EPISODE TRANSCRIPTS :
Tom.: Hi, I’m Tom with the vending business show.Today we will talk about Hotel Vending. I’m here with Larry Towner, who’s a vending business consultant and has been in the vending industry for a couple of decades I think and sold the majority of his share of his business back in 2012. That’s when he finalized it. So he’s got a lot of interesting things. Thanks for being here with us today Larry.
Larry Towner: Thanks Tom. Good to be here.
Tom.: Well I know we were talking a little bit about how to get started in hotel vending. From an operator’s perspective what tips do you have for us?
Larry Towner: Well, hotel vending is a subset of vending. It’s kind of one of the big markets that’s out there. Hotel Vending generates a tremendous amount of volume. They do big dollars. They can be very, very profitable, but they have some tricks and some tips that you need to know about when you do them. One Hotel Vending is, they’re very, very equipment intensive. The generally want multiple locations on different floors and things like that. They usually want … well, I guess it depends, but the hotels that we always did wanted a certain amount of sundry items for sale.
Larry Towner: That would be things that are not what you would typically call vending items. They would be more along the lines of, we always sold things like trial sizes of toothpaste and deodorant and combs and aspirin and all of those kinds of things, things that travelers need. It’s a little bit of a different slant on the vending business per say. It’s not your traditional snack, soda type vending. It tends to me a little more involved.
Tom.: Okay. How does someone make money in Hotel Vending?
Larry Towner: It’s just like vending in general. You want to have your highest selling items in the machines. You want to understand the dynamics of what the travelers are actually looking for. It’s the same analysis you go through when you go to a regular account. You’ll find out what things actually sell in that account. Not everything sells in every place. You can take one item that absolutely sells like crazy in one location and put it into what you think is a demographically similar account in another location and it doesn’t sell. The big thing is to maintain flexibility and be able to maximize your sales.
Larry Towner: Remember, when you’re doing a vending machine, this is a small store. And if you go to the grocery store, of course they use things called planograms and everything has it’s place and they actually pay for space in a store for shelving. So we can do the same thing in vending. It’s called a planogram. You want to have certain items in certain places. But when you do hotels, you want to make sure your planogram is somewhat flexible so that you can accommodate what it is that the end user customers, which are the people coming to stay in the hotel will actually buy from you. After all, as you know, if you don’t put in items that sell, you have a basically a very nice cabinet sitting in the corner of the room that takes up a lot of space.
Tom.: You touched on one uniqueness of the hotel, the traveler person who’s going to be buying from a vending machine. What other things might help someone who’s getting started in hotel vending?
Larry Towner: The hotel operators know really nothing about vending as a general rule, other than they consider it to be a potential source of profit for them. So they want very, very [inaudible 00:03:51]. What they don’t want is a lot of returns. They want equipment that works well and they want to know that if you have a problem that if they call you, you will be out very quickly to do any kind of repairs or whatever that’s necessary. We always set up hotels on, they were always same day service. Of course with hotel access, you essentially have 24/7 access. They’re open all the time. So sometimes it’s just a question of setting up to where you can have after hours access into the facilities. That’s one thing to key on.
Larry Towner: We did most of our service work in the after hours, meaning after 10:00 at night and before 5:00 in the morning. We worked heavily on maximizing our operations to down times or times when you didn’t have … 9 to 5 was always the maximum time for doing work. So we always scheduled hotels in late in the day. It allowed for easier service times, better service on their part. But one big thing is, stress the service side of it. If you can keep those machines operating, functioning properly all the time or as fast as possible, that goes a long, long way in their mind because they’re dealing with travelers that are transient and you want to make sure that the people get the product that they want.
Larry Towner: We always, [inaudible 00:05:15] had a change fund set up behind the front desk for a hotel. We didn’t always do that in our other accounts, but in hotels we did because of the transient nature of the end user, meaning a guy comes in, spends the night, loses his dollar. The hotel doesn’t want to take the reputation hit because the vending company took this guy’s dollar. So you always had money there for them to give back on the spot if they needed it to do that. And their machines, if you haven’t been in the vending industry, if you think your machines work 100% of the time all the time, you need to rethink that philosophy because it’s equipment, you’re dealing with money and it’s dirty and it’s environmentally sometimes, not so much in a hotel, but it can be environmentally unfriendly, meaning the machine sits outside. It’s different than a machine that sits inside and things like that.
Larry Towner: Some hotels do have outside facilities. So lots of times they’ll have drink machines outside. So it is a consideration.
Tom.: Well thank Larry. Tell us a little more about your business and what you do.
Larry Towner: Well, you said it. We’ve been in the vending business since 1983. Boy that makes me feel old. But we’ve sold off the majority of our actual vending operations, or all of our vending operations in 2012. A lot of reasons for doing that, but it’s a great business to be in. We’ve since gone into the consulting business. We are available at [email protected] by email and you can also go to servicegroupinternational.com. That will be a website that’s up and running by the end of the day. But we’re into the consulting business. We can help you maximize your profits and increase your ability to generate new business and also generate profitable business. That’s what we really specialize in and we would love to be able to help you.
Tom.: You’re watching Hotel Vending the vending business show, a publication of A&M equipment sales.
A great machine for Hotel Vending is the AMS outsider Snack Machine