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Canadian Grocer: Need groceries? Try a vending machineMonday, March 30, 2015 > 11:11:08
Next-generation vending machines sell much more than junk food
Long a provider of pop, chips and candy plus at least one product of indeterminate age–the vending machine is getting a 21st century makeover.
Following the lead of businesses in Japan and the U.K., a small group of Canadian companies is introducing vending machines that dispense everything from doughnuts to eggs to milk.
In Toronto’s upscale Yorkville neighbourhood, two such machines sit side-by-side in the Cumberland Terrace Mall: one sells assorted baked goods from Viennese-inspired bakery BakeryHaus, while an incongruous counterpart sells $65 cufflinks.
Meanwhile, a TeaBot kiosk in Toronto features a touchscreen interface that lets users create their own blend of loose-leaf tea for $2.85– about the price of a Starbucks coffee, but minus the aggravation of having your name misspelled on the cup.
Leading the charge with the most robust offering is Vancouver- based Happy Vending. The company will soon install two machines in B.C. and one in Toronto. Each machine sells between 50 to 70 products, ranging from bacon to bananas to diapers.
Founder Jason Moyal says his market is high-occupancy buildings in cold-weather markets, where people may not want to venture outside to buy groceries. His plan is to place machines in common areas of buildings with at least 180 units (a minimum threshold to ensure the requisite sell-through).
Customers will pay a slight premium for the convenience. Moyal says prices will be “very similar” to those at the local 7-Eleven. “We’ll try to make it competitive with grocery stores around the property,” he says.
Beyond helping high-rise dwellers avoid cold weather, the machines could also help minimize so-called “food deserts.” Vass Bednar, deputy director of the cities initiative at the University of Toronto’s Martin Prosperity Institute, believes the machines could help partially alleviate the lack of access to nutritious food in some areas.
But Bednar doesn’t think the machines can truly substitute fresh grocers providing healthy food if much of the machines’ stock is non- perishable. (Moyal says 65% of Happy’s goods are non-perishable.)
John Williams, senior partner at retail consultancy J.C. Williams Group, says the key to the machines’ success is ensuring the freshness of perishable items, and the availability of key products. Moyal says the machines will be replenished every day or two. Happy Vending is also developing an app for users to track product availability; it will launch this summer.
Williams calls the machines another milestone in the evolution of the constantly morphing retail space. “We all live busy lives, so I think this is very close to the ultimate convenience item,” he says.