacher lounges, student clubs) want the revenue.  The district cannot “have it both ways”.  If the food services program is to operate without a General Fund Subsidy, then it cannot have its “hands tied” by limiting its access to food and beverage revenue sources.  

Now if you do have a vending machine or plan on getting one or more -- never, never allow a local distributor to place the machine and pay you a percentage.  There is a lot of money in these machines and why settle for 10% and allow the distributor to take 90%?  That is insane, especially if you have had to cut hours or are planning to cut hours.  Put these "extra" hours to work filling and servicing your machine.

Purchasing a machine can be expensive, but most companies Coke, Pepsi, Frito Lay, etc will place a machine for free if you fill it with their product, and service it yourself.  Now all these companies have products that will meet your nutritional goals, if you seek them out.  Obviously you need storage for the product, but if you can overcome that problem and find healthy items, juices, water, pretzels, etc. to put in the machines there is money to be made.

Points of information if you have your own machines:

1.  Ensure that they are filled each morning.  No exception.

2.  Ensure that the glass is always cleaned each morning.  No exception

3.  Never allow a spiral or slot to be empty.  These are the favorite items and must always be available.

4.  Always take a deposit 1X a week, have the staff member taking the deposit complete a cash report, date, and sign it.  Then have the vending sale amount "rung" into your register or POS system.

5.  Ensure that every delivery of product is thoroughly checked in before it is signed for and placed in a secure location.  These items are favorites for "walking out" the back door.

Points of Information if you (have to) use a distributor:

1.  Negotiate a 1 year contract, not one that is longer.  Keep your options open to move your business each year.

2.  Negotiate at least a 20% return.

3.  Insist on a commission check once a month.

4.  Insist the the monthly statement provides ALL of the following:  date the machine was filled, the amount of money removed, AND (IMPORTANT) the digital read out when the money was removed.  Every machine has a non resettable counter that the driver must provide to the company.  That is what keeps them honest.  You need the same information, so you can subtract this week's reading from last week's, and know how many transactions have taken place, times the sell price, and you can audit their statement.  DO NOT ACCEPT A "We can't provide that information".  If they tell you that "RUN" to another company, they are ripping you off.

5.  Insist that your distributor give you the best machines.  The ones with the full glass front, lots of color, etc.  They will try to keep them for their "best customers", insist on the newer "glitzy" machines.

6.  Do not allow them to not send you a monthly statement or commission check.

Contact me privately if you need more information.