Covid-19: New opportunities for vending

Covid-19: New opportunities for vending

We all know how devastating the restrictions and lockdowns across Europe have been on the vending industry. With four out of five machines placed in workplaces, our industry is susceptible to changes in the wider economic performance at best of times, so it is unfortunately unsurprising how hard vending has been hit since March.

Machine manufacturer production has been on the whole paused, key vending events postponed or cancelled, and vending operators are reporting average losses across Europe of around 70% – and we’ve even heard of income reduction of up to 90%. Financial support schemes and incentives from national governments will certainly provide a cash injection and hopefully ensure operating businesses continue and skilled technicians and employees are maintained, but we should expect that while lockdown restrictions are easing in many countries we will be returning to a new normality, and no doubt our sector will be feeling the consequences for some time yet.

(Note: A list of the key measures and business support measures across Europe can be found by logging in here)

So where does vending go from here? Are there opportunities through this crisis?

The EVA believes that there are a number of opportunities that the industry is well equipped to take advantage of:

1.Consumer behaviour

There is absolutely no doubt that consumer behaviour has changed during this ongoing health crisis; imposed through new government rules of course but also crucially through voluntary behavioural shifts. Before this crisis we were told that vending lacks a ‘human touch’ and that consumers prefer some personal interaction or experience when purchasing an item. Now consumers are in fact looking for less face to face interactions – they want less contact when purchasing items – and indeed they are more apprehensive in dealing with other people.

One major change in consumer behaviour is through a preference for electronic payments, sometimes even the only means of payment currently accepted in e.g. some supermarkets (Note the World Health Organisation explained that cash is also a safe means of payment).  For vending operators this apparent shift is a significant business opportunity and a driver to truly seize the cashless baton and invest in contactless and mobile payment solutions. Further to this, changes made to the Multi Drop Bus – Internal Communication Protocol (MDB/ICP) over the last year thanks to the work of EVA experts in the Standards Committee, enables greater functionalities through remote ordering (through apps) as well as basket product grouping; abilities which would give added confidence to consumers when making a transaction at the vending machine.

2. New business

As countries start to ease certain restrictions, the EVA is aware of potential new business in the following domains:

  • As employees return to work in large companies, the food and drink provision is being rethought. We have heard that in some buildings, a single and large canteen is being replaced by a series of vending machines in different points throughout the premises, in order to help maintain social distancing between staff. A significant opportunity could present itself for operators here, in sites which previously there were limited business opportunities. Similarly, growth in micromarkets in large companies could occur as a contact-free checkout experience and wide selection of products are sought.
  • Governments, institutions and companies have been contacting vending associations and operators to install machines selling personal protective equipment (PPE) such as face masks and hand sanitisers in public locations. This is particularly relevant as a number of countries make the wearing of face masks mandatory in certain public locations as a condition of reopening. This could be not only an opportunity for operators to place new desirable products in machines in existing public locations, but indeed can secure new contracts in attractive public sites, previously unavailable. For example with masks now mandatory in public in Poland, the local Vending Association (PSV) launched a commendable project to place PPE machines in major cities. More info: https://fr.reuters.com/article/healthNews/idUKKCN21S1MJ

3. Legislation

The final opportunity we can identify is for potential legislative change. Until this crisis, the clear direction of public opinion and politicians was to ban and reduce certain single use plastic items such as beverage cups. Despite a key report highlighting the health risks involved by moving too quick to legislate on certain plastic items, the EU and national member states have introduced measures (or in the process of legislating on their usage). With Covid-19, even large multinational coffee chains have refused to accept reusable cups from consumers due to the risk of contamination. There could be an opportunity now that the ‘significant reduction’ of single use plastic cups becomes ‘less significant’ or a less severe target. And justifiable so.

When the new EU Commission took office at the end of 2019, one of the flagship policies announced was the EU Green Deal. This series of environmental initiatives could bring an impact on vending (notably through the ‘Farm2Fork’ strategy) by introducing things like further machine energy consumption targets, healthier vending pressure and so on. A key European political grouping and industry associations have called for the F2F strategy to be postponed as the market conditions are of course not suitable to absorb any new rules for industries in the process on recovering. As always, the EVA will be monitoring the legislative landscape and speaking up for vending where we can, and developments can be followed monthly through our EU Newsletter – members can find the latest editions on our website upon log in.

 

It would be wrong to claim that these opportunities and others mean that vending is not struggling during this period; there are certainly some tough times today and undoubtedly the case in the short term future. The EVA however does believe that new opportunities for our industry will and do exist, we have adapt, share common experience and best practices, and keep looking with an open mind to seize the new chances and our prosperous future.

By | 2020-04-30T14:42:15+00:00 April 30th, 2020|News|0 Comments

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