Food Sales REMAIN FLAT

An online survey of vending operators who sell food reveals sales of perishable foods sold in fresh and frozen food machines remain flat. More than half of respondents report that food sales are overall flat.

The online survey was sent via email to more than 3,000 operators in January.

Operators carry three types of food, frozen, shipped refrigerated and freshly prepared types of products, almost equally. Of the frozen categories, the products are nearly evenly divided between food items and ice cream or desserts, with the latter leading slightly.

The survey, in comparison to the Automatic Merchandiser State of the Industry Survey, which was based on fiscal 2006 figures, indicates that operators continue to make progress raising the price points on food products, but the food category continues to challenge the industry due to the high cost of operating food machines.

FOOD PRICES NOT YET BENEFITTING FROM CASHLESS

Food products are among the highest priced products operators carry. As such, there is a good chance that cashless transaction capability will make it easier for operators to vend products with higher price points, but cashless vending remains undeveloped in the near term.

The findings of the recent survey mirror those of the Automatic Merchandiser State of the Vending Industry Report for the past three years.

The recent online report found that freshly prepared food accounted for 29 percent of all food sold, which closely matches the 28 percent reported for fiscal 2006 in the State of the Industry Report. Freshly-prepared food has decreased as a total percentage compared to a decade ago, when there were more refrigerated machines.

However, the reports indicate that the decline in freshly-prepared food has leveled off.

Overall lower food sales reflects the decline in food machines and less activity in locations that have food machines.

In the last 15 years, the decline in refrigerated machines was more than matched by the emergence of frozen food machines. However, in the last four years, the rate of growth in frozen machines has slackened.

The good news is that vending operators have been able to raise selling prices of food. The new report found that the most common price points for refrigerated and frozen-prepared food were between $2.50 and $3.00. The recent State of the Vending Industry Report, by comparison, noted that selling prices were below $2.00 for both categories.

QUALITY AND BRAND ARE IMPORTANT TO CONSUMERS

The survey also indicated consumers are largely motivated based on product quality. For refrigerated food, consumers overwhelmingly choose based on product quality, with packaging coming up second. For the frozen category, consumers base their decision more on brand name, followed closely by quality.