V Management Program

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V Management is the latest vending tool in the range of Circum Tec products and is the practical theory to be used in conjunction with the Circumtec remote monitoring system.

This theory is designed to make the Vending Operator as efficient and profitable as possible and is delivered by using the Circumtec remote monitoring system to capture “live” information from the vending machine audit file.

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Once the information is downloaded from the vending machine it is sent to the Circumtec server. The server is programmed with the Circumtec software which reformulates the raw vending machine data into management information. This is similar to what an accounting software package such as Sage might already do for you.
A Vending business, however, is not just about counting the cash. Manufacturers and resellers would like you to believe this but the truth is that a vending business is no different to a corner shop or a manufacturing plant. Profit comes from the difference between selling the product and the cost of the buying the product after all other costs have been deducted.
Vending machine operators have traditionally been viewed quite simply as “Count the cash” type operations where you buy for £0.50 and sell for £1.00 and you make £0.50. Of course this does not take into account the operators time, fuel expenses, mobile phone costs, labour and administration along with repair costs associated with keeping the machines operational.
V Management is not designed to cover all associated costs with a vending business as most operators already have accounting software products which produce a profit and loss or balance sheet to determine the health of the business. V Management is about getting all of the machine related costs and products correct to ensure as an operator you are getting maximum efficiencies and margins that enable you to make as much money as possible from your vending machine investment. Module 1 enables you to reduce theft and have better accountability of your cash receipts by reconciling cash expected with cash collected/ counted. Complete cash visibility is provided which means you can immediately highlight incidences of cash theft. We call this module Cash Accountability (1 - Cash Accountability).
By maximizing the sales of products and ensuring the mix, range and number of SKUs are correct allows for increased sales through your vending equipment. This is referred to as Item Level Tracking and is found in module two (2 – Item Level Tracking).
With Item Level Tracking now incorporated into your business the next endeavor is to use this information to a level which allows you to focus on how the customer makes his or her choices. We all know that supermarkets have designed their shelves at a certain height and range those shelves with specific products. Manufactures pay premiums to ensure their products are at a certain height to ensure the consumer sees them first. This is worth many percentage points when you have breakfast manufactures trying to get the edge over each other. The discerning operators will want to place the item of maximum margin with a combination of the most purchased items (which is not necessarily the best margin item) to optimize their chance of receiving the highest return on investment.
Item level tracking also informs you of what is selling across what type of machines. With this information you are then able to merchandise your machines to ensure the products appear in the correct areas of the machines but also for the correct type of location. We now have the ability to go to the third module which is Merchandising and Range. (3 – Merchandising and Range).
After we have successfully completed the first three modules and implemented them into your operation we turn our attention to the route driver and the vending machines themselves.
Traditionally the driver loads their vehicle with all of the stock that they feel is required to fill the machines on any given day.
Generally or inadvertently the driver will load too much or too little. This has an impact on the stock itself which may be returned either broken or damaged - another loss incurred by the operator or owner.
Then there is the route itself. The driver pulls up at the location, walks into the site and performs a stock count, either manually or with a handheld device. This stage of his work cycle can take more than 15 minutes at any given location.
This will vary depending upon the distance to be walked from the van to the machine and back again along with how many items need to be counted within the machine.  This will also vary as a result of the size of the machine and configuration.
If time in this area could be saved then the additional time would allow for an increase in the number of sites to be refilled and damaged stock would be eliminated. This is all covered in our fourth module (4 – Pre Picking).
Increased employee efficiency allows more machines to be filled by the same staff members allowing the owner to further increase the size of his or her business.
Alternatively if they did not want to increase the size then the efficiencies could be used to remove one in every four routes. This will result in further cost savings in terms of vehicle expenses, fuel, insurance, vehicle maintenance and of course labour.
From here we need to focus on machine performance and integrate this with the driver which allows us to decrease the cost of site refilling. Each time a driver goes to refill there is a cost associated with this. Normally a driver will go to a site based on a call for service or a set schedule. If the driver only achieves 15 calls per day the cost to do this including wages, fuel and maintenance could be anything up to £20.00 per visit. If the current product cost is 50% then going to a machine to pick up £80.00 has resulted in little or no profit.


An example would be when a driver collects only £80.00. The first £40.00 goes to pays for the product cost. The next £20.00 is associated with the cost of the employee which leaves a grand total of £20.00 for the owner of the business. Twenty pounds then has to cover the cost of equipment, maintenance and back office overhead while the balance is your return on the machine investment. In this scenario there was probably nothing left for the owner or operator.
Therefore to improve the net profit to the operator we need to increase the takings prior to pick up by the driver. We need to reduce the number of unnecessary calls and only go to machines when required.
The last module takes all of these factors into account and ensures neither time nor money is wasted. This module is called Dynamic Scheduling (5 – Dynamic Scheduling)