Did you know that as early as the 1st century AD, the ancient Greek Heron's device for dispensing holy water is considered the world's earliest vending machine? Modern vending machines began in 1925 when the United States developed a machine to sell cigarettes, followed by various modern machines for stamps, tickets, and beverages.

The types, structures, and functions of modern vending machines depend on the types of goods sold, covering a wide range of product categories. Whether it's beverages, snacks, adult products, fruits, or fresh food, the items sold are diverse, almost encompassing daily necessities, all available through vending machines. Payment methods have evolved from the initial coin mode to bank card payments, and now to WeChat, Alipay, or Best Pay, among others, making vending machine operations increasingly varied.

China's vending machines usher in a second spring

At the 2016 Alibaba Cloud Computing Conference in October, Jack Ma first proposed the concept of New Retail in his speech: "In the next ten or twenty years, there will be no e-commerce, only New Retail." The New Retail concept sparked a new wave, with numerous companies and capital rushing in. From 2017 to the present, various unmanned convenience stores, vending machines, unmanned restaurants, and unmanned shelves have risen, riding the New Retail wave. The New Retail war is imminent, with financing reaching over 5 billion yuan in a short period. With the continuous development of internet technology and mechanical manufacturing, the maturity of mobile electronic payments, and RFID, facial recognition, sensors, and the Internet of Things becoming standard for unmanned stores, the high technical threshold, immaturity, and instability have led to the second spring for vending machines, which have the lowest technical threshold.

A vending machine occupies only 1-5 square meters. Compared to traditional retail stores, maintenance and operating costs, as well as labor costs, are very low. Previously, a store required 8 people for normal operation; now one person can manage 8 stores and achieve 24-hour non-stop operation. In the United States, the ratio of vending machines to convenience stores is 30:1, with one machine per 50-60 people; in Europe, one per 50-120 people. In Japan, on average, every 25 people have one vending machine. Currently, China has about 200,000 vending machines, which is negligible for a country with a population of 1.3 billion. Calculated at one vending machine per 500 people, China has a market gap of over one million units. Many large and medium-sized cities in China have become emerging markets for vending machines, and the future potential and development direction are undoubtedly bright.

Vending machine development requires several hard conditions

**1. Sufficiently dense population; 2. Mature mobile payment system (WeChat, Alipay, Best Pay, bus card payment); 3. High economic development level and GDP (rising labor costs); 4. China's electronic manufacturing technology is relatively high and mature.

Besides schools, vending machines are easily found in high-traffic places such as airports, subways, shopping malls, and parks. As a avant-garde retail method, vending machines are popular among young people who love fashion. According to vending machine industry insights, China's vast market and large population base create huge demand for retail food and beverages, so the vending machine agency and sales market will develop rapidly as the financial crisis recedes.

Vending machines are a very special industry; trying to make quick money or take shortcuts is definitely not feasible. Vending machines require persistence to be profitable, with the most critical factors being location selection and the attributes of the goods sold. The profit model for vending machines is simple; the most direct is retail, selling snacks and drinks like a small store to earn the price difference, but vending machine placement is much more flexible. Another additional profit method is advertising revenue, which involves playing various advertisements on the large display screens on the machines, and this market is also considerable.

Operating income from vending machines

The operating income from vending machines mainly includes three parts: sales revenue, advertising revenue, and slot fees. Sales revenue refers to income from selling goods; advertising revenue refers to income from operators contracting out machine body advertisements, using the "what you see is what you get" gimmick to attract FMCG brands to place ads, and using the vending machine screens to set up highly interactive game ads to stimulate user participation during purchases; slot fees are similar to the entry fees supermarkets charge suppliers. A vending machine operator in Shanghai, due to distinctive location selection and operations, achieved a monthly average turnover of 75,000 yuan with only 3 machines, with a gross profit margin of 36%.

As a product of the times, vending machines offer clear advantages in return on investment, lower maintenance costs, and faster equipment investment, which has enabled more and more ambitious people to taste the sweetness of being a boss and quickly accumulate initial capital. In foreign countries and Hong Kong, many people treat vending machines as a second career, which does not affect their main job and stably increases income, killing two birds with one stone. Some visionary people have taken the lead and quietly earned a lot of advertising fees and wholesale-retail price differences.

Key aspects in daily vending machine operations

1. Timely replenishment of goods: Replenish out-of-stock items to reduce operational losses caused by missing products. 2. Proper equipment maintenance and cleaning: Regularly inspect and maintain equipment, such as cleaning coin slots, washing filters, checking for aging power cords, wiping the machine body, and keeping it clean, to fully ensure the normal usage rate and enhance user purchase desire. 3. Reasonable product placement and inspection: During operation and maintenance, pay attention to the standardized placement of products in the equipment, and regularly conduct rechecks and inspections, checking the internal equipment conditions, such as whether lighting is intact, labels are intact, and there is no contamination. 4. Timely cash collection and replenishment: Regularly collect cash from the equipment and check the coin situation inside, to reduce operational interruptions caused by coin shortages or full cash storage.

With the increasing quality of user groups in China and the clear support of the Ministry of Commerce for the unmanned retail industry, vending machines can operate 24 hours a day without interruption, and the operating environment has greatly improved compared to before. Vending and self-service are a general trend in the 21st century, which is a favorable trend for individuals and enterprises that have invested or plan to invest in vending machines. Unlike other industries, vending machines are currently only in the market introduction period, with almost no competition to speak of; looking around, almost everywhere is an unclaimed domestic market. Will vending machines dominate the world?

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